Why Worry About Housing?

In Chap. 2, we pointed out that state involvement in housing usually arose first, in a context of early industrialisation and urbanisation, from concerns about adverse urban living conditions and their effects on public health, and then secondly from the need to promote housing supply in the face of shortages following wars or demographic surges. Over time, recognition grew that wide inequalities of income and wealth were incompatible with maintaining decent housing conditions without some forms of welfare or subsidy provision to assist poorer groups. If we ask what are the conditions now which motivate policy concern about housing, in the advanced industrialised countries, then the original concerns about slum conditions and public health are less dominant, although there are still some public health concerns relevant to contemporary planning. The need to promote supply is still an issue, more prominent in some countries (e.g. England) than in others (e.g. the USA, Spain or Ireland), as is the need to have some system of welfare and subsidy to reflect the gross inequalities of purchasing power across societies. However, other issues have come forward into more prominence in the contemporary era. For example, there are concerns about the operation of lightly regulated financial markets, including both access to finance and the instability of housing and financial markets interacting in a way which threatens macro-economic stability. The energy (in)efficiency of the housing stock and urban form are a key part of the environmental challenge of moving to a lower-carbon future. Widening disparities in market performance between regions are a growing problem, both for economies—in terms of labour mobility and supply for high-growth city-regions and in terms of misallocation of resources into real estate, and for the cost and sustainability of welfare systems.

However, it is one thing to identify strategic policy problems from an objective, semi-detached standpoint, and another to see these problems being articulated in a helpful way within the political process. Real world politics, whether local or national, responds to a range of influences, including public sentiment through democratic mechanisms, media portrayal of issues, lobby group influences and deeper power structures in society which tend to reflect the gross inequalities of wealth which themselves pose one of the most pervasive challenges. In some countries, of which Britain is perhaps a clear example, housing issues have been less salient in political competition than other issues, such as health, the economy and welfare, although there are some signs of this changing. In such cases, the housing producer lobby has been less influential than in cases such as Ireland, Spain and Australia, where housebuilding has been seen as a key sector of the economy. Where issues of ‘affordability’ have gained traction, the emphasis in popular and media treatment tends to be upon middle-income groups’ ability to access home ownership, rather than on the groups with objectively the most acute problems, who are typically poorer private renters. As highlighted in the case study chapters, responses to this often result in reinforcement or extension of demand-side subsidies which, without appropriate supply-side reform, may further push up prices and exacerbate the problem. In what are predominantly owner-occupier societies, popular perception and media treatment tend to portray high and rising house prices in a positive light, reflecting the perceptions of the comfortable, well-housed majority of older homeowners, who in this case are the privileged ‘insiders’, and who are generally much more likely to vote in elections. ‘Insider’-‘outsider’ conflicts are pervasive in housing, whether considering tax and subsidy arrangements, new building alongside existing communities, or rental systems which embed subsidy or regulatory protection for some insiders at the expense of wider groups of outsiders.

The time horizons of policy and politics also present problems for attempts to apply ‘rational’ solutions to housing problems. Political time horizons are often short, focussed on the next election or even on next week’s media headlines, whereas key policy reforms and strategies take much longer to work through. Using planning in positive ways to promote supply where it is needed and to change planning mechanisms to enable more inclusionary patterns of development all take time to implement and even longer to show their full benefits. A political logic may lead to policies which are purely ‘symbolic’, with no discernible impact in the real world, or policies which appear to offer a ‘quick fix’ at the expense of the longer term effectiveness of the system. Examples of the former are seen in Australia’s long preoccupation with planning reform as a response to housing affordability pressures, whilst the latter kind can be seen in England’s recent attempts to respond to its own crisis in new housing supply.

 
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