Select Committee on Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Written Evidence

Memorandum by Mira Bar-Hillel (AH 01)

  My name is Mira Bar-Hillel and I have been the property and planning correspondent of the London Evening Standard since 1982.

  I am delighted that your committee is looking into affordability and the supply of housing, as this is a matter of grave concern especially in London and the South of England where property prices have reached such levels that essential workers can no longer afford to buy homes and are increasingly being squeezed out of the region altogether.

  I am, however, disappointed and disturbed that the focus of your investigation is the further extension of home ownership, while you have entirely excluded the vital subject of the private rented sector. In my opinion more private renting offers the only potential for normalisation of the UK housing market, bringing it into line with the housing markets which prevail in the rest of the Western world and in those countries which are our main economic competitors.

  Britain is on its own in having very high levels of home ownership, complemented by a shrinking social housing sector and a private rented sector which is only around one third of its size in countries like France, Germany, North America and Australia. Only around 11% of UK households rent privately (compared with around 35% elsewhere), while in London around 17% rent, compared with well above 45% in other capital cities.

  In other countries young people—including most of those essential public sector workers who we are at serious risk of losing now—do not struggle to buy a home when in their 20s. Instead, they rent cheaply and conveniently from a large selection available in all sizes, locations and price ranges, until they are truly ready to settle down in terms of family commitments and long-term employment.

  Indeed, many French and German families remain in rented homes all their lives. They consider their monthly rent as they do the gas and electricity bills: not "money down the drain" (a peculiar British obsession) but a fair price to pay for an essential need: a roof over one's head. When they need to move house, it is relatively quick and cheap. Britons move on average once every seven years, currently at an average cost of between £10,000-£30,000 a time—now that's money down the drain. Another benefit are far more stable housing markets, without the house price rollercoasters we have in Britain and without our constant obsession with house prices, booms and crashes, which inevitably creates as many losers as winners.

  On the continent and across the Atlantic landlords and tenants are not at war with each other. They sign contracts and abide by them. Tenants who misbehave or don't pay the rent can be removed and they know it. Landlords, knowing the tenants have choices, have every incentive to provide decent accommodation at a fair price and none to neglect the property or abuse the renter.

  In Britain the law, the legal system and the national psyche still see all landlords as potential Rachmans, villains who cannot be trusted. Tenants are perceived as capable of being only victims. As a result, tenants can play the system and live rent-free for months on end, knowing the courts are reluctant to evict and will always give them extra time. Some landlords have lost tens of thousands of pounds to rogue tenants and given up, others protect themselves by only letting to the well off. The systems actually encourages only the worst landlords—and tenants—to remain within it.

  The only long-term solution to the affordability crisis is, in my opinion, NOT to increase home ownership further but, on the contrary, to aim towards an owning/renting balance more in line with our competitors.

  The government must set targets for increasing the private rented sector substantially and initiate policies—including changes to the law and the attitudes of the courts—which will help make them happen. A bigger and healthier private rented sector will not only allow more people more choice about where they wish to live and how much they wish to pay for their accommodation, but will bring to the economy much-needed additional flexibility and mobility of labour which is currently hamstrung by the cost of home ownership in general and the huge and growing cost of moving home in particular.

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