Housing crisis: London School of Economics experts describe government plans as ‘meddling at the edges’

A group of senior London academics has dismissed government proposals for housing market improvements as offering “at best a ‘steady-as-you-go’ agenda which cannot hope to address the crisis”.

The London School of Economics response to February’s white paper “fixing our broken housing market”, says the measures suggested would not help generate sustainable growth in the supply of new homes and would make the planning system more complex and uncertain.

It also criticises the paper for confining itself “almost entirely to new housing and hardly touches issues around how to improve the existing housing market” and for saying “very little about affordable housing” and providing “almost no insight into major issues such as homelessness”.

The response, whose 13 signatories include Professors Christine Whitehead, Paul Cheshire and Tony Travers, says that “essential preconditions for change” are either moved into further consultation or just not addressed at all, including improving estimates of demand for housing, setting out how the controversial issue of development viability should be assessed and ensuring an adequate supply of land for building on.

“Much of what is in the white paper could perhaps be ungenerously called meddling at the edges,” the response says, adding that “the overall feel is of increased micro-management and increased complexity”.

The academics endorse suggestions about improving access to housing-related information, including free access to Land Registry data, and encouraging the sub-division of large sites and the speedier development of small ones. However, they are unimpressed by modest potential amendments to green belt planning policies, saying that “an important opportunity has been missed to take note of the costs as well as the benefits of the green belt”.

Echoing points made in the 2004 Barker Review of housing supply,  they argue that “there is a strong case for supporting trade offs between ‘bad’ existing green belt – i.e. areas where there are few benefits from leaving the land undeveloped but very significant benefits from development – and ‘good’ potential green belt, where introducing such a designation would produce welfare gains”.

The suggestion of a national minimum requirement of 10% affordable homes in all housing developments except those of ten or fewer units is also challenged, with the notion of any specified minimum rejected and the effect of an exception for sites with less than ten dwellings described creating “serious and perverse incentives, with developers seeking to maximise the number of proposals below that threshold and local authorities increasingly unwilling to permit small developments”.

The white paper is a national policy proposal not a London-only one, but has particular relevance to the capital, where persistent undersupply of housing, particularly of homes affordable to low and middle income households, is a major social and political issue. London Mayor Sadiq Khan has committed to a long-term goal of 50% of overall housing supply in London being “genuinely affordable”.

The LSE response to the government white paper can be read in full here or here. The housing white paper itself is here. The main findings of a June 2016 LSE report on accelerating housing supply in London written by four of the response’s signatories is here.