Generation Rent and broken markets

 The Conservative Government’s housing White Paper is a desperate cry to every strata of the housing market to step up and play their part in what is nothing short of a generational social pandemic. From developers to councils the government have not only attempted to revitalise the demand side of the market but also the supply side by pledging to provide not just affordable ownership but also affordable rented properties.

 

If you are under 25 and wish to live anywhere near London you should probably re-evaluate your dreams of owning a house. Similarly you should probably re-evaluate if you are not married, do not have wealthy parents or want to enjoy your early adulthood. Returning from an existential tangent it is nothing short of disappointing that this white paper did not come up with anything more innovative than building upwards rather than outwards.

 

There is a right for generational scepticism born out of countless disappointments. Housing ownership is on a perilous downward spiral. And as refreshing as it is to hear an admission of failure from the government many are yet to be convinced these measures are not just simply feeble.

 

Outlined in the White Paper are specific measures across four main areas that will supposedly rectify problems associated with housing delivery and affordability. Appropriate housing plans are to be put in place to allow right homes to be built in the right places. Faster home building and market diversification are also to be employed along with strategies to help cope with the current housing shortage.

 

These specific measures are supposed to address three major problems which have to be tackled in the pursuit of affordable house building. Local authorities are branded in the paper as lacking an effective plan to meet housing growth in their area. This is compounded by an overly slow pace of development and an oligopolistic market structure inhibiting any increase in supply.

 

The Department for Communities and Local Government’s Housing White Paper is the culmination of long overdue efforts to attempt to resurrect a “broken housing market”. The succinct and frank use of such terms by Sajid Javid is a noticeable progression from previous Governments that have failed to address this pressing issue.

 

May’s Government has rightly prioritised an attempt to address the problem that can be seen in the housing market. An ever-widening gap between salaries and house prices and a generation who are unlikely to conceivably get on the housing ladder continues to pose significant challenges to social mobility and hinder the very people the Prime Minister pledged to help.

 

It is clear that this is a perceived movement towards concerted action in the housing market, however it also appears to pose more questions than it actually answers. In the simplest of terms, demand in the housing market has outstripped supply and consequently prices have skyrocketed. Is this not how the free market operates? The free market that Tories have championed for decades is simply not working.

 

The market is simply refusing to supply economic housing. By empowering local authorities to facilitate housing projects homes can be provided at low costs via long-term finance.

 

A paradigm shift is needed in the United Kingdom, free market provision of housing is not working and an emphasis on building more homes faster and cheaper is not the only answer. Intensifying existing building stock is a viable and more sustainable option. Shared ownership and converting surplus commercial space into much needed housing both releases pressure on the ever-expanding green belt and could perhaps address the issue of loneliness amongst the elderly in an ageing society.

 

John Healey, Labour’s shadow housing secretary, said the plan was “feeble beyond belief”. Fundamentally bold plans were required from this white paper, a radical change to the housing market that would reduce rent and make ownership more affordable. The previous Government’s planning framework has essentially been scrapped and in an act of “re-treading old ground” the government have returned to a similar housing plan to that under Blair and Brown.

 

More by this commentator. 

 

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