The two biggest issues that concern young voters are housing and climate change. Housing is the more hands-on challenge, as plenty of young adults just can’t get on the property ladder, whether buying or renting. The traditional rite of passage of children fleeing the nest when school ends now unravels three or four years later when they return to their parental home as their only financially viable living option – which can remain their home for several frustrating years. So if we want to be taken seriously by the youngest voters, we have to have a credible housing policy.
The option all political parties have chosen to tackle the housing crisis at the last few elections is to promise mass housebuilding. It has led to unseemly and meaningless auctions – one party promises 200,000 new dwellings a year, another raises that to 250,000, another to 300,000 – plus antagonistic debates about housebuilding targets at Lib Dem conferences. The developers love it, but the numbers of houses being built don’t really change. And anyway, do we really need to build our way out of trouble?
With the Liberal Democrats holding 72 MPs, many seats in the kind of small towns whose peripheries are threatened by the surge in housebuilding promised by Starmer’s government, we have something of a dilemma. We don’t want to be Nimbyist, but at the same time we don’t want our rural towns to become sprawling car-dependent suburbia.
The implicit assumption behind mass housebuilding is that there isn’t enough residential property. Yet for years suggestions have abounded that we do have enough living space – we just don’t use it well. Even if that’s technically true, to be ultra-efficient would result in a loss of freedom as the state would have to order people to live in others’ houses to maximise residential space. That would be a hard pill for Liberals to swallow, let alone the rest of society that remembers the centralised residential diktats of the Soviet bloc.
Having said that, last year, the London School of Economics published a paper saying a focus on newbuilds is not the solution; maximising use of existing housing stock is. It identifies what it calls ‘excess housing’, saying it comes from the ratio between people’s legitimate needs and existing housing stock, and proposes a number of solutions, including reform of housing taxation that puts surcharges on excess housing. The paper’s authors suggest starting with “a radical reform of housing taxation and pricing, incorporating more progressive property or land tax and the regulation of second homes and excess housing.”
When we in the Yorkist group were compiling our discussion paper “What would Paddy do?”, we drew up a package of measures to tackle housing:
- A requirement to build one- and two-bedroom ‘starter’ homes, not the executive homes that make the biggest profits for developers
- Stricter deadlines for developers to act on planning consent to avoid ‘land banking’
- An end to the scope for wriggling out of commitments to building affordable homes
- A shift in taxation to make it increasingly expensive to have a second (or more) home which remains empty for much of the year
- The right of councils to invest in new social housing for rent
- Revision of rental legislation to establish a fair deal for both landlords and tenants
- A complete reassessment of who owns land and how that land should feature in national plans for housing and wealth taxation
But there’s one element – really two – that we omitted which our friends at the LSE identified. A housing market predicated on building ourselves out of trouble is going to be energy-inefficient (and thus high-carbon) and will increase inequality by giving a poor deal to disadvantaged and low-income families. That’s why they say the rapid retrofitting of existing housing stock “is essential, and will have a more immediate and extensive impact on overall emissions than the building of new efficient housing. If appropriately subsidised, it will also benefit the least well-off by reducing energy costs, and making homes easier to heat.”
If we want to attract the 18-35 age cohort to politics, and then get them to vote Lib Dem, we have to show we are serious but realistic about them having a viable and affordable place to live. That means relying on more than newbuilds. Some newbuilds will be necessary, but making better use of existing stock, and ensuring any newbuilds are the right dwellings in the right places, will be crucial to getting this right. We can solve the housing problem without creating rural sprawl – and if we get the package of measures right, it could be a massive electoral asset.
* Chris Bowers is a two-term district councillor and four-time parliamentary candidate. He writes on cross-party cooperation, was the lead author of the New Liberal Manifesto, and is unofficial coordinator of the Yorkists.
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15 Comments
What about demand side, immigration is a leading cause of the housing shortage.
That is not to say that individual migrants are morally at fault, but as a class the influx of migrants over the last 20 plus years as caused a massive increase in housing demand resulting in a massive increase in housing costs.
Second homes and private landlords are an issue too. I would outlaw all private landlords and only allow local authorities and other social landlords to rent out property. Unlike migrants these people are morally at fault.
I would also have punitive taxes on second and Emory hones. Minimum of 1000% surcharge on normal council tax rates.
A home should be a place to live and not an investment.
