Politicians have to accept there is no quick fix to the problem – and getting it right will take an attitudinal shift
Housing is at the heart of the economic crisis, and getting housing right will be part of its answer. It is also one of the toughest of political quandaries, one whose obvious answer is so unpalatable that no government has had the courage to face it. The quandary is this: housing costs too much, but for millions of people, security depends on the value of their bricks and mortar.
A generation are being priced out of homes so that their parents keep the value of their principal asset. It is not surprising that the politicians’ solutions – whether it’s the hints this weekend from the prime minister and the chancellor of easier planning laws, or the implementation at the end of last week of a law that criminalises squatting – are little more than populist window dressing that will make no real difference to the fundamental problem. And while attempts to magic a simple answer are rational short-term politics, they risk damaging the prospects of a realistic debate and ultimately a long-term solution.
Plainly, more homes are needed, particularly in the south-east. But the reason for the catastrophic decline in the number of new ones being built is not only the tight planning regulations or an overprotected green belt. Builders aren’t building on land for which they have planning permission now because they can’t sell the houses they’ve built already. They can’t sell the houses because mortgages are still hard to come by and people are still fearful of getting into more debt. So lending is still two-thirds below its 2007 peak. And builders won’t bring down their prices because it would compromise their investment in expensive land and expensively built homes.
The shortage of homes people can afford means young couples are delaying having children. At the current rate, one in four will be priced out of home ownership by 2025. To fill the gap, the private rented sector is expanding fast. But it needs better, longer-term tenancy agreements in place if it is to become a valid choice for families, and it needs to find ways – as the government’s Montague report suggested last month – of persuading pension funds to invest in the housing market when relatively low profitability makes the idea unattractive.
In this context, criminalising squatting can be seen for the irrelevance that it is. It is true that there have been cases of homes left briefly empty for sale or renovation being taken over by squatters. These get lots of publicity and rightly make people angry and also disproportionately fearful. But it is not hard to prosecute them under the current law (as 160 practitioners pointed out in a letter on these pages last year). Research from the housing action charity Crisis suggests most people who squat are vulnerable and homeless, and squat because they can see no alternative. It is a welfare and housing issue, not a criminal one. At the same time there are at least 700,000 empty homes in England and Wales. But bringing them back into service is not easy. Most are for sale or awaiting repairs or renovation. Less than a third have been empty for more than six months. Everyone knows this is daft, an affront to those desperate for somewhere to live as well as to those who have to live next door to boarded-up, often vandalised properties, but it is no long-term answer to the housing crisis. Meanwhile, the consequences of policy failure mount up in soaring private-sector rents and the cap on housing benefit, plans to sell off high value social housing and reinvigorate the right to buy.
Politicians have to accept there is no quick fix for housing. More than that, there is no obvious, tried and tested route out of the current crisis. Getting it right will take an attitudinal shift. It is no longer possible to leave it to the market. Housing policy cannot be constrained by the desire to maintain and enhance voters’ assets, nor the need to protect the construction industry’s profits. Nor, important as it is, should it only be about providing jobs. Housing is a public good, and that is how public policy must treat it.
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