On this blog, we have been banging on about the ‘housing crisis’ for years.

It has now got so bad that it has entered mainstream news, and even the politicians are starting to take notice.

With up to 25 applicants per rented property and more and more people wanting to rent, the problem is mostly caused by a lack of available properties to rent.  Simple supply and demand.

So something has to be done about supply.

There are two main problems:

• Landlords pulling out, and
• Not enough properties being built

Landlords pulling out

Some people seem to think it is a Landlords market just now, with sky-high rents and tenants clamouring to pay months of rent up front in order to secure a property.  Surely landlords have never had it so good?

But then, if that were the case, why are so many selling up?  There are basically four main problems:

• High mortgage costs, and
• High taxation – which together mean that landlord profits are low, along with
• Uncertainty about future legislation, and
• The prospect of having to shell out thousands for green upgrades

The green upgrades problem has been shelved for the moment   But the upgrades will have to be done at some stage if the UK is to meet its climate goals.

All of these issues have together persuaded thousands of landlords that the time has come to sell up and invest in something else.

So unless those properties are bought by another landlord, they will no longer be available to low-income families.

New houses not being built

There seem to be as many problems with housebuilding as there are with landlords.  Not only are not enough houses being built – the ones that are being built appear (according to this article in the Guardian) to be shoddy and substandard.

Relevant issues appear to be

• Small builders having been squeezed out by a few large building companies
• Massive profits by those building companies who now have fewer competitors and so can focus on maximising payouts to directors and shareholders, and saving costs by skimping on quality
• A shortage of skilled construction workers, with so many EU workers having left after Brexit, along with
• No proper certification (meaning that ‘cowboys’ abound), and
• Little proper training available, and
• Ineffective building control and inspection regimes

Not to mention Rishi Sunak’s backtracking on housing targets.

The fact that big housebuilders are getting massive profits out of all this makes one wonder whether there could be any connection with the fact that some 20% of Tory party donations come (or at least came) from the property sector?

At one stage, it looked as if modular homes could be the answer.  As they can deliver housing quicker with half the emissions.

However, it seems that most of the modular home construction companies are going out of business.

Legal and General, for example, who have a big modular homes factory in Selby, are ceasing production citing problems with long planning delays among other things, and are making their staff redundant.  Another modular homes company, Urban Splash, have entered administration.

So what is the solution?

The problems are so massive and extensive it’s hard to say.  Many things will need to change, and I suspect the current Conservative government are not going to be making those changes.

Building houses

Clearly, planning rules will need to change, and Keir Starmer (if he becomes Prime Minister) has promised to do something about this.

Then there need to be changes in the inspection process along with proper training and certification.

It would also be a big help if Local Authorities could start building again, but there need to be changes in their finances to allow this to happen, plus changes in (if not the abolition of) the right to buy.

It is unreasonable to expect organisations to go through the difficult and time-consuming business of building new housing if it is just going to be sold off at an undervalue after a few years.

Landlords

Until new houses can be built, it is crucial that the haemorrhage of private landlords is stopped.  Otherwise, the supply of homes to rent will dry up completely and there will be many more people sleeping on the streets.

This is no doubt behind the government’s recent promise to landlords that section 21 will not be abolished until improvements have been made to the court procedures to allow landlords to evict within a reasonable time for legitimate reasons (such as rent arrears and anti-social behaviour).  At present, it can take up to a year or more.

Although, the fact that Gove is to speak at the forthcoming Landlords conference may also have something to do with it.

It would also help if the anti-landlord tax changes made over the past few years were reversed.  Although this may be difficult politically.

And finally

We are in the dying days of a worn-out government with a limited amount of time to achieve anything, even if it had the will to do so.

The almost inevitable incoming Labour Party have not so far said much about their plans for housing other than that they will be abolishing section 21.  But all parties have made that pledge.

I hope that they will think carefully about what they do and won’t blindly follow calls from the tenant’s organisations for further clampdowns on landlords, which could result in a massive landlord exodus.  Which won’t help anyone.  Least of all tenants.

We shall just have to wait and see.

The post What can we do about our dreadful housing problems? appeared first on The Landlord Law Blog.