Scan planning applications for new housing in London and you will find a curious preoccupation with the number 14. Why 14? Because 14 is the maximum number of units a developer can build without having to make any "affordable". The result is that, in desirable areas, small is beautiful. The premium that can be charged for such flats makes it worthwhile to build fewer but better. Another result, of course, is less "affordable" housing.
The Housing minister, Yvette Cooper, yesterday published a Green Paper intended to tackle what - before the deluge - Gordon Brown had identified as the most urgent item on his agenda: housing. The proposals include an additional £3bn to be spent on new social housing over three years, and a commitment to build three million new homes by 2010-11, including 210,000 classed as "affordable". For the first time since Margaret Thatcher allowed sales of council homes, local authorities will also be permitted to use rents from the housing that remains in their ownership to fund new building.
All of which sounds very earnest and reasonable - of a piece, in fact, with the Brown style of government. And it is only fair to acknowledge that housing policy needs to be long-term, even if planning procedures are streamlined - as they should be. Yet what is on offer looks very much like jam tomorrow, piled on to crusts already larded with those finicky shared ownership and key worker schemes that so distort the market. Ministers are again shying away from the sensitive issues that could make a difference here and now.
The first is whether "affordable", as in housing, is a useful concept. I make no apology for focusing on London and the south-east, because this is where so much housing is supposed to be "unaffordable". But is it true? At the very top end, the market is global; at the bottom, it is distorted by the subsidies that benefit particular groups.
For everyone else - the majority - prices reflect what people can pay. Relatively low interest rates, rising salaries for some professionals and the proliferation of double-earner households have been responsible for inflating prices just as much as City bonuses or Russian oligarchs. Single-earner households and lower earners inevitably feel the pinch. First-time buyers come into both categories. They (and their often well-heeled parents) are squealing. Interest rates will do more than any government scheme to sort this out.
A second issue is whether the continuing fetish with increasing home ownership is sensible. We already have one of the highest rates of ownership in the developed world. As the crash of the sub-prime mortgage market in the United States has shown, there are people for whom ownership may not be advisable - especially in a market where price rises are slowing. There has to be a rental sector, and part of that sector needs to be subsidised. The question is how, and by how much.
The problem with social housing, especially in the south-east, is not primarily that there is too little of it - though there is - but that it provides a value, in terms of low rent and security in high-price areas, that far exceeds what the occupant pays. For those who have it, it is a boon that they are reluctant to give up. Those who do not have it add their names to waiting lists, envying those whose number comes up.
Even if the Government fulfils its new commitment to increase "affordable" housing, this will still not meet demand. More drastic measures need to be considered. One option would be to bring rents and conditions of tenure more into line with the private sector in any given area, so that social housing would cease to be such a bargain. Another would be for councils to find out exactly who lives in their social housing - they might be surprised at the amount of subletting and profiteering that goes on - and whether those without work or local family ties could not be persuaded to move.
There are parts of the country where housing is in surplus and prices are static to falling. Is it really not possible to match up spare housing with those who need it? Coercion is clearly unacceptable, but where people are completely dependent on the state and without job prospects, would it be so wrong for the state to have a say in where they lived? Transfers within the local authority system are easier than they were, but maybe there should be sticks as well as carrots.
The last time such issues were even broached was when Dame Shirley Porter manipulated sales of council flats in an illegal effort to secure a majority for the Conservatives in Westminster. It is a great pity that the long-term effect of her gerrymandering has been to render any real critique of social housing heretical.Reuse content