A building boom isn’t the only answer to the housing crisis — regeneration and incentives to downsize are essential
It’s hard to feel sorry for the Russian oligarch whose £15 million Eaton 
Square house was taken over by squatters last month with the intention of using it as a shelter for the homeless. Andrey Goncharenko has three other properties in London, including Hanover Lodge in Regent’s Park, for which he paid £120 million, but he doesn’t live in any of them. Meanwhile the number of 25 to 34- year-olds able to buy their own home has fallen to its lowest level in 25 years.
The housing market in Britain is full of bizarre anomalies. Immaculate houses in central London lie empty, used as assets in buy-to-leave schemes. More than three quarters of luxury new builds were snapped up by foreign investors last year while homelessness soared.
In the rest of the country swathes of land have been bought up by the big developers that are sitting on their land banks, ignoring the fact that they are supposed to be helping with the drive to build 250,000 more homes a year. High streets, market towns and seaside resorts are looking windswept and forlorn, old-fashioned shopping malls sprawl across their tumbleweed outskirts and brownfield sites are left to decay. Meanwhile there are increasingly urgent calls for new garden villages and towns.
The British are obsessed by property — we have created Country Life, the National Trust, Location, Location, Location and Zoopla to celebrate it. But housing has increasingly become like Monopoly, with the youngest and poorest shoved off the board before they have even started to play while the rich in Mayfair get substantially wealthier. Successive governments have tried to change the rules but it hasn’t worked.
Yesterday Sajid Javid, the communities secretary, launched another attempt to mend the “broken housing market” with a government white paper. He is promising steps to coerce the big developers to build more, while also suggesting using station car parks and offering lifetime ISAs to help first-time buyers. But if councils are to reach his ambitious targets they may still feel the need to unbuckle their green belts.
Council tax should be doubled for those who leave properties empty
Yet it is short-sighted to tarmac over fields and smother them with identikit brick boxes and prefab homes and it is already causing antagonism in the green belt. As The Times said in a leader in 1919: “In our eagerness to create new wealth and provide new houses there is a danger we may sacrifice our rich inheritance of natural beauty.” Instead there should be a concerted effort to regenerate dilapidated old towns and utilise current housing stock.
First, the government needs to find more ways to force those who buy their homes purely as an investment to rent out their properties. There are at present more than 610,000 empty homes across England. Encouraging squatters is not a grown-up answer but new buildings in cities should predominantly be for first home owners — and council tax should be doubled for those who never enter their own front door. Islington council is already implementing laws aimed at banning owners of new homes from leaving their properties empty for longer than three months.
Successive governments and developers have also become too obsessed with building four-bedroom family homes when it is the elderly who need purpose-built accommodation. In Britain only 141,000 specialist retirement homes have been constructed for sale, making up 1 per cent of the market. In Australia it is 13 per cent and in America it is 17 per cent.
The bedroom tax was a crude attempt to force old people to downsize from their council homes; instead we should be enticing the elderly to move to more practical accommodation for their last years. A report by the Royal Institution of Chartered Surveyors said 2.6 million family homes could be released on to the property market if older owners downsized. The majority won’t want to leave their memories behind but some are being prevented from moving by the cost. All downsizers could be given an exemption from stamp duty.
All downsizers could be given an exemption from stamp duty
Finally, we need to regenerate once beautiful market towns rather than allow them to disintegrate slowly while developers move to new pastures. Britain saw a renaissance in its cities at the end of the last century. With the increase in online shopping, towns soon won’t need vast shopping malls and sprawling high streets, so these can be turned into housing. Local authorities should use compulsory purchase powers to buy these now half-filled retail parks.
Councils should not be expected to find as much new land as possible but to think of ways of renovating their area. According to a House of Lords report last year, the housing industry resembles an “oligopoly”. The three largest developers — Persimmon, Taylor Wimpey and Barratt — completed 43,000 homes in 2015, but had planning permission for another 201,000 and additional landholdings with space for 278,000 more. They have a vested interest in keeping house prices high. But they will now, Mr Javid said, have their planning permission revoked after two years if they don’t use their land. Instead the incentives are finally going to small building companies, which should be encouraged to think creatively on fiddly, complicated brownfield sites.
All of this takes huge time and effort, but if we regenerate Britain at the same time as building better new housing everyone will benefit — and everyone from the young to the elderly will feel they are still in the property game, not just the oligarchs.
