Housing

Part of Opposition Day – in the House of Commons at 4:20 pm on 28 April 1987.

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Photo of Mr Jeff Rooker Mr Jeff Rooker , Birmingham, Perry Barr 4:20, 28 April 1987

No.

That imaginative scheme has been organised to build and rent family housing using institutional funding with the required rate of return, and rents set at no higher than fair rent level. The concept is simple. I cannot go into all the details, but it is based on the idea that the voluntary sector exists to provide homes to rent and not necessarily to build up a property portfolio. It rests on some equity surrender or withdrawal at some point during the period of the loan to ensure the required rate of return to the building society or pension fund. With a rolling programme of development and acquisition over the loan period, normal voids occur at no less than three times the rate required for the equity withdrawal. Therefore, there is no problem in respect of security of tenure. As ever, it was made in Birmingham. It is a good idea and the imaginative scheme of COPEC deserves all our support. I certainly hope that the Minister will look at the scheme. I know that the Housing Corporation supports it and that it finds favour with the institutions as well.

Earlier this year I wrote to the Minister, following the claim in the public expenditure White Paper that there is generally speaking an adequate supply of housing overall in Britain. I pointed out, using everybody else's figures, not Labour party figures, that we appear to be about 1 million homes short rather than having 500,000 too many. I wrote to the Minister and told him that I had not taken account of the high rise blocks or the defective housing, much of which will have to be demolished or replaced, and I did not take account of the view of the Royal Institution of Chartered Surveyors, which is that we need about 2·5 per cent. —nearly 500,000 homes—empty at any one time to facilitate mobility. The professional view is that without that, the system will not work.

After disputing the figures, which, incidentally, were repeated by the National Housing Forum in its note to party political leaders at the end of March, the Minister went on to remind me that most people want to own their own home. I wrote to the Minister about total numbers of homes for people, irrespective of whether they are owned or rented. Unfortunately, the Minister picked up only one aspect. What he asserts is correct for the majority of people, but people want to decide for themselves when they want to buy.

We now know of people being forced into purchases prematurely. The building societies are worried about that. The Minister's attention has been drawn by the building societies to the fact that we have the largest sector of young home owners anywhere in the advanced western world. They see some pluses in that but they also see some minuses. One has only to look at the high repossession rate, especially among the younger sector of the population. If there is a shortage, there is no choice. It is plain and simple.

The Nationwide building society has said that prices for first-time buyers are outstripping rises in pay and that people are being forced to buy smaller and smaller homes. Hon. Members must know from their constituents that those homes are not easy to sell. A show house which is empty or has specially built furniture designed to create the illusion of more space, can look great. Those houses might be all right for Tom Thumb people, but not for ordinary people. [An hon. Member: "Shortisin."] I plead guilty to shortism. Builders are being forced to build smaller dwellings.

People go to their Members of Parliament or local councillors and say: "Look, I bought this home in good faith. Now I can't sell it. What are you going to do about it?" We have to explain that this is the result of free market housing and that this Government over the past eight years have deliberately created a shortage of rental housing. Thousands of people are trapped in homes that they are finding it extremely difficult to dispose of.

Only yesterday, the south-east director of Wimpey claimed that, due to the demand on new housing estates, he was tickling up the price of new houses, in some cases daily. My constituents have told me that they have difficulty keeping up with price rises every week, but prices being tickled up daily is news to me. The director of Wimpey was reported in the London Daily News as having said that that is the case. House price inflation in the south-east on this scale is in nobody's interests. It is not in the interests of owners or buyers, especially first-time buyers.

I find it difficult to understand why some Ministers have said that some people want to remain tenants. Some people remain tenants because they cannot afford to buy a home, but some people genuinely want to remain tenants. They resent being forced into what they consider to be not very good quality housing; they would prefer to remain tenants. Tenants cannot see why rent structures are organised so that they have no share in the capital growth of the property, and they end up buying the homes for the landlords. That is the present rent structure in the public and private sectors.

This issue ought to be tackled because many good things would come from such changes, such as flexible leases. That is not the only scheme which could be implemented. Tenants must feel that the rent they pay is not wasted money. Tenants often say, "I have boughs this house two or three times over with my rent," but neither the property nor the capital growth accrues to them. People do not necessarily want to buy houses, but they do not want to feel that the rent is wasted money. Some changes which could improve the tenants' satisfaction are to increase the stock of rented housing and to provide better maintenance and above all, to assist in breaking the polarisation between tenants and owners, which has concerned hon. Members and our late colleague, Tony Crosland, in the 1977 housing policy review. We have never taken on board that concern as seriously as he intended.

Some authorities, Labour and Conservative, have experimented, but at the margin of the present law. Parliament should assist by introducing these changes. No one course of action will solve the problem; many ideas could be implemented to give new rights to tenants and to convince them that money paid in rent is not money down the drain.

We all know, because of the debates on pensions and the aged—we have just had a ten-minute Bill relating to the Occupational Pensions Board—that the aged population is changing and will do so in the first part of the next century, which will lead to a much higher proportion of elderly people. We have to adjust our housing policy to take account of this. A Conservative Member has said to me, "It is all these divorces causing more homeless and household formation growth," but no one says that we should change the law and stop people divorcing, or force people to live together as they used to have to do.