Community land auctions: moving towards implementation

Tim Leunig
November 2011

In Budget 2011, George Osborne announced that the government will be piloting Community Land Auctions, an idea first put forward by Tim Leunig in 2007.

The report 'Community land auctions: working towards implementation' sets out this idea in more detail. It uses real figures from developers to show that in the south east, where housing is most needed, Community Land Auctions would raise at least £45,000 per house for the community that allowed them to be built.

CentreForum believes that this step-change in incentives will persuade people to back more housing in their area, rather than oppose it.

Download the full report.

"Land auctions are a radical way to change the community's incentives toward accepting development. It's time to test their practical value."

- Kate Barker, Chair of the UK Government Barker Review of Housing Supply

"Tim Leunig’s proposals would be a major step forward to solving land supply problems and give the community a real incentive to welcome development"

- Sir Stuart Lipton, Deputy chairman of Chelsfield Partners LLP and founding chairman of the Commission for Architecture and the Built Environment (CABE)

"Innovative and essential"

- Martin Wolf CBE, chief economics commentator, FT

"The economics are clear that Britain needs more houses, but reforms to the planning system have been consistently blocked by politics. Tim Leunig’s proposals show how to cut the Gordian knot."

- Professor John van Reenan, London School of Economics

"In real terms the Swiss have had stable house prices for 40 years; Swiss local authorities get real tax incentives to encourage them to allow building. The Swiss also have a strong economy. Tim Leunig’s highly original but simple idea could inject real incentives into house building in Britain. Maybe our economy could become more Swiss!"

- Professor Paul Cheshire, London School of Economics

"Were it not for arbitrary planning constraints, Britain would get the house building it desperately needs. Tim Leunig’s pathbreaking work shows how to remove the planning logjam without providing unearned windfall profits for existing landowners."

- Chris Giles, Economics Editor, FT

"Tim Leunig makes a compelling case that Community Land Auctions are both desirable and feasible"

- Professor Paul Klemperer, leading UK auctions expert, Oxford University

"The best idea for growth"

- Sir Samuel Brittan, economic commentator, FT

"Tim Leunig’s analysis is typically excellent. He has played a key role in highlighting current planning failure."

- Alex Morton, Policy Exchange

"The significance of this proposal is that it creates a mechanism for capturing the rises in land value that come with the granting of planning permission. As such it is a very valuable contribution to the housing debate."

- Anna Minton, author 'Ground Control'

"In the UK, all methods of expressing economic preferences on land-use planning issues are completely excluded by our planning system. This has disastrous results from the point of view of those who cannot afford housing and unsatisfactory results from the point of view of preserving environmental amenities. This proposal is an important attempt to rectify this long-standing defect."

- Professor Philip Booth, IEA

"A major step forward in making us a better housed nation"

- Professor Stephen Nickell, Office of Budget Responsibility and former head of the National House Planning Advisory Unit

"Britain’s housing shortage clearly needs some radical solutions. Dr Tim Leunig always argues his case very powerfully, and in this instance makes innovative and challenging proposals about how the problem could be solved."

- Trudi Elliott CBE, Chief Executive of the Royal Town Planning Institute

"Community land auctions offer a promising alternative, capturing for the local community value created through the planning system."

- Andy Hull, Senior Research Fellow, IPPR