Keir Starmer has vowed to tackle the huge shortfall in British housing stock should Labour win the next election. Plans to release more land for building will help address the housing crisis in the UK.
Housing an Issue for Decades
Data from the Centre for Cities shows, “Compared to the average European country, Britain today has a backlog of 4.3 million homes that are missing from the national housing market as they were never built.”
Supply and Demand Dictates Price
All markets work on supply and demand. Such a huge shortfall dictates the degree to which house prices rise, and they’ve risen at a rapid rate over the last five decades. The affordability is at some of the all-time lows.
Housing Cost as a Multiple of Income
According to the House Buyer Bureau, in the 1970s the average house price was £9,277. Adjusted for inflation, that would be £68,493 today. This represented 4.1 times average income.
Affordability a Real Challenge
Fast forward to today, and the average house price is £281,000 according to the Office for National Statistics. The average UK pre-tax salary is £34,900. This represents 8 times average income.
Lack of Building the Issue
For decades the scale of building hasn’t kept up with population growth. This, coupled with second home and direct foreign investment into the UK (in particular, London) property markets has created huge demand and increased prices.
Labour Plans to Address This
Under the plans, Labour will seek to release poor quality or ‘ugly’ green belt land for housing development. Under the plans, at least 50% would have to be affordable, and there’d be an obligation by developers to improve local infrastructure.
Starmer Explains Decision
He said, “Labour supports brownfield-first policies. But we must be honest, we cannot build the homes Britain needs without also releasing some land currently classed as green belt. We’ll prioritise ugly, disused grey belt land, and set tough new conditions for releasing that land.”
Building a Better Economy
The construction sector is a major contributor to the UK’s economy, so a huge building project would be a direct investment in growth. It would create thousands of jobs and see the country regenerated.
Giving Young People a Chance
It’ll also improve the opportunities for young people when it comes to owning their own home. The average age of first time buyers is now mid 30s, a figure that has been steadily rising over time.
Angela Rayner Agrees
Rayner said, “Grey belt land should not be off limits while local people are kept off the housing ladder.” This is the crux of the matter—we have a housing crisis, not a land crisis. We just need more house building.
Not All Green Belt Is Green
Rayner went on to say that a lot of the green belt land “isn’t green, rolling hills, but poor-quality scrubland, mothballed on the outskirts of town”. If this land was liberated, we could see hundreds of thousands of homes per year built.
National Housing Federation in Support of Plans
Kate Henderson, the chair of the National Housing Federation said it is “right to consider how our approach to the green belt can better serve our country and our communities. We strongly support plans to use this ‘grey belt’ to tackle the housing crisis, and to deliver a minimum of 50% affordable homes.”
National Federation of Builders Also in Support of Plans
Richard Beresford, their chief executive said, “Prioritising grey belt and pairing it with golden rules would ensure green space loss is mitigated, vital supporting infrastructure is delivered and both builders and local people get planning and place-making certainty. It’s a win for all parties, which is why we support it.”
Pace of House Building Lags Behind Requirement
Although house building rates are up, they’re only around 200,000 per year. If the government wants to make a meaningful dent in the shortfall, they would need to increase that figure significantly.
Commitment of 1.5 Million Homes From Labour
Labour has promised to build 1.5 million homes across the parliament, which is the same as the Tories pledge of 300,000 per year. The concern is these figures are still too low – it would take 15 years to address the shortfall at that pace, assuming there’s no population growth.
Planning System Needs Reform
The issue goes beyond building—there’s a requirement to speed up the planning process, too. The average planning decision takes 3 months. There are a couple of reasons—the first is the strict planning laws in the UK, and the second is the under-resourcing of planning departments.
Land-Banking Needs to Be Stopped
Some smaller developers have expressed frustration at large companies ‘land banking, where they buy land, get planning permission then sit on the land, leaving it bare and selling it later for a profit. Although measures have been taken, some argue that they aren’t strict enough.
Housing on the Agenda
It’s good to see that action is being taken on the issue. The housing crisis in the UK is well known, but subsequent governments have done little to address the problem. Maybe now that will change.
Potential Levelling of the Property Market
Hopefully, a well-funded and progressive housing policy will help more people get on the property ladder and own their own homes. There’s been a lot of talk—now it’s time for action.
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