Tories have terrible housing ideas
I’ve just read the Conservative Party’s Green Paper on Housing. Housing policy is a vitally important issue, affecting the lives of millions of people. It is arguably nearly as important an issue as one politician sending an e-mail to another politician with gossip about some other politicians. The Paper is also quite stunningly awful.
The green paper says that we need to build more houses. It then lists a range of policies designed to reduce the number of houses which will be built. Councils will no longer be required to build a certain number of houses (because this is central targets and is bad), it will be easier for councils to prevent developments (e.g. by designating land as green belt or stopping eco-towns), and opponents of housing developments will have more opportunities to try to stop housing developments in their backyard.
But more houses will be built, because The Market Will Provide. The Planning Delivery Grant which allocated £510 million to local councils will be scrapped, and instead the money will be used to give councils an amount equal to the council tax for the property for each new house built in their area.
So the way to build more new houses, according to the Conservatives, is to allocate the same amount of money in a different way to local councils, while making it harder for developers to build houses. And instead of lots of nasty flats being built, this will also result in larger houses suitable for families being built, with gardens, and a pony.
On page 8, the paper “proves” that the building of flats cannot have been a reaction to market demand because an opinion poll found that half of people aspire to live in a detached house, and only 3% in a flat. This is a point that only even begins to make sense if you believe that unregulated markets always deliver the goods and services which people would like to receive, and ignore the fact that converting family houses into flats has been an extremely profitable activity for quite a number of people over the past few years. And if you believe that in this day and age, I’ve got a Credit Default Swap that you might be interested in.
Moving on, there are pages of drivel about social housing and dependency, and a consistent confusion between homelessness and rough sleeping, but the private rented sector merits only a brief mention (page 34). It praises the role of private landlords and claims that the Conservatives will look to see how the burden of regulation on them can be eased.
This is interesting because it is an example of the Conservatives sticking up for the rich (buy-to-let landlords) against ‘Middle England’ (the people who suffer from bad landlords who are only interested in making a profit, regardless of the effect on the area). Not all landlords are like that, but you can guarantee that the Conservatives won’t be publicising this policy in marginal constituencies where there are high levels of multiple occupation housing – as it is absolute political poison with private tenants and home-owners alike.
Taken together, these two policies reveal a lot about the Conservative approach. There is a desperate need for more housing, but the effect of their policies will be to reduce the number of homes built, causing more misery and suffering. They place their faith that less regulation and leaving things to the market will magically solve problems, in defiance of the evidence. And the only group of unpopular people who they are prepared to stick up for and shower with praise are those that spent most of the last decade enriching themselves at the expense of local communities.
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Don Paskini is deputy-editor of LC. He also blogs at donpaskini. He is on twitter as @donpaskini
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Story Filed Under: Blog ,Conservative Party ,Economy ,Think-tanks ,Westminster
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Reader comments
“an opinion poll found that half of people aspire to live in a detached house, and only 3% in a flat.”
Similarly, an opinion found that half of people aspire to drive a Ferrari, and only 3% a Smart Car, so sales of all cars with fewer than four doors have been banned.
Meh. A Hummer, rather than a Ferrari, otherwise that makes no sense.
“They place their faith that less regulation and leaving things to the market will magically solve problems, in defiance of the evidence.”
If they left it to the market they’d abolish planning controls and the green belt. What they seem to be proposing is the creation of a rigged government-distorted market (or rather altering the distortions in an already distorted market).
It was actually the Tory Ferdinand Mount who in his interesting book, Mind the Gap, proposed that planning laws should be eased so that those on law incomes could afford to build and buy houses in the countryside. Can’t see this going down well with the environmental lobby though.
That said I can sympathise with those who don’t want a block of flats built in their back yard.
Welcome to the Future.
Thanks Labour, thanks for making this possible.
Strange that much of Europe works quite well on the basis of renting from private landlords.
And they allow far greater movement of labour of course.
Tried moving from one council property to one in another area??
Obviously we need both public and private don’t we?
Strange that much of Europe works quite well on the basis of renting from private landlords.
With stringent rent controls and assured tenancy, would be the difference.
