Want to solve your city's housing crisis? Simple - build more houses, any sort of houses

So much angst is being expended on trying to solve London's (and other places too - Cambridge, Oxford, Manchester and so forth) housing problems. It seems that the solution is rather simpler than all the think tanks, planners and mayors suggest:

It is not some magical mystery as to why Sydney's rental prices are declining. And it's certainly not due to rent control. It's because Sydney's seeing a building boom. The size of Sydney's apartment market has doubled in two years, and landlords have had to drop rents in order to get tenants.

The Sydney Morning Herald reported over the weekend that the city has seen more than 30,800 multi-unit dwellings built last year, a record for any Australian city. And there still are nearly 200,000 additional dwellings in various stages of development. The city is seeing a glut driven by investors. And those investors are now leasing out the apartments.

So it's easy. Allow more development. And to do this you have to encourage speculative investment:

About half of Australia’s apartments are likely to be owned by an investor. And lending to investors in NSW, rose sharply a few years ago, fuelling a real estate investment boom that created this massive rise in rental stock, Ms Owen said.

There are risks here but primarily (as connoisseurs of Spain's 2000s housing boom will know) for the investor not the renter or the taxpayer. So why is it that governments are stopping things that drive this investment (foreign buyers, Airbnb, liberal planning regulations) and then complaining that there aren't enough houses? Or, worse, blaming high rents on those investors - look at Barcelona's Airbnb protests - rather than on the failings of mayors and local councillors.

I appreciate that mayors want to placate the NIMBYs (remembering that current residents have votes while possible future residents don't) but if, in doing so, those mayors propose counterproductive ideas like rent controls, foreign investment controls and height limits then they should be bundled out of office for being dangerous fools.

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Forget the flowers, what you'll need in San Francisco is a load of money for the rent

San Francisco is a great city. Today it's a great city filled with billionaires, something that rather explains its problems (or why they're not being sorted out). But San Francisco, in one respect, isn't unique but just the best example of how to truly, utterly screw up your housing markets.

We arrived in San Francisco by train. Sorry, we arrived in San Francisco on a bus (an hour late bus) because the train doesn't go to San Francisco, it finishes in Emeryville on the other side of the bay. So we arrived at a bus station, a bus station without a taxi rank (I guess because the sort of people who arrive in San Francisco on a bus aren't the sort of people who use taxis). It seems that, for all its progressive credentials, San Francisco's relationship with public transport - at least the sort that brings people into and out from the city - is not great. As, it seems, Google employees discovered with their benign employer laid on buses to work.

Anyway. Having got a taxi (big thanks to the bloke in the bus ticket office who rang for one - pretty sure it's not the first time), got to our hotel and settled in by having some nice pasta and a hugely expensive bottle of white wine, we'd a city to explore. And what better way to do this exploring that by buying a bus ticket!

The Big Bus was great. For a couple of days we'd access (at a good San Francisco price) to their buses as they toured round San Francisco. And some of these buses have a guide - in our case a thirtysomething Jewish guy with a beard and ready wit. As we went round the city he described the sights, elaborated on the history and pointed out things we might not have otherwise noticed.

So the bus is going up Market heading towards the Tenderloin as our guide starts to talk about the rent - and why it's so damned high. All this is nicely mixed in with the history of the great San Francisco earthquake and fire of 1906. Pointing to some early 20th century apartment buildings, our guide, says: "there are SROs, let me tell you about SROS".

SRO is an acronym for 'single room occupancy' and it's a form of tenure where, for your rent, you get a room with a basin. Pretty good stuff if you're a single, sort of itinerant, construction worker looking for somewhere to sleep whilst you rebuild the earthquake and fire ravaged San Francisco. Cheap, fits the bill and better than a washing line. But in 2019?

Our guide asked us to guess what the rent is for one of these SROs. The usual to-and-fro banter ensued concluding with a shocked silence when he said; "$700-800 a month." If you want a room with a private bathroom, it's over $1000. It really is an obscene amount of money to rent a room in a boarding house. Yet this is the consequence of policies that prevent new high rise development, constrain the development boundaries of the city and provide a myriad of excuses and justifications for stopping or slowing new housing development. Unless - as our guide pointed out - you're rich enough to afford to pay the $7,500 monthly rent in a new development near the (splendid but ever-so-slightly pastiche) San Francisco City Hall.

