A Manufactured Housing Crisis

If the last 13 years of Tory rule, and each Tory rule prior to the current one, has taught us anything, it’s that the only foundations the Tories appear to like laying are the foundations for crisis. Once this foundation is laid, they are expert architects to build, brick by brick, a towering wall that barricades the hopes and aspirations of millions attempting to simply get by and live.

With this in mind, it is perhaps surprising, given their world beating pedigree as builders, that the Tories seem to have very little interest in building actual dwellings, or at least those that the ordinary person (not landlord) can afford.

Indeed, one would have thought that, even with this lack of house building (particularly social housing) that support would at least be given to those who need it. Rather, we have seen the implementation of the infamous bedroom tax, spiralling rents and house prices, exploding homelessness, and a net reduction year on year of the number of available social houses (this despite the waiting list being over a million strong).

Even with the white paper on the abolition of section 21, it still remains in place at time of writing and has spiraled out of control under the Tories, especially during COVID and the lockdowns that came with it.

Take the real example of Anthony from the brilliant book “Tenants”[1] by Vicky Spratt. Anthony had lived in his home in Brighton for 9 years, renting off a landlord who owned several properties in the area. When COVID came around, Anthony, who is a Labourer and Part-time carer found himself, like so many others, furloughed and on just over of what he would usually earn on a monthly basis.

Anthony was living in a house share, or House of Multiple Occupancy (HMO), and in the nine years he had lived in his home, he had paid over £48,000 of rent. What did he have to show for this? Nothing, barring lining the pockets of his already wealthy landlord. £48k would be plenty for a deposit on a property but this money was lost to the land of the landlord.

The dreaded day came for Anthony and at the worst possible time in the midst of a global pandemic: section 21, a “no fault eviction” as it’s often coined used by landlords freely to rid themselves of a tenant for any reason (often none at all) and at any time.

Anthony’s landlord didn’t have the proper certificates to be renting out their property as a HMO and didn’t even have a gas certificate for the property. He was the one breaking the law: but the bailiffs showed for Anthony. Regulation of landlords is frankly a pipedream in Tory Britain, while protections for renters is even more fanciful. Hardly surprising when one considers that 68 Conservative MPs are themselves landlords, including Chancellor Jeremy Hunt and the ever delightful Suella Braverman[2].

Anthonys story is not one set in isolation. It has become all too common as the housing market has geared itself so ruthlessly to putting people into privately renting. Why is this the case?

For years, house building has been very low on the agenda for government. As such, a shortage of housing has driven house prices up and up and up. The consequence of this is natural: if people cannot afford their own home, they are forced to rent and those that can't afford that are left homeless. And so it is that we have a housing economy dominated by landlordism and millions who can only dream of owning their own home. This, of course, hasn’t been made any easier by Liz Truss and Kwasi Kwarteng kamikaze few weeks in charge, driving mortgage rates up even higher, not that they’re sorry or feel they did any wrong. Why should they care in any case? They're millionaires...

Ten years ago, in August 2012, the average house price in the UK was £171,000 and the average price in England was £180,000. Prices in England have gone up by 76% across this period. Wages simply haven’t kept up with this rise and this theme is evident across all regions in the UK (see figure 1)[3]. Certainly something worth bearing in mind when government ministers blame workers for striking for a fair wage: those in government simply do not care and are so far out of touch they’d likely do a better job of managing the country if they gave the task to my cat, and she hates everyone.

(figure 1 – Workplace-based earnings to house price ratios since 1997)

With so many people crying out for housing, it is yet more repugnant that the rise of the private renting sector, motivated and dominated by the profit incentive, has allowed there to exist over 650,000 empty homes in Britain, with this figure having risen by 3.6% in the last year alone[4].

For context, and as a caveat it is of course more complicated than this, there are an estimated 271,000 people homeless in the UK, with 123,000 of these people being homeless[5].

650,000 empty homes.

What is the government doing to quell this crisis then? Well fear not! Our glorious leaders have set a world beating (code for nowhere near good enough) target of building “of 300,000 homes a year by the mid-2020s”. Bear in mind, 271,000 people are homeless with over a million waiting for social housing. Figure 2 shows the progress being made on this front and it seems they are keeping their promise about as well as the 40 new hospitals promise they made.

(Figure 2 – House building figures since 2000)

It’s worth noting here that New Labours time in government also showed not enough houses being built and they do not escape guilt here. Compared to the average European country, Britain today has a backlog of 4.3 million homes that are missing from the national housing market as they were never built.

This housing deficit would take at least half a century to fill even if the Government’s current target to build 300,000 homes a year is reached (which it isn’t). Tackling the problem sooner would require 442,000 homes per year over the next 25 years or 654,000 per year over the next decade in England alone[6]. Of these new homes that are being built, figure 3 shows the number of so called “affordable houses” being built.

