1. Governance
April 27, 2016

Here are six possible solutions to Britain’s housing crisis

By Peter Wynne

The housing crisis facing the UK, and particularly London, is rarely out of the news. While those on lower incomes cry out for suitable homes, we’re facing a growing house price bubble, an oversupply of luxury flats, and a government obsessed with home ownership at the expense of renters. We hear a lot about the “squeezed middle”; rather less about the “squashed bottom” being priced out of even the smallest homes.

The causes are numerous and well-rehearsed; but the solutions are less straightforward. How do we make sure the right homes are being built, in the right areas? How do we make London a place where all can afford to live? And how do we make room for a population that continues to grow?

In an attempt to answer some of these questions, UCL recently gathered an expert panel of housing experts for a “Question Time”-style event. Thanks to a lively discussion from the panel and audience, a number of possible solutions were suggested – all of which are ripe for adoption by London’s next mayor.

Change the tax system to encourage building

A Land Value Tax has been suggested for some time. Might this encourage building on those areas of land that are currently being hoarded by developers, eager to see their investment rise in value without breaking ground?

June Barnes, a board member of developer Urban and Civic and former member of the London Mayor’s Design Advisory Group, suggests such a tax could make a difference, but only if brought in with appropriate government powers. Local authorities should be able to purchase unproductive land at its real value – that is, according to its current value rather than its post-development potential – to ensure developments aren’t being stalled by “land banking”.

Similarly, Duncan Bowie from the University of Westminster suggested scrapping stamp duty and replacing it with a tax on development gain, so developers would only pay after the building is finished.

Designate land use for different types of housing

I believe we need more distinct land use categories for housing. There need to be specific designations of land use – for “social housing”, for “family housing”, or for “single dwellings”, for example. Only in this way can local planning authorities build the homes that specific areas need the most.

Content from our partners
The key role of heat network integration in creating one of London’s most sustainable buildings
The role of green bonds in financing the urban energy transition
The need to grow London's EV infrastructure at speed and scale

This would restrict the number of luxury developments in London, which our panel agreed are in oversupply, by approving the types of units needed for occupation rather than the high-rise “safety-deposit boxes” sought by the investment market.

Build on the greenbelt

This may have been expected to cause a mutiny in our panel, but they all broadly agreed with the suggestion. Duncan Bowie described the green belt as “a girdle that is strangling London”, and the rest of the panel agreed.

A 2014 report from the Centre for Cities suggested that, by building on just 5 per cent of the city’s’ greenbelt, we could free up enough space to build the homes we need.

And, contrary to what the name suggests, much of London’s greenbelt is far from green. Biodiversity levels in London’s greenbelt are actually low, so building on it doesn’t mean concreting over our green and pleasant land.

June Barnes suggested building “pocket parks” alongside housing in the greenbelt, similar to the “lungs” built in the Victorian era. This proposal is bound to attract opposition, but it could be a necessary move if we’re going to build the homes Britain requires.

Improve other things that make a house worth living in

Interventions other than building more houses could well alleviate the housing crisis. Building urban expansions along existing transport routes requires that these routes are improved and upgraded. If transport both into and around London improves, we can look further afield to build new houses.

Of course, this will require significant investment, and members of our panel were unimpressed with plans from Labour’s mayoral candidate Sadiq Khan to freeze fares. Such a move would create an enormous black hole in TfL’s finances.

Interestingly that organisation may be facing its own housing crisis: Alice Martin from think tank the New Economics Foundation revealed that 50 per cent of TFL’s staff now live outside London, thanks to house price increases.

Mobilise generation rent

Alice Martin also suggested one of the problems facing “Generation Rent” is that they are not taken seriously by the powers that be. Social housing is a thing of the past, and buying a house is out of reach for most in London, so the number of people in private rented accommodation is growing.

This could be a powerful group, if it were to organise (as is starting to happen in Scotland), and it could wield great influence in London. There are already organisation like Just Space and Priced Out who are working in this field. Austen Reid from Circle Housing said that it would be up to young renters, perhaps through groups like these, to change the narrative against their sector.

Declare a state of crisis in London

This would be a largely symbolic move, but one which may have the emotional effect to get things moving. Our panel suggested declaring London a “housing crisis zone’ or an ‘inequality crisis zone”, then setting the concrete actions needed to move the city out of this status. This should be a stated policy of whoever becomes London mayor.

Another suggestion was for the mayor to set a target for house price inflation to reach zero. Asking prices in the capital are currently 9.5 per cent higher than they were a year ago, but a slowdown has been predicted over the coming months by surveyors. Would having these indicators of the housing crisis public and prominent encourage the mayor to take more urgent action?

Maybe we didn’t end up with a manifesto, after our lively debate – but our audience did identify many of the questions which will need to be addressed by whoever wins the mayoral election next month. “Generation Rent” is waiting for your answer.

Peter Wynne Jones is professor of places and planning at University College London, and a former City of London Planning Officer.

This article is from the CityMetric archive: some formatting and images may not be present.
Websites in our network