In a functioning market if the price goes up, it sends a “signal” for supply to be increased and the price to come back down. Though we often talk about the “housing market”, it isn’t really a market due to the severe constraints on increasing supply due to the planning system. So the shortage gets worse and worse and prices go up and up. The solution is to increase supply. Miraculously both the main political parties seem to have stumbled into a broad acceptance of this basic economic reality, at least in principle.
The lack of choice and competition due to the shortage of accommodation inevitably results in low quality as well as high prices. Scapegoating the landlords was a popular displacement activity for a while – especially those “buy to let landlords” denounced for being exceptionally villainous. One way of punishing them was to impose lots of pointless box-ticking regulations – pay for an engineer to check the boiler every year, pay for electricians to come and check the plug sockets every five years, and so on. The sort of things no homeowner would bother with for their own place. Then there was the Finance Act 2015 – which removed a landlord’s right to deduct mortgage interest from their rental income before calculating their tax liability. It was made harder for landlords to evict if the rent was unpaid. Some councils have a licensing scheme – to sting landlords for a large fee, or a hefty fine if they don’t fill the form in on time. A law is coming in to require landlords to have work done to upgrade their properties to meet the “decent homes standard.” Now that on top of all this, interest rates have gone up, some landlords have sold up.
“Hey! Where are you going?” the politicians have started shouting. “Come back!” For instance, a report from London Councils said:
“The reduction in Private Rented Sector supply and consequent rising rents impacts on all Londoners reliant on the tenure, but it has significant implications for lower-income residents and councils seeking to secure accommodation for homeless residents.”
It adds:
“Policy and economic factors are increasing landlord costs, and this impacts particularly those letting at lower rents. Landlord focus groups and online forums cite challenges leading more landlords to consider selling: the abolition of Section 21, increased mortgage rates, and new rules on EPC ratings.”
The proposed abolition of Section 21 evictions is “welcome” but “this needs to be delivered in a way that does not lead to an even greater reduction in the availability of properties.” It concludes:
“To tackle the root causes of this crisis the government must go further and develop a long-term private rented sector strategy to ensure the provision of sufficient privately rented homes to meet demand.”
Might it not occur to London Councils to ease planning restrictions in their boroughs to allow an increase in supply? That is the failure that means some tenants feel they have little choice but to put up with damp and mould – especially when they are in temporary accommodation found for them by a local authority.
Suppose there was a really big expansion of property development allowed. Millions of new homes built. There would be plenty of room – just over one per cent of the land in our country is currently taken up with housing. Prices would fall sharply – whether to rent or to buy. The buy to let landlords could make a comeback – buying some properties much more cheaply. They would then charge much lower rents – still being able to make a profit as their mortgages were much lower. But all the new building would mean strong competition. They had better sort out the damp patches or their tenants will move out.
That would still leave the social housing sector. Suppose that however much market rents fell, the rents for council and housing association properties were kept well below it. Plus there would be the offer of security of tenure for life. That means the municipal landlord doesn’t need to worry too much about the tenants leaving due to failings in repairs and maintenance. So whatever the mission statements in the website might promise about how caring they are, everything can be left to slide. Rochdale Boroughwide Housing failed to take proper action to deal with damp and mould on their properties even after the case of Awaab Ishak, a two-year-old boy who died from a respiratory condition caused by exposure to mould.
The Social Housing Regulation Act has just been passed, giving more power to a Quango called the Regulator for Social Housing to carry out inspections and demand improvements. I would be very surprised if it makes any difference at all – genuine empowerment of tenants in social housing would be achieved by strengthening the right to repair and boosting shared ownership, with a free equity stake for those who take responsibility for minor repairs.
Of course, the counter-narrative will be that more public spending is the answer. If only the mean-spirited Government handed over a few more billion in subsidies to councils and housing associations all would be well.
To give an example to show why that would not be the case, I have done some research – using Freedom of Information requests regarding exterior repainting of council properties. Bricks are porous so protecting them is an important way to avoid damp. Wood and concrete are also porous. There is some good news that in recent years the quality of paint has improved. If you talk to someone with technical expertise you can discover the great advantages of graphene paint and fungicidal paint – both in lasting much longer and in the extra safeguard they provide against damp and mould.
They do cost more than conventional paints. Suppose you need three gallons of paint to repaint the outside of a house. Maybe the cost of these miracle paints might come to an extra £50 for the three gallons. Perhaps £125 instead of £75. But that is well worth it, if it lasts 20 or 30 years rather than five or ten. Also if the damp and mould is avoided and thus the cost of that remedial work. Keep in mind that you have the labour costs and often the costs of scaffolding. The painter costs much more than the paint.
There is also the cost of the housing officers administering the process. We might hope they would be keenly on the look out for better value. But in practice their interests are to leave the tender as it is and go with the cheapest bid. Any sort of innovation involves extra work and risk. They would have nothing to gain.
So all the councils I asked are using conventional masonry paint. Some replied that they had done no repainting. For instance, my own Council, Hammersmith and Fulham, said:
“Owing to financial constraints, we do not currently carry out a planned exterior decoration programme.”
They added:
“Approximately £560,000 was spent on remedying damp and mould issues within our homes during 2022/23.”
Of those councils that did the costs varied greatly.
For Reading, the cost of the scaffolding (£232,947.75) was more than the paint and labour combined (£113,029.46.) The cost per property was £432. Others cost far more. Hackney £566. Braintree £609. Hillingdon £740. Cornwall £767. Wolverhampton £818. Caerphilly £861. Waverley £909. Castle Point £1,174. Cardiff £1,619. Barnet £1,818. Thanet £2,277. Hounslow £3,228. Pretty astonishing variation when they all using much the same sort of paint.
Lest I am misrepresented, I am not claiming that using better paint would eliminate the problem of damp and mould. Roofs have been known to leak. Modernist architecture has inherent problems of condensation caused by poor ventilation. But efficient repainting would make an important contribution. Often remedial action will still be needed.
All I propose is that as well as being tough on mould, we should also be tough on the causes of mould.