Ed Miliband lurched further to the Left yesterday with a land grab to extend state control over the property market. The Labour leader's 'Stalinist' plan to seize unused plots – as well as impose rent controls – shocked experts and investors. Property analysts said the move would take Britain back to the 'dark days of the Seventies'. Scroll down for video . Land-Grabber: Red Ed wants councils to encourage building by raising tax on unused land . Mr Miliband wants to bring in 'use it or lose it' powers allowing councils to encourage building by putting up taxes on undeveloped land. Sites still left idle could be compulsorily purchased for use by another developer. The announcement saw shares in housebuilders, including Barratt Developments, Persimmon and Taylor Wimpey, fall by around 2 per cent before later recovering. The Institute of Directors describes the land grab as a 'Stalinist attack on property rights'. Last night a spokesman said: 'Developers do not generally sit on large amounts of land for long periods. Talking about compulsory purchasing is very difficult – who makes the decisions? 'We don't think that a series of interventions on the demand side of the housing market are particularly helpful when the problem is we are not building enough houses.' Pointing the way: Mr Miliband wants to bring in 'use it or lose it' powers for councils . Andrew Percy, Tory candidate for Brigg and Goole, said: 'It is the sort of policy you might expect from Soviet Russia. 'We should encourage developers to use this land, but threatening to steal people's land is using a stick rather than a carrot.' Mr Miliband's plan to link rents to inflation under new, three-year contracts came under fire too. Alan Ward, of the Residential Landlords Association, said Margaret Thatcher's abolition of rent controls in 1988 had doubled the number of homes on the lettings market. 'Labour's plans would take use back to the dark days of the Seventies and the Eighties which caused a shortage of decent homes to rent,' he added. Melanie Leech, chief executive of the British Property Federation, said: 'In places like London tenants will find this policy on rents may make their budgeting harder, rather than easier. 'Their rent will tick along at CPI inflation for a couple of years and then they will face a potential sharp rise in year three when the rent returns to market. 'Ultimately what will help tenants best is more investment in housing. 'Pension funds and other institutions have billions to invest in this market – developing places that would provide a new generation of high-quality homes that offer greater choice to renters, including the option to sign longer tenancies.' In it together: Mr Miliband said the pledge to cut stamp duty to zero over the next three years would benefit nine out of ten people buying their first home . Richard Lambert, of the National Landlords Association, said Labour's package would make owners less likely to risk their money in providing homes while banks would be deterred from advancing loans. In his policy package, Mr Miliband also said he wanted to 'restore the dream of home ownership' by giving first-time buyers a stamp duty holiday on homes up to £300,000 in value. He said up to half of new homes would be earmarked for local residents trying to get a foot on the property ladder, while higher taxes would be imposed on foreign buyers. Mr Miliband's housing announcements are an attempt to regain the initiative after the Tories unveiled a popular policy two weeks ago to extend the right to buy to all tenants of housing associations. The Labour leader said housing would be a late addition on his party's election pledge card – increasing the number of pledges from five to six. Mr Miliband said the pledge to cut stamp duty to zero over the next three years would benefit nine out of ten people buying their first home, could save up to £5,000 and would cost the Government £225million a year. Chancellor George Osborne dismissed Mr Miliband's stamp duty pledge as a 'complete gimmick'. Naomi Heaton, of London Central Portfolio, an asset management company, said Mr Miliband's housing policy was 'a load of old cobblers'. 'Labour are clearly very bad at their sums, which is why, of course, we are so worried about them running the economy,' she said. 'The average purchase price for a first time buyer outside London is £137,120, according to the Halifax. Following the new stamp duty reforms introduced by the Conservative coalition last December, the stamp duty charge for buyers at this level is just £242. 'This is what the Labour policy would save – not £5,000.' Jenny Luckitt, of campaign group Generation Rent, said: 'These policies to cut stamp duty do nothing for affordability. 'They merely stimulate demand and drive house prices even further out of reach of ordinary first-time buyers. 'Limiting this policy to the first two years of government is a gimmick that will only drive up prices as people scramble to buy before the 'holiday' is over.' Trump card: The Labour leader said housing would be a late addition on his party's election pledge card – increasing the number of pledges from five to six . David Orr, of the National Housing Federation, said: 'Slashing stamp duty could lead to even higher demand on homes for first-time buyers, pushing up prices even further out of reach, while not addressing the supply of homes we so desperately need.' Mr Miliband dismissed the backlash, saying: 'Our proposals will be better for home owners in Britain and for companies building homes in Britain. 'We have a housing market that is frankly not working and we have government that is not unblocking the real barriers there are in the housing market.' Mr Miliband added: 'We won't let those large developers just hoard land – waiting for it to go up in value when it could be used to build homes. 'We'll say: Either you use the land or you lose the land.'
Red Ed wants councils to encourage building by hiking tax on unused land . Sites still left idle could be compulsorily purchased  by another developer . Property analysts say it would take UK back to 'dark days of the Seventies' Tory candidate said it's 'sort of policy you might expect from Soviet Russia'