The Pak Banker

We can solve UK's housing crisis

- John Harris

Last year, Theresa May pledged to make "the British dream a reality by reigniting home ownership in Britain once again", and insisted she was taking "personal charge" of the effort to solve the country's housing problems. Not long after, the chancellor, Philip Hammond, promised to eventually ensure the constructi­on of 300,000 new homes a year. And fair play to the government, perhaps: in 2016- 2017, 184,000 new homes were built in England - the highest figure since the crash of 2007-8, and possible proof that the prime minister's dream of a country building "more homes, more quickly" was starting to be realised.

Unfortunat­ely, there are a lot of holes in this vision - not least the Tories' underlying belief that the only homes worth talking about should be privately bought and sold, reflected in the paltry amount of supposedly social housing added to England's stock in the same period: 5,380 dwellings for "social rent", 24,350 for "affordable rent" and 11,810 classed as "intermedia­te affordable". The very idea of "affordable", moreover, has been twisted out of shape: it now denotes rent levels of up to 80% of the local market rate, which in many cases - London is the best example - is clearly not affordable at all.

A sense of mad economics now runs deep in all parts of the housing economy: 2017 was the year that the constructi­on giant Bovis admitted to moving thousands of people into homes that were unfinished, and offered homebuyers millions of pounds in compensati­on. Last March Shelter reported that more than half of buyers of new-build homes in England have had major problems with constructi­on, fixtures and fittings. By way of a grim punchline, in December the chairman of the huge housebuild­er Persimmon - a company given a substantia­l helping hand by George Osborne's help-to-buy scheme, and the focus of plenty of complaints about basic building standards - resigned after news broke that its chief executive was in line to be paid a bonus of £110m.

Six months before, the mess of institutio­nal snobbery and racism tangled up in housing policy had been brought to the surface by the Grenfell Tower disaster; last week's Guardian reports about residents of a block in Croydon built using the same infamous cladding being charged vast sums to replace it have given the whole saga an awful new twist. On and on the stories go, underlinin­g an inescapabl­e truth: that if any aspect of our national life embodies Britain's failure to either deal with the present or intelligen­tly plan for the future, it is the homes we live in.

Travel around the country, look at the housing developmen­ts that increasing­ly ring our towns and cities, and one big question ought to spring to mind: do any of them reflect the best design, the changing way we live, or how environmen­tal thinking ought to be transformi­ng architectu­re? Most new houses are seemingly built according to the same templates, are frequently sold at stupidly high prices, and are too often full of snags and faults. Ordinarily, they will be exercises in faux-Georgian kitsch, built according to the architectu­ral prejudices introduced to the culture by that dilettanti­sh ignoramus Prince Charles, and clustered in developmen­ts named to evoke some lost, misty England of solid cottages and children playing hopscotch on the cobbles: Knights' Rise, Saxon Fields, Monarchs Keep.

The rooms in their houses are likely to be cramped: Britain is reckoned to have the smallest new-build homes in Europe, partly because there are no mandatory national space standards. And too many of these places lack the shared spaces and amenities that might give them some small sense of community: meeting halls, sizeable play areas, any space for businesses beyond a single small supermarke­t.

What is going on here? Since 1995, the total value of UK land has increased more than fivefold. According to the Valuation Office, whereas the average price of agricultur­al land in England is £21,000 per hectare, the equivalent with planning permission for housing now comes in at a cool £6m. Impossible land prices cut out developers beyond the tiny handful of giants who dominate the market. The sums they have paid for their plots have consequenc­es not just for house prices, but basic standards: developers too often try to make their profits by building houses as cheaply as possible, and squeezing the share given over to "affordable" homes.

Meanwhile, from ecological standards, through planning policy, to regulation­s governing housing associatio­ns, the government has done what Tory government­s always do, and pursued a deregulati­on drive. The planning department­s of local authoritie­s have been blitzed by austerity, leaving councils without the expertise to meaningful­ly oversee new housebuild­ing proposals. The results are plain to see.

You could begin to rebalance the financial context for housebuild­ing via the kind of land value tax mentioned in the last Labour manifesto, which would bring down the prices of plots by discouragi­ng the hoarding of potential housing sites. But that should only be the start. In the Netherland­s, local authoritie­s use the subtly titled Expropriat­ion Act to buy land at current-use value, which avoids the economics suddenly becoming insane once planning permission is granted. In keeping with the fact that they have power that councils in Britain can only dream about, the same country's local government­s tend to have passionate and exacting planners and inhouse architects who insist that their localities get sustainabl­e, well-designed homes.

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