Good evening! This week's edition of the In Common newsletter comes from Robin McAlpine, head of strategic development at Common Weal. To receive the newsletter direct to your inbox every week click here.
IF the Scottish Government wants a magic wand solution in a single policy area which might help turn around widely negative perceptions about its performance, there is something the political class has simply missed.
Last year an opinion poll came out on public satisfaction over devolved policy. I started asking what came bottom as a quiz question with political and media types to see if they could guess. Not a single person got it right. The correct answer was housing. I wasn't the slightest surprised given how much of my personal conversations the subject takes up. In fact, it takes up more discussion time than any other political issue.
Some of my friends are over-mortgaged, trapped into working more hours than they want to pay for a house. Younger friends despair of ever owning and so their gripe is either the insane cost of private sector rental or the poor-quality service you get in return (or both). Another friend has a council house so badly maintained that when they explored the possibility of buying it, they discovered it was unmortgageable – but they still pay full rent and council tax.
And all those examples are professionals or business owners. Which means this doesn't begin to pick up the homeless, those in dreadful substandard housing with its damp, mould and cold problems, those in temporary accommodation, those at risk of home repossession...
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Yet the political class has been sleepwalking into this situation since the turn of the millennium. The perceived wisdom in politics is that the Thatcher revolution created a home-owning democracy which is wildly popular with people and that rising house prices make people feel wealthier. That, they think, is the end of that.
Except this is a political view trapped inside a particular moment. To gain from the contemporary housing market, you either needed to buy your house before the mid-2000s, inherit a house early in life, have paid off your mortgage or be a property developer. For everyone else, housing costs are simply an ever-increasing burden.
Yet constantly inflating housing costs has been a core goal of every government since Margaret Thatcher (above). Any time the housing market is about to correct itself and reduce house prices, the corporate property developers ask for help-to-buy schemes and endless public subsidies for “affordable” housing to distort the market and keep the profits coming in.
The goal of this is to make housing more and more expensive. It has worked, but there's a problem. The political class is wrong. It may have forgotten this, but having a secure, comfortable, warm place to call home is now and has always been at the heart of politics. Thatcher made people feel good about their housing by putting in place a kind of housing Ponzi scheme.
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As a result, house prices are now out of control for everyone and there are giant swathes of the population who do not have secure, warm, comfortable homes. This is a toxic situation.
But there is good news. This one the Scottish Government can fix and fix quickly – if it can stop policy being driven by lobbyists for big developers. The key is controlling house prices and preventing them rising perpetually by increasing the public rental housing stock. Literally stop subsidising big, highly profitable corporations to build “affordable” homes and let them compete in the market.
If they can't provide the homes people need and want at a price they can afford, let them face the consequences. You don't let toothpaste makers inflate their prices at will and then subsidise them using taxpayer money, so why do you do it with big property developers?
Build houses. Houses don't need public subsidy. If you finance them over their lifecycle via mortgage-style lending, you can build as many as people want. Stop thinking of these in terms of “social housing”, which implies “houses for people who failed”. Take the German approach; public rental housing is for everyone, from young professionals to middle-class families.
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Build quality. Build them where people want them. Be aggressive with landowners and use land value capture (i.e. buy the land at the value without planning and then grant yourself planning – this is the power of the public sector when it uses it). Make these houses desirable, challenge the market, challenge the profiteering and help people find homes.
And do it fast. The Scottish Government can't borrow mortgage-style but it can work with local authorities which can. The faster you build, the better. It can turn around perceptions, especially if you tell people you're doing it and get them on waiting lists. It becomes real for them.
The housing situation in Scotland is now a very major political issue whether the political classes want it to be or not. Continuing on as is will result in a furious backlash at the ballot box. If the Scottish Government wants to survive, it needs to spend less time with corporations and more time with people who can actually vote.
Because you know what they're talking about? Housing.
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