Britain’s housing crisis – what’s the latest?

 

Theresa May could face a Conservative backlash over the housing crisis if she doesn’t listen to the backbench Conservatives.

The Prime Minister has been advised to force councils to build more homes in an attempt to tackle the housing crisis and prompt a building boom.

Proposals have been put in place but nothing will be published until the end of the month according to The Department for Communities and Local Government.

The Communities Secretary, Sajid Javid, would like to see housebuilding boosted significantly.

In the housing white paper ‘Fixing Our Broken Housing Market’ published in February 2017, the Government said: “Some local authorities can duck potentially difficult decisions, because they are free to come up with their own methodology for calculating ‘objectively assessed need’. So, we are going to consult on a new standard methodology for calculating ‘objectively assessed need’, and encourage councils to plan on this basis.”

Sajid Javid hopes by adopting an expansive approach, which includes data about the local housing market, he can boost redevelopment in areas where prices are rising quickly. However, Javid and his allies are likely to find themselves up against Tory MPs and councillors that are wary of a planning blight. Andrew Mitchell, the former Development Secretary, publicly conflicted with Javid over plans for a housing development in his Sutton Coldfield constituency.

Housing campaigners urged the Prime Minister to be bold-faced. Gill Payne, the executive director of public impact at the National Housing Federation, said: “Getting this right will be a show of the strength of Government’s commitment to building the homes the nation needs. Getting a consistent and accurate picture of housing need is really important – it cements into the local plan the number of homes that need to be delivered.”

Ms Payne added: “Robust methodology will give a consistent and undisputable approach across the country.”

Polly Neate, the chief executive of Shelter, said: “We hope these changes will help to simplify and join up the way councils across the country assess housing need in their areas, and it’s vital that the new proposals work to deliver as many affordable homes as possible.”

She added that Javid should tighten up the planning regime, to allow local authorities to exert more control over what can be built, where, rather than relying on the market to deliver.

“It’s important to remember that developers can still often build whatever they like, regardless of whether it meets what the council says is needed or not. The Government must now take action to change this, by giving councils more power to get housing built that will meet the needs of their community.”

Previous Governments have sought to make property ownership more affordable. Ambitious building targets have rarely been met, and George Osborne’s focus on subsidising mortgages through the help-to-buy scheme was disparaged for fuelling the boom.

Moving forwards…

Theresa May really does need more young voters

The Prime Minister’s efforts to tackle the problem may have been strengthened by the Conservative’s poor showing among the younger generation at the general election in June. A recent YouGov poll suggested that just 4% of 18-24-year-olds trust the Conservatives to deal with the issue of housing – against 44% for Labour. If Theresa May takes the appropriate steps, she could gain more support from young people.

Official figures

Homeowners could expect to pay about 7.6 times their annual earnings to buy a house in England and Wales in 2016, up from 3.6 times earnings in 1997.

The Housing need test

The housing need test is one of a package of measures radical Conservatives believe will be necessary to tackle the challenge.

Whilst in Scotland…

The Scottish Conservative leader, Ruth Davidson, in a speech focusing on housing policy in Scotland, said on Friday: “It is a bedrock of Conservative belief that we should encourage a property-owning democracy. Yet increasingly, we now have something more akin to a property-owning oligarchy. Made up of lucky, mainly older, people who – by dint of having scaled the housing ladder – are now the ones who now control the country’s economic purse strings. “

George Freeman, chair of the Conservative policy forum, has also warned that young people risk rejecting capitalism if they have no chance of owning a home.

May signalled on her trip to Japan that she wants to press ahead with domestic reform, as well as complete the Brexit negotiations.

She pointed to her Downing Street speech last year, in which she pledged to right, “burning injustices”, including the fact that “if you’re young, you’ll find it harder than ever before to own your own home”.

But diluted corporate governance reforms published last week raised questions about whether May’s minority Government will be willing to take on vested interests.

Housebuilding slumped after the financial crash from more than 215,000 homes a year in 2007-8 to 133,000 in 2012-13. It has since recovered, but has not regained its pre-crisis level.

We will keep you informed about future developments.

Read our article on the Housing white paper 2017 here. 

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