There are a pile of reasons why the rent's so high in San Francisco but most of them are down to the combination of creating thousands of new, exciting and well-paid jobs but not building the thousands of homes needed to house the people who're taking up those exciting and well-paid jobs. This is why folk in Chinatown are complaining about the lack of housing, why there's twice as many homeless than in Chicago despite San Francisco being a third of the Windy City's size, and why folk in the Mission were stoning buses taking Google employees to work.

Just witness the madness of trying to get a launderette listed as a historical landmark just to stop a housing development!

The first hurdle came when the Planning Commission ordered a detailed historical review, based on a claim that various community groups had offices on the property in the 1970s and 80s, so the site might qualify for preservation. The resulting 137-page study cost Tillman $23,000 and delayed him an additional four months. It found that the laundry didn't merit landmark status.

But Tillman's project was still far from being approved. City law says that any individual or group, no matter where they live, can pay a $617 fee to appeal a decision by the Planning Commission. In this case, the challenge came from an organization called Calle 24, which declined Reason's interview request.

Calle 24 is one of several neighborhood groups determined to stop gentrification in the Mission, a neighborhood that's home to a working-class...

I'm not sure whether Tillman has got to build his apartment block yet but it beggar's belief that, in a city with an acute housing shortage, it can take best part of a decade to get permission to build some of those much-needed homes. When I talk of the stupidity of planning, this is what I'm thinking of - an endless parade of hoops and jumps that must be negotiated just to start digging the foundations for a development.

The city responds to its housing problems with a veritable first aid kit - rent controls, ordinances on building standards, grand affordable housing strategies and much else besides. Except, of course, for the thing that really would make a difference - allowing more dense development in San Francisco suburbs and using the city's economics and political clout to get more land released for housing in the Bay Area generally.

San Francisco is a particularly egregious example and, in its defence, is constrained by its geography - being stuck on a peninsula limits the scope for development. But the same issues - rents soaring, lack of development and lots of supposed solutions that don't actually face up to the supply problem - can be seen right across the world: New York, London, Madrid, Barcelona, Edinburgh, Auckland, Sydney, city after city where urban growth is bounded and reasons not to develop outnumber reasons to let people build. And in all of these places the result is high prices, rising rents, overcrowding and dissatisfaction with city and national authorities response to the problems.

If your policies for housing in a growing city don't include making more land available, allowing higher buildings and apartments in suburbs and ending daft zoning restrictions then you are failing - it shouldn't take a national government, as has happened in New Zealand and is happening in the UK and US, to tell local places that they're strangling their success with over-restrictive green belts, urban growth boundaries and that parade of reasons - environmental, heritage, landscape, bats, shadows, chimneys - not to develop. None of this will suddenly make these cities cheap places to live, the cost of success has always been higher rents, but it will start to make the liveable again.

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Why council housing isn't any sort of solution to our housing problems

From Randall O'Toole talking about Denver, Colorado:

Affordable housing is meant to help low-income people who can’t afford housing in a free-market environment, not to bring down the price of housing for everyone. Even helping 125 families is not going to make a dent in the overall housing market, which has been rendered unaffordable by government interference in the land market.

It's the last part that matters - by making land scarce through urban containment, government makes that land expensive. And, as night follows day, the result is more expensive houses and higher rents.

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Exploitative rents make the case for promoting home ownership

It's funny how reading something from a couple of Marxist sociologists reminds me of the value of property ownership. Here's their shtick:

It is a mistake, Desmond and Wilmers argue, to see slums as a byproduct of the modern city, rundown areas that occur by accident. Instead, they contend that the slum has long been a “prime moneymaker” for those who profit from land scarcity, racial segregation, and deferred maintenance. “If labor exploitation is understood to be getting paid less than the market value of what one produces,” they write, “we can extend this definition to the housing market by operationalizing exploitation as being overcharged relative to the market value of what one purchases, paying more for less.”

Now I think that we need to be careful here in defining a slum - there's a big difference between the slums in developing world cities and those in the developed world. Desmond and Wilmers are talking about the latter - for the former, the most common issue isn't landlordism but rather that land is occupied informally, the slum-dwellers are squatters.

