Emily Carver is Head of Media at the Institute of Economic Affairs.
It would appear the Government has all but given up on making housing in Britain more affordable. In last year’s Queen’s Speech, they promised to bring forth a Planning Bill to help more people onto the housing ladder.
Back then, they were at least making the right noises. One year on, the government has u-turned, given into NIMBY outrage, and abandoned reforms in favour of minor and trivial changes.
For a ruling party that is struggling to appeal to those under the age of 40, kicking the can down the road once again could be a matter of survival.
With rents reaching record highs across the country and the age of home ownership continuing to rise, it’s hardly surprising that communist policies like rent controls are becoming more appealing to the public. As Sadiq Khan wrote in The Independent, over two-thirds of Londoners now support this policy, according to a YouGov survey.
Of course, the London mayor’s claim that there is some way to introduce rent controls London “without choking off supply” is disingenuous and economically illiterate. Nowhere have rent controls proven to improve affordability and availability of housing.
Yet, at least in theory, the popularity of such a policy is incontestable.
This reality shows firstly, how important the issue of housing affordability is to people, and secondly, how politically dangerous it is for the Government.
It’s an issue that can easily mobilise support for left-wing political parties – inaction is a gift to the Labour party. With London rents up 14 per cent in one year (of course, in no small part to the easing of pandemic restrictions), housing may well have contributed to Labour’s wins in last week’s elections.
And, as the IEA’s polling shows, 80 per cent of millennials blame the housing crisis on “capitalism”. Presumably, they also believe socialism is the solution.
This should provide a wake-up call to ministers. If the Government is to counter these tempting, quick-fix, populist measures, it needs to do more than tinker round the edges. The 2020 White Paper, ‘Planning for the Future’, set out plans to make the planning system more rules-based and less discretionary, and so reduce the political power of anti-development obstructionists.
However, by axing these plans the Government has made clear that it can’t escape the straitjacket of NIMBYism.
At the same time as not going far enough on planning reform, some of the most popular announcements today may even, in reality, prove counter-productive.
Reforms to renters’ rights, for example, including scrapping no-fault evictions, may have the perverse effect of not only undermining property rights but dampening supply by making it less attractive for landlords to rent out their properties.
But no level of renter protections can make up for not allowing enough housing to be built.
How can the Government possibly address the cost-of-living crisis without solving the problem of affordable housing? And how can politicians advocate a liberal immigration system, with net immigration reaching the hundreds of thousands nearly every year over the past decade, without addressing honestly where people are going to live?
Now, I have some sympathy with the NIMBYs. If I owned a beautiful period property with stunning views, I too would be miffed by the prospect of a hideous monstrosity (aka a modern housing development) going up in my backyard.
And I have some sympathy too with Michael Gove, who has been battling his own colleagues on this issue.
But there will always be those who would appeal the construction of a picket fence if it were painted the wrong colour.
Sure, a softly, softly approach to ensuring local support for “gentle densification” of housing, by allowing residents to draw up local design codes, could have a positive impact. It may empower local people to feel they have more of a say over what is built in their area and, when people realise that the buildings are no longer monstrosities, local residents may stop viciously opposing new developments.
But this may well be a generational shift, rather than the radical steps we need now. It’s hardly surprising that people are choosing to start a family later and later, when the average age of buying you own home is now past the age of 30.
There is simply no way the Government can continue to give into the demands of MPs for short-term popularity, and the very noisy vested interests of a small minority of their constituents, at the expense of those seeking to rent at a reasonable price, and to get their first foot on the housing ladder.
Ultimately, it seems many are in denial about the severity of the problem we face – and the impact this issue will have on voting patterns. Why else would any serious attempt to shake up planning be axed at a time when we’re facing the biggest drop in living standards since 1956?