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Julia Park: 'We have to end this schizophrenic approach to housing'


Head of housing for Levitt Bernstein. Julia Park, says the housing industry is being flooded with misguided ideas

For an industry that keeps explaining it needs certainty to plan ahead, being constantly bombarded by schizophrenic, misguided ideas (in this case paraded as planning reforms) is pretty unhelpful. After years of painful deliberation we finally get confirmation of Zero Carbon - and within 6 months it’s repealed.

The government is obsessed with devolution of power to local authorities - but at the same time, constantly threatens to intervene if the answer isn’t ‘right’. In a press statement on the Housing Standards Review consultation (12 September 2014), the Minister promised, ‘a new approach to housing quality….to make new homes safer, more accessible to older and disabled people and more sustainable’. Less than a year later, all that’s needed to develop on brownfield land is ‘approval of a limited number of technical details’. 

The lack of understanding about how the housing industry works was epitomised by the extraordinary collection of ‘exemplar low cost starter homes’ put together by a government appointed design advisory panel, and published by DCLG in March (see Row hits ‘templated’ first-time buyer homes drive).

Most looked like something designed in the middle of the last century

Most looked like something designed for the middle classes in middle England in the middle of the last century. Why assume all first-time buyers need a new home anyway? Given that so few existing homes are suited to an ageing population, would it not make sense to ensure that more new homes are designed for older people?

Before extending Right to Buy, remember that every time someone exercises their right to buy; someone else (usually someone less fortunate) is denied their right to an affordable rent.  Before de-regulating to ‘remove obstacles’, remember that deregulation of the banking sector contributed to the 2007-8 crash. If you want to speed up delivery, tackle the practice of ‘slow-release’ that keeps prices high, and put a time limit on land-banking.

If you want to make the private rented sector (PRS) fairer - yes, sort out the tax relief anomalies - but also introduce rent caps, mandatory smoke detectors,  effective measures to prevent overcrowding (with sanctions) and a ‘decent homes test’. All the while that house-building is allowed to remain a profit–driven industry, aimed at meeting shareholders expectations rather than peoples’ housing needs, we will continue to need regulation and the planning system to protect against disastrous outcomes.   

None of this is tackling the twin crises of supply and affordability. Our answer would be to reverse the systematic annihilation of social housing that has taken place over the last five years and build more. Applying a fixed requirement for 30 per cent of all new homes to be affordable would bring down land value and therefore house prices. In the very few cases where viability is genuinely marginal, don’t give in - give subsidy.

Instead of selling off public land - and giving up most of the potential profit as well as a public asset - build affordable housing on it. Use MMC to speed up delivery. With factory-built, volumetric pods, a home can be built in two weeks and the rest done using local labour.

The thrust of all the recent planning reforms is saving money. In fact, the economic arguments for building more affordable housing are almost as compelling as the social and moral ones. When people have to give up to 75 per cent of their income to a private landlord, they can’t contribute to the local economy, save for a deposit or make adequate pension contributions. They feel miserable and resentful and are more likely to need health care and be dependent on welfare – if not now, then later. Someone else will almost certainly need to pay for them to grow old.

A new study by Capital Economics (see Of course politicians don’t care about lowering house prices) shows that up-front public investment in social housing will work out very much cheaper than the consequential bill for social care. It also notes, ‘For every £1 the Treasury spent on housebuilding, economic output would be boosted by £2.84’.  Even if you don’t place any value on mixed communities, social equality, better life chances or community cohesion, building more affordable housing would be much more productive than constant meddling.

Julia Park is head of housing research and Levitt Bernstein


Readers' comments (4)

  • Absolutely spot on Julia - well said.

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  • Perhaps George Osborne will issue an edict 'repealing' Julia Park.

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  • What a breathe of fresh air amid al the stupid political posturing of the government. Please, please circulate to every MP, and everyone concerned with housing policy and delivery.

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  • Anna French

    What a great article, as a professional in the industry and a homeowner likely to be stuck on the bottom rung for the foreseeable future I agree whole heartily with Julia's summary.

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