Last month’s Conservative Party conference put housing back near the top of the political agenda. Initiatives to help buyers, promote building and encourage activity have been part of the landscape for a while but it seems there is a bigger plan this time.
Outside Brexit, this appears to be the flagship element of current policy. Indeed, it is clear housing policy has achieved a new enhanced status within the civil service, with more staff and higher-profile ministerial support.
Over the past few decades we have failed continually to build the now commonly agreed 250,000 new houses per year. We are still at least 20 per cent short on current delivery and have an accumulated shortfall estimated by some to be as large as one million homes.
It should be noted at this point that it has taken 50 years to develop the new town of Milton Keynes to have 100,000 homes. To begin to address our current housing crisis requires either savage inner-city regeneration by mass demolition or four new, privately developed towns the size of Milton Keynes.
This scale of development requires not just planning but commitment to a deeper infrastructure. There need to be jobs, proximity of rail and quality road transport, as well as access to good shops. This will give other employers confidence to site there and grow their business with certainty about housing and quality of life. It is a virtuous circle.
The real issues facing us were well set out by property market analyst and commentator Kate Faulkner on BBC Breakfast recently. She identified that, while the Government has indicated support for local councils to start building again, there is a lack of a proper plan.
We have government aspiration, supported by funding, but it is then left to local authorities to develop their own plans and ensure delivery. The problem is there is a lack of people at local authorities who can remember mass-build programmes, and a struggle to find and employ the workers to build.
Put simply, we have a high-level approach from central government and a different list of priorities set out by parish councils and local authorities within their local development frameworks. Until we have a method of resolving the significant disconnect between plans, there is unlikely to be success.
However, any who doubt we will see a more fundamental change should look at the world of pensions. For over a decade the industry was encouraged to change direction or risk losing its preserved status. So compulsion and pension freedoms arrived, which emasculated many traditional suppliers.
Private builders have been the big winners from recent interventions in the housing market but they have not delivered the volumes demanded and have received quiet warnings. Council building is the answer, so I would not underestimate the commitment of central government to deliver this, then reduce reliance on the private sector.
The final part of the housing conundrum is what to do with the elderly residents blocking the chain. Last-time sellers have not been coming to market, as increased longevity and a push by the care services to maintain people in their own home has reduced volumes. The rise in equity release and changes to interest-only polices will further reduce the number of homes that become available due to downsizing by the elderly.
These are longer-term issues and, with extensions to Help to Buy announced, plans to restore council housebuilding and the Term Funding Scheme still open until February, there is much to underpin activity and more to come. We will not see the results of these changes in thinking in the next five years, but the writing is on the wall.
Robert Sinclair is chief executive of Ami