Report from the RGS London Housing Seminar

Seeking Common Ground?

There is little consensus about housing at present. However, one thing that all can agree on is that the London housing market is dysfunctional in a number of ways. This appeared to be the common ground occupied by speakers at the RGS seminar on the 20th June. It was a well-attended event (followed by a dinner for the more privileged attendees), which was chaired by Chris Hamnett (from King’s College London) with four brief presentations.

Former housing minister, Nick Raynsford offered a familiar but engaging analysis (although I winced at the use of the term ‘spatial apartheid’ to categorise post-war council housebuilding). In referring to the political choice made to reduce the local authority building programme post 1979, he commented that policies focussing solely on the private rented sector and owner occupation were doomed to failure for two main reasons. First, private housebuilding had never built more than 150,000 homes p.a. and second affordability will always limit those who can afford owner occupation. Current policies such as Help to Buy and Starter Homes therefore only perpetuate the problem. Raynsford’s solutions were to recognise that a comprehensive programme should involve a full range of tenures, that there should be a role for a range of providers, continuing growth in a decent PRS and institutional investment (including providing government funds). The fact that the vast majority of the £27bn public money in housing is spent on housing benefit is clearly unsustainable. In a theme developed in later presentations, Raynsford commented that we cannot develop without affecting the greenbelt.

Barney Stringer (from Quod consultancy) presented research (undertaken with Shelter) in answer to the question – ‘where should London build?’ Based on the assumption that London’s population is projected to increase by 1m per decade, this is an urgent priority – no other UK city has ever grown so much. Stringer’s argument was that to achieve this we need to double housing delivery by changing the use of land. His illustration (through mapping) demonstrated the main limitations of different models including the use of brownfield land (would involve moving where we work), tall buildings (raising conservation concerns), the greenbelt (essential but difficult to implement), garden cities (would need the equivalent of 10 Milton Keynes), estate regeneration (hugely disruptive), densifying suburbs or developing transport corridors. Each of these carries difficulties, but his argument is that if we rule out one of these options then acute stress is put on other options.

Robin Nicholson (from Cullinan design studio) posed the question ‘why wouldn’t we?’ His focus was on sustainability and he outlined a number of schemes – for example demonstrating how economic sustainability had been central to the Stonebridge Housing Action Trust, demonstrating how rent from a supermarket and health centre had helped to pay for community facilities. His key message is that we have to make the best use of what we have and to use imagination. Nicholson was scathing about office space in London, consisting of (totally unnecessary) air-conditioned glass towers. He advocated the One Planet Living Framework as a model to follow and saw domestic retrofitting as a potential solution. For him the media have a responsibility to stop encouraging us to consume what we neither need nor can afford – a worthy (if unrealistic) objective. The construction industry was described as ‘in complete denial’ about the sustainability agenda. Given that 62% of London comprises gardens or parks, he echoed earlier points that we need to rethink land ownership.

Paul Cheshire’s presentation at first resembled an economics lecture, highlighting the endemic problems of market failure, including the creation of monopolies (leading to land assembly problems) externalities (impacting on welfare) and a failure to provide public goods (such as open space, urban conservation and transport routes). Cheshire’s economic case for regulating land markets criticised the assumption that the housing crisis in London was caused by population growth – between 1951 and 2011 London’s population in fact increased by 0.1%. For him, the most important factor was a growth in real incomes and the result was an overvaluation of space, which had been a deliberate policy decision. His key critique rested on what he termed a ‘grotesque undersupply of land and oversupply of golf courses’. Hence there was a clear reluctance to address market failure – whilst we need conservation and parks we have not considered their impact on prices and costs. The problem of housing was that supply does not respond to demand and we need to provide houses where there are jobs. His target was therefore also the greenbelt, which redistributed housing assets to the richest groups. The overall effect of policy had been to restrict competition and encourage monopoly, resulting in a constructed shortage of space.

In response to questioning, Raynsford was challenged (by Paul Watt from Birkbeck) about the assumption that by the 1980s the crude national shortage of housing had been overcome – as Watt stated there was never a surplus of social housing in London. Raynsford defended the 1997 government’s focus on the Decent Homes programme to tackle the backlog of disrepair in the local authority sector, but admitted that the eco cities programme should have been taken further. Julia Thrift (from the TCPA) stated that (given the inherent risk of private pensions) it was entirely rational for households to look for security in housing wealth. Sara Mahmoud (from Shelter) focussed on the role of housing as a driver in the macro-economy. As one respondent commented housing could be described as a pyramid scheme, which can only end badly. A major part of the problem is the dominance of a constituency that wants to restrict the supply of housing and this has been underpinned by a systemic marginalisation of local authority housing. Duncan Bowie (from the University of Westminster) was critical of the lack of practical recommendations in the contributions. As he commented, without giving local authorities powers over land acquisition, providing government investment in social renting and imposing a tax on capital gains there is little chance of any real change taking place.

Dr. Tony Manzi, Principal Lecturer, University of Westminster & Executive Committee Member of the Housing Studies Association