House prices outstrip earnings.
One of the most striking economic phenomena of the last century has been how house prices have outstripped average earnings in the UK and elsewhere. It is important to note that this has not been the case in some countries like Germany and Switzerland where economic and taxation policies have been different but where it has occurred it is having a defining impact on families. A significant dividing line between rich and poor has come to be defined by who has been able to benefit from house price inflation and who has been priced out by it.
There is no question that the expansion of credit has been a contributory cause of house price inflation. The rise of the two-income family model has played into it. The first middle income households to acquire a second income did very well but once it became the norm, mortgage lenders responded by changing the criteria from 3x a single salary to 3 (or more) x dual salaries. In a market with nearly fixed supply constrained by planning restrictions house prices simply rose to absorb the extra funds available from buyers.
MAHM would like to see:
Housing Minister in position for longer than 1 year
End to discrimination of landlords against single earner families
More support for families to live in their local area
Greater pressure on public landowners such as local councils and church when disposing of land to look at the needs of locals and communities rather than sell at ‘best price’
“We are going backwards, at least our parents could afford to own a home on one income; now you don’t own a house and you have both parents working to have a roof.”
- Rocio, Mother
House prices versus average earnings
There are no easy solutions to the housing crisis.
MAHM are keen to work with others to see how we can help families. If you are able to help us with our work do get in touch.
“Not only the Government’s top domestic priority but the entire country’s primary moral mission: to build the homes that the next generation need and which are currently denied to them.”
— Kit Malthouse, Housing Minister 2019
Useful links.
Resolution Foundation.
Families are spending more of their income on housing and getting less for their money. The Resolution Foundation focuses on understanding the causes and impact of these developments, and on the appropriate policy responses.
Right to Build.
Everyone in England is entitled to sign up to local self build registers. Under the Housing Act 2016, local Councils must ensure they have sufficient ‘shovel ready’ plots to meet the demand on the registers.
A self building journey.
Follow our Chair, Anne and her family as they attempt to build a family home. They’re building what they could not afford to buy in their local area, and they’ve used the Right to Build to help them achieve it.
National Community Land Trust Network.
Community land trusts (CLTs) are set up and run by ordinary people to develop and manage homes. CLTs act as long-term stewards of housing, ensuring that it remains genuinely affordable, based on what people actually earn in their area, not just for now but for every future occupier.
Shelter.
Shelter helps millions of people every year struggling with bad housing or homelessness through our advice, support and legal services.
Housing, Church and Community Commission.
Archbishop of Canterbury has launched Commission on Housing, Church and Community. “If the purpose of housing was understood as building homes and communities, not merely building accommodation with bricks and mortar, the whole nature of the industry would be changed.”