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Every Briton deserves the chance to own a home

In seven years, the Conservatives have failed on housing – it’s up to Labour to give middle Britain hope again, writes John Healey MP.

It’s almost seven years since David Cameron entered Downing Street. Tory Ministers might still like to blame Labour for the country’s problems but that excuse is sounding increasingly desperate. Nowhere is that more true than on housing.

Seven years in, the record of Conservative Ministers on housing is one of failure – on all fronts. In fact, there are few areas of domestic policy where they’ve been so disappointing, and where the gap between Ministers’ rhetoric and the reality for the public is so wide. It’s part of the reason why Labour retains a lead in the opinion polls on housing, with the NHS the only other issue for which this is true.

Ahead of a long-delayed housing relaunch and White Paper scheduled to be published any day now, it’s worth remembering the Conservatives’ record in the last seven years: the number of homes being built fell to the lowest level under any peace-time PM since the 1920s, rough sleeping homelessness has more than doubled since 2010, the number of affordable sub-market homes fell last year to the lowest level in 24 years, with the number of genuinely affordable social rented homes sinking to the lowest level since records began. Meanwhile, spending on housing benefit has risen by £4bn-a-year despite swingeing cuts, as the benefits system has had to try to do more to plug the growing gap between housing costs and household incomes.

But while people recognise – and perhaps by now expect – Conservative failure on homelessness and on affordable house building, I have also made it my mission to see that Labour focuses on an area of housing failure where Tory governments traditional pride themselves – home ownership.

An underappreciated fact is that under a Labour government from 1997 to 2010 a million more households became homeowners, but since 2010 the number of homeowners has fallen by 200,000. For young people it’s in free-fall, with over a third of a million fewer under-35s who now own their home than in 2010.

The fall is starkest amongst those on low and middle incomes, and spread across the regions – in Yorkshire and the East Midlands, not just in London and the South East. This is a big problem for Conservative politicians who have tried to take the mantle as the party for homeowners. It shows starkly that housing pressures aren’t just getting worse for those at the sharp end of the housing crisis. This is hitting middle Britain, too.

Alex Morton, one of David Cameron’s advisers, admitted: “This housing crisis, and the related feeling of unfairness, is the one thing Labour under Jeremy Corbyn could use to claw back into power. “So after a US election, during which Donald Trump’s supporters widely touted the fall in home ownership as an example of how ordinary Americans were shut out of the gains of national economic success, the Tories underestimate the significance of falling domestic home ownership at their peril.

It’s a problem for us all. Most British people own a home or want to, and we want the same for our children, but young people on modest incomes who can’t rely on financial help from their family are increasingly locked out of the housing market.

This steep decline is why I commissioned the ground-breaking Redfern Review, which I launched last autumn. Led by Taylor Wimpey’s chief executive, Pete Redfern, this was the first major inquiry into home ownership for over a decade. It details the causes of the decline in home ownership with unprecedented rigour, and sets the basis for my determination to put widening the opportunity for home ownership at the heart of Labour’s approach.

Wanting to help to boost home ownership runs deep for Labour. Back in 1965, the housing plans on which Harold Wilson would fight the 1966 general election promised that: “The expansion of building for owner occupation . . . reflects a long-term social advance which should gradually pervade every region.”

Anthony Crosland, a former cabinet minister with responsibility for housing, pledged five years later: “Both as a party and as individuals we are strongly in favour of home ownership.” At root level, the decline in home ownership is a deep concern for Labour because what matters to so many people in this country matters to us as a national party. And it also matters to Labour as a party committed for over a century to fighting inequality.

Housing accounts for about 60 per cent of total household wealth in Britain, excluding pensions. The bottom 10 per cent in property wealth is £2bn in debt while the top 10 per cent own about £1.5 trillion in property. The shrinking opportunity for young people on ordinary incomes to own a home is at the centre of the growing gulf between “housing haves” and “housing have-nots”.

The next Labour government will take action to fix the housing problems that so many people face. At the core of our new deal on housing will be a new national programme of affordable house building. I’ve set out previously in a report for the Adam Smith Institute think tank how a Labour government could build and pay for at least 100,000 genuinely affordable homes a year – trebling current levels of building. And we’d help renters with the cost and standard of housing with a new charter of renters’ rights.

But because for Labour our history, our political ambition and our principles all point to helping to boost the number of home owners as well as action to fixing the wider housing crisis, we’d also make it a priority to give young people on ordinary incomes the chance to become home owners.

We will prioritise the building of discounted homes to buy as well as council homes to rent, target government support to buy a home for young people on low and middle incomes who have suffered the most under the Tories, and look at fresh help for the close to one million existing home owners who struggle with unaffordable mortgage costs. The Tories’ seven years of failure on housing on all fronts gives Labour the opportunity to show the difference a Labour government to make – not just on affordable housing and homelessness, but on home ownership too.

