Sign of four

It’s time once again for a comprehensive overview of the state of the housing nation. Here are four key points I drew from this year’s UK Housing Review.

The headlines so far have been made by falls in home ownership for young people, but the 2015 Review also highlights these other key points for housing across all tenures:

1) Universal dependency

This isn’t the first time the Review has made this point but it is the first time I’ve seen it summed up so clearly in one graph.

All the rhetoric about universal credit says that it will reward those ‘hardworking families’ and help to end the ‘dependency culture’ of the benefits system. The new scheme does improve the poverty trap caused by the rate at which housing benefit is withdrawn as your earnings rise. A failure to include council tax benefit plus cuts in recent Budgets and Autumn Statement detract from this objective but it does still seem better designed to ‘make work pay’.

However, there is a price to be paid for this improvement.

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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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The tenure trap

New official figures show stunning changes in housing in England. Here are a dozen examples of what’s happening. We already knew that the number of people who own their own home has shrunk rapidly, that the number of private renters has soared and created Generation Rent and that private renting has overtaken social renting. However, the first results from the English Housing Survey 2013/14 show that these trends are not just continuing: they are accelerating. Everywhere you look in the report and the accompanying tables there are stunning new comparisons to be made:

  • More people now own their home outright than are buying one with a mortgage. The split between them is not available going back very far but I reckon this must be for the first time since the 1930s, when the inter-war mortgage boom was in full flight. Here are the main tenure trends since 1980:

Tenure

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Own goals

Could housing hold the key to the Conservatives’ chances of winning the general election?

I’d assumed till now that the fact David Cameron made housing (or rather home ownership) one of his six priorities for speeches signalled no more than a desire to put aspiration at the heart of the Tory campaign. Mixing a few dubious claims about Help to Buy with some boasts about the Starter Home Initiative might mean some extra votes but housing would remain a secondary issue behind the economy, the NHS and immigration.

But two tweets this week by influential Conservative Tim Montgomerie made me wonder about this. Montgomerie is a Times columnist but that understates his influence in the party as the co-founder of the Centre for Social Justice, creator of the Conservative Home website and speechwriter for two Tory leaders.

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


Winners and losers

So buy to let landlords made £177 billion from rising house prices over the last five years – and that does not include rental income.

A series of linked stories in the Financial Times this morning make clear who the beneficiaries of booming property market have been since 2009, when interest rates fell to a record low. In addition to buy to letters, they are home owners in London (prices up by £563 billion in the last five years) and in Conservative constituencies outside the capital (prices up eight times fasterthan in Labour seats). Even social landlords get in on the act, with a 20 per cent increase in the value of their stock since 2009.

Yet all the research by Savills and impressive FT data visualisation beg some far bigger questions about what it calls the politics of British housing. Why has this happened? If those are the winners, who are the losers?

-> 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


Starter for 20

The government’s plan for starter homes with a 20 per cent discount begs all sorts of questions. Today we got some of the answers.

The scheme announced by David Cameron this morning was first trailed in his conference speech in October as an idea for after the election but has now apparently been brought forward to start early next year.

Some of the details of Dave’s Dream Homes seem to have changed along the way. According to a DCLG consultation also published today,  the starter homes initiative seems to amount to an extension of rural exceptions sites to urban areas. So how will it work?

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


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