For the developed world city, however, the run-down inner city area dominated by poor quality rented housing should be seen as a failure. And, while it is most commonly used as an argument for more municipal or social housing, it is also a strong argument for seeking more home ownership.

Desmond and Wilmers observe:

“Renters in poor neighborhoods are excluded from both home ownership and apartments in middle-class communities on account of their poverty, poor credit, eviction, or conviction history, or race (through discrimination).” Ultimately, they conclude, “renters are exposed to exploitation on account of their reliance on housing and their lack of options for securing it.”

Renting becomes a trap rather than, as we'd come to view it, a temporary circumstance. We should consider ways to encourage and promote home ownership as well as in protecting tenants. This might include longer tenure (not permanency but longer than the typical short-hold arrangement), giving tenants a first option when landlords sell property, extending right-to-buy, and support for co-operative or other forms of social ownership.

The other side of the equation is housing supply and, as well as allowing more development, we should consider specific support for self-build - perhaps by giving people low-cost ground rents on development plots. Some of this might simply mean more trailer parks but these, at least, offer more security than a tatty apartment with exploitative rents.

Desmond and Wilmers see the problem as systemic (in a Marxist sense, a feature of capitalism) but we might also see it as a consequence of the legal and regulatory framework in which housing markets operate. Whatever the cause, there is a strong case for, alongside social housing, the development of models allowing more people from lower income groups to own their own homes.

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Regeneration without new land for suburbs created the problem of Haringey

If you restrict the availability of land for housing, poorer parts of town get gentrified - "regenerated" as we like to say in England. And, because we've restricted land for housing the poor people who live in those gentrifying areas lose out:

And that displays the flaw behind the creative class theory up to now. The idea itself is excellent–creative class professionals enhance urban cultures and economies, and should be welcomed. But cities that have embraced them so far, such as San Francisco and Austin, have not anticipated for this by allowing the necessary new housing. And the results are predictable: wealthier professionals are fighting with poorer service-class workers over the same set neighborhoods and housing stocks–and the latter group is losing.

Right now - as Claire Kober has discovered - the political consequences of this trend are problematic. Not because the people opposing gentrification have got any better proposals than the gentrifiers and regenerators but because a bunch of left wing agitators are riding to power on the back of promising a better world without really explaining how. And doing it violently. It's not just Momentum agitators in Haringey but a trend seen in Barcelona, Seattle, Berlin, San Francisco and Sydney. In every case existing residents are promised new homes, protected rents and the benefits of a delightfully shiny regeneration and, in every case, those residents see wealthy incomers changing their world.

As it happens, I think that local leaders like Claire Kober deserve credit for their efforts - it's not their fault that we've had four decades of urban containment in London - but they should also be saying to people like London's mayor and whoever is in the revolving door as housing minister this week that the city needs space to grow. Central London has pretty close to the world's highest rents (Manhattan and Hong Kong are worse but they're islands so have an excuse) yet nobody is prepared to say that it is wrong-headed planning policies that are to blame not foreigners, property developers, landlords or local council leaders.

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Self-employed remote workers should check out Italian negative rents

 
Italy has a load of problems - banking crises, unsustainable immigration, corrupt government - but one of its biggest is depopulation:

FOR ALL THE ANCIENT Italian hill towns and villages that delight the traveler — the San Gimignanos, Montepulcianos and Fiesoles — there are scores of others (many equally or more beautiful) where few venture and in which very few reside today. According to a 2016 Italian environmental association report, there are nearly 2,500 rural Italian villages that are perilously depopulated, some semi-abandoned and others virtual ghost towns.

One of these towns is Candela in Puglia - and the result is what amounts to negative rents with the town paying you to live there:

The mayor of Candela wants to reverse the declining fortunes of his town, once known as "Little Naples" for its crowded streets, which has seen its population plummet from more than 8,000 to just 2,700 today.

The town is offering €800 [£716] for singles, €1,200 [£1,075] for couples, €1,500 [£1,344] to €1,800 [£1,613] for three-member families, and over €2,000 for families of four to five people who are willing to up sticks and embrace la dolce vita, CNN Travel reports.

