That perennial whine, housing and rentals. We’re told that:
It’s the crisis Thatcher built. It started with the “right to buy” in 1979, which eviscerated the country’s social housing stock. It was followed by Tony Blair’s private finance initiatives, or PFIs, which fragmented local services. And it has been compounded by austerity, which finished local services off. The result of 40 years of free-market extremism is visible all around us: in tent cities, food banks and record-breaking numbers of homeless deaths, which continue to rise every year. Meanwhile, private landlords swim in cash.
The problem here is not enough free market extremism, not too much. We have a national plan for how much housing should be built. We have very strict limitations on who may build what where. We’ve lines on the map insisting that no one at all can build houses Britons want to live in - the absurd idea of minimum density at 30 per hectare - anywhere near where Britons actually want to live - the Green Belt.
These are the reasons that housing is expensive in Britain. For the cost of building a house is very much the same as it is anywhere else. In the £120k to £150,000 for a nice little 3-bedder. All of the rest of the price - and this can be checked by looking at how much the insurance company will pay out if your house were to suffer a sudden dematerialisation event - is the scarcity value not of the land even, but of the pieces of paper that allow you to build a house on a specific piece of land.
So, the solution is to issue more pieces of paper. As with the way government issues money itself: print more, each piece is worth less.
The Conservative party are already subsidising people’s housing costs through housing benefit, much of which is paid into the pockets of private landlords. Wouldn’t it be more efficient to spend that money on building long-term, affordable social housing, rather than empowering landlords who have no interest in meeting the needs of the poorest renters?
It would in fact be more sensible to go all free market in a properly vicious and regulation slashing sense. Blow up the Town and Country Planning Acts 1947 and successors. Proper blow up, kablooie.
Force suppliers - landlords - to chase consumers - renters - just as Tesco, Morrisons, Waitrose, Aldi and the rest have to chase our custom for their baked beans. A proper free market will have prices at around the cost of production of the marginal unit or so. Because that’s how markets work. Second hand will be cheaper as that’s also how markets work.
The solution to the fundamental problem in the British housing market is, at bottom, not to try and tone it a bit with some twerking here and there, it’s to get all Adam Smith on its arse. Viciously so.
Kablooie.