Is there a housing crisis? Resorting to hyperbole is a tempting means for politicians and commentators to attract our attention. There is also a widespread notion that while error or falsehood that spread complacency is quite wrong, when it is alarmism and panic that is created, it is entirely virtuous. This week Gillian Keegan, the Health Minister, said it is better to “over-react than under-react” to Omicron. There is no reasonable basis for claiming that the world is going to end due to climate change. Yet without quite giving a date for the apocalypse, we hear much about the “climate emergency”. “One minute to midnight on that doomsday clock”, as our normally upbeat Prime Minister likes to put it. Such messages have meant some young people are suffering depression and resolving not to have children of their own.

So far as housing is concerned, the costs have obviously sharply risen, compared to those faced by previous generations; while other bills – such as for groceries – have gone down in real terms. But a “housing crisis” for an individual would suggest not just that paying a bill is a struggle, but impossible – with the result being someone is thrown out due to eviction or repossession. The Ministry of Justice produces statistics on these miserable outcomes. The Health Foundation has analysed them and found that the “rate of homelessness claims by previous tenure” has generally been falling. Those in social housing are most likely to be evicted – but that has fallen from 24.6 per thousand households in 2009 to 15.1 per thousand in 2019/20. For those in the private rented sector it’s down from 11.4 to 9.2. So far as mortgage repossessions are concerned it’s down from 10.7 per thousand households a decade ago to 3.2.

Those measures suggest that if there is a crisis it is less severe than a decade ago. Not that being a desiccated calculating machine tells the whole story. How many couples have abandoned hopes of a future together, married with children, due to housing costs? So the report this week from the Centre for Social Justice –  “Exposing the hidden housing crisis” – had a powerful title. How many relationships have floundered ostensibly about some other frustration but with the underlying cause being the lack of a decent home to settle in? The Ministry of Justice might not be able to offer statistics for those unfulfilled dreams but there are probably rather a lot.

We often talk about home-ownership becoming unaffordable. But the report is right to add that increased rents are also a challenge for many. Paying the rent to a private landlord used to take up a tenth of income – now it is around a third. Often when incomes are too low to pay the rent, the taxpayer picks up a hefty bill. The report says that it will come to £30.3 billion (including both Housing Benefit and the housing element of Universal Credit) for 2021–22.

The problem comes with the implication in the report that the solution is a higher ratio of social housing – rather than a general increase in the housing supply. Theresa May states in the forward:

“We tightened up the planning system to ensure developers meet their obligations to deliver more affordable homes.”

The report notes, in passing, the Government’s target of 300,000 homes being “needed”. But it adds that “focusing on the gross number of homes delivered does not tell us much about the types of homes being built, and for whom they best cater.”

Of course, what is needed for house prices to fall is a much bigger increase in overall supply. It could be via social housing. Suppose a million new social homes, spread around the country, were miraculously built overnight. The timescale might be a stretch but otherwise it could be done. The public sector owns millions of acres of surplus land. The principal cost of housing is the land rather than the bricks and mortar. The state could give the necessary land away to housing associations, with planning permission, then it would be perfectly viable. The alphabet soup of affordable housing categories – social rent, affordable rent, shared ownership, discounted market sale – might be varied in the mix. But if housing associations had the land for free it would be possible to make the figures add up, while offering to sell or rent below market prices.

It would also follow that if these million new homes flooding onto the market were attractive and of good quality then there would be plenty of takers. That would have implications for the private sector. Rents and house prices would dive. It wouldn’t much matter if the Government sold the land (thus helping to tackle the National Debt) and a million new homes came on the market at full market price from private developers. Either way house prices would soon plunge.

You have probably spotted the catch. Falling house prices would mean those of us who have already bought see our notional wealth starting to tumble. Those who bought recently would find themselves in “negative equity”. A large number of such cases and soon the media would talk about…”a housing crisis.”

As a home owner, I still say that the Government should ease supply and allow prices to fall to the natural level. We could reintroduce mortgage interest tax relief. Those with the highest mortgages would benefit the most – so that would placate recent buyers. Many home-owners also have children growing up fast who would like to buy – without having to impatiently wait to inherit.

I can see that a policy that will lower house prices is something that politicians are nervous about embracing. But declaring a “housing crisis”, while failing to call for a reduction in housing costs is obfuscation. The Government should put up or shut up.