Housing crisis? What crisis?

Is there a housing crisis in the UK? If so, would building more homes fix the problem?

This debate has been sparked by Ian’s blog arguing that house prices are determined by the supply of credit more than the supply of housing (I’m probably summarising his piece poorly, so you should check it out yourself).

This argument has been met with several responses. These highlight the fact that ‘housing crisis’ has become a useful slogan for a range of interests who disagree both on the nature of the crisis and the reasons for solving it, but are united in believing that there is a crisis and that an increasing in the supply of new houses would solve the crisis.

We can usefully distinguish between a few different interpretations of the housing crisis and ask whether each would be solved by building more homes.

Rising numbers of people who are homeless and falling rates of home ownership are probably not best solved by building new houses.

Whereas, overcrowding, the very high rents paid by some households and the failure of high productivity places to expand are probably best solved by building new houses.

However, in these cases the solution is not as straightforward as building any type of housing and in fact probably come into tension. For example, overcrowding is probably best solved by building more council housing whereas high productivity places probably want to build more private housing.

1. Homelessness

The number of people who are homeless (either sleeping rough, in temporary accomodation or ‘hidden homeless’) is up dramatically since 2010 (see e.g. here or here).

If some new housing was allocated to homeless households this would reduce the amount of time these households spend being homeless. However, benefits changes and security of tenure would be more effective ways of stopping people becoming homeless than building new homes

2. Overcrowding

Over a million households live in overcrowded homes (see e.g. here).

Overcrowding is much more common in social and private rented accomodation. If there were more houses these households could move into these new houses. However, that relies on the new houses being of a certain type and these households getting priority

3. Generation rent

The percentage of households who own their own home is declining. This trend is particuarly prevalent amongst younger people (see e.g. here).

Kate Barker argues that the impact of housing supply on the cost of buying houses is limited and other factors (e.g. interest rates) have a bigger impact. To significantly reduce house prices through a housebuilding programme would require an enormous programme.

4. Housing headwind

Over the past couple of decades there has been an increase in both the number of households who rent privately and the percentage of households who are paying more than a third of their income for housing costs (see e.g. here)

Not all households have seen their rents dramatically increase. The situation is localised. A large increase in the supply of housing in areas with high rents would reduce rents in those areas

5. Productive places

Areas such as London and Oxford have high productivity and have been creating jobs in the past few decades. If they built more homes, more households could move to these areas and get work in these sectors. However, these areas have not created new homes at the rate that some would like (see e.g. here).

If there were more houses in places like Oxford, then more people could work there.

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Give me Shelter

Quite the day in the world of housing policy. Here is what we know:

  • Jeremy Corbyn promised that a Labour government would introduce some form of rent controls
  • Shelter produce a blog aruging that “setting the entire rent can cause big problems”
  • Paul Mason wrote a twitter thread calling Shelter’s integrity into question
  • Shelter announced that they have hired Greg Beales (Former Labour Party Strategist) as their new Director of Policy & Comms

Why does any of this matter?

  • Shelter produced a thought provoking piece last year, arguing that advocates for social housing had got themselves into a situation where they were calling for policies that do not command significant public support and which politicians can easily ignore
  • Rent caps (whatever their policy merits, on which there is much debate) are popular

It will be interesting to see which line Shelter’s new CEO takes in her Today Show interview. Will Shelter try and follow the logic of their piece last year and try and attach their cause to a more populist policy or stick more closely to a policy based response that focuses on the mixed evidence base around rent controls?

 

The opposite

Fathers’ day is a disturbing time of year. Full of joy and cheer thanks to my wonderful wife and daft daughters but full of dread and despair thanks to the ghost of my father, who died before I was a teenager.

All ideas contain the idea of their opposite.

Housing policy has suddenly become a lot more newsworthy due to the horrific fire in Grenfell.
The images of confusion, anger and grief have touched many of us and left us deeply disturbed.
Questions come to mind but answers bring no respite. Even if we find out why the fire happened people will still have died and others will live the rest of their life haunted by grief and trauma.
The idea of social housing contains the idea of home ownership.
British people almost uniformly aspire to own their own home. Governments have responded to this desire in a range of broadly ineffective ways.
Both the desire and the response have done much to traduce the idea of social housing.
Everytime people say they want to own their own home they are also saying they do not want to live in social housing.
The coalition government put lots of money into subsidising mortgages and cut the amount of money spent on maintaining social housing.
When challenged on shoddy work contractors have often said to me “what’s it matter, it’s social housing”
But fewer and fewer people own their homes. It’s as though the very desire to own our homes makes it harder for us to own our homes.
Wanting something contains the idea of never getting it. Like sisyphus we push and we push but we get no closer to the top of the hill. All the while we’re haunted by horrors from the past, the shame of our unrealised dreams and the pity of our efforts.

