Labour's rent "Milishambles"
It really ought not be that difficult for any sane person to see that the one secure and sustainable means to keep housing costs down and help more young people get homes is to help and encourage people to BUILD MORE HOUSES!
That's why the Coalition government is providing a £1 billion Build to Rent fund which is offering private developers debt guarantees to kick-start developments of rented housing, and is expected to deliver another 10,000 new affordable homes. The government has also simplified planning law to try to make it easier for developers to get planning permission for good housing proposals. Government assistance to get construction sites restarted has already delivered 69,000 more homes and will help unlock another 300,000 in the next few years.
As a result of these measures housing starts were up 23% on the previous year and Britain is now building more homes than at any time since before the crash.
The main problems in the housing market do not include rapid increases in rents - in fact average rents fell in real terms last year, increasing by 1% in England, 1.3% in Scotland and 0.6% in Wales at a time when inflation, while falling, was most recently estimated at 1.6% in the 12 months to March.
The main problems in the housing market do include too few houses overall in certain parts of the country, particularly in London and the South East where a price bubble is developing (though there are few signs of such a bubble in the rest of the country), too few affordable houses in most of the country, and a mismatch of the size and type of houses against demand and need in many areas.
The main problem with the cost of housing is NOT that rents are still going up, it is a shortage of properties with prices or rents that are affordable at existing prices and this in turn is a symptom rather than a cause, the fundamental problem being that WE NEED MORE HOUSES.
Hence Labour's badly through through proposals announced on Thursday for a cap on rental increases are tackling the wrong housing problem in the worst possible way. It would be too polite to describe it as a "rearranging the deckchairs on the Titanic" gimmick because it has the capacity to actively make the real problem worse.
Last time Britain had rent controls they shrank the size of the private rented sector drastically: it fell from 55% of households in 1939 to 8% in the late 1980s.
If the last Labour government had put a cap on housing rent increases when they were first elected in 1997, among the first people prosecuted for breaking it would have been ... themselves!
The Blair government rebalanced the social rented sector, and quite deliberately forced councils who had not transferred their council houses to housing associations to phase in massive increases in council house rents over the best part of a decade. Effectively, Labour doubled council house rents in the ten years from 1999.
(In my experience, mentioning this fact at the time in the presence of a Labour councillor who served on an authority which still had council houses was guaranteed to enrage them, often to the point of completely losing it, but this does not alter the fact that this is what their government did.)
Labour's housing announcement was a complete "Mili-shambles" which started to unravel within 24 hours of the announcement. Labour's shadow housing spokesperson had said in January that rent controls don't work. Emma Reynolds MP had told Channel 4 news that
"I do not think rent controls will work in practice."
Confronted with this awkward fact, Labour spokespeople such as Mary Creagh on this week's "Any Questions" broadcast have resorted to such infantile "black equals white if I say it does" tactics as denying that capping rent increases is a form of rent control!
Then there was the little matter that Labour's launch press release claimed that the Royal Institute of Chartered Surveyors was working with them to develop a suitable benchmark for rent controls - something immediately denied by the RICS who for good measure added that they didn't agree with the policy.
Labour's housing announcement on Thursday was further evidence, were any needed, that the present leadership of the party has a fatal predilection for announcing radical new policies without thinking them through, for promising things which sound wonderful but will actually make the underlying problems worse, and for a general level of utter incompetence which suggests the inability to organise you-know-what in a brewery ...
Any open-minded person who has been reading what commentators have written in the press about Labour should have already realised that the opinion I have just expressed above is shared by a much wider range of people who follow politics than just Tories like myself, including even some people on the political left.
I believe that the result of the next election is still wide open. The range of possible outcomes is anywhere from a narrow Labour win (assuming the Scots vote to stay in the UK) through various kinds of hung parliament to a narrow Conservative win.
I don't see anyone getting a landslide (or Labour winning by enough to still have a majority without Scotland) or a Lib/Dem or UKIP win. But on the basis of this week's announcement, if Labour win God help the country.
That's why the Coalition government is providing a £1 billion Build to Rent fund which is offering private developers debt guarantees to kick-start developments of rented housing, and is expected to deliver another 10,000 new affordable homes. The government has also simplified planning law to try to make it easier for developers to get planning permission for good housing proposals. Government assistance to get construction sites restarted has already delivered 69,000 more homes and will help unlock another 300,000 in the next few years.
As a result of these measures housing starts were up 23% on the previous year and Britain is now building more homes than at any time since before the crash.
The main problems in the housing market do not include rapid increases in rents - in fact average rents fell in real terms last year, increasing by 1% in England, 1.3% in Scotland and 0.6% in Wales at a time when inflation, while falling, was most recently estimated at 1.6% in the 12 months to March.