(Figure 3 – Affordable houses built since 1991)

Given the mortgage rate hikes consequential of the aforementioned tenure of Liz Truss, claiming many of these houses are actually affordable is frankly insulting. For instance, if you wanted to buy a £200,000 home (below the average UK house price) with a £40,000 deposit (a figure much higher than most people would be able to afford), you would still be paying over £1,000/month before even thinking about utilities and the cost of living. And that’s effectively a best case scenario!

A clear solution here would be the construction of more Social Housing, but unfortunately the “Right to Buy” scheme implemented under Thatcher has put the number of available Social Houses at a dwindling level (hence the 1 Million people waiting for Social Housing currently).

Perhaps rather controversially, I don’t inherently detest Right to Buy. Owning a home is not something that should be out of reach for people simply by virtue of them living in Social Housing. Indeed, without Right to Buy, you have people in a similar circumstance to that of Anthony: paying 10’s of thousands of pounds over many years with little to show for it (although paying into a local Council and having greater protection than in the private sector is clearly better).

The issue with the Right to Buy as it stands is as follows: if a Social home is bought by the tenant, it needs to be replaced with a new Social home or you will have spiraling waiting lists for housing as we do now.

The Tories have no interest in building new Social homes however, and would much rather allow millions to be exploited by private landlords with next to zero protection. Indeed, In England, there are now 1.4 million fewer households in social housing than there were in 1980.

All while, last year alone, 29,000 social homes were sold or demolished, and less than 7,000 were built.

(Figure 4 – Right to Buy has outstripped the number of new Social Houses built in every year since its inception)

Meanwhile, private developments continue and the house prices and mortgage rates for these new properties leave them in the hands of landlords and the very wealthy: and so the cycle continues, worsening each time. What option possibly exists for ordinary people?

(Figure 5 – The number of people in privately rented accommodation has out numbered the number of people in social and affordable housing since the Tories took government in 2010)

(Figure 6 – The availability of Social housing has been decimated in recent years, all while house prices spiral out of control)

It is most befitting of such an incompetent and corrupt government that when an issue such of that as housing explodes into crisis, their response is have a net loss of Social housing year on year. There’s no solution quite like another problem, ay?

These facts and figures have real people behind them, people increasingly struggling day in day out under the weight of Tory cronyism. The housing crisis spills into numerous other facets of public life, only exacerbating other existing crises.

Almost two-thirds of people (63%) say that living in temporary accommodation has had a negative impact on their mental health. Half (51%) say that it has had a negative impact on their physical health. Two in five people (39%) say that living in temporary accommodation has made it harder to access healthcare appointments.

More than two-thirds of families (68%) living in temporary accommodation have been there for over a year, showing this type of accommodation is becoming less and less “temporary” as families cannot escape homelessness due to the severe lack of affordable homes. This is a situation made even worse by the three-year freeze on housing benefit, and cost of living crisis.

Something particularly telling is evident here (something that has whizzed over the smoothed brained of the cabinet). Namely, that if you better the situation in the housing market for ordinary people, you better their expendable income helping ease the Cost of Living crisis. You lessen the mental health needs for people as fewer people will be in insecure housing, helping elevate stress on the NHS. You give people better access to medical appointments, helping create a healthier population. The list goes on and on and on.

This piece gives only a peak into the keyhole of the Conservative made Housing Crisis. The solutions are clear and evident and permeate far further than just housing. A bold approach is needed to give people the change that is so desperately needed. This change will not, and never will, come from a Conservative government.

Bibliography:

1 - Spratt, V., 2023. Tenants. Profile Books Limited.

2 - 7 MPs are now landlords including Chancellor, research reveals – LandlordZONE. 2023. Available at: https://www.landlordzone.co.uk/news/87-mps-are-now-landlords-including-chancellor-reveals-campaign-group/.

3 - Housing in England: Issues, statistics and commentary - House of Lords Library (parliament.uk)

4 - How many empty homes are there in England? | Mortgage Introducer. 2023. Available at: https://www.mpamag.com/uk/mortgage-types/residential/how-many-empty-homes-are-there-in-england/437584.

5 - Shelter England. 2023. At least 271,000 people are homeless in England today - Shelter England. Available at: https://england.shelter.org.uk/media/press_release/at_least_271000_people_are_homeless_in_england_today.

6 - Centre for Cities. 2023. The housebuilding crisis: The UK’s 4 million missing homes Available at: https://www.centreforcities.org/publication/the-housebuilding-crisis/#:~:text=Compared%20to%20the%20average%20European,homes%20a%20year%20is%20reached.