There are a few caveats (such as having at least €7,500 in annual income and a job) but it's clear that if you've a portable skill or can work remotely this is a great little offer. And it's Italy's south - so wine, weather and history in spades.

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In which we're told £40,000 is poverty wages

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Really?

Take the new legislation in which any person in social housing earning over £40,000 in London and £30,000 outside of London will be made to pay the current market rent. To bring in such a law in London will be crippling to many families and assist the mass exodus of middle and working class families from the city – ethnic, social and class cleansing.

London's median household income in 2013 was £39,100 - I'm guessing it might have risen a little since then to say £40,000. So according to this writer half of London households are struggling in abject poverty. Now, I know London's got high rents but the economy of the city would be collapsing if this argument was at all accurate.

The answer isn't to subsidise rents, of course, but to build more homes.
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No, Germany doesn't have a better housing system that the UK

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Not if this is anything to go by:

Gabrielle Keller has been given until the end of the year to leave her flat in the small southern town of Eschbach, near the border with France.

The flat belongs to the local municipality, which says it is needed to house refugees.

Imagine a UK local council evicting a resident so as to house refugees. You can't can you for the simple reason that our laws don't allow the Council to do this (it's not clear whether German law allows this either).

So perhaps we can stop saying how splendid and super-duper Germany's housing market is? It isn't, it never has been and we really should stop pretending otherwise.

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Housing: 'managed sprawl' rather than rent controls and public subsidy

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For decades the UK had rent controls. Mostly we didn't call it fixing rents, we called it 'council housing' and we subsidised those rents. Some councils deliberately - for specific and ideological reasons - ran a low rent policy building up huge gaps between the rents that council tenants were paying and the level of market rents (in a dwindling stock of private rented property). As with all price fixing the result of this was a distorted market - local councils couldn't afford to build new homes because the rental income wasn't sufficient to justify borrowing, there was no private rented sector worth mentioning and home ownership was seen as the gold standard.

With right-to-buy the council housing business changed overnight. Tenants who were in work took the discounts and bought their homes. And largely carried on living in those homes. Capital constraints on councils and tight housing revenue accounts meant that new council houses became ever more like hen's teeth especially given central government's preference for housing associations and other 'third sector' housing providers. The result was that council housing - more correctly called 'social housing' by this time - was ever more residualised, increasingly filled with the least well-off and those most reliant on benefits.

By 1997 the seeds for our housing 'crisis' were in place as house building (specifically in places with economic, job and population growth) had slowed as a result of a sclerotic planning system, a rented sector that didn't generate surplus for reinvestment and a development sector wedded to levering high land values rather than efficient construction. The result of this was the explosion in house values - between 1997 and 2010 these values nearly tripled - and these homes became less affordable. Without access to social housing, workers began to rent - between 2001 and 2011 the number of people renting in the private sector nearly doubled as the market met the housing need of people who couldn't afford to buy and failed to qualify for social housing.

We now have the situation where, particularly in London, the scale of the private rental sector is such that regulatory intervention - a re-tightening of the regulations liberalised in the 1980s - is being discussed. Much of the debate relates to quality and to preventing the abuse of vulnerable tenants by unscrupulous landlords. There's a secondary part of the debate that asks whether the type of tenancy (the private sector is dominated by short-term tenancies) merits reform to give people renting a little more security. These are pretty sensible debates with arguments on both sides but where there's a real desire to improve standards within an important housing sector.

But there's a growing call for government - local or national - to intervene in the setting of rents, to implement rent controls:

We need to start getting serious about how to address the housing crisis in London, because it’s not just those on minimum wage or housing benefit that are struggling to afford to live here. Teachers, civil servants, retailers and service workers essential to the running of our city are all threatened by the crisis. Though not a silver bullet that will singlehandedly solve the crisis, we should think about how rent controls – done sensibly – can be part of a comprehensive plan to ensure that all Londoners can afford a home in our city.

And such proposals, especially wrapped in Harvard-educated management-speak as David Lammy does here, are something of a temptation. It seems so simple. Yet when we step away from the moderate, reasonable argument the truth remains - limiting rents must always mean limiting the market income which will always mean that there is less supply. And London has enough of a supply problem resulting from decades of indecision on housing and the continued - and wonderful - success of the city as a driver of economic growth.

