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Contextual information on Affordable Housing

Thank goodness for Adam Smith Institute Blog - When will they ever learn? and also Hayek's View of New Urbanism

I was asked to respond to a "Rural Housing Enabler" who wanted... here's my reply (with vast lifted parts from the above)

Dear Madam

I note you wish to meet to "work out the contextual information" for the "Housing Needs Survey for Affordable Housing".

It may help if I quickly set out my views which I think provide the missing "contextual information".

You are no doubt familiar with Hayek, and I would stress the best preparation you can do is to reread him.

As Friedrick Hayek said: "If we wish to preserve a free society, it is essential that we recognise that the desirability of a particular object is not sufficient justification for the use of coercion."

And this is the problem with the approach to planning that is being advocated: "a set of policies aimed at managing development with an eye for greater population density, thus encouraging more public transport, and fewer cars. To this end, they recommend that local governments pass strict land use controls, including urban growth boundaries, zoning laws restricting the construction of single-family homes...Under their philosophy, they're doing society a favour by enforcing a better way of living. In their view, we should be thanking them for saving us from ourselves.

Therein lies the problem with the planners. They don't trust people making their own choices with their own money. They want to make the decisions for us on how and where we should live our lives, and no matter how pure their motivations may be, their methods are simply atrocious. Only I know what's best for me. They only know what's best for themselves.

Ultimately, it comes down to this simple principle: I don't want to be forced to eat chocolate if I happen to prefer vanilla. And neither should you."

And more specifically "Affordable Housing" sounds familiar because we once called it Council Housing. When Lady Thatcher took office 35 percent of homes in Britain were state-owned and occupied at subsidised rents. Those lucky enough to qualify acquired the right to live there, a right they could pass on to dependents and heirs.

It froze labour mobility because someone moving out would forfeit their subsidised dwelling and go to the bottom of the housing list in the new area. Waiting lists were often over a decade long. The council homes had to be built cheaply, and were often poor quality. Indeed, they still blight many inner city areas even today. Together with rent controls, subsidised state rents destroyed the private rental market.

Lady Thatcher cut the Gordian knot by allowing tenants the right to buy at discounted prices, trading one benefit for another. It was politically astute and successful. As home-owners their outlook on taxation and the economy changed. Most of them began to maintain and improve what was now their property.

Mr Prescott is addressing the wrong problem with the wrong policy. The problem is not lack of affordable housing for those on low incomes, it is a shortfall in the supply of housing. We live longer, with more of us in single households. Yet the supply is constrained by planning (zoning) laws and 'banana' attitudes to the environment. (Bananas want to Build Absolutely Nothing Anywhere Near Anyone). Not surprisingly, prices shoot up.

State-owned subsidised rents are not the answer. We've been there, seen that, learned the lesson. At least some of us did.

I hope that provides a little bit of help for you in setting out your survey.


Regards
Tim

Comments

Slightly more polite than "Bugger off you stupid fat cow" but only slightly. Well done indeed.

I have long considered it an injustice that some people (those who were a one point eligible to get on a council housing list) get to pay well below the market rent for a flat, independant of their income.

(Of course, the very poor pay nothing, but that's a different matter). Councils should charge a fair market rent for their houses. Then the taxpayer (ie. us) would spend less subsidising them. Suddenly there's no economic advantage in being a council tenant, so you get your labour mobility back. The council can't use my money to unfairly compete with the private market, and people on medium-low incomes who don't happen to qualify for council housing stop getting screwed.

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