What problem to solve?

I will start a new role as CEO of The Peel Institute in January 2017. The Peel is one of the ‘community hubs’ that operate within the London Borough of Islington.

What problems should organisations like the Peel attempt to address?

There are many answers to this question. For example, some would say community cohesion or ‘placemaking’.

No doubt these are both important issues to address. We have to continue to build good relationships between people from different backgrounds and neighbourhoods that people enjoy living in.

However, tremendous strides have been made in both these areas.

The chart below shows the percentage of people who say that people from different backgrounds get on well in their local area

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And this chart shows the percentage of people who are satisfied with their local area as a place to live.

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As you can see from both charts, people are, by and large, happy with the neighbourhoods they live in and believe that people from different backgrounds get on well together.

Contrast that with the chart below, which shows the percentage of people who think they can influence local decisions (and the percentage of people who think it’s important to be able to influence local decisions).

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The vast majority of people do not feel able to influence decisions, but think it’s important to be able to do so. What’s more, the percentage of people who do feel able to influence decisions has not increased at all in the last decade.

One of the reasons for this may be the focus on ‘involvement’. It’s often assumed that the way to give people a greater sense of control is to create mechanisms whereby their voice can be heard. These are often called things like “forums” or “panels” etc…

Actually, as the chart below shows, people are not that keen on being involved in the bureaucratic processes that surround council decision making.

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The conundrum could be summarised as:

  • People think it’s important to be able to influence local decisions
  • People do not feel able to influence local decisions
  • There is only minimal (and dwindling) appetite for one of the established solutions to this problem

Pioneering new approaches to solving this issue is as pressing a matter as building good relations and improving the quality of local places.

(Data here)

What next for supported housing?

The news that the government will back the Homelessness Reduction Bill will be welcomed by many as an important step in reducing the shocking levels of homelessness in the UK. However, when combined with the proposed changes to funding for supported housing it raises the question of what the future holds for charities that provide services for people who are at risk of being homeless.

Over the past 3 years I have had a unique vantage on this as Director of Development at Hestia.

In that time Hestia has expanded considerably. The charity is supporting something like 60% more people a year than it was when I joined, with turnover up a fifth and staff numbers up by around 40%.

The ways in which Hestia has expanded are suggestive of some of the routes charities working with people at risk of homelessness will need to consider if they are to continue to be viable, in the context of reduced local authority funding and reduced income from rent.

New ‘client groups’

While it is certainly true that local authority funding for traditional models of supported housing such as hostels has been squeezed, there are other sources of funding for specific client groups that have not felt the pinch to the same degree.

Hestia is now the largest provider of outreach support in the country to people the Home Office terms ‘victims of modern day slavery’. Hestia also now provides 5 safe houses for this client group. Other organisations have had success in providing ‘recovery houses’ or ‘crisis houses’, that provide short term support to people either to prevent the need for admission to a mental health ward or following admission.

Successfully identifying emerging ‘client groups’ in this way will be a key skill for supported housing charities who want to continue to provide high quality support to people at risk of homelessness.

Learning to speak ‘health’

A number of Clinical Commissioning Groups and Mental Health Trusts are, at variable rates of progress, getting more involved in funding housing related interventions.

Hestia now provides support to people being discharged from hospital in Hounslow, Ealing and Central West London as well as support to people using GP surgeries in Brent. 10 years ago much or all of this support would have been commissioned by the local authorities. However, they simply do not have the funding to do so, and it is unlikely that they will be in a position to do so in the near future.
Charities that can figure out how to explain their impact to health commissioners will have a better chance of being able to sustain their work.

Moving past labels

Anyone who has worked with people who are homeless or who are at risk of being homeless will tell you that the people they work with are, much like all people, complex and varied. Anyone who has worked in supported housing services will tell you that whatever labels are applied to people (“single homeless”, “mental health”, “substance misuse”) there is not actually nearly as clear a line between the needs of the different people who lived in the various hostels.

Hestia now provides a number of services for people who are variously described as ‘complex’ or ‘socially excluded’ or similar. What this means in practice is that people can come to these services with a variety of needs and the service will still support them to live as independently as possible.