To help us understand this, we need only look at the USA where big cities like New York, Los Angeles, Washington DC and San Francisco have a long history of rent controls as a housing policy tool:

But rent control mainly makes housing expensive by taking units off the market via high occupancy rates and low turnover. Tenants who don’t want to lose their good deal stay in their apartments. This means that newcomers—or anyone not lucky enough to have a rent-controlled unit (including prospective homebuyers)—must compete for a more limited stock of market-rate units. If New York City abolished rent regulations today, it would double the number of available market-rate units, meaning housing costs would be shared more equitably across the population. As things stand now, many people pay more, because so many others pay less.

The evidence is that, far from rent controls acting to reduce housing costs, the effect is to make the housing market even more static than it was already. In New York - and we'll be familiar with this approach in the UK - the preferred tool now is to require that developers of (overpriced because of rent-controls elsewhere in the market) new homes make a proportion of those homes 'affordable'. The problem is that, even without enforced affordable provision, the regulatory cost of building in the city - and London isn't so very different - is verging on prohibitive.

The affordability problem remains a challenge -  as the American Planning Association  discussed recently in Seattle:

The shortfall of affordable housing arguably would take 50 years to fill at the current rate of production in San Francisco—the very frustration expressed by Rahaim. It might take 25 years in New York City. But betting it all on increasing supply is fraught, too. It’s expensive to build in the city, and costlier still to build increased height and density without considering the needed infrastructure to support those kinds of environments.

But the answer does lie in making land available linked to good transport links. It won't make London's housing as cheap as housing in Barnsley but there is a need to open up the possibility of what we might term 'managed sprawl' - allowing the expansion of cities so as to release some of the pressure on the inner boroughs.

In a broader view, a more regional approach, with polycentric, high-density centers supported by transit, has the advantage of breaking out of the borders of the super-hot markets.

Right now our housing debate lacks balance - too much stress is given to managing price within a sclerotic, dysfunctional housing market rather than on reduced the things that slow down that market, add cost and prevent affordable development.

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So takeaways are in low rent urban areas. There's a reason for this and it's not fat poor people.

There have been several reports on the findings from a study by the Centre for Diet and Activity Research (CEDAR) at Cambridge University. In simple terms this study maps the growth in hot food takeaways in Norfolk using Yellow Pages data from 1990 to 2008 and makes two observations - there has been a significant increase in the number of such takeaways and they are more likely to be located in more deprived communities:

Over the 18 year period, the number of takeaway food outlets rose by 45%, from 265 to 385 outlets. This equated to an increase from 2.6 outlets to 3.8 outlets per 10,000 residents. The highest absolute increase in density of outlets was in areas of highest deprivation, which saw an increase from 4.6 outlets to 6.5 outlets per 10,000 residents (a 43% increase).

This, argue the researchers should be a concern because:

Frequent consumption of takeaway food has been associated with excess weight gain over time.Previous studies have shown that people of low socioeconomic status and living in deprived areas are more likely to be overweight and consume unhealthy diets than other sectors of the population. One possible explanation could be that more unhealthy food environments – for example, a greater density of takeaway food outlets – could be contributing to unhealthy lifestyle choices.

This is a familiar argument - let's call it the 'obesogenic status quo' - that we've looked at before. Essentially the argument is that the presence of such concentrations of fast food increases rates of obesity as the population is confronted with multitudinous 'poor food choices'. We also know that the evidence supporting such an argument is pretty weak:

 ...there was no significant association between increasing takeaway and fast food consumption and obesity as measured by BMI corrected for age and gender. This is not a new finding. For example, French and colleagues found no significant relationship between frequent consumption of fast food and being overweight in their analysis of a cohort of 11-18-year-old boys and girls. Similarly, Simmons et al found no correlation between increasing takeaway consumption and obesity measured by either BMI or waist circumference.

