Don't leave house building to the house-builders

Give people a driving seat in housing investment, writes VMC Rozario.

The reality is mortgage finance is never going to get back to the heady days of the early 2000s, nor should it. But with rents rising, saving for a deposit when a lack of supply keeps prices overinflated seems impossible.

I'm part of Generation Rent, a generation unable to access social housing or mortgage finance and left paying more per month for housing than any other group. But I'm also part of a growing generation of people that, unlike their parents, need to find our financial security in something other than the bricks and mortar of their own home.

Whatever the larger debate, we need more homes all sorts of homes, for rent, socially and privately, and to buy.

The question becomes where will this investment come from?

The London Mayor wants a £1.3bn rebate in stamp duty from the Treasury to build 1 million homes by 2050. Yet with the banks holding back on lending and the Government set against going back to a pre-2010 situation of more public subsidy for capital investment in social housing (despite the economic evidence that it could be the short-term kick the economy crucially needs).

Political parties are desperate for a quick fix to this investment problem. Institutional investors, like pension funds, have been incredibly slow to come to the table to kickstart building.

Perhaps we would be better off crowd sourcing investment from the public directly.

There are a growing number of success stories of start-ups who have gone directly to large groups of ordinary savers/investors through websites like Kickstarter. Although the model isn't directly transferable, the principle is. Get people to invest in housing other than their own. Around 1 million plus private landlords in the UK are doing and making a profit out of it, so why not make more of us landlord investors?

That doesn't mean becoming a country of buy-to-let investors, but if more people want to invest in housing other than their own why not tap into that?

Some might scoff at the idea given the economic climate but actually there are two things that mean we should look at it seriously. Firstly we already have a model of public savings that has grown in sufficient volumes to take seriously.

When Premium Bonds were created by Harold Macmillan government in 1956 the aim was to control inflation but also to encourage saving in post-war Britain. On their first day £5 million worth of bonds were sold and by 2006 improvements in accessibility and a desire for safer investments than the stock market saw 23 million people (then around 40 per cent of the British public) hold premium bonds.

The ability to bring together savings from such a broad section of society (1.6 million of those bond holders had saved only a reasonable £5,000) should be something to replicate in housing investment, especially as housing is relatively stable and long-term investment.

Now National Savings and Investments manage over £100 billion in ordinary people's savings. Imagine if a separate housing fund was launched. There is something powerful about the idea of a family growing into habit of saving, with the added bonus that their investment has helped a housing association deliver them a home and keep house prices and rents down is a bonus. Unlike dead rent, in time those savings could fund a deposit on their own home, university fees or even retirement costs.

The second indicator that this general idea, people investing in housing other than their own, needs closer inspection is that where housing associations have dipped their toes in retail bond issues they have generally had their feet bitten off. Steve Binks, Places for People's Finance Director told the Communities and Local Government Select Committee last year about their experience of reaching out to private investors:

We went out with a relatively small issue, or ambitions for a relatively small issue of £25 million to £50 million. That was our initial asking and we were surprised-almost overwhelmed-by the demand. We ended up raising £140 million in two weeks from people who would invest money with us for five and a half years, put it into an ISA at-I think the interest rate was 5 per cent.

Moreover there's enormous scope of innovation and creativity in this space to give ordinary people a stronger say in housing investment. More work should be done to think and test how this could help communities fund more housing locally, how housing associations could come together to utilising the wealth of savers in the south east (who unsurprisingly save the most) to fund affordable housing across the country and how investments could be made as easy to buy and manage as a premium bond.

A sign marks a plot for sale on a housing construction site on in Swindon, England. Photograph: Getty Images

V M C Rozario is a pseudonymous former housing professional and a member of Generation Rent.

ELLIE FOREMAN-PECK FOR NEW STATESMAN
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The triumph of Misbah-ul-Haq, the quiet grafter

How Misbah redeemed Pakistani cricket.

It was an incongruous sight: the entire Pakistani cricket team doing press-ups on the revered pitch at Lord’s, led by its captain, Misbah-ul-Haq. This unusual celebration marked not merely a Test match victory over England on Sunday but something greater: the rehabilitation of Pakistani cricket.