In the UK, if your b-t-l landlord goes bust, you can be kicked out of your home on no notice – annoying if you’re a student or 20something renting, but an absolute disaster if you’re a family.
There’s no way in hell I’d rent privately if I had kids, unless there was absolutely no other option financially.
This is a poor show.
The government considers (and I am sure the Tories agree) that it is reasonable to expect job-seekers to travel for an hour and a half to reach their place of work. I doubt there is any workplace within Greater London that is more than an hour and a half’s travelling time from the Greater London boundary (the M25 give or take a bit).
It follows that there is no need whatsoever to provide social housing for lower-paid workers (let alone anyone else) in the Greater London area. The 800,000 social housing units in the capital therefore represent a magnificent redevelopment resource. Whilst some of them are probably worth only site value (less demolition costs) others are worth a lot more. For example, in Westminster and Kensington & Chelsea there are 32,000 social housing “units” (probably almost all flats and maisonettes) – these (Tory) authorities have few if any “problem” estates and manage and maintain their property well.
Assuming that these units can be sold for £250k each the abolition of social housing in these two boroughs alone will raise £8bn. A cautious valuation of the rest of London’s social housing stock at three times the value of that in those two boroughs gives a further £25bn or so – given that these are very rough figures the total value of the sale is probably about £30-40bn. This could be applied to the incentivisation of entrepreneurs, e.g. grant aid to tax exiles to enable them to return to the country of their birth which they so dearly love and miss.
There would of course be no need to make alternative arrangements for the tenants, as the market will provide. And of course the Labour Party will never win a Parliamentary seat in London again, which given that the demand from Conservative candidates for a safe London seat far exceeds the supply represents a further market rectification of socialist distortion.
Now, shall I tell Dan Hannan or will you?
Not that I’m a Tory or anything, but your critique is really grasping at straws.
For a start, changing the Planning Delivery Grant to a scheme where councils get money for each house built sounds pretty sensible to me. If you want more houses built, it seems reasonably obvious that actually giving local authorities positive incentives to allow developers to build will actually make councils more likely to approve planning permission, rather than less as you claim.
In the report, as opposed to your mischaracterisation of it, a lot more is said about the relative numbers of flats and houses being built. For one thing, they cite a change in planning laws introduced in 2000, which is (as demonstrated by their helpful graph) precisely when the proportion of flats being built started to rise, and the proportion of houses being built started to fall. I’m no expert, but the conclusion they draw – that changes in planning permission rules changed the balance between flats and houses – seems like a perfectly reasonable one given the data.
I’m sorry but your points about easing regulations on landlords being some kind of bonus to them alone makes no sense at all unless you assume the supply of rented accommodation is unaffected by existing regulations, with the tenants gaining all the benefits and landlords bearing all the costs. Needless to say, this doesn’t exactly square with basic economics or empirical evidence (such as rent control in New York).
In reality the burden of regulation produces some mixture of landlords providing less accommodation and tenants paying more rent.
‘In the UK, if your b-t-l landlord goes bust, you can be kicked out of your home on no notice – annoying if you’re a student or 20something renting, but an absolute disaster if you’re a family.’
I’ve had experience of that. Assured tenancy might well be a good idea to encourage. Rent controls are not such a good idea as they will distort market signals in the development of new housing. But the most important thing is to de-regulate planning, else you are just handing a license to print cash back to the buy to letters, rather than a license to compete for custom. It is a shame the Tories cannot be encouraged to be consistent free marketers in this respect.
The first action of a housing policy for an incoming Tory Govt should be to restrict immigration.
Just quick replies, more later:
8 – http://www.bickerstafferecord.org.uk/?p=630 says better than I can what the effect of the changes in funding allocations will be.
9 – of course, we don’t know what regulations the Tories actually want to remove, which makes the whole argument a bit abstract. But what’s needed (and would be popular) are additional regulations which give more protection to tenants, generate more resources to spend on improvements to the local area and reduce the profits which landlords make and drive the bad landlords who are only interested in making a quick buck out of the business altogether.
There’s much more terrible stuff in this report, by the way, which I’ll link to when I get a chance.
