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Who is to blame for the housing crisis?


I’m one of the lucky ones. When I first moved to London in 1978 I lived in a succession of shared houses before saving enough money for the deposit on a flat in Hackney Wick. It cost £27,000 in 1983 – about twice our combined salary – and in 1988 we sold it for £85,000 and moved to Cambridge where we bought a Victorian terrace for £79,000, which is now worth around £500,000.

Since 1978, homes in the East End of London have increased in value ten-fold. My younger self would stand little chance of buying there now.

The main cause of the massive hike in rents and house prices over the past 30 years is the decline in housebuilding. In the late sixties we were building 350,000 homes a year in England. Last year we built a third of that (118,000). The result is a deepening housing crisis.

So who is to blame? Of course the buck stops with our politicians. A recent Ipsos MORI poll found that 86 percent of MPs disagreed with the statement that “there isn’t much that British governments can do to deal with Britain’s housing problem’’. So politicians know that they have the power to solve the problem, but they are caught in the crossfire between influential nimby protestors and constituents who are desperate for homes.

The trouble is that those who oppose new homes have often been more vocal than those who need them. That is why the Homes for Britain campaign is so important.

We need to change public opinion and make the case for housebuilding. But as a founding member of SHOUT, the Campaign for Social Housing, I believe we also need to make affordability a key part of the solution. We should aim to build 100,000 social rented homes a year.

Written by Colin Wiles | Posted on 24th February 2015

Colin Wiles is an independent housing consultant and blogs regularly for Inside Housing. He is a founder member of SHOUT, the Campaign for Social Housing

Website: http://www.4socialhousing.co.uk/

  • Wanda Lozinska

    What about all the houses that lie empty? And those that are under occupied by elderly people, some of whom would be happier in more suitable accommodation should it be available in their area at affordable prices. There are many unused brownfield sites which builders prefer not to build on as it’s more expensive for them to do so. Also there are lots of 2nd homes lying empty for much of the year. Builders also prefer to build 3-4 bedroomed homes, as they are more profitable, but building flats would use up far less land. There are more and more people living on their own but not so many properties designed for singles. People don’t want to live in concrete jungles, we need our green spaces, so more intensive housing, sensitively designed, should help.

    • nae a belger

      The houses that lie empty are owned by someone. If they choose to leave it empty that’s their business.
      As for under occupation by elderly – again that’s their business. If they want to leave great but I am not happy about the prospect of forced moves for the elderly.
      As for your opinions on builders – well why would they want to build where it is more expensive? why would they build property that is less profitable?

      The best solution is to actually abandon the whole planning system.
      Let people build where they want. The cost of property reinstatement is a small fraction of the actual cost due to excessive land costs because we have artificially limited supply.