New PM, new diagnosis of the housing crisis

Before she was fast-tracked to 10 Downing St - in one of many dramatic twists in recent weeks - Theresa May gave us a glimpse of how her housing policy might differ from David Cameron's.

Launching her leadership campaign in Birmingham on Monday, May went further than Cameron has ever done in describing the the damage that house price inflation causes:

"...unless we deal with the housing deficit, we will see house prices keep on rising. Young people will find it even harder to afford their own home. The divide between those who inherit wealth and those who don't will become more pronounced. And more and more of the country's money will go into expensive housing instead of more productive investments that generate more economic growth."

It’s almost as if Generation Rent has been on her reading list.

Aside from a short-lived call for price stability early in the Coalition from then Housing Minister Grant Shapps, the past two decades have seen governments of every colour more than happy to preside over house prices ratcheting up and up.

None of her sentiments are original to housing policy wonks, but May’s statement is a significant break from the prevailing views in Westminster:

  • blaming house prices, not (or as well as) mortgage availability, for the decline in home ownership;
  • highlighting the impact of housing wealth on overall inequality; and
  • recognising the drain expensive housing is on the wider economy

Other senior Tory figures have spoken of boosting investment in housing – including social housing – in the past few weeks, so it’s possible that this rhetoric is matched by action.

What those of us shut out from home ownership need desperately is a stable rented sector, with protections from eviction and rent rises. And government intervention will be essential if private house builders shut up shop amid economic uncertainty.

However, given the government’s shameful record on affordable housing, and their manifesto commitments to home ownership gimmickry, we cannot take anything for granted. In the coming weeks we will be doing what we can to guide the new PM in the right direction.

First, we need to know who the Housing Minister will be…

In the meantime, join us.

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