Giving with one hand, taking with two June 19, 2006
Posted by Brickonomist in Housing economics, Housing inequality, Housing investment, Housing need, Party politics.add a comment
24dash is a pretty good site for news on housing and other areas of social policy, and they’ve done well in recruiting Richard Best of the Joseph Rowntree Foundation as a columnist. His latest adds some good detail on a subject I posted about recently, namely the paucity of net government investment in housing:
what people may not appreciate is that a whole series of changes to housing policies have sent billions of pounds to the Treasury. More than enough money to boost the supply of decent, affordable homes …
… over the last 20 years:
* Receipts from the Right-to-Buy sales of Council housing have yielded around £45 billion – but only a quarter has been recycled into improving public housing.
* The abolition of Mortgage Interest Tax Relief (MITR) – which was the corner stone of the Duke of Edinburgh’s Inquiry into British Housing, which celebrated its 20th anniversary last week – has boosted tax receipts by £30 billion, plus a further £3 billion each year.
* Stamp Duty when anyone buys a property (plus a major part of the Inheritance tax) brought in £6.5 billion last year alone.
* The Treasury has not had to put up the money for loans to housing associations through the Housing Corporation because housing associations have been borrowing – more than £50 billion since 1990 – from banks and building societies instead.
* Because of the improved economic climate, with lower levels of unemployment, the government has been paying out less in Housing Benefit to help low-income tenants.
Not convinced about that last one, but housing is clearly generating a lot of revenue for the Treasury – the Right to Buy alone has been easily the most lucrative privatisation of all. Directing a bit more of this money back towards housing seems only fair, and it’s not like there’s nothing to spend it on: Best highlights the need for an extra £2-£3 billion a year for new affordable housing, a safety net for low-income home-owners, help for elderly or vulnerable homeowners to get repairs to their homes, and bringing council homes and estates up to a good condition. He concludes:
The contrast between large financial gains to the Treasury from changes in housing policy and the continued level of misery created by bad housing, is very striking.
If only a modest proportion of the government’s increased revenue was to be recycled, a vital contribution could be made to defusing the growing crisis in British Housing. Come on Gordon Brown, housing needs a better deal!
Quick links 15/06/06 June 15, 2006
Posted by Brickonomist in Design, Environment, Housing markets, Housing need, Overcrowding, Party politics, Planning.add a comment
Sorry for the lack of posting recently – too much work, sun and football on the telly. Here’s a round-up of what’s been happening:
- Homes to be energy-saving rated: “Every house sold in England and Wales will be given an energy efficiency rating like those found on electrical goods”. Sounds reasonable to me, but will it be introduced for rented housing too? Doesn’t seem to have been confirmed, but these people seem to think it will be.
- MPs out of touch on housing concerns: “while 98% of the public think that a lack of affordable housing is a major issue, only 34% of MPs think the same.”
- Redwood all at sea: Let’s build a new city on land reclaimed from the sea, says John. Not sure if this is meant to be more environmentally friendly but it probably wouldn’t be. Maybe Redwood has been inspired by Anthony Lau’s concept of Offshore Living, part of the Sustainable Living By Design exhibition at the GLA, which involves sticking people in refashioned cargo containers stacked on decommissioned oil rigs.
- Fancy re-designing Castleford?
- A tight squeeze: “A chronic shortage of family sized homes, planning problems and economic ‘factors’ are contributing to the growing crisis of overcrowding.”
- Beware the winds of change: “Low income households could lose out in the government’s push towards homeownership, Dominic Maxwell warns”.
Deluded of Tunbridge Wells May 29, 2006
Posted by Brickonomist in Environment, Factoids, Homelessness, Media, NIMBYs, Party politics, Planning.2 comments
Greg Clark, Conservative MP for Tunbridge Wells, has a shocking tale to relate (via obliging Times journalist Rosemary Bennett):
Up to 20,000 new homes each year that ministers claim are going up on brownfield sites are actually being built in back gardens, figures show.
That “up to”, friend to alarmists everywhere, sets alarm bells ringing, as does the implication that unsuspecting homeowners are waking up to find that sneaky developers have dumped a block of flats on their geraniums. So let’s do what Rosemary Bennett didn’t and give this factoid more than a moment’s reflection.
Her article goes on:
“Garden grabbing” now accounts for 15 per cent of all new housing as family homes in towns and suburbs are pulled down by developers and replaced with flats.
The Conservatives, who obtained the figures from the Department for Communities and Local Government, said that the public was being “deceived”.
Greg Clark, Tory MP for Tunbridge Wells, said: “Most people assume that when the Government talks about building on brownfield sites it means ex-industrial land, like disused factories and railway sidings. They have no idea that much of it is actually beautiful, green, environmentally important gardens.”
That first line really is a peach. What Clark and Bennett call “Garden grabbing” actually covers any and all construction of new dwellings on previously residential land – including the land occupied not by gardens but by the buildings themselves. So if, for example, someone pulled down a block of flats without gardens and replaced them with semi-detached homes with gardens, Clark would call that “garden grabbing”. The logical extension of the argument is for all current residential land to be frozen in its current state of development for perpetuity or for it to be declared undevelopable greenfield as soon as the current dwellings are demolished. That would naturally create far more pressure for greenbelt land to be developed, but I’m sure Clark doesn’t actually want that.
