Builders face 'cheaper homes' tax

Those building one home will have to pay the new tax

Anyone who builds a house in part of south Devon may have to pay an affordable housing tax in future.

South Hams Council will be the first in the South West to introduce such a policy to tackle the shortage of affordable housing.

The district is among the least affordable rural areas for homebuyers in the UK.

Those building only one house could have to pay 10% of the cost of putting utilities onto the site.

The rate goes up to 20% for sites with 2-5 dwellings.

Our villages are dying Michael Saltern

The rate is 35% for those with between 6-14 dwellings and 50% with 15 houses or more.

The new tax, which will be payable as part of planning, is contained in the council's new policy document on affordable housing, which will be formally published for comment in January.

Other larger sites will have to make between half and 60% of their homes affordable, depending on the location.

Councillor Michael Saltern, who has special responsibility for affordable housing on the council, said: "The situation in the South Hams is critical and we have to take firm measures.

"We believe it will be a lifeline for those getting on the housing ladder, but it won't prevent individuals from building their own small house."

About 4,000 homes in the South Hams, 12% of the total, are second homes.

Mr Saltern said: "Our villages are dying.

"We want to reinstate life into those areas and we can't just carry on talking about the problem."