Letter: Solutions to the housing crisis

Sir: How many more jobs have to go before the Government gives up its laissez-faire approach to the housing crisis? Nationwide's 300 redundancies are the latest in a long line ('Nationwide to shed 300 staff by closing 58 agencies', 19 January).

While the second-largest building society can weather spiralling mortgage arrears and poor profits by cutting subsidiary operations and laying off staff, smaller societies do not have that luxury.

Bad-debt provision shot up fourfold between 1990-91, analysis by the London Housing Unit of medium-sized societies' accounts reveals. If financial difficulties continue to mount - as seems likely with more than 300,000 borrowers over six months in arrears - the Building Society Commission rules could force them to step up repossessions or face merger with larger lenders.

Further repossessions spell disaster, swelling the glut of empty properties already dragging down prices, destroying any hopes of recovery in the housing market, and condemning thousands more families to homelessness and hardship.

One way the Government can play a role in averting this disaster is to allow councils to take out 20-year leases on repossessed properties to house the homeless. As well as removing the glut of empty homes it would save money on temporary accommodation costs, which are running at more than pounds 1m a day in London alone.

While we do not suggest that this is the magic solution to the housing crisis, it could be a significant step on the road to recovery.

Yours faithfully,

MARGARET MORAN

Chair, London Housing Unit

London, NW1

19 January