UK communities secretary Sajid Javid’s white paper on housing recognises the problem: too few houses and flats are being built for the people that need them. Sadly, his commitment to restrictions on housebuilding, to maintaining the ‘green belt’, means that there is little he can do to stop the problem.
With Britain’s housing stock now at a value of over £5.2 trillion, Britons are surprisingly badly served. Average house prices are above a quarter of a million pounds, and approaching £300,000 in London; rents average between £900 and £1,250 a month in London. The reason for this, as Javid rightly says, is that too few homes are being built for the people who need them. With limited supply and growing demand, prices rise.
The social impact of high rents and house prices is damaging. Outright homelessness is on the rise: the number of rough sleepers has doubled to 4,000 over five years. Living on the streets is still exceptional, but many more people – around 60,000 households – are assessed as being in ‘priority housing’ need by local authorities because they are threatened with homelessness. Hidden deeper in the statistics are the real problems of overcrowding, which has risen precipitately with house prices and rents.
Worse still, with wages stagnant and rents and house prices rising, housing shortages exacerbate income inequality. Higher prices help those who own their own homes, but penalise those who are renting, as more young people are.
The reason too few homes are being built is well known. Legal restrictions on housebuilding put in place under the Town and Country Planning Act create ‘green belts’ that limit city expansion. Since they were first proposed 60 years ago, green belts have grown to around 13 per cent of England’s total land. This is much larger than the developed land, which is around seven per cent of the total. Far from being the case that the countryside is under threat, the towns are being strangled by a green belt.