This shouldn't really surprise us since the components of obesity (overeating and lack of exercise) are not exactly driven by relatively expensive takeaway food. Indeed a recent study from Leeds Beckett University's childhood obesity research team provided further evidence rejecting the link between obesity and hot food takeaways:

“This study provides little support for the notion that exposure to fast food and other food outlets in the home, school and commuting neighbourhoods increase the risk of obesity in children. It seems that the evidence is not well placed to support governmental interventions and recommendations currently being proposed including zoning laws around schools and I would urge policy makers to approach policies designed to limit food outlets with caution."

So why is it that these takeaways seem to cluster in more deprived communities if it isn't primarily to cater for the needs of nascently obese deprived people? Now I don't have the CEDAR team's map but a map of deprivation in Norfolk show it to be concentrated in Great Yarmouth, Norwich and King's Lynn plus, less significantly. places like Cromer and Hunstanton.

It strikes me that the demand these hot food takeaways meet is as much driven by visitors as by the needs of the resident population. Great Yarmouth has some of England's most deprived places - but these are right behind the sea front (Nelson Ward is Great Yarmouth's most deprived) and I'm guessing take advantage of cheaper rents slightly away from the town centre.

The reality is - ask anyone in the business - that running a takeaway, whether a Chinese, Indian or fish & chips (the three types looked at in this study), is hard work and pretty low margin. Which means that you set up in places where there's demand and cheap rents - those deprived communities the researchers identify. Their location isn't connected to (or determining - people have choice and the UK doesn't have food deserts) the food choices of residents but rather to a desire to get as close as possible to busy town centres without having to pay higher town centre rents.

This research is interesting but really doesn't provide any further evidence supporting the demand - repeated yet again by the Local Government Association for councils to have more powers:

“Town halls want to put a stop to it and have pleaded that the first Queen’s Speech of the new parliament heralds a law to give them new authority over local licensing decisions. The Norfolk findings are generalisable across the country, particularly in urban areas. Local councils are desperate to limit junk food outlets increase or ban them outright but, like rabbits caught in the headlights, are petrified to do so in the face of face of legal challenges and red tape,”

Added to the aggressive use of egregious planning controls what we have here is an assault on one business type - not because it's remotely the cause of all that supposed obesity but more because such businesses are seen as a bit grubby and down-market selling greasy unappealing food to drunk twentysomethings and portly lorry drivers. As every local councillor knows, takeaways are never popular - people don't like the bad parking, the smells, the litter and (although they seldom say this) the customers. Sometimes they don't like the immigrants running them either. Blaming fast food takeaways for obesity is a convenient cop out from the real reasons for wanting to get rid of them - simple snobbery and prejudice.

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No Bradford doesn't have a housing crisis...

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Nor is it worsening. Yet we keep being told this:

Bradford has an affordable-homes crisis which is worsening year-by-year, the National Housing Federation has warned.

The federation, which represents housing associations, says a rising number of people are being priced out of a property market where the average house price is £142,000 but average annual earnings are £18,500.

Ah, the NHF again. So let's deal with the issue - firstly it's not simply about house price, it's about rents, but let's start with those prices.

According to those nice folk at Zoopla the current average price for houses sold in Bradford is £118,940 which is a slight rise (less than 3%) on the previous year. But if we look at the 'affordable' bit of the market - terraced properties and flats - we find that the average is below £100,000.  Still too much for those on Bradford's average earnings but only two-thirds of the NHF figure.

Which brings us to rents. Again looking at Zoopla we find an average rent of £486 per month - not super cheap but hardly at crisis levels. And again the average for terraced properties is at or around £400 per month.

Moreover, I'm prepared to bet that there are parts of the city where rents are lower still - indeed little different from social rent levels - and we know that you can buy a property (about 60 are on the T& A website right now) at £50,000 or less.

No-one's saying we don;t need to build more houses or even that there aren't problems wrought by a combination of a growing population and low wages. But there isn't a crisis. Not even a little one.

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Rent controls? A daft idea looking for a Labour Party to implement it...

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A committee chaired by a Labour MP is proposing to look at whether rent controls are a good idea:

MPs will examine the possibility of introducing rent controls as part of a new probe into the private rented sector.

The Communities and Local Government select committee launched a new inquiry today into the quality and regulation of private rented accommodation.

Issues that are likely to be examined include the option of introducing rent controls, the interaction between housing benefit and rents, and the regulation of landlords and lettings agents .