Of course, it is important to maintain specialist knowledge and skills, for example relating to mental health or substance misuse, but those charities that can provide ‘person centred’ support, that recognises the complexity and variety of people’s experience, will be in a stronger position.

Next steps

None of this is to underestimate the challenges facing charities who support people at risk of homelessness. Local authority funding and income from rents will continue to be reduced even as ever greater numbers of people face the risk of homelessness.

On a personal note it’s been a privilege to be at Hestia for this time. I am moving on to be CEO of the Peel Institute, a community association in Clerkenwell. But more on that later…

What next after Brexit?

“the problems facing inner-city communities do not result from a lack of effective solutions, but from a lack of power to implement these solutions”

The Brexit vote represents another victory for campaigns based on the idea that there is something deeply wrong with British society and that people have little control over the decisions affecting their lives.

Despite being on the losing end this time, David Cameron has benefited as much as anyone from this message. His Conservative party ran in 2010 on a slogan of “Broken Britain”. In a speech in 2011, after riots in London, he defined our ‘broken society’ as one featuring

“irresponsibility, selfishness, behaving as if your choices have no consequences, children without fathers, schools without discipline, reward without effort, crime without punishment, rights without responsibilities”

These words make for effective campaigns because many people do not feel able to influence the decisions that affect their lives.

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This was a theme that the Leave campaign played on strongly with lots of talk of ‘taking back control’. Polling shows that themes of control (over decision making in general or levels of immigration in particular) were the main reason given for voting to leave.

While the Brexit and Broken Britain campaigns were successful they have not yet lead to changes to the underlying sense of a lack of control felt by many people.

David Cameron’s ‘Big Society’ was meant to fix ‘Broken Britain’. Perhaps the nicest thing we can say about that is that the Broken Britain campaign was more successful on its own terms than the Big Society.

We might well predict that the implementation of Brexit will not lead to people feeling a greater sense of control over their lives. Indeed, we might go further and predict that the result will lead to a greater suspicion in Whitehall of the very idea of trying to give people control of their lives, given the establishments well documented opposition to Brexit.

If this does happen we can also predict that the resentment and alienation many people feel about modern Britain will continue to find ways to manifest itself, primarily through campaigns lamenting the state of the world and offering very little practical means of improving it.

Several years ago I saw Umberto Unger give one of the most amazing speeches I’ve ever heard. He offered a different way forward. One which was so radical that I remember inhaling sharply when he said it. He proposed having annual, programmatic referenda.

I think what he meant was to offer the public a different kind of choice than the one that was offered this time round. One of the policy problems with the Brexit vote is that no one agrees what it means. A vote on alternative programmes would be much clearer.  People would be given the chance to vote for which programme would be implemented in the coming year. And then the government would have to implement this.

This is an incredibly radical idea and one at which many people would baulk. However, it does serve to make us think about how we could actually give people a greater sense of control of their lives.

 

Working class people are less likely to vote and making it easier to vote wont change that

People on lower incomes are less likely to vote than people on higher incomes.

image (4) And it’s not just voting. A recent American study found that “Lower-income people are more likely than others to withhold political opinions by saying “don’t know“”

Some, for example this recent report by Policy Network have argued that we need new institutions to engage people in politics. They called for:

“local deliberative bodies or citizen assemblies, support local authorities conduct effective participatory budgeting exercises, and experiment with new means for the public to engage in political decision-making processes in more direct and sustained ways”

There may well be a place for these things but the chances are that they are just as likely to replicate existing inequalities as they are to overcome them. For example, if working class people do not feel engaged in politics but middle class people do, there is a risk that the middle class people would dominate any new local assemblies.

Historically, one of the ways that working class people got involved in politics was through membership of formal associations such as trade unions. People learned that their opinions were valid and deserved to be heard through being members of these clubs or associations.

However, membership of trade unions has been in decline for many years.

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Indeed, few people are members of any type of association (although significant numbers are still members of sports clubs).

The situation is starker still if we break the numbers down by age. Most people under 35 are not members of any type of political, voluntary or recreational association.

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It’s probably no coincidence that as well as not being members of clubs, most people under 35 also do not think that most people can be trusted.

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There is plenty out there to give working class people the impression that their views don’t count. For examples, schools and workplaces can often reinforce the view that it’s best to keep your head down rather than speak out, particularly on controversial topics. Changing this requires far more than making it easier to vote.