I appreciate that some folk want me to believe - against all the evidence - that the supply of housing for purchase is not connected to high rents and high property values. Thing is that, however hard you try with this, I still don't think that the essential truths of supply and demand are not applicable to the sale and purchase of houses.
Tragedy struck one of those artist residences last week when 36 people died after a fire ripped through the illegally converted Ghost Ship warehouse in Fruitvale during a concert.This is in one of the world's richest cities where illegal conversion, overcrowding and ridiculous rental values contribute to an almost wholly unnecessary housing crisis. Here's Scott Beyer:
The horrific event could lead city officials to go after illegally converted warehouses across Oakland, especially as evidence mounts that building inspectors knew of numerous problems with the Ghost Ship property but didn’t take action.
The more pertinent point, at least for housing, is whether metros respond to such changes, or just sit on their hands…as the Bay Area has done. Between 2010 and 2015, the metro population grew by 100,000 people per year, but added only 20,000 units per year. Bay Area median home prices have thus predictably skyrocketed since December 2010 from $515,000 to $825,000.So at any point in the last five or six years there have been at least 100,000 people looking for somewhere to live in and around San Francisco and only 20,000 homes plus the relatively few additional as a result of outward migration. The result is what we saw at Ghost Ship - overcrowding, exploitation and death.
And don't think that the UK's overheating cities - especially London - are any different. I've been reading Ben Reeve-Lewis's blog on Landlord Law for some while and some of his stories about exploitative, dangerous and overcrowded housing in our capital beggar belief. The problem is that, for all the shouting and rhetoric, we've our fingers in our ears on this issue, continuing to pretend that the housing can be put somewhere else - words like 'brownfield' or 'regeneration' are popular here - rather than where people actually need to live so they can get to the jobs our economy is providing.
Some time in the next week or so (right now we're told probably 16 January) the UK government will publish a 'White Paper' on housing. The content of this paper remains a matter of speculation but it has been strongly hinted that the need to build homes will trump the desire to protect open countryside on the fringes of towns and cities. To understand how the reaction from some MPs might run, we can look at the Neighbourhood Planning Bill currently before parliament:
In a Tory split over a planning bill, 15 backbenchers have tabled amendments which seek to protect land around cities and to increase the powers of local people to stop new development.Now I know that these MPs mean well. They face considerable pressures from well-organised local groups largely opposed to any further development in the semi-rural exurbs they represent. But when the consequence of these actions is the sort of overcrowding that led to those deaths in Oakland, we perhaps need to start asking quite where we want to put our priorities. I've no particular desire to defend housebuilders but I don't consider them unspeakable - someone has to build the homes people need.
Conservatives rebelling on the Neighbourhood Planning Bill included Andrew Mitchell MP, who told HuffPostUK “I shall be questioning the Government’s commitment to the greenbelt in forceful terms” in the chamber.
Heavy-weight backbenchers Crispin Blunt, Nick Herbert and Nicholas Soames also opposed the Government’s plans. Soames tweeted on Monday that the “unspeakable behaviour of housebuilders” needed to be “dealt with”.
OK so you're asking how it is that the housing needs of relatively poor, often immigrant communities in central London can be met by building houses outside Crawley or at Sutton Coldfield? The answer lies in a hidden challenge facing our big cities - a generation of younger people wanting to do what folk do and get married, raise a family. Right now they can't do that - check out the sort of rented accommodation in central London and then ask whether you think is sensible or even possible to raise a family in such places? The result is that people don't get married and don't have families - here's the world's starkest example, the Bay Area of California:
Over 70% of households in San Francisco are childless. The situation in London is nearly as stark - about 64% of Inner London households are child free. As we move into suburbia - Outer London - the pattern changes with 27% of households consisting of couples with children. The problem is that the outer London suburbs are, as the children brought up in these plces soon find out, increasingly unaffordable.
Just as with San Francisco, there is a big difference between the growth in housing demand in London (about 60,000 per year) and the delivery of new housing (currently about 25,000). This would be fine if the housing need was being met elsewhere (i.e. in the South East beyond the Greater London boundary) but it seems not:
The 30 fastest-growing non-London local authority areas in percentage terms are almost all in the South-East (Table 3). Of those, 21 were below the national average in terms of their housing supply measured against household growth, and only five supplied enough homes to keep up with long-term need. These were Uttlesford, Dartford, Ashford, Aylesbury Vale and Slough. Collectively, London plus these next 30 areas expect to experience 38 per cent of England’s household growth over the next 25 years, yet they contributed just 26 per cent of last year’s housing supply.This is the context for the Nick Soames complaint. He represents one of those places - Mid Sussex - that has, in part, to meet the pressure on housing need generated by the economic success of London and all the yelling about housebuilders won't change this fact. What MPs should be doing is discussing the nature of this new demand and considering how new suburbs can be built to house England's future families. There are lots of possible answers but nearly all of them, for these places in London's exurbia, require the use of land that is currently designated as 'green belt'.
The question for me isn't whether Nick Soames and others can stop all this terrible housebuilding (at a terrible cost to those future families) but whether they're actually doing their jobs. Have they met with the 'unspeakable' housebuilders? Sat down and talked to local planners about the issues and challenges? Discussed different options for meeting local housing need? Or are they just grandstanding in parliament to sweep up a few votes (that given Soames' majority he probably doesn't need)?
Right across England we need a more mature debate about housing development. Not the polemical ASI "scrap the green belt" debate but rather one with local communities about how much extra housing they'd be happy with and where it might go. After all most of those people have families, they know how expensive housing is these days and they want their children and grandchildren to have the joys of home ownership. Instead the dumb voices of the CPRE and assorted BANANA groups are allowed the space to say that all the housing need can somehow be met on brownfield and regeneration sites in the big cities.
What we need isn't new skyscrapers in London (or for that matter in Manchester, Leeds or Birmingham) but new suburbs - you can call them garden cities if that floats your boat - where families can come to live, grow and thrive just as did their parents and grandparents.