12 November 2013
The trouble with housing policymakers is that they don’t listen to the the everyday experiences of ordinary people.
Housing policy has been trapped by free market ideology. Other political parties and many policy experts have been obsessed by ways to help private property developers increase supply, and are undaunted by the complete failure of this approach for thirty years. Blame NIMBYs, blame planning controls, blame anything that has held property developers back from building more homes.
But property developers don’t particularly want to build lots more homes. They hold onto big sites and only gradually release homes so that prices don’t drop, wiping out their profits. In recent years they have consolidated their land banks, rather than massively expanding their operations.
Planning controls are there, by and large, to stop urban sprawl and poor quality housing, and to protect social and environmental goods like affordable housing and natural habitats. They don’t always do a good job of this, but we cannot do without them.
As for NIMBYs, it’s too easy to blame them as self-serving. Their arguments are often good, because new homes are often bad.
In a free market, we should build most in expensive areas. But new new housing there comes in the form of small, extremely expensive flats sold to investors or commuters.
How often have you walked past a block of “luxury one bed apartments” being sold for £300,000 a pop and thought, “oh good, housing supply is on the up!”
New housing often means the loss of valuable council housing or natural habitats. In London, the Mayor expects 80 per cent of new housing to come from so-called “opportunity areas”. I have helped residents campaigning against the demolition of their homes in the Heygate estate in Southwark, the Carpenters estate in Newham, and the Gibbs Green and West Kensington estates in Hammersmith and Fulham. These perfectly decent homes are cleared away so big, corporate property developers can make a killing building luxury flats or high-end workplaces that are sold to wealthy investors. The scale and nature of the developments mean that community involvement in the plans is negligible, the consultation process a box ticking exercise.
You can read more about these disastrous new housing schemes in my recent report, Crumbs for Londoners [http://bit.ly/crumbsforlondoners], and watch this two minute video summary [http://www.youtube.com/watch?v=CLR98BdYEPE].
This leaves people renting the flats on insecure tenancy agreements in the private rented sector.
It’s no wonder that people oppose new supply if this is what it looks like.
I have been working on the London Assembly to shift the debate away from this free market dogma, which sees the public sector’s only role as addressing market failures - helping the market where it struggles by releasing land and pumping in credit, and picking up the pieces where the market fails by giving out housing benefits and mortgage rescue packages.
The Housing Commitee that I chair recently published a report on council housing. We noted that in the three decades following the second world war, councils built almost half the new homes in England. Opposition to new homes would be less fierce if the homes were genuinely affordable, with secure tenancies.
Councils could also enable new housing that is planned with genuine community involvement, rather than simply being the gatekeeper and at times the tool of private developers. Perhaps we could follow countries like Germany and the Netherlands, where councils buy up and assemble land for development, parcelling it out so that smaller private and co-op builders can provide well planned, higher quality homes at reasonable prices. Again, this would probably arouse less opposition.
Finally, we need to move beyond just looking at supply. Until we regulate the private rented sector to stabilise rents and improve security, everybody will be clamouring to own their own home and new private rented supply will leave people stuck renting with a raw deal. Until we stop stoking up demand through policies like Help to Buy and buy-to-let tax breaks, and look to reduce demand through policies like land value taxation and controls on second homes, we cannot hope for supply to match demand.
The ideological shift we need is not back to 1945 or even 1930, but towards housing policy that puts the public, private and community sectors on an equal footing, and that treats demand as seriously as supply.