Housing, Planning and Modern Life (1955)

From the October 1955 issue of the Socialist Standard

“I was struck with the magnificence of the building . . . ‘One should think,' said I, ‘that the proprietor of all this must be happy.'  ‘Nay, Sir,' said Johnson, ‘all this excludes but one evil — poverty.' "

Boswell's Life of Johnson

People marrying in 1955 have no better prospect of somewhere to live than they had in 1945. That is not an uninformed guess by this writer: it is a statement made on the third of July this year in the Sunday Pictorial. How much attention it gained, among the nymphs and the strip cartoons, is uncertain. It should have had a great deal—most of all from those who believe that capitalism can solve its problems.

Between the wars, four million houses were built in Great Britain, and by 1939 there were twelve millions altogether. With the slum clearance programmes two-thirds completed, about a quarter of a million remained condemned as unfit for habitation, and nearly half a million were “overcrowded." Another half-million were destroyed or severely damaged during the war—most in docklands and crowded industrial areas, and so anticipating further “slum clearance." In 1945, authorities agreed that four million new houses were needed in the next ten years; in fact, at the end of that period two millions have been built

Even allowing that it is only half the estimate, two millions is an impressive number. Indeed, nobody wants figures to know that a great deal of building has been done. Small, semi-rural towns have dilated to populous urban areas; on the outskirts of cities, the council estates (and latterly “private" ones, too) have mushroomed; in the cities themselves, clumps of prefabs and great chest-of-drawers blocks of flats have risen on bomb-sites, waste patches, football fields— every place, in, fact, where there was land to spare for the housing of working people.

The solution of the housing problem has been the great promise of the postwar years; getting a council house, once slightly shameful (“corned beef islands," the estates were called), has become heart's desire to millions. Local authorities, faced with endless lists of applicants, made dire need almost their sole criterion. Most have used the “points" system to ensure that the houses went to the largest families with the worst accommodation: a temporary relief which ensures more overcrowding in a few years on the council estates. Outside of what is provided by the councils, the letting of houses has entirely disappeared. Virtually all that is available to childless or one-child couples is furnished accommodation at extortionate prices, or house-purchase.

For most people, buying a house is out of the question. Usually a tenth of the price must be paid as deposit; add on legal charges and other expenses, and an initial outlay of £300 is needed for a very modest house. Recently, it has become possible to obtain 95 per cent. and even 100 per cent, mortgages: that sends up the weekly repayments to something like £4—again, out of the question for most people. More are buying houses, because it is the only solution to their housing problem; over 90 per cent. of them—according to figures recently published by the Association of Building Societies—houses costing £2,000 or less. In short, some working people can buy houses, but only cheap ones.

What is obvious is that all to-day’s housing schemes rest entirely on the assumption of full employment. Buying a house takes 15 or 20 years, and if you do it for less than £3 a week you’re lucky. Council tenancies cost approximately double those of the older houses with controlled rents. In the last few years there has been a great deal of talk about “improved standards of living” that has been based largely on working people buying their own houses and being fixed up in smart little boxes with all-electric kitchens. The truth is that most people, with jobs and plenty of overtime, struggle for financial survival after having their housing problem solved. The Daily Herald, on the 16th of last month, gave some sobering facts about die lucky ones who are supposed to exemplify the better standard of living:

"In a London court last week an eviction order was granted against a £15-a-week factory worker for non-payment of rent. He has been living in a 32s.-a-week council house, with three young children, a host of debts, and a TV set.

The man who sought and won the eviction order against him on behalf of the local council had no sense of elation about the success, of his mission.

He, too, is living above his means. . .  He can't afford to smoke or drink. He hasn't a suit to his name—and wears sports clothes for economy reasons. He has already borrowed £245 against his life insurance—and he now faces a summons for non-payment of £5 rates."

The housing problem, in fact, is not post-war at all: it is the continuation of one of capitalism’s oldest problems. The working class never has been adequately housed. Before the war it was the slum problem—rehousing people who lived in such squalor that their children were malformed and tuberculous. Plenty still live in those conditions, by the way, and are not rehoused because they can’t afford to be. However, the dominant factor in the housing problem since the war has been that most people are in work and so are asking for houses to themselves. In this writer’s town there is a row of houses, built just before the war, which still bears a signboard announcing in faded letters that £20 down will buy one. Passers-by lament the change without realizing what it was. Now, they haven’t houses; then, they hadn’t the money. As soon as there is legislation which allows rents to be raised (and that seems a near-future inevitability) the post-war housing problem will fall back into its century-old perspective of people needing houses but unable to seek them.

For—and this is the great fact about the housing problem—houses are not produced to satisfy needs. Nor is anything else in this world. Food is not produced to be eaten, clothes to be worn, or anything else for its utilitarian purpose. All things, under capitalism, are produced with one motive only: sale and profit. Thus, at times when millions have needed it, food has been destroyed; thus, at any time (including today) anybody can have what he can pay for and nothing else. Note, please, that rich people have no housing problem. The Observer and the Sunday Times advertize houses to satisfy anyone; at £4,000 and upward.

