There was an article on Radio 4 as I drove to work this morning, about the "housing crisis" that home ownership levels have fallen to the same level as in the mid '80s. This is not a crisis. Insecure tenures, the systematic destruction of public housing stock, and reliance on private companies to build houses are the problem.

Okay, so I was driving and may not have taken in every facet of this particular report as it was early and I was concentrating on the road. But the gist of it was that it's a terrible thing that fewer people own their own homes than in the recent past, broadly similar to the Grauniad's article "Home ownership in England at lowest level in 30 years as housing crisis grows". The Guardian's article is more factual  (or at least heavier on statistics) than the item I heard on the radio seemed, but the headline is the same, that lower levels of owner-occupancy is a crisis.This is founded on the assumption that renting is a bad thing, and that lower levels of home ownership is the same as insufficient housing stock, but neither of these is necessarily the case.

I'm writing from memory and experience here, rather than research as I'd like given how long this has become, so please forgive such errors and exaggerations as are likel to creep in. And this is a rant, not necessarily fully reasoned or well explained, prejudiced, and hurried out on a week night before a 5.30am start.

TL:DR version - modern way of renting bad, doesn't have to be; unfair blame; market doesn't work; scrap right to buy, build council houses.

 

Things are pretty rubbish right now.

Renting rather than owning your home was the normal state of affairs for most people for generations, and remains so to this day across much ofthe world.The admittedly short and currently slightly dated list of countries by home ownership on Wikipedia shows fewer of the other states in the G8 having higher rates of home ownership (Canada, Italy, Russia) than the UK, and more lower (France, Germany, Japan, the US) - though its a pretty even split above/below. This is pretty basic, but as its a work night and I lack time for proper research lets take that as an indicator that it's not the end of the world for people to rent their homes.

But Britons don't want to rent, they want to buy. It is seen to represent greater financial security, security of tenure, and personal freedom. Which isn't necessarily wrong - but is not the way it has to be. It is the direct result of successive governments attacking tenants rights, except when it uses them to attack the prospect of would-be tennants having a hope of social housing.

I'm talking about "Assured Shorthold Tenancies" (they must be more secure than the old Shorthold Tenancies, they're "Assured"!), the planning system, and the right to buy. If you rent in England or Wales today, and I assume the rest of the UK too, you're pretty sure to have an Assured Shorthold Tenancy (AST). Not all are the same, but the stereotype is one I and many others have experienced. You're billed inordinate sums at every turn by unscrupulous agents (copy and paste a word file, open it, enter new tenancy end date, print and post - five minutes work, bill for hundreds of pounds) (they're also often ripping off the landlord by not passing on your fault reports and similarly billing large sums for small tasks on top of their percentage of the rent). You can be turfed out at a couple of months notice, but may not have the right to do the same back. You can't paint a wall or hang a picture without permission and any "damage" comes off the deposit - I was once docked for "damaging" the garden by grubbing up some weeds and planting geraniums in their place. If the landlord or their agents give you 24 hours written notice they can enter your home whether or not you're there or even know they're coming (say they delivered a note, and you're on holiday), and they'll then give you orders on how to live once they've done their inspection (the lease says clean and don't damage, not alphabetise your books and tidy the shoe rack!). Some of these effects are worse than others, and not all landlords are bad, but renting can easily be demoralising and the feeling you can't escape it awful. Even with a decent landlord its' easy to feel out of control and that ownership would be liberating.

The story we're usually told is that the way out of this is owner-occupation, the problem with achieving that is one of pricing, supply and demand... and that it's somehow the Council's fault. Time and again in the news Councils are censured, for "failing to meet affordable homes targets", "failing to deliver housebuilding plans" and "failing to replace council homes sold through right to buy." Lets consider those three headlines as acusations shall we?

Councils virtually never build homes any more, as they don't have the means to do so, so they can't directly "meet "affordable" homes targets" (or fail to). I'm not sure exactly how council house building works as I think they were actually banned from doing so at one point, but I know a few are now working on small schemes.

Anyway those construction targets are supposed to be met through planning, whereby they're stipulated as part of all developments over a certain size. So its the Council's fault for failing to force developers to meet the quota - except they can't force them. Planning policies tend, not entirely unreasonably, to allow for some exceptions where any given standard can't be met, for instance where providing a quota of parking per household would affect the economic viability of a development. Developers, beholden to maximise profit for their shareholders will see anything that runs against that as "affecting the economic viability" of a project, and push hard for concessions using any and every reasonably-intended caveat or loophole. This is a lot for under-resourced "development management" departments to fight, where a lone planning officer with literally dozens of other cases backed up by a few specialists who can only spare minutes for "DC work" is more or less the sole line of defence against the developers consultants who descend in tome-wielding packs claiming their tons of documentation proves all standards are met, mitigated or exceeded. And everyone knows that given the "presumption in favour of sustainable development" if the decision goes against the developer it's all but bound to be overturned if they appeal. So the planners fight a desperate rear guard action to get as much as they can from the developers while knowing that meeting standards in full, especially expensive ones like "devauling" parts of a site by making homes"affordable", just won't happen (while costing a fortune in time and stress they cannot afford). And in all this they also have to priorise some standards over others: if they can get a certain value of concessions should that be in more "afforable" homes, or contributions to deal with other problems the development will cause - and note that throughout I've put quotation marks around "affordable" because they usually aren't.

 And then of course there's the build rate. Estate unfinished after ten years? Not surprising, nor hard to fathom. The council will again get slated, but its the developers who do the building and apart from starting work within three years of permission there's no control and it pays the builders to construct exactly as fast (or preferably a little slower than) they can sell the houses as this evens out incomings/outgoings and maximises profit.

"Failing to deliver housebuilding plans" is something that Councils do do, but doesn't mean they're responsible for somehow choking off development - the contrary in fact, as in the absence of a plan there are far fewer policy grounds for refusing or moderating a development. And it's hardly surprising that plans can be long delayed as it takes time to prepare and consult on them, hold the public inquiry, etc. and central government will reliably move the goal posts at least once in this cycle so that you're lucky if you don't have to start from scratch (they release it to the media as "making it easier/more effective/anything other than totally disruptive like it really is...").

"Failing to replace council homes sold through the right to buy" - true, but also more or less inevitable. But the fault here lies with central Government. You are required to sell an assest for below its market value, and to spend the income raised on like-for-like replacement for which you will have to pay full price. You receive no financial assistance to do so, have no reserves you can use for this thanks to years of cuts, can't raise your own income through local taxation as you'll be punished by central funding cuts, you're now forbidden by law from increasing rents and required to lower them instead (although probably taking below market rate already), are unlikely to come out on top if you borrow as the new properties will likely be sold in turn creating an ongoing cycle, and will struggle to build down to the price of available funds without lumbering yourself with a future liability in maintenance.... expecting this to be done is simply unrealistic.

And that's a real shame, as if Councils could reliably replace their housing stock, and/or were allowed to preserve what they already have, it could be a siginificant part of the answer.

What could the answer look like?

Reliance on the market with little regulation means powerful profit motives can treat individuals badly, drive prices ever upwards, and that homes are generally delivered when and where they pay best, not when they're best timed or where best placed. This seems obvious, and like it should have been obvious before the changes of the 80s and beyond that led to this, but it plays into the ideologies and aims of the governments of the time. In the short term each change was calculated to buy votes. Helping to use public money make profits for private companies is part of the status quo that Mrs Thatcher so firmly established and continues to this day, and fits with the Tory aim to "shrink the state". Things improved slightly under New Labour as shown by a well-known graphic on the Huffington Post, but the neoliberal concensus wouldn't allow (and New Labour didn't want) more active intervention to provide where the market failed.

But such intervention is needed if central government wants to help people rather than just criticising its poor relations for failing to do the impossible. Wouldn't that be expensive and "distort the market" though? No more than the status quo. Housing benefit transfers very large sums into private pockets in subsidising rent from private landlords (though that's the start of another rant, on top of that, Councils have a mandatory duty to house certain people who are "statutory homeless" and lacking "spare" housing stock that really means B&Bs and Hotels and this consumes large sums that they can't afford, but have to spend! Anyway...). If I remember rightly the majority of housing benefit goes to private landlords, which increasingly means companies and the rich, not individuals who have a second or third property. This pushes up private rents, and thereby house prices.

Short of forcible redistribution of property (which I suspect is part of the history of how Russia got so high up that list I linked to earlier ad for the avoidance of doubt, I'm not advocating!) matters could be improved by a complete overhaul of the "social housing" sector (or "market" as some would call it). Firstly this could be a means to give those public tenants at least a decent security of tenure, and enjoy more similar rights to tenants in other countries who don't seem to mind it as much - ones that were lost in the '80s. Some of those drawbacks above are there because landlords too have rights, and ultimately it is their property, but when an asset is owned by everyone we should be prepared to show a little more generosity with the common wealth - that doesn't mean allowing wilful damage and so on, but willingness to put trust in people, treat them as adults and act reasonably. It'd be hard to codify, but could and should be backed up by democratic means, perhaps by Councillors having direct more involvement in or at least responsibility for managing the estate.

This should be accompanied by an end to the right to buy, and expansion of the existing stock so that Councils can supply their obligations. Part of that would have to be either funding to allow Councils to establish the housing stock they need (keeping millions of pounds of public money in the public purse rather than subsidising private profit) or stronger powers to require developers to provide not just "affordable" housing but social housing stock as part of their estates, to build them first, and to complete them (and indeed the development as a whole) within a certain timescale. 

It must be possible by such means to create an environment of secure and affordable tenancy with decent, trustworthy landlords that could make possession of a Council home the subject of envy as it once was, with the homes having been built where they're needed when they're needed. This could then be a springboard where if you want to buy you're better placed to do so, with rents controlled and reasonable, not being penalised by continual and excessive fees that could otherwise go into that vital first deposit, and not needing as large a deposit as house prices wouldn't have been inflated by state rent subsidies.

And maybe I'm not too off the wall, at least one columnist at the Guardian thinks the state should start building too, as did some of his sources.