From One Planet to Dr Earth

Part 2 of my blog on what housing could expect from a multi-party government looks at what the Greens and UKIP are saying.

I suspect many Inside Housing readers would welcome a Green housing minister committed to implementing its manifesto pledges to ‘provide 500,000 social homes for rent over the five-year parliament, control excessive rents and achieve house price stability’.

The manifesto is the only one from the English parties already represented at Westminster that offers a genuine alternative to the current system. While many will question its feasibility, few would quarrel with its principle of ‘making property investment and speculation less attractive and increasing housing supply’. Among the policies on offer are the removal of borrowing caps on councils, the end of the right to buy at a discount, more rights to homeless people, five-year private tenancies with rent increases limited to CPI, removal of tax relief for buy to let landlords and preparations for a land value tax.

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Village vision

Inner city council estates were once the solution to the housing crisis, then the problem. Now they could be the solution again. But for who?

There is arguably no more controversial issue in housing than the regeneration of existing social housing estates, especially in London. Schemes in boroughs right across the capital have hit the headlines, mostly for the wrong reasons.

In a report this week, the Labour peer Lord Adonis and the think tank IPPR presents a vision for what they call ‘city villages’. The scope is broad, with town centres, private renting and the great private estates of central London discussed alongside some opposing views about new towns. However, the focus is overwhelmingly on the densification of existing council estates with mixed tenure development. If anyone attending the launch needed any reminding that this is controversial territory, tenants from the West Kensington and Gibbs Green estates in Hammersmith & Fulham were protesting outside.

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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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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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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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Right to buy: a clarification

Oops. The final Right to Buy stats before the election show that the reinvigorated policy is delivering less than half the new homes the government previously claimed: one for every 11 sold.

Up to now, the ratio was running at one start on site for every five homes sold compared to an apparent pledge of 1-for-1 replacement when discounts were increased in April 2012. The chances of achieving that always seemed somewhere between slim and zero given that the Treasury still takes a cut of the receipts and the fine print meant that the pledge only applied only to additional sales on top of those already expected, even though the replacements would not be like for like.

However, as Pete Apps reports, today’s figures for replacement starts on site have been revised downwards substantially. The apparent 4,795 starts between April 2012 and September 2013 turn out to be just 2,298. That compares with more than 26,000 homes sold off since April 2012.

The graph below shows the comparison quarter by quarter:

RTB

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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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