Home-owners will be offered council tax discounts and house price guarantees to encourage them to accept a new Garden Citydevelopment in their area, under plans being drawn up by ministers.
Nick Clegg, the Deputy Prime Minister, said he wanted a shortlist of potential locations for up to three new towns, each with more than 15,000 homes, to be published by the end of the year.
He suggested ministers could offer to buy houses adversely affected by disruption during construction at the full market price, in a scheme similar to other major infrastructure projects like the planned High Speed 2 rail line.
Mr Clegg said he wanted to “go the extra mile” to reassure communities that they would not lose out financially if construction began on thousands of homes nearby.
He told The Telegraph: “Many people will want to live in world-beating garden cities.
The coalition has announced plans for up to three new garden city developments to be built to ease England’s housing shortage.
Construction firms in England last year built about 110,000 new homes. But this would accommodate only half the expected 220,000 extra households created during the year.
However, all major construction projects carry is a risk that property values of nearby homes will suffer “blight” during the building phase and potentially once work has finished.
Ministers have drawn up plans to compensate homeowners living along the route of the new London to Birmingham HS2 railway line. The government would buy properties within 60 metres of the line at the full market value plus an extra 10 per cent, under recent proposals.
In an interview with the BBC’s Countryfile programme, to be broadcast on Sunday, Mr Clegg suggested that similar options would be needed to persuade communities to accept garden cities.
In addition to guaranteeing the price of residents’ properties, another possibility would be to offer council tax relief as an incentive, he said.
“We could maybe give deductions on their council tax for the period of time during which the garden city is being built,” he said. “We could possibly also say to those homes where they think the price of their home will be affected, we will guarantee the price of their home by buying it, if you like, up front.”
The Deputy Prime Minister said he did not believe the compensation bill for taxpayers would be too large for the Treasury to accommodate.
“What I’m saying is we’re actively looking at things like that to show that we will go the extra mile to allay those concerns of people who feel that their property, or the price of their home, might be affected. We don’t want people to lose out.
“This is something that we do anyway, don’t we, as a country, where you have big infrastructure projects,” he said. “I think the same principle can and should apply to garden cities.”
The Government published its Garden Cities Prospectus in April, inviting local areas to come forward with plans for garden cities or suburbs, each with more than 15,000 homes, in their areas.
Councils have been given until the end of this month to raise any concerns they have about accommodating such developments locally.
Mr Clegg told the programme he wanted a shortlist of potential locations for new garden cities to be published by the end of December this year. He also suggested that central government could specify that all homes in the new developments would need to be no further than 10 minutes from a public green space.
In the post-war years, some 27 new towns were built across Britain, including Milton Keynes, Stevenage, Corby, and Cumbernauld.
Garden cities were fully designed to include plenty of green spaces for residents, as a solution to the shortage of housing caused by the Blitz, a weak construction industry and the post-war baby boom.