I do think the idea of a surcharge on ‘excess housing’ as assessed by some bureaucrat is a suggestion that may have come from a Soviet Union think-tank. Is that really something a Liberal could ever support? I can imagine the discussion: so you are a single pensioner living in a three-bedroom house…why do you require so many excess bedrooms? My son and his family live 200 miles away and when they come to visit they stay overnight. Sorry, not good enough – extra taxes for you!!!
Firstly, let’s stop using the newspeak term “affordable housing”. It bears no relationship to whether people can afford it. The requirement to make some proportion of larger developments (defined by number of homes) “affordable” is one of the reasons developers to put a small number of big houses on a plot instead of a large number of starter homes. Another is that locals seldom object to a few more rich neighbours but do object to a large number of new poor neighbours.
The main need for social housing is for child friendly family homes. In many areas there are more suitable homes than there are families with children. You don’t need to tie council housing to new build. Councils could increase their stock faster and more economically by buying and renovating. The new build in those areas needs to be mainly high density homes which are not suitable for children.
One of the key purposes of land value tax is to incentivise the efficient use of land and prevent land hoarding including residential housing.
Mike comments above “so you are a single pensioner living in a three-bedroom house…why do you require so many excess bedrooms? My son and his family live 200 miles away and when they come to visit they stay overnight. Sorry, not good enough – extra taxes for you!”
This is a common argument. However, the son will likely inherit the home when his pensioner parent passes away and may either decide to pay deferred taxes from the estate or pay as they arise to keep the value of the estate unecmbered as was common with deferrment of rates scheme for OAPs in Northern Ireland OAPs allowed to defer rate bills. The alternative would be to either downsize or make one or two spare rooms available for rent either privately or via the local authority to defray land taxes if necessary.
Generations of widows relied on lodgers as a source of income throughout the 20th century.
The Intergenerational foundation estimated In 2011 there was something like 25 miliion unoccupied bedrooms 25 MILLION UNOCCUPIED BEDROOMS in the UK. Creative solutions that encourage use of part of this inventory could go a long way to taking the pressure off of rents and housing costs.
Two things that would help with using existing homes better are abolishing stamp duty – which is a huge barrier to people downsizing, and encouraging people to let rooms to lodgers. The Ukraine scheme showed what might be done there. We have the rent-a-room tax scheme but it’s poorly advertised.
Taxing 2nd homes would probably have only a marginal impact, and besides, 2nd homes would tend to be in holiday and rural areas, whereas the shortage of homes is most acute in London and the SouthEast.
I think though @Chris you’re overestimating the potential for existing homes: The studies you and Joseph link to define unoccupied bedrooms as ones where houses have more rooms than the Government defines as necessary for the numbers of people. That doesn’t mean the bedrooms are unused, and any attempt to penalise families for having those rooms would be incredibly unpopular.
I really don’t think there is an alternative to mass house-building. We avoid car-dependant urban sprawl by what types of houses we build and where. For example favouring flats and building near public transport hubs.
The whole notion of requiring a proportion of housing sites to be “affordable” is deeply flawed. As Peter Davies points out, 80% of market rents is simply not affordable in most places and developers may game the system by providing an imbalance of larger more expensive houses to offset the “affordable” ones. More fundamentally though the requirement of (say) 25% to be “affordable” means that 75% can be and very likely will be non-affordable. The overall numbers of houses may add up to the Local Plan target numbers but 25% affordable rarely comes near to meet actual housing need. This is a serious mis-allocation of a scarce resource, i.e. potential housing land.
Simon R “we avoid car-dependant urban sprawl by what types of houses we build and where”
I have two queries:
a) From time to time we are told that there are x thousands of planning approvals for homes that have not been built. Is this true and if so, how many are there and where are they?
b) Should not the focus be on higher densities rather than urban sprawl? I was recently in Gothenburg – very impressed with their often five to six storey blocks of apartments / green spaces / tram network. So in particular the first two provisions should surely be a consideration.
In general we need to talk about homes rather than “houses”.
There is clearly a case for improving existing housing, but how does that create new supply? There is very little derelict, unoccupied housing, particularly in areas where housing is expensive.
As you say, my LSE colleagues point out that if we forced my elderly neighbour out of the home she loves, has lived in for 60 years, and is full of wonderful memories, and we did that to every such person, we would indeed have enough housing to go round. No spare bedrooms in the UK! Alternatively we could allow more houses to be build, so that she can enjoy her house and her memories, and have her children and grandchildren to stay from time to time. I know which I think is more liberal.
