SOMEOME ELSE WHO UNDERSTAND FIXING LAND PRICES IS THE SOLUTION TO THE HOUSING CRISIS
ANOTHER (fairly) BRILLIANT IDEA TO CAPTURE LANDVALUES
LAND IS NOW HALF OF OUR WEALTH!
Andrew Parvin points out the ‘irony’ of Affordable Housing, when what’s really driving up prices is the land cost. The graph above shows what’s happened. So far so brilliant, but his solution is for Local Authorities (Councils) to acquire land, or use their own land and the LEASE it for housing at much reduced ‘affordable’ cost.
The catch is that only social housing applicants would qualify, and they would be selected, somehow, perhaps by a points system, and be hedged in by strict regulations when letting or selling the resultant house.
What a shame he couldn’t go the whole hog and say we need to get rid of this category of social/affordable housing altogether! We know how, don’t we? Full value LVT — to be fair Parvin does give a mention for Henry George.
You can read his original paper here https://files.cargocollective.com/c186433/Affordable-Land-2.0--1-.pdf
A similar idea was proposed by Ryan and Collins as ‘The Peoples’ Land Trust’
Andrew Parvin explained in a Guardian article:
Affordable land would mean affordable housing. Here’s how we get there
The price of land is a huge barrier to house-building, by councils or developers. Lease to individuals, and the equation changes
Tue 23 Oct 2018 08.00 BSTLast modified on Tue 23 Oct 2018 11.39 BST
Lord Porter, the chairman of the Local Government Association, has proposed to “set forth a million builders” by giving residents a role in the design and construction of council-built homes. It’s the latest sign of a radical common sense that is slowly making its way into housing policy, but if government truly wants to unlock the “citizen sector”, there’s an easier way.
Slowly, all the political parties are now waking up to the realisation that private developers will never build the number or quality of homes that Britain needs. This is not because developers are just greedy or immoral – it’s because their business model is perfectly designed to make sure they have no incentive to do so. No amount of subsidy or regulation will change that.
A new consensus is emerging that, once again, it will be councils who will have the lead role in tackling housing need. And with greater power to borrow, they will be able to.
The result would produce places that are genuinely affordable, sustainable and loved by the people who live there
But there are a few catches. First, like any developer, councils’ bandwidth is limited. Building a thousand homes takes a million hours of attention. Second, even though there is no shortage of land (tens of thousands of undeveloped small sites already under public ownership), are local communities really going to support thousands of cookie-cutter, council-built homes popping up in their neighbourhoods? Third, there will always be a temptation to go for numbers, and compromise on quality, instead of investing in building generous, healthy, low-energy homes and resilient neighbourhoods that meet people’s (diverse) needs, and really allow them to put down roots.
This is where some clearer thinking might be needed. Allowing people to customise their homes (for example, choosing the layout) is a good thing, as is helping future tenants bring down the price of those homes by allowing them to help build them. But it doesn’t really change the economics of development that much. In fact, those things often can make the process more costly and complicated for councils. There must be a better way.
What Porter is stumbling into here is one of the most obvious pieces of common sense that has yet to become housing policy: the recognition that most of what is unaffordable about unaffordable housing is not the house itself, but the land beneath it.
In a sensible world, the people best placed to provide affordable land are councils. However, the people best placed to build the homes on top of that land are the families and communities who will live in them, raise their children in them, and pay the heating bills.
In fact, residents are the only people who actually have an incentive to put more insulation into the walls, to bring more daylight into their homes, to create car-free neighbourhoods – in short, to do all the other things that we agree we should be doing in the 21st century.
So why not just lease the plots at an affordable price directly to local families and groups, who can then build – or buy – homes for themselves? There are plenty of examples to follow. From Almere in the Netherlands where citizens can buy or rent “serviced plots” with pre-applied planning permission, to London, where the GLA have begun making small sites available through the Smal Sites portal.
Imagine being able to go to a website, find an affordable plot of land near where you live, and apply to lease it with only a few clicks. Once you’ve got the lease, imagine being able to connect with a whole array of companies and local lenders who can help you get a home customised to your needs. Some families will choose to do it as part of a group or social enterprise, some will choose to do it as individuals. Some will commission a builder or manufacturer to make a house for them, others will physically build the homes themselves.
The result wouldn’t just be thousands of genuinely affordable homes, it would also be a huge boost for UK housing innovation and, most importantly, it would produce places that are genuinely affordable, beautiful, sustainable, socially resilient and loved by the people who live there. Places to be proud of.
Whichever model is used – and hopefully the answer will be “all of the above, please” – what is needed to make this happen isn’t just investment into building homes themselves, it is investment into creating the digital, legal, financial and physical infrastructure that will make the process simpler and easier, for everyone.
Put plainly, if you want to “set forth a million builders”, first build a road for them to go forth on.
• Alastair Parvin is the founder of Open Systems Lab, a non-profit company working on digital innovation in housing and the built environment