Heart, brain and Clegg

What could housing expect from a government influenced by parties other than the Conservatives and Labour? Part 1: the Lib Dems.

Assuming the polls are right and there will be another hung parliament,  any of the other five parties who took  part in the first TV debate could have an influence. The SNP and Plaid Cymru would seek concessions for Scotland and Wales while demanding less austerity from a Labour government, especially on welfare [though later the SNP reached out to the rest of the UK with a call for 100,000 affordable homes]. However, most housing issues are devolved from Westminster, so I’ll concentrate in this two-part blog on the other three parties. Power may matter a lot more than policies, there are some hints in the Lib Dem, Green and UKIP manifestos of what might offer common ground with one of the bigger parties.

So first, the Lib Dems. Assuming enough of them keep their seats, they could be a coalition partner (or a less formal supporter) for either a Tory or Labour government and they are the only party with a track record in coalition at Westminster.

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Plan C

So the Conservatives will pledge a ‘housing revolution’ at the election. Sound familiar?

In an interview with the Sunday Telegraph over the weekend, George Osborne outlined a Tory plan to help a million more people into home ownership in the next parliament thanks to schemes like Help to Buy, Right to Buy and the Starter Home scheme.

‘I would like to see us double the number of first time buyers, up to half a million. That is the kind of level we saw in the 1980s. There is no reason why our country can’t achieve that again. That’s a goal we set ourselves today.

‘I think we can deliver a revolution in home ownership and make this the home-owning democracy, the home-owning society that I think is one of the Conservatives’ core beliefs.’

The chancellor says that visiting building sites is ‘the best part of my job’, not to mention donning high-vis jackets and being pictured with happy first-time buyers. ‘It reminds me of why we are doing this. Ultimately this is about people’s aspirations, their futures and their dreams.’

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Beyond the pale

When if ever will politicians catch up with the scale of the housing crisis unfolding before their eyes?

As the Homes for Britain campaign moves to the heart of Westminster, the default response of the major parties is to promise new homes. Traditionally, these come in multiples of 100,000:  the Conservatives want 100,000 and then 200,000 starter homes; Labour promises 200,000 new homes a year by 2020; the Liberal Democrats say 300,000 with a tenth of those being rent to own; and the Greens want 500,000 rented homes.

It was ever thus of course. Back in the 1950s, Labour and the Conservatives competed with each other to promise more homes. The difference was that they delivered. Macmillan pledged and then exceeded 300,000 a year as housing minister in the 1950s. This numbers game had major downsides in terms of design and build quality that we need to remember but it showed that governments were serious about housing.

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Starters’ orders

So the national housing strategy now comes down to this ahead of the election: think of a big number and double it.

Even by recent standards, the starter home initiative plumbs new depths in allowing the politics to drive the policy. The idea of building 100,000 homes at a 20 per cent discount for first-time buyers was first proposed in David Cameron’s conference speech in October. The launch (of a website to register interest, as no homes will be built for some time) was accelerated to this month when the consultation was published in December. And in Cameron’s housing speech today it’s been doubled to 200,000 homes.

Housing minister Brandon Lewis made a written statement earlier that is an extraordinarily rapid government response to a consultation that only ended three weeks ago. However, the response (full version here) is only to the original plan for 100,000 homes, not Cameron’s doubling of it. Reading through some of the responses to the consultation today, I was especially struck by this comment from the Council of Mortgage Lenders:

‘Our overall view of the scheme as outlined is that it could provide a modest addition to the flow of lower cost housing for FTBs and we would support this main objective. But we would warn against setting over-ambitious targets for the scheme at this juncture, before the attractiveness of this particular proposition has been tested on the market.’

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Falling short

What do the final housebuilding figures for England before the election have to say about the deficit and the debt – in new homes?

Needless to say, ministers have greeted them with their usual mix of spin and agility in finding the measure that looks best in PR terms. So housing minister Brandon Lewis says ‘housebuilding continues to climb’ on the basis that housing starts in 2014 were 10 per cent up on a year ago. That may be but starts have been falling for the last two quarters: October to December 2014 was down 10 per cent on the previous quarter and 8 per cent on a year ago, suggesting perhaps that the recovery sparked by Help to Buy is petering out.

Lewis also claims that ‘overall 700,000 new homes have been delivered since the end of 2009’ without any acknowledgment that he is talking about completely different figures – additions to the council tax register – or that he has to borrow six months of the last Labour government to come up with the number.

Starts may indicate current activity but you can’t live in a start and completions are a more reliable measure of housebuilding progress. Curiously, Lewis does not mention these even though the news is actually not bad for the government: October to December completions were up 1 per cent on the previous quarter and 8 per cent on a year ago; and the 118,830 new homes built in 2014 represented an 8 per cent increase on 2013.

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Helping hand

So it turns out that subsidising housebuilders may not have been the best way to boost housebuilding after all.

It’s bad enough that even developers are now arguing that the government has made too many concessions to them. Now it turns out that George Osborne was warned by his own civil servants that Help to Buy could end up going to homes that would have been built anyway.

I’m catching up on a week’s worth of news that  shakes the twin pillars of government policy on housebuilding and home ownership: cutting ‘red tape’ to make sites more viable for new homes and funding equity loan and guarantee schemes to persuade people to buy them.

-> Read the rest of this post on Inside Edge 2, my blog for Inside Housing


10 things about 2014: part 2

The final part of my look back at the issues I’ve been blogging about this year also looks forward to 2015.

6) Maybe to homes

If words were bricks the housing crisis would have been over long ago. Instead housebuilding continued to flatline in 2014 even as the political rhetoric soared.

In January I compared politicians arguing about who had the worst record since the 1920s to bald men squabbling over a comb. A month later Eric Pickles perfected his combover by claiming that in 2013 the coalition had built the most homes since 2007. He’d chosen to emphasise housing starts rather than housing completions. That was understandable but you can’t live in a start and completions were lower than in 2012, 2011, 2009 and 2008 and still less than half the level needed to meet demand.

-> Read the rest of this post on Inside Edge 2, my blog for Inside Housing


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