Rent controls are a pretty daft idea - they lead to things like this:

The major effects have been to reduce rents on pre-1976 units but to increase rents on newly constructed post-1975 units, to reduce new construction, to accelerate deterioration and conversion of the existing rental stock, to generate a severe rental housing shortage, to create an environment for key money, to inefficiently and inequitably redistribute income, and to significantly exacerbate government budgetary deficits by reducing tax revenues and inducing increased government housing expenditures.

And we also get folk like Peter Rachman who look to arbitrage the gap between regulated and unregulated rents (although one hopes without the colour bar this time).

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So we make providing homes to rent more expensive - that will help the housing crisis!

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The Welsh government (and plenty of English councils) are keen on the idea of "accrediting" private landlords.

The government will set out plans to improve the private rented sector and will expect landlords to register on an accreditation scheme.

It all seems like a great idea - we'll have a scheme that improves the quality of homes and management in the "sector". But the problem is that these schemes involve (this is from a voluntary one in Leeds):

Payment of a non-returnable application and membership fee.

And while this is fine if it's only a few quid, will it stay that way? If you inherit mum's terraced house and rent it out rather than sell, you'll end up losing a month's rent in accreditation to add to the month's rent in agent fees and the month's rent in costs. So you either sell or put the rent up.

This isn't simply a registration scheme but a means by which the sort of provisions under section 82 of the Housing Act 2004 become common-place.

In a selective licensing area the landlord must comply with the fit and proper person test included within the Housing Act 2004 to obtain a licence. His rented properties must be let within the terms of the licence conditions to ensure that the properties are safe and that the landlord can, and will, deal with anti-social tenants.

Accreditation is about exercising state-control over the private rental sector - it isn't about improving stock quality or housing management. It is expensive and the expectation is that the landlord will be picking up the cost - an act that simply makes housing more expensive.

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Should Bradford's Labour councillors stand on their (housing) principles...

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At a recent Bradford Council meeting, a dozen or so Labour councillors declared interests as landlords (for completeness three Conservative councillors and one Green did likewise). The sight of this made us grin a little - socialists as a new rentier class!

However, there's a serious point to be made here about the housing debate. Bradford's Labour councillors are adamant that we are facing a "housing crisis" in the City and that we desperately need "affordable" housing for the vast hordes of future Bradfordians. As a result Cllr Slater, the housing and planning lead is adamant that "middle-class" objectors to greenfield housing development must be slapped down:

And Councillor Val Slater conceded she and other councillors will be locking horns with “middle class” protesters as the battles rage over where to build the 45,500 homes said to be needed by 2028. 

So why then are those rent earning labour councillors not playing their part? After all Cllr Malik, chair of the corporate scrutiny committee doesn't just own one or two houses:

 At Premier Housing we have been providing quality rental properties for over 20 years. Whether you are a student or a professional we have an ever expanding portfolio of quality, studios, flats and houses, you can be certain that we will find a property that suits your needs.

You could ask why Cllr Malik doesn't stand on his socialist principles and provide some of that "affordable" housing?  Or is this what is meant by affordability:

He (Cllr Malik) is one of two directors of Premier Housing (Bradford) Ltd who, along with the company itself, were fined a total of £34,000 by the courts earlier this year.

The firm has a portfolio of rented flats in Bradford, Leeds, Halifax and Liverpool and was taken to court by Liverpool Council over 41/43 Holt Road, Liverpool, for eight offences under the Houses in Multiple Occupation legislation.

The charges described the flats above a shop as rat-infested and poorly-converted.

The company re-appeared in court for six similar offences relating to flats in Laburnum Road, Liverpool. 

Not much evidence of caring for the poor but that's not really my point here - why don't those Labour councillors rent their properties out to the poor at affordable rents rather than argue for the rest of us (who don't earn rents) to pay more taxes so as to pay the higher rates of housing benefit needed to pay those higher market rents?

And here's another idea - Cllr Slater lives in a large three or four bedroomed house in Bingley (about ten miles or so from her 'deprived' ward). Just her and her husband. Why isn't she doing something to help with this "housing crisis" she's invented by renting out those spare rooms?

