England’s housing crisis is a is now in fact a disaster ¬ can it ever be resolved?


This Country is suffering a vice like grip of a housing shortage that has been around for decades – why is that then? The biggest, but not only reason, is that we simply don’t build enough houses, do we? Why not for goodness sake?

Is it because we don’t have the available land to build housing on? Er NO, there is a shed load of land already with planning permission – but it is mothballed by the potential builders because its value increases exponentially as time goes by, doesn’t it? (Good for the company balance sheet you see).

Is it because we don’t have the materials to build houses? Er NO, there is plenty of bricks & mortar, concrete, slates, wood, steel, glass, insulation, and all else required, comparatively cheap in the market place.

Is it because we don’t have the trained construction workers with the necessary skills to build houses – like brickies, carpenters, electricians, plasters, painters, pipefitters, steelmen, roofers, scaffolders, labourers, and the like? Er NO, not really, particularly because we have got many skills coming in from eastern European immigration, but the drop-off in funding of in-house apprentices, that we have seen for a few decades, does put a squeeze on resources (good for a bricklayer though who can these days now earn over fifty grand, eh?).

Is it because house builders are struggling financially and don’t have the money to invest in new build? Er, NO, they are making a killing aren’t they? They are more concerned though about their share price dropping than building more houses, surely? The biggest boys are raking in massive profits – Barratt a 45% jump in profits, Taylor Wimpy profit up 68%, Persimmon profit jumped nearly 40%, Berkeley profits rocketed up by 42 per cent, Redrow Bellway streaked to soaring profits of 44 per cent, Galliford Try posted a 20% jump in profit, Bovis profits jump sharply by a 69% rise. Sickening?

Why won’t the builders build more houses then? ‘It is the business, stupid’ to coin a phrase from US President Bill Clinton. It is all about the imbalance between supply and demand, isn’t it? If supply doesn’t meet demand then the price goes up, so the fewer houses you build the greater price you can charge for them, eh? Build a hundred houses and you can say charge £350grand each, but build five thousand houses and the price drops say to £250grand and your massive profits are reduced – the shareholders don’t like that a bit, do they?

Then there is the question of the so called ‘affordable housing’ (social housing) – that is a pseudonym for houses that are at the lower end of the scale (not necessarily reasonably cheap though). House builders don’t want to build them however do they? Why is that you might wonder, when that is what our society desperately needs – properties that the less well off can aspire to buy or live in? Again ‘it is the business, stupid’. As a builder and you have say a mark-up of ten to twenty percent on what you build, then you only make £20grand to £40grand on a £200grand family home property, but if you instead build and sell a £500grand mansion you can stuff £50grand to £100 grand into your company bank account – the shareholders prefer that and the staff bonuses reflect that as well, don’t they?).

The dire shortage of decent cheaper houses not only means a large part of the population is priced out of home ownership, but it also causes soaring rents, poor living conditions, and rising homelessness – not least massively shoving up the welfare cost of housing benefits. [The average cost of a house has now risen to a record over £200grand and the numbers for sale has dropped to record low levels]

Repeatedly our Governments promises, particularly before elections, to build a shed load more houses – but they NEVER do it, do they? [In 2012/13 we built the lowest number on record of houses since the 1920s]. The government’s current target of one million homes to be built by 2020 is seen by most commentators as ‘unobtainable’ – even though inadequate, That is because they have no control over these fat-cat housebuilders, and have repetitively failed to bring in any legislation whatsoever to address the problem – like confiscating tracts of dormant land with planning permission, or forcing private developers to build using punitive planning controls, or hitting the big companies with a windfall tax on their excessive profits (so demand is continuing to excessively exceed supply and prices are rising year on year). No, the Tories have actually done the exact opposite, and have irresponsibly simply fuelled the demand – first perversely substantially subsidising people at our expense (to buy with only five percent deposit and given a twenty percent interest free loan for five years) in a nearly four billion pounds Help to Buy scheme that favoured the rich (involving mansions costing six hundred thousand pounds (three times the average house cost) and even allowing them to buy second properties; some forty percent have ended up with private landlords), and now a new flagship policy to woo working class voters by forcing Housing associations by legal compulsion to sell-off their stock to tenants. Matters aren’t helped either by annual net immigration now hitting nearly three hundred and fifty thousand, is it? This all comes on top of sustained low interest rates, and improved lending from mortgage providers.

The financial crash of 2008 was caused by the banks and their subprime mortgage crisis, when the housing bubble was finally pricked and that led to the longest recession that this Country has ever seen – many say we are stupidly heading in that direction yet again (house prices up at an accelerating rate with ANOTHER near ten percent in the past year alone, and shows no sign of stopping)? Our growing buy-to-let landlords alone owe more than two hundred billion pounds on mortgages. The housing market is heating up fast with lending rising month by month

We apparently need to build over three hundred thousand to a quarter of a million new homes every year to meet needs, but last year we managed just a derisory one hundred and forty-one thousand (much less than half needed)– how does that grab you? Forty-five years ago in England we were able to build over three hundred thousand new houses, but it has dropped practically year on year since.

Why has house building in England all gone wrong then? It is simply because it was local councils that used to build the bulk of our houses – they looked to the needs of their communities didn’t they? PM Margaret Thatcher was the one who put a stop on all that though, forcing councils to sell off their stock at a large discount in a Right-to-Buy initiative, while preventing them financially from replacing the properties – the mass of council houses so sold have then gone into commercial ownership, so have been lost to their communities they served and not as claimed continued to house those intended. These days the houses that councils build have to be handed over to Housing Associations, so local communities have progressively lost out and control, haven’t they?

Is there going to be an end to this fiasco? NO, not under the current Government certainly, despite their ongoing false promises (two hundred thousand properties for first-time buyers and two hundred and seventy-five thousand affordable homes this parliament – dream on everybody?). . The only way that sufficient new houses will be built in England is for the responsibility to be taken away from the grasping private sector wishing only to build top of the pile housing and given back to local communities – our councils – to build social housing to buy and rent and tackle the affordability issue. Of course this will require the estimated significant public investment of a dozen billion pounds, but it will be profitable in the long-term, as well as helping to reduce the welfare budget by some half of that cost.


[Our chronic housing problem needs fixing urgently, and requires vision and big thinking in government – and that has been badly missing hasn’t it?]

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.