Housing

Debate between Rachael Maskell and Roberta Blackman-Woods

Wednesday 10th June 2015 Commons Chamber

[Dr Blackman-Woods]

My hon. Friend makes an excellent point; it is one that we made a number of times when we were opposing the Government’s changes to section 106 agreements. Those changes are incredibly short-sighted and will lead to a long-term dearth of the infrastructure that our country so desperately needs.

Our housing market is in crisis because the Government are failing to build the homes that our country needs. We need 245,000 homes to be built every year in England alone, just to keep up with demand, but only 125,000 new homes were built in England between April 2014 and March 2015. Recent figures from an LSE report demonstrate clearly that house building figures were much lower under the coalition Government than under the previous Labour Administration. Indeed, house building fell during that time to its lowest level since the 1920s.

Between 2011 and 2014, the total shortfall against the need for new homes was a massive 515,000. This has led to record numbers of young people in their 20s and 30s living with their parents. Analysis by the estate agent Savills has shown that in areas such as the south-east, where there is high demand and a strong employment market, approvals for new builds are

“falling well below objectively assessed need”.

In other words, even the homes that are being built are not necessarily in the places with the most acute housing need.

As a result of the Government’s continuing failure to tackle barriers to housing supply, prices are continuing to rise, reflecting sky-high demand. Even though there is deflation in other parts of the economy, the annual rate of house-price inflation is now 8.6%. House prices have outstripped wage inflation and hit an affordability ceiling in all parts of the country, with figures for last year showing a salary-to-house-price ratio of 10 times across the UK. Houses are unaffordable right across the country, with a rate of seven times in the north-west and 14 times in London. As prices are pushed beyond the reach of an increasing majority of us, home ownership has fallen to a 30-year low.

[Rachael Maskell (York Central) (Lab/Co-op)]

Does my hon. Friend acknowledge that there are now real issues with recruiting to our vital public services because people cannot afford to live in our cities any more?

[Dr Blackman-Woods]

Indeed; my hon. Friend makes an excellent point.

The Government’s flagship Help to Buy scheme is also stuttering to a halt, with completions falling by 43% in the last quarter of last year and at the beginning of this one. The record on private renting is no better. For renters who aspire to home ownership, the future poses huge challenges. Around 11 million people are now renting privately. They are not just young people trying to get on to the housing ladder: 1.4 million of them are families with children, and almost half of private renters are over the age of 35. The undersupply of private rented homes is making housing unaffordable for many, particularly those who rely on that sector. Rents are rising, and between 2008-09 and 2013-14, the mean average private rent increased from £153 a week to £176 a week—an increase of 15%. The increase in London was 21%.

What are the Government doing about this? Absolutely nothing. Indeed, the previous Conservative chairman, the right hon. Member for Welwyn Hatfield (Grant Shapps), denied that private rents were rising, much to the incredulity of Labour Members. The Tories’ record on social renting is no better. In 2013-14, only 10,840 social rented homes were delivered. That was a 71% decrease from the 37,000 delivered in 2012-13. Furthermore, despite Government promises to replace every home sold through the right to buy, that simply did not happen—for every 10 sold, only one had started to be built to replace them.

The Government therefore have real questions to answer about their extension of the right to buy scheme. In particular, we must have better answers about how the extended scheme will be financed. Selling off expensive council houses to fund the policy will mean that, for some areas of London and for other inner cities too, all council housing might need to be sold, with like-for-like replacement unlikely to be achieved. That point was well made by my hon. Friend the Member for Sheffield South East (Mr Betts) and my right hon. Friend the Member for Tooting (Sadiq Khan). I look forward to hearing from the Minister how the scheme is to be financed.

All the measures that the Government have put in place, however, do not tackle the issue of homelessness.