The main problems in the housing market do include too few houses overall in certain parts of the country, particularly in London and the South East where a price bubble is developing (though there are few signs of such a bubble in the rest of the country), too few affordable houses in most of the country, and a mismatch of the size and type of houses against demand and need in many areas.
The main problem with the cost of housing is NOT that rents are still going up, it is a shortage of properties with prices or rents that are affordable at existing prices and this in turn is a symptom rather than a cause, the fundamental problem being that WE NEED MORE HOUSES.
Hence Labour's badly through through proposals announced on Thursday for a cap on rental increases are tackling the wrong housing problem in the worst possible way. It would be too polite to describe it as a "rearranging the deckchairs on the Titanic" gimmick because it has the capacity to actively make the real problem worse.
Last time Britain had rent controls they shrank the size of the private rented sector drastically: it fell from 55% of households in 1939 to 8% in the late 1980s.
If the last Labour government had put a cap on housing rent increases when they were first elected in 1997, among the first people prosecuted for breaking it would have been ... themselves!
The Blair government rebalanced the social rented sector, and quite deliberately forced councils who had not transferred their council houses to housing associations to phase in massive increases in council house rents over the best part of a decade. Effectively, Labour doubled council house rents in the ten years from 1999.
(In my experience, mentioning this fact at the time in the presence of a Labour councillor who served on an authority which still had council houses was guaranteed to enrage them, often to the point of completely losing it, but this does not alter the fact that this is what their government did.)
Labour's housing announcement was a complete "Mili-shambles" which started to unravel within 24 hours of the announcement. Labour's shadow housing spokesperson had said in January that rent controls don't work. Emma Reynolds MP had told Channel 4 news that
"I do not think rent controls will work in practice."
Confronted with this awkward fact, Labour spokespeople such as Mary Creagh on this week's "Any Questions" broadcast have resorted to such infantile "black equals white if I say it does" tactics as denying that capping rent increases is a form of rent control!
Then there was the little matter that Labour's launch press release claimed that the Royal Institute of Chartered Surveyors was working with them to develop a suitable benchmark for rent controls - something immediately denied by the RICS who for good measure added that they didn't agree with the policy.
Labour's housing announcement on Thursday was further evidence, were any needed, that the present leadership of the party has a fatal predilection for announcing radical new policies without thinking them through, for promising things which sound wonderful but will actually make the underlying problems worse, and for a general level of utter incompetence which suggests the inability to organise you-know-what in a brewery ...
Any open-minded person who has been reading what commentators have written in the press about Labour should have already realised that the opinion I have just expressed above is shared by a much wider range of people who follow politics than just Tories like myself, including even some people on the political left.
I believe that the result of the next election is still wide open. The range of possible outcomes is anywhere from a narrow Labour win (assuming the Scots vote to stay in the UK) through various kinds of hung parliament to a narrow Conservative win.
I don't see anyone getting a landslide (or Labour winning by enough to still have a majority without Scotland) or a Lib/Dem or UKIP win. But on the basis of this week's announcement, if Labour win God help the country.
Comments
67,500 new homes were registered with the National House Building Council (NHBC) in the first half of 2013 alone. This is being stimulated by government efforts to increase the new build sector (using of course tax payer moneys)
So what do we get, well we get building firms like Persimmon, Story, Barratt etc, building record numbers of them, to the lowest possible standards as profit is priority, speed is everything (to make targets and gain incentives) so whats left to bend in the "construction triangle" thats right its Quality.
I am currently having a house constructed and for these reasons I am having to watch the builder like a hawk, for cut corners, and watchdog style bodge it and scarper tricks. Now new homes do come with a 2 year guarantee, granted but the loopholes builders have mean the consumer has more protection when they buy a hot dog from a street vendor then they do when they buy a new home.
Planning permission is being eased so the builder can build loads of new homes, but the buyer cant put it right if they have to, sure they can get planning permission, but the builders hide in the contracts and the deeds clauses like this one i am battling my builder to remove "not to erect or construct any building or other structure whether temporary or permanent on the property (except for good quality domestic sheds and greenhouses of a size appropriate to the property) without the prior concent in writing of the Transferor for which a fee will be payable".
in otherwords the planning regs help the builder build a low quality home, but to put it right means you need both planning permission as well as expensive "builder permission" which they can choose to decline and then charge a fee. even if you do have planning permission. also they are now leaving these type clauses open ended (no time lapse) so it binds the next buyer, meaning you cant sell it should you want to.
The people from the building firm already think i am a complete pain, checking things, the solicitor thinks I am a pain, for wanting a house with normal workable reasonable deed restrictions. all as its affecting targets as they need to build x new houses this year otherwise they lose grands and this affects profits to the firms, so they dont want me holding them up for something so hideous as wanting a home build to a high quality, with fair deed conditions, the "help to buy scheme" (which i am not using) is helping to ensure the builders are charging top whack for these low grade homes though