The housing crisis tells us zilch about ‘our economic model’ (whatever that is) as a whole. The way to solve it is not to bring back Arthur Scargill, reopen the coalmines and renationalise British Airways. It is to roll back the greenbelt, deregulate planning, and ignore the whining of the Nimbys. But try to explain that to an angry student audience, copy of the Guardian in one hand, and Russell Brand’s or Owen Jones’ book in the other.
Then they talk sense
as always, Cameron has followed the well-known script for a politically harmless statement on the subject: Talk about housebuilding in the abstract, but at the same time, send reassuring signals to the anti-housing lobby, showing them that you don’t mean it. Rule out touching the greenbelt, and reheat the brownfield myth. Say nothing tangible unless you talk about demand side subsidies and other gimmicks.
Hence Cameron talked about low interest rates (demand side), the Help to Buy programme (demand side) and the Right to Buy programme (demand side). Unless it involves an increase in the number of planning permits, the talked-up ‘starter homes’ initiative will not lead to a net increase in housing supply either, but merely to a relabelling of development projects that would have taken place anyway. Exempting developers from the Community Infrastructure Levy and Section 106 payments may lower prices for buyers, but presumably, central government will have to compensate local governments for the ensuing shortfall in revenue, which would turn this measure into just another repackaging of costs. Reserving homes for first-time buyers, at the expense of Buy-To-Let landlords, will benefit the ‘marginal first-time buyer’, but since it does nothing to stimulate overall supply, this has to come at the expense of the rental sector. Cameron has offered precisely nothing that could reverse the long-term decline in housebuilding.