Conditions are right for the large-scale social housing that the UK urgently needs. Why wait?

The problem is how to help the millions who have no chance of ever being able to shoulder a mortgage


What is the answer to the housing shortage? Given demographic trends, and the inevitable increase in immigration to the UK, there seems little chance of demand falling away soon, even in areas where the recovery has been subdued.

In go-go London, the inward flow of investment bankers and mini-cab drivers alike means that the National Housing Federation’s forecast of an average house price of £650,000 in the capital by 2020 may turn out to be an undershoot. Meanwhile, the taxpayer picks up the cost of escalating claims for housing benefit, as rents skyrocket. Even with the Government’s cap, which is necessary, these claims are liable to grow.

Reducing the cap imposes an unacceptable cost on the poorest, and pushes labour out of areas of high demand. One rational answer – to choke off speculative property demand by applying capital gains tax to primary residences – is politically unthinkable.

So the answer is “increase supply”. The good news is that this is not so difficult. The various schemes to oblige developers to allot a certain percentage of any schemes to “affordable” homes suffer a fundamental weakness – they target those in range of buying their own place, by definition the relatively well-off, and they are small in scale.

The problem is how to help the millions who have no chance of ever being able to shoulder a mortgage. This is where the National Housing Federation is wrong. Living in warm, dry, safe accommodation might be a human right; to own the title deeds patently is not.

In fact, the Government could return to the lost world of post-war politics, where housing ministers on the make – including a One Nation Tory by the name of Harold Macmillan – set ever more ambitious plans for council housing at elections. A half-million target for new homes over five years was the usual entry-price to the national debate.

Some poor designs resulted, and the vast sums of cash swilling around the system fuelled corruption. In addition, some of the worst works of well-meaning architects had to be dynamited ahead of their natural lifespan. At the same time there was a great addition to the housing stock, the majority of it still standing. Social housing, though in shortage (memorably portrayed in the 1960s TV drama Cathy Come Home), was not, as now, in crisis. We have every reason to repeat what we did then, especially as the dearth in house-building of any kind since the 1980s has rapidly aged the national housing stock.

The cost of borrowing for the Government is now so low that a large-scale programme could pay for itself, even at lowish rents. It would boost the economy and jobs. Rents could be set at levels that were sub-economic, but still offer a payback over the life of the stock – half a century plus. We would save on benefits.

The problem is another shibboleth; the “right to buy”. This guarantees a loss for the taxpayer, on any programme of social housing. Witness the row over the under-pricing of Royal Mail shares by, say, £2bn. And yet the discounts offered to ex-tenants exercising a “right to buy” since the 1980s is probably somewhere between £50bn and £100bn: the largest transfer of wealth since the Reformation.

There is no point in spending billions on social housing just to flog it off at a 40 per cent discount in a few years. Therefore we need to abolish the so-called right to buy and pledge to build half-a-million social homes. Now, which One Nation party is going to suggest that at the next election?

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

Marketing Manager - Leicestershire - £35,000

£30000 - £35000 per annum: Ashdown Group: Marketing Manager (CIM, B2B, MS Offi...

Marketing Executive (B2B and B2C) - Rugby, Warwickshire

£22000 - £25000 per annum: Ashdown Group: A highly successful organisation wit...

SEN Coordinator + Teacher (SENCO)

£1 per day: Randstad Education Leeds: Job Purpose To work closely with the he...

Research Manager - Quantitative/Qualitative

£32000 - £42000 Per Annum: Clearwater People Solutions Ltd: Our client is curr...

Day In a Page

Read Next
Piper Ryan Randall leads a pro-Scottish independence rally in the suburbs of Edinburgh  

i Editor's Letter: Britain survives, but change is afoot

Oliver Duff Oliver Duff
Some believe that David Cameron is to blame for allowing Alex Salmond a referendum  

Scottish referendum: So how about the English now being given a chance to split from England?

Mark Steel
Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments
These Iranian-controlled Shia militias used to specialise in killing American soldiers. Now they are fighting Isis, backed up by US airstrikes

Widespread fear of Isis is producing strange bedfellows

Iranian-controlled Shia militias that used to kill American soldiers are now fighting Isis, helped by US airstrikes
Topshop goes part Athena poster, part last spring Prada

Topshop goes part Athena poster, part last spring Prada

Shoppers don't come to Topshop for the unique
How to make a Lego masterpiece

How to make a Lego masterpiece

Toy breaks out of the nursery and heads for the gallery
Meet the ‘Endies’ – city dwellers who are too poor to have fun

Meet the ‘Endies’ – city dwellers who are too poor to have fun

Urbanites are cursed with an acronym pointing to Employed but No Disposable Income or Savings
Paisley’s decision to make peace with IRA enemies might remind the Arabs of Sadat

Ian Paisley’s decision to make peace with his IRA enemies

His Save Ulster from Sodomy campaign would surely have been supported by many a Sunni imam