But my best landlord was only ever interested in making a quick buck. That is the great thing about a well-functioning market. You don’t need to rely on the altruistic motivations of the actors.
By contrast, one of the worst has been owned by a council. They can’t/won’t even fix fairly essential shared security doors. Do you think councils and their workers have intrinsically better motivations than collecting their pay checks?
My favourite bit of the report is on page 29 where they propose insecure tenancies in substandard housing they admit is unfit for kids so tenants can be kicked out when prices rise.
I’d appeal to everyone to read the report for yourself so you can see just how terrible it would be to have a government that would screw the working class over a great deal, rather than just a moderate amount. The Tories really haven’t learned lessons about deregulated markets – this report, if enacted, would make it possible for a handful of rich people to play clever games to try and increase value and make a quick buck.
It’s Old Etonians playing games with people’s lives.
Dan – great piece
Like you, I’m finding the interrelated unmitigated awfulness of it all hard to come to terms with in a single post, so will be doing several, no doubt linking with yours and other commenters (here) thoughts, but i think the plan to put people – families are named as the main target – in homes that are not in the currently available social stock BECAUSE they do not meet the basic standard, on insecure tenancies, specifically so that social housing organisations can sell them on for profit later when the tenants have done the up, is the one that really takes my breath away just now.
Well done on starting the outing of this.
I think I may come out of retirement after the General Election!
People do not realise S England is very densely populated. Water supplies are in adequate for future demand. In reality Britain is over populated at 60 million, a figure of 40-50million would be more realistic. If population increases to 70 million with the majority of the increase in S England then there will be serious problems.
We need to increase manufacturing in N England, Wales and Scotland and reduce our reliance on financial services in S England. In fact there are are large areas of semi-derelict property in the former industrial areas and there are sufficient water resources for the increased population.
Part of the cause of our housing problems alomg with many othere is our over reliance on the financial services based in S England. Improve our technical skills. Listen to Dyson and Cable and we can once again become a robust economy with a common sense balence between finnancial services and manufacturing and between S England and the rest of the country. If we can set up well paid jobs in manufacturing industries in the former industrial areas of the UK we will relieve much of the pressure on S England- housing, transport, utilities and open space.
Also we need to look at the quality of continental flats . There is no social stigma living in flats in continental Europe. Friends have flat with large hall, 3-4 bedrooms, 2-3 reception rooms, large balconies where the family of 5 or 6 can take lunch and dinner; underground parking with 2 secure spaces and a shared gardens with private entrances . By dividing the cost of land , foundations and roof between 5 or 6 flats greatly reduces their constructions costs. The problem in this country most flats are very poorly constructed and therefore considered only suitable for the poor or first time buyers. By constructing more flats, using solar or ground heating systems are more cost effective than if individual houses are built.
Housing is a complex issue . Herbert Morrison said he will build the Tories out of London. If we want good quality housing built in a cost effective manner, then this left /right tribalism will have to end.
Chalie:
People do not realise S England is very densely populated. Water supplies are in adequate for future demand. In reality Britain is over populated at 60 million, a figure of 40-50million would be more realistic. If population increases to 70 million with the majority of the increase in S England then there will be serious problems.
So…whom do we kill/sterilise/deport? (a question which could equally be directed at chavscum, btw)
Okay, I’ve read what follows as well, but doesn’t that smack of having a planning policy for the regions, of trying to encourage the ‘market’ so that the economy flourishes in the whole of the country? Wouldn’t that also take planning on infrastructure (e.g. high-speed rail lines)? Wouldn’t that all require some form of co-ordination…you know, the thing that governments are elected to do? Between New Labour’s obsession with PFI and PPP (as well as its the problems with its devolved regional strategies), and the Tories’ faith in deregulated markets, I’m not holding my breath that both major parties just want to get the housing bubble inflating again.
18.redpesto. Coordination- entirely agree. I suggest we look at at Germany and particularly France where they can construct high quality infrastructure projects on time and to budget. I suggest we look at our civil service . Having engineers with further training in management run out Depts of Energy, Transport and Industry would help rather than having someone with a degree in “Greats ” would help.
