To have a broom cupboard of one's own: why solving the housing crisis is not an impossible dream

Home ownership peaked a decade ago when 70.9 per cent of households owned their own home; that is now down to 66 per cent and shrinking fast.


There is something refreshing about Nick Boles: a Conservative minister and son of a former chairman of the National Trust who is prepared to declare open season on Nimbys to promote more house-building. Alone among ministers, Boles has appreciated that the inability of the young to afford to buy a home is going to be one of the biggest political issues over the next few years. Home ownership peaked a decade ago when 70.9 per cent of households owned their own home; that is now down to 66 per cent and shrinking fast.

The hypocrisy of many of those who oppose new house-building was demonstrated by Simon Jenkins, who debated with Boles on Wednesday’s Newsnight. Jenkins’s solution is to pile more people on top of each other in poky flats in existing cities. As Boles was quick to assert, a man who owns at least two homes should not talk down to people who cannot afford to buy one. We are in danger of returning to a Victorian social structure, in which a large unpropertied class is forced to rent its homes from a small class of landowners.

Yet for someone so brave and precise at diagnosing the problem, Boles has come up with a disappointingly weak solution. His big idea is to bribe communities to drop their opposition to new housing with the promise of money for new community facilities, paid for by the new community infrastructure levy (CIL), a tax on house-building paid by developers.

Communities are already bribed in this way. My own village has a spanking new tennis court built partly courtesy of money from “section 106” agreements: an informal levy on house-builders which has existed for several decades. In any case, the current low rates of house-building have far more to do with the shortage of mortgage finance than problems with planning delays. There are already 487,000 plots with planning permission – 246,000 where building has not yet begun – but developers don’t want to build on them because they don’t think they could find the buyers.

Opening the countryside to the bulldozers didn’t do Spain and Ireland much good; they suffered inflationary booms in house prices in spite of having lax planning policies. It is cheap money, more than shortage, which drives a property boom.

If we want to reverse the inflation that is causing home-ownership to fall, we have to eliminate the speculation. There is an easy way to do this: by imposing on most new homes restrictive covenants which limit them to being bought by owner-occupiers. Such covenants are already used to limit properties in some areas to being used as holiday lets or second homes. If most new homes were limited for owner-occupation, they could not be scooped up by investors as “buy-to-let” or, worse still, “buy-to-leaves” – where speculators leave properties empty because they calculate that the rental income would not exceed the loss in value from scuff marks that tenants might leave on the kitchen worktops.

The community infrastructure levy is part of the problem, not the solution: in some areas it will add £40,000 to the cost of building a new four-bedroom property. Excessive environmental legislation, too, is adding unnecessary cost to house-building. New homes should be required to have excellent insulation, but by 2016 the building regulations will go far further, demanding that all new homes be carbon neutral. Nick Boles’s own department (Planning) has estimated that these regulations will add £38,000 – 50 per cent – to the cost of building a four-bedroom home. And yet, strangely, it does not seem to have worked out the consequences: that the extra costs will drive developers to concentrate – even more than they do already – on building small numbers of luxury properties where the costs can more easily be absorbed.

This trend is already very evident: between 2010 and 2011 – when the housing market as a whole was static – the average selling price of a Redrow Home climbed from £154,800 to £174,100. We will see more affordable housing for buyers only if the cosy little monopoly enjoyed by the established house-builders is broken. This could be achieved if development corporations were set up to compulsory-purchase land at agricultural value, grant it planning permission and then auction it off in lots of various sizes, giving individuals and small developers a chance to build homes, too. Compulsory purchase would eliminate the need for the CIL, as the uplift in land value generated by the granting of planning permission would be captured for the public good rather than, as now, for private profit. Of course, even with reform to bring down the real cost of housing, not everyone will want, or be able, to become a homeowner.

For this group, renting desperately needs to be made friendlier. We have gone from a situation 25 years ago when landlords dared not let out properties for fear that the tenant would be there for life to one where tenants in privately rented properties have no security of tenure for more than a few months.

Tenancy law should be changed to reflect the fact that for most tenants a property is their home, while for the landlord it is just another investment. A tenant who has paid rent on time and looked after a property should be granted the right to renew a shorthold tenancy for up to three years. Tenants who want to move out, however, should be required to give the landlord only two months’ notice.

Many of these proposals may seem politically difficult at present, when a large number of voters still see high house prices as a virtue, and their homes as a big part of their pension funds. But with home ownership plummeting, there will soon come a time when the growing constituency of young people frozen out of the housing market politically overwhelms the vested interests who want to keep house prices high.