But then I remembered! The thing about socialism is that it's not about people actually doing caring things to help less fortunate folk. Such activity is patronising and to be stopped - the state through taxes will provide what those folk need! And Cllr Slater can sit in her comfortable home in a pleasant market town secure in the knowledge that she has forced those pesky taxpayers to cough up for subsidising affordable housing.

Taxpayers like the one who wrote to me recently:

"My full army and OAP adds up to £14,590 of which I pay almost £1,000 tax."

These are the "middle classes" that Cllr Slater is so disparaging about. This is the lie of her ostentatious socialism - condemning decent, hard-working folk to virtual penury while lecturing us about how we don't care because we don't support higher taxes and more government.

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Is there really a housing crisis?

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I'm just not sure how much of a problem we actually do have. For sure in London and some parts of the South East, rents and income have diverged - to the point where their affordability is open to question.

But the "there aren't enough houses" crisis - this would suggest rapidly rising rents everywhere. Which doesn't seem to be the case:

Private rents in England and Wales fell for the first time in 10 months in November, according to the latest buy-to-let index from property services firm LSL.

Average rent dropped by 0.4 per cent to £717 month, down from October’s figure of £720 per month. It is the first time there has been a month-on-month fall since January.

OK there are seasonal factors and rents have risen in some regions - but this doesn't suggest that, right this minute, there's a crisis level shortage of housing.

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Ah, yes...Friends!

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How is this a problem?

New research has shown that high rents and living costs are forcing London tenants to live in shared homes. The average number of people living in a property in the capital has gone up from 1.5 to 2 in just two years, according to data compiled by HomeLet for its October rental index.

Didn't they watch Friends?

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Because there isn't a good enough return maybe?

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The Communities and Local Government Select Committee (prop. Clive Betts MP) are asking why large pension funds aren't investing in social housing:

Mr Betts said housing associations represent ‘an ideal instrument’ for pension funds and other institutional investors.

‘I want [social housing] to be something that pension funds and other institutions invest in,’ explained Mr Betts. ‘I very much want to hear evidence on this issue. We want the people who have the money to tell us what they want to invest in.’

I agree with Mr Betts - pension funds have been very reluctant to invest in residential rent opportunities of any kind but - and it's a big but - now they're interested in the sector, why on earth should they invest in social housing with rents at £300 per month when that can invest in market rented property at £1,200 per month?

The reduction (virtual removal) of grants for social housing and the structure of rents makes the social housing sector unattractive as an investment.  Perhaps we should be looking more closely at the way rents are determined - perhaps through a housing allowance system rather than the setting of artificially low rents? That would make such investment very attractive given the current housing market pressures.

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So we don't need to build more houses, do we?

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Rents in London and the South East are climbing through the roof. Market rents in the City are already beyond the means of most working people and continue to climb:

The cost of renting a property in London has reached a record high, despite the continuing economic slowdown.

 According to research from tenant referencing service HomeLet, the average rental price in the capital went over the £1,200 barrier for the first time ever.

In August, tenants paid an average of £1,202 compared with £1,154 the previous month.

The figures show a 12.2 per cent month-on-month rise in rental prices, while average tenant salary in Greater London rose by just 2.4 per cent.

The South East needs more houses yet the sclerotic planning system, the stolid banks and the idiot government (local and national) conspire to make it ever harder an ever more expensive to develop and ever more difficult to rent.

At the same time rents in the social housing sector (council houses and housing association lets) average about £330 - little more that 25% of the market rent. The scale of subsidy this represents is astonishing and demonstrates the difficulties with getting an effective rental market in a city where over half the properties for rent are in the social sector and in receipt of a massive subsidy determined by the property rather than by the earnings of the person(s) living in the property.

These figures - and a similar picture will be played out across the south east and in cities such as Leeds, Manchester and Birmingham - represent a huge challenge. If we fail to realise that subsidy isn't the most efficient way to manage a housing market where a great deal of the tenure is rental, we will find ourselves with an escalating problem of homelessness, default and housing debt from unaffordable rents rather than unaffordable mortgage risk.

And yes we do need to make it a lot easier for developers to build houses - this needs a sensible discussion about how to protect the 'green belt' rather than the "build the houses in the grotty industrial bits where the poor people live" approach pioneered by the CPRE.

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