For Far Too Many People, A Starter Home Will Be a Non-Starter

The PM and the Chancellor have a responsibility and an historic opportunity to get to grips with a problem dodged by governments for decades, and help thousands of families on everyday wages find - and keep - a home.

If ever there was a metaphor for a politics out of touch with everyday concerns, it has to be the news this week that a London Housing Association flat labelled 'affordable' went on sale for £1million.

How can it be that a home, something so essential, proven to benefit families in so many ways, and cheap to actually build, can have become so scarce and expensive?

Blame speculative land ownership, or councils not taking the lead in building homes in their area, thanks to old fashioned Nimby-ism. Add in big cuts to budgets for home building, and an economy built for generations on the charade of house price value, and you have a lot of suspects. It's easy to point the finger at any one factor, but although they all play a role, they aren't the true rotten root of the problem, the lack of decisive political action is.

Successive governments have fuelled the housing crisis by not building enough affordable homes. Instead, they've indulged in a dangerous mix of increasing cheap mortgage debt; doing deals with developers which sacrifice community commitments and fail to deliver more than a handful of additional homes; and, keeping their faith in the false premise that most voters demand rising house prices. Not only has this not worked, it's fed the public's feeling that politics doesn't work for them.

It's not a popular thing to say, but I love the power of politics because at its best, it can achieve powerful positive change. From the UK establishing some of Europe's first homelessness protections to preventing a higher wave of repossessions that could have easily followed the financial crash.

But this is increasingly an isolated view. Many feel politics is played out in a London bubble, by people shielded from life's realities. People increasingly don't vote, or vote with no enthusiasm. It's not hard to understand why people are in danger of losing faith when this new government, voted in on the promise of prioritising housing, is currently not doing so.

Fixing our housing problems isn't a cure-all, but would significantly dent people's doubts. Every day at Shelter we hear from people across the country who don't want the instability of house price booms. They want to see people like them benefiting for a change and know their kids will have a reasonable shot at a decent home.

The government's current plans, which in the main focus on building affordable 'Starter Homes', are not the solution we need. The offer of 20% off some new homes costing up to £450,000, whose prices are rising at over 5% a year, is empty, as it's still out of reach for millions of people. Plus it will be paid for by scrapping other plans to build more homes ordinary people can afford to rent or buy, and selling off many of the few affordable homes we have left.

Our analysis, released recently, shows that these 'Starter homes' will be unaffordable for families earning average wages in over half of local authorities in England in 2020. For families on the new National Living Wage, that rises to 98%.

People on significantly more than average wages will benefit, which is fine, but it can't be the only show in town. And certainly not when it leaves millions of families with no option but an insecure, unaffordable private let.

This can be fixed, but as homes take time to build, the autumn spending review is George Osborne's last chance in this parliament to take decisive action. Shelter and KPMG have shown how to do that. Invest £1billion extra a year (still below pre-2010 levels) and we could be building 250,000 homes a year by 2020, which would provide a mix of homes, decent and affordable, to rent or buy, in existing towns and villages, and in new garden cities.

The PM and the Chancellor have a responsibility and an historic opportunity to get to grips with a problem dodged by governments for decades, and help thousands of families on everyday wages find - and keep - a home. Relying solely on a policy that helps only the well-off will not only fail them, but leave many wondering if they're really on their side. More dangerously, the result could be a complete loss of faith in politics generally.

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