by Frances Haigh on 26 February, 2017
Recently the Tory Government published its much-heralded Housing White Paper. This, it was promised, would fix our broken housing market. The response from across the housing sector was generally along the lines of “Is that it???”
The real crisis is that there are not enough homes. There are many people who cannot afford to buy or rent privately. People on zero hours’ contracts; people in bed and breakfast made homeless because their landlord has increased the rent to extortionate levels; people sleeping in doorways, stairwells and woods; young adults living with their parents because they cannot afford to move out; people crowded into shared houses; people sofa-surfing – they still need homes, so what is the Government doing to help? Nothing.
There is a need for truly affordable homes to rent, that help people to live near to where there is work, to enable their children to have stability and for families to be close to their relatives so they can support each other. We all recognise this.
Some commentators said that the housing market is not broken. If you look at the market for sale and purchase of residential property, it works well. There is a shortage of property, so prices are high, and property is sold for in excess of asking prices. Much property goes to investors who have realised the opportunities in the rental market, bought up property and become landlords. This has forced up property prices, making it even less affordable for young families and pushing them into the rented sector. Meanwhile, build-out rates for new properties are kept down so that prices remain high.
Similarly, the private rental market works according to economic theory. People unable to buy property have to rent as an alternative. Demand is high, so prices are high. The downside of this is that tenancies are short, generally insecure, and in nearly a third, the properties are poorly maintained. The Housing White Paper itself reported “Standards in the private rented sector remain below those in the social and owner occupied sectors, but are improving: just 28% of homes are now non-decent compared to 37% in 2010.”
After the war when the UK was up to its eyes in debt, the Government invested in good quality social housing to provide homes so that everyone was suitably housed. For many years now, Government has not only cut off the funding for this housing, it has been selling it off. Even where tenants initially benefited from buying their homes, many of these properties are now in the hands of private landlords, and the Government has done nothing to replace them for the next generations.
The Tory Government has tinkered around with incentives for the residential property market, addressing totally the wrong problem with schemes such as Help to Buy loans. These may make property more affordable to buy initially, but many owners will soon have to start paying for these loans in addition to their main mortgage.
The real solution to the housing crisis, is to enable councils and housing associations to access funding so they can build homes for local need. So that when councils allow development on our green fields, as in North of Horsham, what is built is not the whopping 828 4-bed executive market houses that are proposed by the developer, but much-needed property for all ages and all tenures, so that everyone can have a place to call home.Leave a comment