Simon R “Taxing 2nd homes would probably have only a marginal impact, and besides, 2nd homes would tend to be in holiday and rural areas, whereas the shortage of homes is most acute in London and the SouthEast. ”
While this may be true and tax is rarely a good way of achieving non financial objectives there is good evidence that holiday homes in some rural areas has an adverse effect on local people finding housing, see https://lordslibrary.parliament.uk/housing-in-rural-and-coastal-communities/.
Action to “level up” incomes throughout the UK and thus enable locals to compete on equal terms would be the best solution. More Council and Housing Association housing is another measure worth pursuing.
But in the short term tsome taxation increases on holiday homes and other short term lets, such as AirB&B, is worth considering.
@Graham Jeffs There will always be plots with planning permission but no homes. Large developers like to build slowly. They can have one team doing all the roofs or the plumming one house at a time rather than multiple teams spending a short period on site then moving to the next one. They also like to get planning permission sorted well before the scheduled start of building. It may take a year longer than they expected.
On homes versus houses, yes, flats are the obvious way to produce high densities but most most people prefer houses. Buyers in particular hate leasehold and you can never own a flat. You can get just as good densities with tall, low footprint terraces. We could even reassess back-to-backs. They are always associated with Victorian slums because if you were a Victorian building a slum they were the obvious way to go. The advantages in terms of density, low construction costs and thermal efficiency are still valid and we could now build them to modern standards as an alternative to flats (which are mainly back-to-back).
@ Andrew Campion,
“tax is rarely a good way of achieving non financial objectives”
Is this really true?
Many of us gave up smoking years ago when the tax on tobacco products started to really bite. Many of us would drive around in “gas guzzling” 4×4 SUVs if it wasn’t for high fuel taxes and the high “road tax” imposed on them. The drive towards “net zero” is based on the concept that high CO2 emissions should attract higher levels of taxation.
It can be argued that all govt taxes have non-financial objectives in the sense that the govt can issue as much money as it likes for itself. It doesn’t need our tax money per se. What it really wants is for us to do the work to obtain their issued money and so pay their taxes.
@ Peter Davies – “There will always be plots with planning permission but no homes. Large developers like to build slowly.”
This is also the approach of sane largescale development. The Milton Keynes Development Corporation deliberated built in a patchwork, so as to avoid a dated monoculture. Even today, some 60 years after the cities founding and 30 years after the winding up of the development corporation, there are still substantial city centre blocks awaiting development…
>” tall, low footprint terraces”
A side benefit, is the passive exercise machine built into these houses… 🙂
@Graham. Yes, I carelessly wrote ‘houses’ when I meant ‘homes’. A quick google suggests there are about a million homes that have been given planning permission since 2015 but not yet built (https://www.homebuilding.co.uk/news/one-in-three-homes-granted-planning-permission-arent-built-we-look-at-why). That sounds shocking and in my experience people on the left who dislike private companies often like to assume without evidence that it’s all, evil companies land-banking: But we don’t know that and as Peter and Roland point out, there are lots of legitimate reasons for not building when you have planning permission – most obviously the UK’s acute shortage of skilled builders.
@Andrew. Agreed, and I’m not necessarily opposed to taxing 2nd homes, I just don’t think it would have much impact on housing supply. And it could be very easy to avoid (1st home in wife’s name, 2nd home in husband’s name or daughter’s name… How do you prove it’s a taxable 2nd home?)
I am at present a member of an Ombudsman Board and the CAE.
After the war a different type of home was produced to make housing more quickly available.
I would live in a home not built of bricks, a modular home these are being used in Wiltshire.
Some serious thoughts and actions need to happen.
I see property only used a few days a month.
The key factor missed by analysis like this article is self-built homes and small developers. The UK has one of the lowest rates of self-built housing in Europe; the vast majority of new development is under an effective monopoly of large developers who have the expertise and legal resources of dealing with the planning process, and know how to maximize their own profits over the interests of the people.
Mandating that new houses be small is not a solution- the UK already has some of the smallest houses in the developed world on average and this is only worsening with the division of houses into flats in many areas, and it is also grounded in the assumption of nuclear family structure whereas in many cultures it’s more common for extended families to live together in larger housing.
The change that is needed to help young people enter the housing ladder is the waiving of planning permission requirements for single-home developments. Breaking the monopoly of large developers over the house construction process, allowing individuals the liberty to buy a small and easily-affordable plot of land anywhere in the country and decide what type of home they want to have constructed to live in, would be the perfect answer to the problem.