‘A Broom Cupboard of One’s Own: the Housing Crisis and How to Solve It’ by Ross Clark is published as an ebook by Harriman House

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Corporate Tax Solicitor

Highly Competitive Salary: Austen Lloyd: CITY - HIGHEST QUALITY INTERNATIONAL ...

Relationship Manager

£500 - £600 per day: Orgtel: Relationship Manager, London, Banking, Accountant...

Marketing & PR Assistant - NW London

£15 - £17 per hour: Ashdown Group: Marketing & PR Assistant - Kentish Town are...

Senior Network Integration/Test Engineer

£250 - £300 per day: Orgtel: Senior Network Integration/Test Engineer Berkshir...

Day In a Page

Read Next

Should America pay ISIS ransom money to free hostages like Jim Foley?

Kim Sengupta

The Malky Mackay allegations raise the spectre of Britain's casual racism

Chris Maume
Middle East crisis: We know all too much about the cruelty of Isis – but all too little about who they are

We know all too much about the cruelty of Isis – but all too little about who they are

Now Obama has seen the next US reporter to be threatened with beheading, will he blink, asks Robert Fisk
Neanderthals lived alongside humans for centuries, latest study shows

Final resting place of our Neanderthal neighbours revealed

Bones dated to 40,000 years ago show species may have died out in Belgium species co-existed
Scottish independence: The new Scots who hold fate of the UK in their hands

The new Scots who hold fate of the UK in their hands

Scotland’s immigrants are as passionate about the future of their adopted nation as anyone else
Britain's ugliest buildings: Which monstrosities should be nominated for the Dead Prize?

Blight club: Britain's ugliest buildings

Following the architect Cameron Sinclair's introduction of the Dead Prize, an award for ugly buildings, John Rentoul reflects on some of the biggest blots on the UK landscape
eBay's enduring appeal: Online auction site is still the UK's most popular e-commerce retailer

eBay's enduring appeal

The online auction site is still the UK's most popular e-commerce site
Culture Minister Ed Vaizey: ‘lack of ethnic minority and black faces on TV is weird’

'Lack of ethnic minority and black faces on TV is weird'

Culture Minister Ed Vaizey calls for immediate action to address the problem
Artist Olafur Eliasson's latest large-scale works are inspired by the paintings of JMW Turner

Magic circles: Artist Olafur Eliasson

Eliasson's works will go alongside a new exhibition of JMW Turner at Tate Britain. He tells Jay Merrick why the paintings of his hero are ripe for reinvention
Josephine Dickinson: 'A cochlear implant helped me to discover a new world of sound'

Josephine Dickinson: 'How I discovered a new world of sound'

After going deaf as a child, musician and poet Josephine Dickinson made do with a hearing aid for five decades. Then she had a cochlear implant - and everything changed
Greggs Google fail: Was the bakery's response to its logo mishap a stroke of marketing genius?

Greggs gives lesson in crisis management

After a mishap with their logo, high street staple Greggs went viral this week. But, as Simon Usborne discovers, their social media response was anything but half baked
Matthew McConaughey has been singing the praises of bumbags (shame he doesn't know how to wear one)

Matthew McConaughey sings the praises of bumbags

Shame he doesn't know how to wear one. Harriet Walker explains the dos and don'ts of fanny packs
7 best quadcopters and drones

Flying fun: 7 best quadcopters and drones

From state of the art devices with stabilised cameras to mini gadgets that can soar around the home, we take some flying objects for a spin
Joey Barton: ‘I’ve been guilty of getting a bit irate’

Joey Barton: ‘I’ve been guilty of getting a bit irate’

The midfielder returned to the Premier League after two years last weekend. The controversial character had much to discuss after his first game back
Andy Murray: I quit while I’m ahead too often

Andy Murray: I quit while I’m ahead too often

British No 1 knows his consistency as well as his fitness needs working on as he prepares for the US Open after a ‘very, very up and down’ year
Ferguson: In the heartlands of America, a descent into madness

A descent into madness in America's heartlands

David Usborne arrived in Ferguson, Missouri to be greeted by a scene more redolent of Gaza and Afghanistan
BBC’s filming of raid at Sir Cliff’s home ‘may be result of corruption’

BBC faces corruption allegation over its Sir Cliff police raid coverage

Reporter’s relationship with police under scrutiny as DG is summoned by MPs to explain extensive live broadcast of swoop on singer’s home