The UK has a strong fascination with owning homes, which has even become a form of daytime entertainment often associated with sure profits. However, the reality is sobering, with home ownership becoming unattainable for many. Recent statistics revealed that only about 7% of local areas in England and Wales offer homes considered affordable, drastically down from 88% in 1997.
Years of skyrocketing home prices, stagnating wages, and a shortage of housing have led to a significant decline in homeownership among younger people, a surge in private rentals, over a million families waiting for social housing, and increasing poverty and homelessness. These issues should be of major concern to the ruling party, which has long touted itself as the champion of homeownership. Despite this, the housing crisis has only worsened after 14 years of unproductive policy changes.
Recently, Michael Gove gave into pressures from Conservative MPs to dilute important reforms that would protect renters. As a result, many are looking to the Labour Party for solutions. Labour leader Keir Starmer claims they will become the new homeownership champions by changing planning laws, although some argue that Labour’s plans lack the necessary robust funding.
Retail entrepreneur Julian Richer, owner of over 300 properties and founder of the Richer Sounds audio retail chain, discusses this national issue in his new book “Our Housing Disaster – and what we can do about it.” Richer, who promotes a more socially-responsible approach to business, demands stronger government intervention to address housing issues, as he believes the market alone will not solve them.
Richer criticizes the government’s handling of housing, which he sees as a long-term problem that directly affects millions of lives. He calls on politicians to exhibit more understanding and compassion on the matter. His book proposes immediate solutions such as improving renters’ lives by offering greater protection and suggests a broad plan including a significant boost in affordable housing construction, akin to the post-World War II rebuilding efforts.
For decades, government policy has shifted away from social housing, as evidenced by the sale of over 2 million council homes during Margaret Thatcher’s government, most of which have not been replaced. Richer recommends ending the right-to-buy scheme, arguing that while it benefited some initially, younger people with modest incomes are now suffering the consequences.
Labour’s plans include a substantial increase in affordable housing by confronting developers and overhauling planning regulations to establish 1.5 million homes over five years. This involves creating new towns and enabling development corporations to buy land without factoring in the speculative ‘hope value.’
While Labour may take advantage of recent reforms allowing local authorities to acquire land for social housing without paying hope value, a complete reversal of the 1961 Land Compensation Act could face legal delays. Richer argues for a target of 3 million affordable homes over ten years, emphasizing that only a significant initiative will truly mitigate the housing crisis.
To finance such a program, Richer suggests that government funds, which are currently supporting the private market through schemes like Help to Buy and significant housing benefits expenses, could be better utilized in creating state-owned assets that generate revenue.
Richer concludes by saying that transforming housing is feasible, as demonstrated in the post-war era where political will led to the creation of numerous modern homes. The book’s message is clear: solutions exist, but they require resolute political action.
