Housing Solutions Can’t be Left to the Market

By Adam Peggs
While there is now near-consensus that Britain’s housing market is a calamity, the breadth of vision required to alter this is often absent, while the solutions to really change things remains relatively tentative.

On the left we want more than just active housing policy and progressive social democracy if we are to transform the way housing is provided

You even have Progress, Labour’s centrist wing, publishing pieces from an ex-Conservative Councillor calling for “radical and public solutions” to the housing crisis. In fact, the language of radicalism on housing is just about everywhere: The Spectator, The Times, The Daily Telegraph – you name it. Of course few of these publications on the right have argued for anything other than re-heated Thatcher-era policy, while those on the centre-left have rarely offered anything beyond their own comfort zones.

Yet, housing is an indispensable area in the struggle for a fair society free from exploitation   and the left must live up to that aspiration. We ought to realign Labour housing policy from the strident progressivism of the manifesto, back to the left’s pledges circa 2015 and 2016 and be able to articulate a vision of a housing model which goes even beyond that.

This would surely involve taking a more sceptical look at the national obsession with home-ownership, in favour of a philosophy which is more oriented toward security, affordability and quality of housing.

Labour’s 2017 housing document, which contained a range of exceptional policies, appeared to take the view that Labour’s key goals should be ‘to make private renting a more affordable and more secure type of housing’ and to help people get a foot on the housing ladder. Though admirable at first glance, this is uncomfortably close to the right’s vision of ‘property owning democracy’ and ignores the fact that giving primacy to private housing models routinely leads to worse outcomes. While markedly more impressive than anything to come out of the Tory Party, this seemed to indicate a degree of pessimism about the future of social housing and of an altogether different way of organising housing.

In specific terms, Labour should be thinking about reversing the watering down of its commitments on social housing between 2015 and 2017. By the time last year’s General Election came, Labour had moved from advocating the construction of 100,000 council houses per year to proposing a target of 100,000 units of social housing by the end of a five year period. The housing document may have watered this down further with the words social housing effectively replaced by ‘genuinely affordable homes to rent and buy’, implying the inclusion of forms such as shared ownership and private rents.

Labour also wouldn’t be unwise to commit to having social housing built by Direct Labour Organisations, local authority owned bodies, which would effectively cut corporate profit out of the construction process. Related to this is Labour’s welcome commitment to something along the lines of a Land Development Corporation, which has proved successful in the past and in contemporary South Korea. Such a body would purchase land on behalf of the government and sell it on to councils and Housing Associations, ending the scandal of social housing providers being ripped off when they acquire land. The savings from this would likely allow for lower social rents, increased investment in social housing or a combination of both. This would be along the lines of how Nye Bevan delivered a mass council housing programme in the postwar years.

While the private rental sector continues to play such a large role in UK housing, it’s necessary for efforts to re-regulate the sector to be bolder. On security for renters there is perhaps little reason not to return to the norm before the late 1980s, in which tenancies were so secure that they were effectively indefinite. And while Labour did advocate for rent controls last year, the proposals were relatively modest – only proposing a cap in line with inflation. This would still leave Britain having softer protections for tenants than much of Western Europe. In an era in which the right’s policies have set in across most of the continent, this was a surprisingly modest policy. Rent controls more in line with countries like the Netherlands would surely be worth consideration and fortunately the party may already be moving in this direction – though that isn’t a given.

But the left should also be looking forward to ambitious next steps which go beyond this, from the approach of mending the housing crisis into the territory of transformative change.

This could well involve attempts to build a different kind of housing, the housing co-operative, a system in which tenants are members and therefore act as joint-owners of the house or houses. As a form of tenure a housing co-op would provide tenants with more rights and autonomy over their own accomodation than the other forms of renting, without the financial barriers to home ownership.

A generation of state-funded housing co-operatives would be unorthodox but could be a key plank of future housing policy, providing tenants with affordability, stronger rights and independence from a bureaucratic state. To make this happen would presumably require public money, likely from the budget of a social housing programme and could lead to concerns about the co-ops not being a public asset. Despite this the housing co-op could still be a significant part of a positive alternative model in housing, given their autonomy.

The role of Housing Associations should also face some questions. I lived in a green Housing Association home a few years ago and respect and value the role they play in providing genuinely affordable homes to those who need it. However, Housing Associations have in recent decades often served as a more expensive alternative to council housing and as a way for governments, especially New Labour, not to build council housing.

Worse still, many homes built by Housing Associations are being rented out at more expensive, so-called intermediate rents, others operating under shared ownership, with huge wads of public money going to executives. Labour’s shift from pledging council housing to social housing could be seen as a quiet acceptance of the flaws of this model. Yet, because of these flaws, alternatives such as bringing Housing Associations under public control (or even ownership), or diverting funding toward council housing would be worth serious consideration. As would a demand for all of their rents to be lowered to the levels typical of council housing.

There is also some need to reevaluate how we deal with the phenomenon of homes which find themselves empty for long periods of time. Last year some 200,000 homes laid empty, often the unused playthings of the rich, while hundreds of thousands of people found themselves homeless or languishing on waiting lists for social housing.
Despite the inevitable howls of outrage, there would be little wrong in returning to arguing for a ‘programme of action against property held empty without justification’ as advocated by Labour in the 1980s. Seeking to transfer such homes into the hands of social landlords would be every bit justifiable.

It’s plausible that there are numerous ways to fix the housing crisis, some better than others, but they all involve pivoting away from the policies of the centre and the right. Labour has massively succeeded on these terms, but some question still remains over how big the rupture with the orthodoxy should be. If we are to imagine what the project of the left looks like on housing, then it must mean a lot more than just resurrecting the post-war housing model.

Finally, a real shift in housing provision might have to involve a  considerable increase in the proportion of rental properties which are rented not for profit and at typical social rents — with the aim of bringing about a housing system where everybody has access to quality, affordable public housing. This would involve a change in the way some of us conceive of social housing, from a place for the least rich, to a high-quality form of housing that’s desirable for all.  This could involve a vision of many forms of social housing, with the presumption that it would be built for all. There is also some precedent of mass social housing in Vienna, where half of the whole population are social tenants. This would likely too have to involve a significant change in how social housing is run, in the direction of the democratic ‘resident-controlled’ model discussed by Karen Narefsky.

A marked shift away from absentee landlordism may not be politically tenable now, but would nonetheless be the right choice for a society which wants to promote co-operation. If we are to break loose from the logic of the free market and top-down control of resources, housing, as the foundation of many people’s lives is a key place to start.