James Murray is a Labour councillor and executive member for housing and development for the London Borough of Islington.
In his second “State of the City” address earlier this year, New York City’s Democrat mayor Bill de Blasio focused almost entirely on one issue. The issue in question is an overwhelming pre-occupation for everyday New Yorkers. Although he didn’t use these words, de Blasio could have titled his speech, “It’s housing, stupid.”
In London, as Labour’s mayoral candidates begin their battle for selection, housing is set to be a pre-occupation for them, too. Both cities are suffering a crisis of affordability: rents are rising faster than wages, too few affordable homes are being built, house prices are soaring. As we move on from our bruising general election result, London – where Labour had great success – needs mayoral candidates who have clear and bold plans on housing. So are there any insights our candidates could gain by looking at New York’s approach?
Not long after de Blasio’s address, I had the chance to learn more about his city’s approach to affordable housing – set out in “Housing New York: A Five-Borough, Ten-Year Plan” – when I met his deputy mayor for housing, Alicia Glen, at Manhattan’s City Hall (for the record: on a personal trip over a bank holiday). Whilst London and New York have very distinct contexts that make direct comparison difficult, taking a look at some of the differences and similarities between our two cities’ approaches shines an interesting light on the debate in London.
First, most obviously, a big difference: in New York there is no equivalent to council home-building. The New York City Housing Authority houses around 400,000 New Yorkers in existing dwellings, but local government is not building any more right now. Whilst New York uses planning and tax systems to secure affordable housing, there is no state building programme.
Compare this to London where, despite a national climate averse to public home-building, the boroughs are keen to build again. Our difference here is to our advantage – London’s Mayor should actively support councils to build, as well as looking to take on a direct development role through City Hall.
Second, there is a strong emphasis on “preservation” of affordability in de Blasio’s plan – keeping rents down in existing homes. The plan’s target of 200,000 affordable homes over 10 years comprises building 80,000 new homes, and “preserving” affordability in 120,000 existing ones. Towards this goal, de Blasio is trying to keep rents down in the million-or-so rent-regulated apartments in the city. He appoints members of the Rent Guidelines Board – the body that limits rent rises for these apartments – and, for what would have been the first time in nearly half-a-century, they came close to agreeing a rent freeze this year.
Furthermore, de Blasio has called on the state legislature to strengthen other laws that cover rent-regulated apartments, such as ending “vacancy decontrol” – a step that would stop landlords being able to hike rents between tenants.
Whilst building new homes has dominated the debate in London, the principle of keeping rents down in existing home should be central, too. With no Labour government to introduce rent limit legislation, our mayor should be the leading advocate for powers over rents – like being able to limit and freeze their rises, and to control how rents change between tenancies.
London mayor Boris Johnson: the man with no plan in particular. Image: Oli Scarff/Getty.
We also need to fight to “preserve” affordable housing more widely. The coalition’s decision to let housing associations “convert” their homes to near-market rents meant around 10,000 homes for social rent were lost in the last parliament. With this policy now likely to continue, and to be joined by the forced sale of council housing and an extension of the right-to-buy, the fight to preserve affordable homes will become increasingly urgent.
Third, New York makes greater use of bonds and pension fund investment in housing. The city is set to invest $6.7bn over 10 years through bonds raised against future income from tax the city controls.
In London, the sources of investment are different; City Hall here does not have comparable financial control. We have therefore been arguing for greater grant, greater powers for councils to invest more, and so on.
But what if we got greater financial control devolved to London’s mayor? Could we potentially use devolved tax powers to raise additional housing investment through bonds? We would need a hands-on mayor to make this happen – as we would with pension investment, which has been long talked about in London, but slow to come forward in significant amounts.
The gentrification question
Fourth, there is a tension in New York that is central to the London debate too: who benefits from the apparent “success” of our cities. As both cities have become more sought-after and seen their populations rise in recent decades, similar debates have raged over the damage that gentrification can cause to existing communities.
Both cities need to find a way to make sure success benefits local people, rather than just feeding landowners and speculators. As de Blasio put it, it’s about “making sure the same pressures that have pushed New Yorkers out of their neighbourhoods are harnessed to build the next generation of affordable housing.”
In London, many boroughs try to “harness” these pressures by applying affordable housing requirements to developers’ schemes. To a similar end, a centrepiece of the plan de Blasio and Glen are leading is what they call “Mandatory Inclusionary Zoning” (catchy phrase, I know). In a nutshell, this means certain areas in New York will be “re-zoned”, thereby accommodating more housing – and in return for being allowed to build more homes, developers will be required to offer a to-be-announced proportion as affordable.
The policy has sparked far more debate than we can explore here. It differs from the approach that Ken Livingstone led in London, in that it only applies mandatorily to additional housing capacity in certain areas, rather than to all developments citywide.
But as New York looks to introduce and enforce a target for affordable housing, it reminds us how sorely lacking this approach has been in London under the current mayor. He has let even meagre requirements for affordable housing be pushed aside on the basis of spurious “viability” arguments. This must urgently be set right by his successor.
Finally, local media in New York reports anxiety amongst tenants about their future in an area when re-development is afoot. Deputy mayor Glen made clear in a recent interview that she understands how important this is, saying she is “really serious about making sure communities that are there have the right to stay there”.
This is an important principle for London, particularly when the prospect of “estate regeneration” is being discussed. We need to make clear that we are really serious too about putting existing tenants first, by avoiding talking in sweeping terms about the mass redevelopment of estates across our city. If greater density is being advocated in London, we need to make the local case for it, as many councils already do – for instance, by guaranteeing local lettings for existing tenants, investing in other estate improvements, and considering where infill options are possible instead of full demolition.
We know London’s housing crisis demands an approach that will challenge the fundamentals, rather than tinkering round the edges. But as in New York, London has neither a simple nor single housing crisis; we have a collection of millions of individual housing crises.
Yes, our mayoral candidate needs a big plan with large numbers and bold reforms – but they also need to promise individual Londoners a plan that credibly offers them and their family hope.
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