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Labour is reportedly planning a major overhaul of compulsory purchase rules in a bid to cut homebuilding costs if the party wins the next general election. 

Shadow levelling up secretary Lisa Nandy (pictured) is drawing up plans to force landowners to sell plots of land for under the market value, according to a Labour aide quoted in the . 

The reported proposals would change how land is valued when it is acquired by local authorities via compulsory purchase orders (CPOs).

These intended reforms go beyond the Conservative government鈥檚 recent decision to make it possible for landowners to sell their land more cheaply 鈥渋n certain cases involving affordable housing, health or education.鈥�

CPOs allow local authorities or other public bodies to force property owners to

Under the current 1961 Land Compensation Act, local councils are prevented from buying land for housing at its agricultural value.

Instead, it must be acquired at a 鈥渉ope value鈥� which reflects . This takes into consideration the value of the land if planning permission for residential usage were to be granted.

A Labour government would reportedly introduce new legislation allowing councils to buy land at its agricultural value.

鈥淲e want local areas to capture and benefit from a lot more of the uplift than they currently do when development occurs,鈥� an unnamed Labour aide told the FT.

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鈥淲e want to tilt the balance of power. It feels like the scales are tilted towards [鈥�]鈥塴andowners, we want to re-tilt it towards the communities that want to see more houses built.鈥�

An amendment to the Levelling Up and Regeneration Bill tabled by the government earlier this year means the government can implement CPOs without paying the landowner any 鈥渉ope value鈥� on limited occasions.

The proposed Labour reforms would constitute a more widespread change in CPO usage with the intention of meeting housebuilding targets and making development costs cheaper. 

A Department for Levelling Up, Housing and Communities spokesperson told Housing Today: 鈥淲e want councils to be able to unlock more land for affordable housing, which is why we are reforming compensation for compulsory purchase orders.

鈥淭he current rules can significantly increase costs for councils and our reforms will ensure the taxpayer gets best value for money, by removing 鈥榟ope value鈥� where justified and in the public interest.

鈥淚t will ultimately be for the secretary of state to decide whether a compulsory purchase order can be approved and if the removal of hope value is appropriate.鈥�

Housing targets are likely to be a key theme in the run up to the next general election. 

Earlier this month Labour leader Keir Starmer accused prime minister Rishi Sunak of 鈥渒illing the dream of home ownership for a generation.鈥