One aspect which would make social housing less problematic would to demand that tenants do not disrupt their neighbours in the early hours of the morning or let their front gardens look like scrap heaps. Bad tenants drive out good tenants and produce slums.
Hopefully a decline in the financial sector will reduce the demand for low skilled and low paid service sector jobs in London and therefore reduce the demand for cheap housing. It is time that well paid people learnt to clean their homes, cook food, undertake fitness training without a personal coach, do without nannies, paint their their bedroom without employing a decorator and genrally run their lives without vast numbers of paid helpers.
@14: bloody hell. They really are evil, aren’t they?
@19 It is time that well paid people learnt to clean their homes, cook food, undertake fitness training without a personal coach, do without nannies, paint their their bedroom without employing a decorator and genrally run their lives without vast numbers of paid helpers.
Err, *why* is it time for that? If we’re going to have people paid enormous sums for playing financial games, it’s better that they provide employment for dozens of others than spend all the money on diamond-plated Rolexes…
tim f @ 14
I’d appeal to everyone to read the report for yourself so you can see just how terrible it would be to have a government that would screw the working class over a great deal, rather than just a moderate amount.
Thank you, but I’ve already seen and read enough (see welfare ‘reform’) to know that 2010 will offer a choice between the bad and the worse.
Sorry: first para, quote; second para, me.
@22, just to be clear, which way round are you classing that? IIRC the recent welfare reform stuff is Labour (or did I miss the Tories’ even-more-evil proposals on that?)
John B – I think you did miss the Tories’ even-more-evil proposals on welfare reform.
On that issue there sadly isn’t much difference between the proposals, but for example the Tories want to bring private companies in to manage individuals at an earlier stage – which is bad for the individual and also allows private companies to cream off more profit because the Tories ignore figures about how long it takes most people on JSA to find a job of their own accord (ie the private companies would be paid to get people jobs who statistically would be highly likely to find themselves jobs on their own).
john b – it’s probably more fun for you to choose: either way round, it’s a race to the bottom (or to introduce workfare, whichever is the lower)
“In the UK, if your b-t-l landlord goes bust, you can be kicked out of your home on no notice – annoying if you’re a student or 20something renting, but an absolute disaster if you’re a family. ”
Forgive my ignorance, but tenants with an assured shorthold tenancy are entitled to 2 (or in exceptional circumstances, where the tenant is in considerable default, 1) months’ notice under s.21, Housing Act 1988.
In addition, where the landlord goes bankrupt, the position of others affected by the bankruptcy can be taken into account by the court in the first 12 months after the bankruptcy order iteself – although after that period, the presumption is that the interest of creditors will prevail.
This is no different to the situation where the landlord requires possession and serves a section 21 notice without having been made bankrupt.
There is, as I understand it, no other lawful process for the landlord or his trustee in bankruptcy to obtain possession from an Assured Shorthold tenant – if someone can point to some other piece of legislation or principle, then please let me know …
20 john b. London has an unbalenced economy, a few people earning a small fortune employing low skilled low paid help who have to pay high rents to live in the city. Consequently landlords can charge relatively high rents for poor people to live in overcrowded and poor accommodation.
Large numbers of poor people put stress on public services . The wealthy do not use the public services and therefore are not aware of the problems. The result is a small very wealthy group who live in a totally isolated cocoon divorced from the practical realities which face 90% of the population.
@26 one month’s notice, when you expected 6, approximates to ‘no notice’ by European standards. ok for studenty/yuppie flatsharing, no good for families
So The Tory party is still siding with the Nimbys rather than the homeless.
No change there from call me Dave.
@28; john b – in normal circumstances where the tenant is not in default, the minimum period of notice from a landlord is 2 months for an assured shorthold tenancy – this is not changed as a result the landlord’s bankruptcy.
Most tenants are able to give a single months’ notice to quit.
These periods have not be changed since 1988! On what basis would you expect 6 months’ notice – you could negotiate a longer notice period with a landlord, but then that would probably come with a demand for a larger deposit that the single months’ deposit.
If anyone has info that I have got some of this wrong, please let me know.
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