Seven years earlier, the Sri Lankan team bus was en route to the cricket stadium in Lahore for the third day of a Test match against Pakistan when it was attacked by Islamist militants. Gunfire killed six police officers and a driver; several Sri Lankan cricketers were also injured. That was the last Test match played in Pakistan, which, despite protestations, opponents consider too dangerous to visit.

A year later, Pakistan toured England for a Test series. The News of the World alleged that in the final match at Lord’s three Pakistani cricketers had conspired to bowl no-balls in exchange for money. All three received bans of five years or more for corruption. The entire squad was lampooned; police had to shield its members from abuse as they arrived home.

Misbah was on the periphery of all of this. Aged 36 at the time, he was dropped from the squad before the English tour and seemed unlikely to play international cricket again. But the turbulence engulfing Pakistani cricket forced the selectors to reassess. Not only was Misbah recalled but he was made captain. “You have to ask yourself,” he later said: “‘Have I been the captain because they supported me, or because they had no alternatives?’”

Pakistani cricket prizes and mythologises teenage talent plucked from obscurity and brought into the international side. During his decade as captain, Imran Khan picked 11 teenagers to make their debuts, often simply on the basis of being wowed by their performance in the nets. Misbah shows that another way is possible. He grew up in Mianwali, a city that was so remote that: “The culture there wasn’t such that you thought about playing for Pakistan.”

At the behest of his parents, he devoted his early twenties not to his promising batting but to gaining an MBA. Only at 24 did he make his first-class debut, strikingly late in an age when professional sportsmen are expected to dedicate all their energy to the game from their teenage years.

Pakistani cricket has always been “a little blip of chaos to the straight lines of order”, Osman Samiuddin writes in The Unquiet Ones. Misbah has created order out of chaos. He is unflappable and methodical, both as a captain and as a batsman. His mood seems impervious to results. More than anything, he is resilient.

He has led Pakistan to 21 Test victories – seven more than any other captain. He has done this with a bowling attack ravaged by the 2010 corruption scandal and without playing a single match at home. Because of security concerns, Pakistan now play in the United Arab Emirates, sometimes in front of fewer than a hundred supporters.

Misbah has developed a team that marries professionalism with the self-expression and flair for which his country’s cricket is renowned. And he has scored runs – lots of them. Over his 43 Tests as captain, he has averaged at 56.68. Few have been so empowered by responsibility, or as selfless. He often fields at short leg, the most dangerous position in the game and one usually reserved for the team’s junior player.

Misbah has retained his capacity to surprise. As a batsman, he has a reputation for stoic defence. Yet, in November 2014 he reached a century against Australia in just 56 balls, equalling the previous record for the fastest ever Test innings, held by Viv Richards. The tuk-tuk had become a Ferrari.

Late in 2015, Misbah tried to retire. He was 41 and had helped to keep Pakistani cricket alive during some of its darkest days. But the selectors pressured him to stay on, arguing that the team would need him during its arduous tours to England and Australia.

They were right. His crowning glory was still to come. The team arrived in England following weeks of training with the national army in Abbottabad. “The army people are not getting much salaries, but for this flag and for the Pakistani nation, they want to sacrifice their lives,” Misbah said. “That’s a big motivation for all of us. Everyone is really putting effort in for that flag and the nation.”

Now 42, almost a decade older than any cricketer in England’s side, Misbah fulfilled a lifetime’s ambition by playing in a Test match at Lord’s. In Pakistan’s first innings, he scored a century and celebrated with push-ups on the outfield, in homage to the army’s fitness regime and those who had had the temerity to mock his age.

When Pakistan secured victory a little after 6pm on the fourth evening of the game, the entire team imitated the captain’s push-ups, then saluted the national flag. The applause for them reverberated far beyond St John’s Wood.

“It’s been a remarkable turnaround after the 2010 incident,” Misbah-ul-Haq said, ever undemonstrative.

He would never say as much, but he has done more than anyone else to lead Pakistan back to glory. 

Tim Wigmore is a contributing writer to the New Statesman and the author of Second XI: Cricket In Its Outposts.

This article first appeared in the 21 July 2016 issue of the New Statesman, The English Revolt