A vote for housing
Housing finally ignited as a major political issue in the run-up to the London mayoral elections this week. Carl Brown investigates how some of the main contenders plan to tackle the issue
‘It is incredible the number of people who raise housing with me on the street - there is a real problem now for young people finding somewhere to live in this city.’
Boris Johnson, the Conservative candidate in next Thursday’s London mayoral elections and incumbent, made these comments at a hustings last week responding to concerns raised by the National Housing Federation that the election debate so far in London has underestimated the importance of housing.
This year’s poll is arguably the most important for housing ever to take place in London. The newly elected mayor will control the Homes and Communities Agencies’ investment powers and a £1.6 billion development budget as well as 530 hectares of land assets owned previously by the HCA and London Development Agency. The candidates have no excuse for not giving housing at least as much priority as transport and crime.
So what are the main candidates’ policies on housing, and do they stack up?
The manifestos of Mr Johnson, Labour’s Ken Livingstone and Liberal Democrat candidate Brian Paddick all have one thing in common: they are light on detail making them difficult to interrogate. However, the focus so far seems to be on how housing supply can be increased in a future when there is unlikely to be much in the way of capital grant from central government.
‘The interesting thing is what is not in the manifestos this time around,’ says Steve Douglas, partner at consultancy Altair. ‘There is very little on quality [of stock], the balance between social and intermediate rents - it is all just around supply and funding.’
So what are they talking about? Inside Housing investigates.
1. Private rented sector
Perhaps unsurprisingly, given the expansion in private renting, all three main candidates have policies to improve the private rented sector.
Mr Livingstone has grabbed the headlines with his idea for a ‘London living rent’ campaign, interpreted by Mr Johnson as a call for rent controls. Mr Johnson says this would deter investment and lead to fewer PRS homes being made available.
In this, he is backed by the National Landlords Association. Richard Lambert, chief executive of the NLA, says candidates should focus on increasing supply and ‘allow the market to set an appropriate rent’.
Both Mr Johnson and Liberal Democrat candidate Brian Paddick have pledged to set up accreditation schemes to improve conditions in the PRS.
In addition to Mr Livingstone’s pledge on affordable rents (see Funding), the Labour candidate also wants to reintroduce a 50 per cent target for affordable housing in new developments. Brendan Sarsfield, chief executive of Family Mosaic, says this is needed as councils are increasingly waiving onsite affordable housing in section 106 obligations in return for cash. ‘We need something because section 106 is being exploited to achieve other ends,’ he says.
Major developers, perhaps unsurprisingly, are less likely to agree. ‘Trying to implement a single percentage figure across the whole of London is a worthy aspiration but I don’t think it’s deliverable as it would be difficult to implement,’ says Stephen Teagle, managing director of affordable housing regeneration at house builder Galliford Try.
3. House building
Anyone who follows the London political scene knows the mayor and his opponents often make competing claims about how many homes have been built in the capital.
Statistics from the Communities and Local Government department show that between 2000 and 2008 affordable housing increased by an average of 10,723 homes a year, while between 2008 and 2011 the figure was 13,636. This suggests Mr Johnson was more successful at delivering new homes than Mr Livingstone - although this increase is largely due to an increase in HCA-funded social rented homes, from 7,360 in 1997/98 to 9,130 in 2010/11. Mr Livingstone would also argue that Mr Johnson has benefitted from his housing legacy.
The candidates this time have made varying commitments on house building. Mr Johnson has pledged 55,000 new affordable homes by 2015 - of these 20,193 will be for social rent, 16,614 for affordable rent, and 18,031 for intermediate housing.
Mr Livingstone, perhaps surprisingly, has not offered a figure for how many homes he wants to build because he does not have access to ‘consolidated HCA funding figures’ - although he says he will build more than Mr Johnson. Mr Paddick claims he will build 360,000 homes over 10 years if elected.
When asked what this figure was based upon, his office simply cited the Greater London Authority’s strategic housing market assessment estimate of the number of homes needed in the capital. He has pledged to spend £360,000 to set up a housing company to boost supply.
One of Mr Livingstone’s most eye-catching pledges is to cap ‘affordable’ rent levels at 50 per cent of market rents. He says this can be made possible by releasing some of the 530 hectares of public land now under the mayor’s control on an equity share basis to housing associations.
Mr Johnson also talks about the possibility of using land for development, and wants to establish a register of all public land in London, but does not want to bring in a 50 per cent ceiling.
Mr Livingstone’s plan in principle has been welcomed by major sector figures in London, although they point to a number of potential flaws. Keith Exford, chief executive of Affinity Sutton, says not all the land may be suitable for development, and planning permission would be needed from local authorities. He also says it would be better if the land was gifted, rather than provided as equity, because associations could then borrow against it to raise money. ‘If you want us to borrow, you’ve got to make it secure,’ he adds.
David Montague, chief executive of London & Quadrant, says 50 per cent would be too high in some parts of London and too low in others, while Mr Sarsfield is simply sceptical about the amount of public land that could be freed up. ‘Why have these sites not been built on before?’ he asks.
The main candidates also talk about the importance of attracting institutional investment into housing, but are characteristically vague on how this can be achieved. Mr Livingstone says he will set up meetings to try to persuade them to invest, while Mr Johnson last week said there is a ‘moral argument’ he would make to pension funds to invest in housing.
More election coverage
For all our coverage of the race to be the next mayor of London see our election page. The leading candidates have all set out their housing policies on our website this week, see what each of them had to say: