To fix Britain’s housing mess, think outside the box
I’m surprised to see Larry Elliott (How to turn the UK’s ‘generation rent’ into ‘generation buy’, 7 February) pointing to “tough green belt regulations” and “local planning rules” as villains in the housing affordability equation, because, as he has previously said, the housing market isn’t a market at all in the traditional supply-and-demand sense. Developers won’t increase supply to the point where they have to drop prices. Granting them more planning consents simply gives them more bankable assets, which is why they donate millions to the Tory party.
He does mention a land value tax to deter hoarding, but then compounds his felony by suggesting that the outrageous help-to-buy scheme, which has been bloating prices and developers’ profits since 2013, might be part of the future, along with other creative lending wheezes to saddle punters with more debt than banks think they can afford.
What’s needed is some creative levelling up through a fundamental shift in ownership philosophy, with main homes regarded as homes, not investments, higher taxation of socially-divisive inherited property wealth, and higher taxation of dwellings which are not the main home of a UK taxpayer – all of that to bring prices down across the entire housing stock, with new-build emphasis moving to social housing.
John Worrall
Cromer, Norfolk
Young adults are certainly taking a hiding. So far, government help always seems to put up house prices on “less-for-your money” new housing. This is the opposite of what is needed, namely lower prices on better housing – but this seems almost impossible to achieve in the uncompetitive British housing market. One way to modify this very unhealthy situation might be to give much stronger support to not-for-profit community land trusts (CLTs) working with not-for profit housing associations in their local areas.
Civic parishes, towns and cities should be encouraged to make land sites available at agricultural land prices or less for their local CLTs and community-led housing (CLH) groups. Councillors should be instructed to concentrate on the unhoused and not the nimby housed when making planning decisions, and infrastructure grants must be more readily available to CLH groups.
Barry Jones
Malvern, Worcestershire
Larry Elliott’s piece on Policy Exchange’s proposal to increase the chances for young people to saddle themselves with huge mortgages begins with an assumption that conventional home ownership should be the default position.
Average house prices would have to fall by about two-thirds to be truly affordable to someone earning an average UK wage. That people manage, either to buy directly or to pay their landlord’s mortgage, is through two or more people sharing the load, aided by record low interest rates. Underlying much of the desire to get and stay on the housing ladder is the expectation that property values will always rise so as to provide a nest egg for retirement. Facilitating the notion of a property-owning democracy is – like student loans – a neat way of binding a portion of the population into long-term debt.
In preindustrial societies people built their own homes, starting small with what they could afford, and expanding as needs grew and funds allowed. Finance and planning could be tailored to such a programme today, but it would be such a threat to existing property owners that it is unlikely ever to appeal to the mainstream political parties.
Duncan Roberts
Belford, Northumberland
