Developers, planners and oligarchs – the politics of the housing crisis

It seems no-one is immune from blame when it comes to the housing crisis – developers land bank; council planning officers are obstructive; oligarchs buy homes to leave empty; and landlords hoover up the few houses that remain.

Politicians don’t incur much of the blame, although they do seem to get a lot of credit for opposing new housing developments – largely because the consequences of allowing a housing development are borne by the local councillors responsible. Conversely, the consequences of blocking a proposal aren’t.

Balancing benefits and harms

The planning system is, at its core, about trying to balance benefit and harm. Every housing development will cause some harm, and every housing development will have some benefits. The task of weighing them up and reaching a decision falls to local councillors, guided by their planning officers.

Perceived harm usually centres on aspects like increased traffic, loss of green fields or disruption during the construction process. Those harms occur in a very localised area – normally limited to the single council ward in which the development is to take place.

The benefits of development are typically things like job creation, ameliorating house price growth, and financial support for social infrastructure such as schools and parks. Benefits accrue over a wider area – certainly bigger than the council ward in which a development site lies, and often bigger than the local authority itself.

These benefits are mainly things that are taken as a given – people expect the government to deliver economic growth, affordable homes and new schools and parks. It often takes time for those benefits to come to fruition, meaning that the politicians responsible for delivering them don’t always get the credit – they come a long time after the development so the connection is lost and the politician should have delivered them anyway.

Conversely, harm occurs at the same local scale at which councillors are elected. It is more concentrated and felt more acutely. It can happen very quickly too – the field is lost on day one of the development. It makes it all too easy for local councillors to be ‘blamed’ for new developments and to be punished at the ballot box as a result. Political pragmatism leads councillors  and those seeking election – to come out against new development in their wards. Whilst that might harm economic growth or make homes less affordable in the long-run, they won’t be blamed for that – developers, oligarchs and landlords will be the culprits instead.

The political consequences

When councils prepare a new Local Plan, those tensions are multiplied. There are usually lengthy arguments over the number of homes that can be accommodated, with councils often pushing for the lowest figure they believe they can justify. Research by Savills suggests that councils are only planning to deliver 88% of their actual housing need.

These tensions result in a planning system that is trying to deliver new homes into a headwind. If the housing crisis is really going to be addressed, it needs politicians to make bold, long term decisions that are in the best interests of the electorate as a whole – not just the vocal opponents of new development who live closest to new development sites. Often, though, that sort of thinking just isn’t rewarded come election day.

The Strategic Land Group is a land promoter that is used to dealing with these political challenges. That is why we have an established track record of maximising land values. You can learn about how land promotion works here. If you know of a site that you think might benefit from our involvement, please don’t hesitate to get in touch for a confidential, free, no obligation assessment.

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