The article implies that “garden grabbing” is a new or growing phenomenon, since it “now accounts for 15 per cent of all new housing” and Bennett cherry-picks 1997 as a base year since the figure then was only 11 per cent. What she mysteriously omits to say is that back in 1986 (under the Conservative government), fully 26 per cent of all new housing was built on previously residential land, and that this “garden grabbing” accounted for half of all brownfield development. This was revealed by Yvette Cooper in her answer to Clark’s parliamentary question on the matter, but he naturally chose to ignore the far more serious offences of his party colleagues, and Bennett naturally chose not to bother herself fact-checking the figures he spoonfed her.
NIMBYism resurgent May 14, 2006
Posted by Brickonomist in Housing economics, NIMBYs, Party politics, Planning.add a comment
The NIMBY News Daily Telegraph reacted with predictable horror to Ruth Kelly’s determination to increase housing supply even in middle-class areas. This is anathema to the Telegraph and its readership, who seem to agree that more housing should be built somewhere, just not in their ‘local communities’. Instead, it should be built somewhere comfortably distant so as not to affect the ever-rising value of their property.
It is notable that nowhere in the story is there any acknowledgement by the Tories or their journalistic mouthpiece of the huge unmet need for social housing. Instead, the shadow local government minister is more concerned opposing densification and Labour’s (non-existent) “plans to bulldoze Britain’s back gardens”. Maybe this indicates the future path of Conservative housing policy – paying lip-service to the aspiration to increase housing supply while objecting to any practical means of achieving it, and insisting on the right of local communities to block housing development (but especially housing for those on low incomes) in their areas.
Since it was precisely this NIMBYism that created the current concentrations of social housing in inner-city areas and all its attendant problems, and since its other main consequence is to boost house prices in the non-developable areas, it seems to me there is a case for making NIMBYs pay for the priveleges they enjoy at significant cost to others. I don’t mean “make them pay” as in kick over their garden gnomes and key their cars – I mean councils that don’t build their fair share of the affordable housing needed in their region should make a financial contribution to the councils that build more than their fair share, and that this charge be recovered from homeowners through the council tax. I hope to come come back to this rather appealing notion later.
The money pit, not April 27, 2006
Posted by Brickonomist in Homelessness, Housing investment, Party politics.add a comment
In a revealing answer to a written parliamentary question, Housing Minister Yvette Cooper makes much of the fact that “since 1997 the Government have consistently invested more in housing than they have received in receipts [from sales of council housing]“.
This just goes to show how tiny tax-funded investment in housing is: for the first six of those years, investment exceeded receipts by an average of only £1bn a year, and in 2004-05 the net investment of around £2.4bn amounts to around one quarter of one percent of England’s GDP.
To put it into a bit more perspective, consider that in the most recent year with available data (2002-03) housing accounted for 1.2% of all government expenditure, compared to 21% for health, 14% for education, and 6.5% for defence. That year, our government spent more on “Culture, media and sport” (1.6%) than on housing.
Housing didn’t always have such a low priority for government. In 1980-81 housing accounted for 6% of government spending, and even Thatcher’s government spent more on it than New Labour.
So what happened? Perhaps today’s government thinks the problem of inadequate or insufficient housing is a relatively minor one today. Is that really tenable when a million children still live homeless or in overcrowded or unfit housing, with serious consequences for their health and education?
“Concreting over the countryside” March 16, 2006
Posted by Brickonomist in Environment, NIMBYs, Party politics, Planning.add a comment
From a news story in yesterday’s The Daily Telegraph:
Five million new homes will be needed in England over the next 20 years, 1.5 million of them because of record levels of immigration, according to Government figures published yesterday.
From the accompanying editorial:
The basis of this claim is questionable.
Indeed it is. From the government press release announcing the new figures:
The household projections are not an assessment of housing need.
The basis of the claim in the Telegraph is questionable mostly because the Telegraph has invented it. The government figures released are projections of future household growth if current demographic trends continue. They are unconstrained by the availability of housing.
But as both the government and the Telegraph are well aware, housing is extremely expensive at the moment, and likely to remain so for some time. So whereas one person households account for 150,000 of the 209,000 projected annual household growth, in reality many of these single people will not form households of their own, but will stay at home or share with other single people. Alternatively, they’ll all go live in tiny flats in London, sparing the Telegraph’s beloved South East from the depradations of Mr Prescott’s bulldozers.
But even if that doesn’t happen and every single new household requires a new home, every single one of which must be built on new land – how much land would be used up? Handily, Charles Clover of the Telegraph has the calculation to hand:
If translated into new homes built, this would mean the loss of more than 368 square miles of countryside … in 20 years. That is a rate of urbanisation of 16 square miles a year.
The total area of England is over 50,000 square miles. I would have thought that a government that allegedly wants to ‘concrete over the countryside‘ can do better than less than 1% of the land area in 20 years.
The Tories might just have a housing policy again February 11, 2006
Posted by Brickonomist in Party politics.add a comment
This is interesting:
We should give local communities a much greater say in development. But, in return, those communities will need to balance the interests of today’s homeowner with the home-owning aspirations of their children.
We should increase supply of affordable new homes, but we should insist that that housing is well-designed, environmentally sustainable and eco-friendly.
We should see if we can make new land available for development, but we should demand that developers do not simply bank it but bring it forward for building.
We should build homes where people want to live, but we should make sure that local communities get the resources to meet the additional strain on infrastructure and local public services.
John Prescott has been compared to Stalin for less, but this is actually Conservative Shadow Chancellor George Osborn speaking. Could it be that the Tories are actually developing a vaguely sensible policy on housing, one that doesn’t call any proposal to build new homes any place where people might want to move to “concreting over the countryside”? And isn’t this another example of David Cameron’s new Conservatives adopting quite sensible policies whose only drawback is that they’re not too easily distinguishable from those already being pursued by Labour?