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A joined-up approach to resolving the UK housing crisis

That there is a housing crisis in the United Kingdom is a point of consensus, rare among our political parties. Whether left or right, moderate or radical, plenty are willing to agree that there is a shortage of housing to satisfy the obvious and rising demand from an ambitious as well as ageing population. Here, David Orr, the chief executive of the National Housing Federation, offers his thoughts on the nation’s predicament.

Is there really a UK housing crisis?

You’d have to have your head in the sand to think otherwise. For all the talk of postwar recovery and property-owning democracy, the fact is that the fortunes of the housing market have been funnelled to only a small portion of our society.

The average UK house price has risen and risen again; many millennials have now resigned themselves to never owning a home. It takes 22 years, on average, to save a deposit for a home.

Practically every part of society is affected – even baby boomers, who see just how hard it is for their children to get a foot on the ladder. Around half of first-time buyers need parental financial support. The crisis is no longer just the preserve of those on low incomes in poor-quality rented accommodation. It is everyone’s crisis now.

Is the answer as simple as “build more homes”?

Yes, it is. We have taken something that is simple and straightforward and made it complex and difficult. For 30 years or more we have failed to build the number of new homes we need. Governments of all colours have had tenure policies and new products and favourite schemes and initiatives galore. The net effect of all that? We still have a housing crisis.

And we bear collective responsibility – our government, housing associations, local government, the private sector, everyone. So yes, we need to build more homes, but to do that effectively will require greater collaboration, innovation and vision. The housing industry itself has been pretty poor with its R&D.

In the past, other technologies – TVs, for example – were big and clunky. Over time, they became sleeker and more lightweight. So why has our approach to building houses remained so static? The idea of mass production (and this applies to housing) often elicits images of prefabrication, standardisation and therefore a lack of identity. Then you get a stigma attached to it and people are put off living in “prefabs”, and immediately the house you’re building is a hard sell. Housing associations, though, have some brilliant projects under way, producing quite beautiful factory-built homes.

What is the role of government in addressing the crisis?

If you’re going to build new homes on a significant scale, the key things you’re going to need are: land, money, materials and people to build them. All of these things are easier to deliver if there is a strong, clear political steer towards them.

I’d say that land supply is the dominant issue here. It’s the one area where government action is critical, and the housing white paper will need to address this. The best thing the government can do is set a course that is strategic and long-term. If a housing association goes to the capital market to borrow money, it’s going to incur a 30-year debt, so decisions that are made now are going to have an impact that will span generations.

Has land-related legislation helped or hindered the rate of UK building?

Planning can be complicated and drawn out, but I don’t think that planning consent is the principal reason for the current crisis. As a country, we need to get our head around land supply. There’s a lot of public land which could be used for building homes, but isn’t. Government departments will stall or insist on selling it to the highest bidder, which fails to recognise the urgency of our situation.

We need a grown-up debate about where new homes will be built. Consider that when you fly over Britain, you can see by the lights where the population centres are. Most of the country, as it stands, is dark. We are not overdeveloped. There’s a narrative about that which is just nonsense; and I think the public is much further ahead on this than is commonly recognised.

What are the roles of housing associations in finding a solution?

Ultimately, the private sector will do what it is legally obliged to do – it will build exactly the number of homes needed to maximise shareholder value. We should bank that, then ask: “Where will the rest of the new homes come from?” The only realistic answer now is: “Housing associations, which have an ambition to build homes for everyone at scale.” Housing associations exist to ensure everyone in the country can live in a quality home that they can afford. These will include homes for social and affordable rents, specialist homes for older people, homes for sale on the open market, and schemes such as shared ownership and rent-to-buy.

Our model is flexible and resilient. We don’t syphon profits out of the business to pay shareholders. We reinvest our profits in building new homes and delivering on our social purpose. The big private builders raise funds, build, sell, take profit and leave. That’s fine but it limits what they can do. Housing associations raise funds, build, make profit, reinvest, build more and stay. We don’t just build homes, we build communities. This is our unique contribution to ending the current crisis. We’re in it for the long term.



About the National Housing Federation

The National Housing Federation is the voice of affordable housing in England. Housing associations are united by a single purpose: to ensure everyone in the country can live in a quality home that he or she can afford.

For over a hundred years we have delivered on this front, whether that’s building low-cost homes for Victorian workers or helping young families get on the housing ladder today. We meet shifting housing needs by building more homes, by providing extra support when it’s needed and by innovating to tackle the challenges people face.

In changing times, we deliver where the private sector won’t and the public sector can’t. We generate income, which doesn’t go to shareholders, so we can reinvest all our profits in homes and communities.

If you share our sense of purpose, we want to work with you. If you want to end the housing crisis, you need to work with us.

David Orr is Chief Executive of the National Housing Federation.