David Alexander: Purpose-built rental homes are the way forward
OKAY, so it is normally taken for granted that Britain is a nation of home-owners and no-one is arguing with the latest estimate that 80 per cent of the people of this nation aspire to own the roof over their heads.
But is this aspiration a result of overwhelming desire or is it at least partly down to lack of choice? For 40 years from the end of the Second World War, most people in the UK could choose between owner-occupation and public-sector rented housing. But at least our citizens had a choice, unlike now when, due to the mass sale of the municipal stock, owner-occupation has become the only viable option for the majority.
But unlike most of Europe, Britain did not offer, on a large scale, what would have been a “third way” then or a “second way” now – new housing specifically built for rent by private companies and financial institutions.
These landlords would have charged “market rents”, making the properties more expensive for tenants than public-sector or housing association equivalents. But with economies of scale and a healthy balance of supply and demand, consumer power would almost certainly bring rents down to more affordable levels.
I had hoped that the crisis in the mortgage market would have produced one silver lining, encouraging the growth of a more structured private rental sector to appeal to the great mass of the population. Up to now this has not happened but there were hopes that the situation may soon change following a positive response by Grant Shapps (just before his move this week from housing minister), to a report by top businessman, Sir Adrian Montague.
This calls for moves to encourage the private rented sector to break out from its buy-to-let salient and grow through the development of new homes (houses as well as flats) specifically for rent.
The disappointment is that Sir Adrian’s brief was restricted to England for housing is one of those matters devolved to the Scottish Parliament. But one hopes that Holyrood politicians will carefully study the report and consider how its recommendations might be adopted in Scotland as well.
l David Alexander is sole proprietor of the Edinburgh- and Glasgow-based letting agency, DJ Alexander
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