David Cameron’s first pronouncements on housing fly in the face of reality. To propose as a serious solution to the housing crisis a further raft of social housing sales suggest that the Conservatives have learnt nothing since Margaret Thatcher introduced council house sales two decades ago.
Housing policy has to meet three objectives: to provide housing, ensuring that everyone has a decent home; to create sustainable communities; and to create wealth, especially to provide an asset base for low-income earners.
Council house sales achieved objective three in spectacular fashion, but at the cost of having an adequate supply of social housing and of tackling housing standards. The Tory legacy of poor conditions, overcrowding and homelessness
is witness to that.
But instead of getting hung up on home ownership, we need a housing policy that caters for our changing society. A sustainable community now has to be able to support a more diverse ethnic mix, more geographic mobility, greater longevity, more women working and the growth of single-person households.
Aspirations are higher. Young people don’t want to go on a list to wait for a council property. They want a place of their own once they leave college or university or start a job. Social housing faces the challenge of an ageing population, independent living for those with special needs and the panic over anti-social families.
So where does that leave housing policy? First, we need to assert that housing provided by social landlords is the best way to support the vulnerable. To tell a dysfunctional family struggling with severe behavioural challenges that what they actually need is to own their own home is not sensible. Equally, as research in Birmingham in the 1980s showed, home ownership can be a liability for people on low incomes.
That is not to rule out any form of asset transfer from the state to the poor. Equity stakes in their homes for social tenants, through capitalising rents or housing benefit, provides a way forward without requiring the transfer of the ownership. The aim here is not just wealth creation, but also to build more sustainable communities by ensuring that people on very low incomes or housing benefit have a vested interest in their property.
Second, for people whose lives are in transition, we need more flexible models of participation. Instead of being a fixed state, home ownership can be a sliding scale that shifts to adjust to the person’s needs: a lower stake for young people newly onto the jobs market; a higher stake for people at the peak of their earning power; and perhaps a reduction as people move onto their pensions and want to release equity for other purposes.
There are some excellent examples of three-way partnerships by local housing authorities, housing associations and developers. But what is needed is a massive scaling up to improve access.
There also has to be the development of suitable accommodation. Our European counterparts have always accepted high-density rented housing in flats. We struggle to create the legal framework for secure tenures, quite apart from the social acceptance of flats. The housing company Urban Splash are notable pioneers in this area.
The big issue for government is how to support the process, and not by simply providing the housing. For most economically active people the private sector will be the appropriate provider. However, for many young people the barrier to entry into the housing market is a combination of high property prices and debt. For older people the barrier to utilising capital tied up in their homes is lack of protection against financial losses. A combination of tax support and tight regulation of equity release or sharing schemes would help support people during periods of transition.
David Cameron’s target is no doubt the almost three million voters who live in housing association properties. This time Labour needs a better answer.