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At last, everyone is talking about housing.

October 14, 2017 12:10 PM
By Laura Coyle in Liberal Democrat Newswire

As a housing legal aid lawyer, it has long been my belief that access to decent quality secure housing should be given as much priority as access to quality healthcare and education. Without a decent secure home access to quality education is undermined and health is compromised.

For too long all of the main political parties, including the Lib Dems, have failed to develop radical policies to deal with a growing crisis in housing in the UK which is feeding a relentless growth in inequality, between rich and the poor and between old and young.

According to the most recent available data from the Department of Communities and Local Government, in 2014 the proportion of people in the UK owning their own home had fallen to 63.5% (its lowest rate since 1987) and the proportion of households living in social housing had fallen to 18% (from 33% in 1980). Meanwhile, the proportion of households living in private sector rented accommodation rose to 19% in 2014 (from a low of 9% in 1984).

The statistics only tell half of the story. The other half is that the Landlord and Tenant Act 1985 introduced sweeping changes to the private rental sector by doing away with protected tenancies and rent control. Private sector tenants today have no security of tenure beyond an initial statutory six month fixed term, beyond which the landlord can choose to repossess and/or increase the rent.

Vince Cable said in his speech to party conference last month that, "homes are to live in; they're not pieces on a Monopoly board". He rightly talked about taxing foreigners who acquire residential property for investment purposes and protecting rural communities from absentee second home ownership. But we also need to talk about the buy to let market. Every time a homeowner decides to buy another property to rent out they deprive another household of the opportunity to buy their own home.

If we believe that houses should be homes and not investment vehicles then we need to disincentivise the purchase of residential property to let rather than encourage it. Since April 2017, mortgage interest deductions have been limited to the basic rate, but the Liberal Democrats should be calling for all mortgage interest tax relief to be scrapped and to encourage private landlords to provide properties to let at more affordable rents and for longer periods we should explore the possibility of linking other deductible expenses from taxable rental income to the level of rent charged and the security of tenure offered.

Of course, we also need to build more homes, and in particular social homes. But achieving a massive increase in the social housing stock will require funding. Allowing local authorities to borrow to build new homes is one part of the answer. But we should explore others. For example, the increase in land value from the grant of planning permission is huge but current taxation rates are low. It is the state that grants planning permission and yet in doing so it often prices itself out of the market for buying land for building new homes. We should look into the possibility of introducing a new, higher tax on the capital gain deriving from the grant of planning permission which is payable direct to the local authority to fund the acquisition of land for building new social homes.

These are just a few ideas. The main purpose of this article is to say that we need to urgently start the debate on how to tackle one of the biggest drivers of inequality of our time. We have a proud tradition in our party of developing radical liberal policies to address social ills and we should be at the forefront of doing so now.