Some initiatives are sensible, if modest. Some might make some kind of short term sense but are clearly not a sustainable long term basis for policy. Others make little or no sense now, let alone in the future. And current housing initiatives are often in tension with developments occurring as part of welfare reform or broader economic policy.
We sort of know this.
There are colleagues in the academic, policy and practitioner communities doing valiant work tracking the short and long term impacts of individual policy changes, such as the reforms to the local housing allowance. There are also useful monitoring exercises trying to sum the parts and make sense of what it all adds up to. But I still think we are not fully grasping the bigger picture.
This point struck me forcefully yesterday when I spent half a day at the Housing Studies Association Annual Conference. It was unfortunate that I was only able to make the last day of the conference, for reasons too tedious to recount. But even in the brief time I was there I heard several colleagues making presentations that raised some big questions about where we are heading.
At the same time, the trade press is reporting the likely problematic future for current initiatives such as Affordable Rent. Initially this was seen as a time limited strategy to sweat housing association assets in order to build new properties with less public funding. Then the Government started to suggest it needn’t be quite so time limited because there are still plenty of housing association assets out there unencumbered by debt. Housing associations are also successfully moving into issuing their own bonds. There are now suggestions that the next CSR might see development grant disappearing entirely. This could be accompanied by further rent rises and increased demands on the housing allowance budget. But housing associations are starting to suggest that development without grant is not going to be viable. Development could dry up.
The recently released figures for housing benefit indicate that things are heading rapidly in the wrong direction. Reforms intended to curb the aggregate HB bill have, instead, been succeeded by rapid increases. This is partly a result of demand pressures in rental markets, but also the deterioration in the broader economic climate. Reduced generosity in mainstream welfare benefits is going to play a part in making the situation worse. And, of course, the number of people who have lost their grip on the formal housing market entirely and find themselves homeless has increased.
In the background we still have the problems of a misfiring mortgage market and of inadequate new supply, which the NPPF in its final form is unlikely to deal with effectively.
We can detect the fallout from these intersecting policy agendas at local level. Over the last week or so a number of urban local authorities have proposed or debated regulations to try to control the number or spatial concentration of Houses in Multiple Occupation within their boundaries (eg here). Yet, the growth of HMOs are an inevitable result of lack of supply, lack of affordability, and increased unwillingness on the part of the state to assist households by providing resources to secure more adequate independent accommodation. All overlaid upon increased restrictions on access to mortgage finance and increased labour market insecurity and vulnerability.
There are therefore pressing problems. And many of them will have serious long term consequences, the outline of which we can as yet only dimly discern.
But there are bigger questions we have yet to explore adequately. These are associated the structure of the housing system and the expectations of its role in broader policy thinking . Pre-crash welfare policy was based upon a move towards asset-based welfare, underpinned by rising house prices. The retreat of the state from tax-funded welfare was premised upon, and justified by, appreciating housing assets giving households the wherewithal to self-insure against life’s vicissitudes. What happens when house prices stall? Equally importantly, the release of housing equity to fund long-term care in old age, for example, rests on the availability of appropriate financial instruments and/or a cohort of younger households with sufficiently robust finances to pay the prices demanded.
Yet, if the labour market continues to develop in the direction of increasing flexibility, precariousness, and inequality, then there is a risk that when the time comes few will be in a position to pay. If that’s the case then house prices may have to fall as a consequence, thereby depleting the funds available for care. Alternatively, tenure restructuring will continue as properties are purchased by those who already own assets and renting becomes further ingrained. The reconfiguration of the labour market blows a big hole in the asset-based welfare approach.
Yet while the half of the equation that provides the ‘solution’ looks increasingly questionable, policy proceeds with the retreat from social insurance and tax-funded welfare. The risk is increasing poverty and inequality in old age. Colleagues at St Andrews are working to examine this important set of questions which take us well beyond “housing” to pose profound questions for the overall direction of policy.
So my sense that we need to get a better grip on the bigger picture is hardly original. The need to join the dots and expose the contradictions embedded in current agendas is clear. What I think is becoming clearer is the urgency of the task. There are serious concerns that the 2013 CSR could herald a complete withdrawal from government support for building genuinely affordable housing, for example.
If we think this is not just ill-advised but counter-productive in a multitude of ways then the arguments need to be made rapidly. They need to be well grounded in evidence and they need to be framed in a way that has policy traction. This is no small challenge to the academic community.
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