How is it, though, that two million new houses in ten years leave the demand still unappeased? There are all sorts of contributory immediate answers—people keep on marrying, millions have shared houses for years, and so on. They all boil down to the fact that working-class families are in unsuitable accommodation and want to get out of it: the more important fact is that it always was unsuitable. Houses built for working people are small, cheap houses—soon overcrowded and soon dilapidated. The labourers’ dwellings and tenements and. industrial estates of the last century are the slums of this. Many thousands of people, incidentally, will still live in houses which were flung up over a 100 years ago to cram workers into the industrial towns. Go through the Lancashire mill-towns, and you see rows of grimy little dwellings with dates—1833, 1834, and so on—on their fronts and earth-closets at their backs. Go through London’s suburbs, and you see the unlovely prefabs of 1945; many of them now are having their lives formally extended for several years because their inhabitants cannot be rehoused elsewhere. So there is a perpetual process like that of the Augean stables, where the troublesome matter flows in at exactly the same rate as it it cleared out.

The biggest post-war housing project of all has been the building of “new towns.” Really vast estates attached to smallish country towns, they are the planners’' pride. It is worth examining them to see how much they really contribute to better living standards and human happiness. Essentially, they represent the way of life provided for the modern industrial worker; the north-country towns do the same for older, heavier industries, and the outer suburbs of southern cities the different amenities of the petrol-engine and electric-motor era. In them is incorporated, actually and potentially, the culture of the mid-twentieth century.

A new town has no music-halls, no street traders or little gold-mines. It is laid out in careful uniformity, and all the inhabitants keep their front gardens tidy because they are told they must. The buildings are grouped neatly according to function or income; shops together, civic buildings together, rows of houses with garages for the higher-income groups. Much has been made of this last point; in new towns, they say, the officials and professional people and managers live close to the rest. The fact may be true, but its implication is nonsense. There is as much snobbery in the new towns as anywhere else, and placing people close together makes no difference to it. In every big city in the world, wealth and poverty are contiguous with a world between them. The writer knows plenty of places where one side or one end of a street regards the other as “a different class."

The workers in the new towns are dependent on local industries, which are mostly of the newer sorts—plastics, electronics and so on. With largish families (the chief condition for getting the houses) and high rents, they can hardly lead lavish lives. Consequently, there are not many pubs or cinemas, and the new towns—like the estates— form “community associations” which really are means of recreation for people who have not much money and must look after young children in the evenings. Local transport generally is poor and the distances to former neighbourhoods considerable: the new towns impose fixed ways of living as firmly as the old.

Are those better, more satisfying ways? Consider the man living in Harlow or Stevenage or one of the others. He is fairly young and fairly skilled and has a family. He works in a radio or plastics factory; he works as many hours as he can to make ends meet, and if the factory closes half the town will be unemployed. He has a television set and complains of the programmes. His house has a refrigerator in which his wife keeps a pint of milk overnight during three weeks of the year. His wife uses Omo and Daz so that her family’s clothes are white, and they all use green toothpaste to keep their breath sweet. They haven’t a book in the house, but they take in Reveille, Tit-bits, Woman and the Daily Mirror. They are scared of having more children, getting diseases, and Henry’s firm becoming slack, and they do the football pools in the hope of buying themselves out of it all.

The condition of the working class, in new towns and old towns remains a deplorable one of insecurity and want. If material improvements can be discerned (which is debatable) they are outweighed by frustrations and fears of which our grandfathers knew nothing. Indeed, the degree scarcely matters: if things became much better they would still be bad. Housing is one of the innumerable problems which capitalism has created and cannot solve, simply because capitalism has no care for human needs. Many people refuse to believe that such problems cannot be solved within the capitalist system: the astonishing thing is that they are refusing to believe their own eyes.

Can Socialism house people, as people should be housed? The short and simple answer is that there will be no money barrier to the satisfaction of any need when all the means of production are owned by every person. The cheap and shoddy in houses, as in everything else, will vanish when there is no profit motive. As for the question of space—well, think of all the buildings which nobody will want. Shops, banks, exchanges, offices of every description ... and, in addition, a lot (an awful lot) of buildings which only a perverse society could think suitable for human beings.

Robert Barltrop

NOTE: The figures about rents and house prices apply to southern England. In the north and in Scotland they are rather lower. So are wages.

What right to housing? (2002)

From the March 2002 issue of the Socialist Standard

Every week we are treated to the latest front-page-filling concern for the paid scribblers of the capitalist class. The current crisis is concern over the spiralling cost of housing. In recent weeks, we have had announcements by banks, such as the National Westminster, that they intend to withhold mortgages on houses in certain post-codes (mostly in London), for fear of a burst in the house-price bubble. Simultaneously, on 7 February, we were treated to a round of reports about the average house price exceeding £100,000 in Britain. At the root of all this is the continuing inability of the market system to provide for even this most basic need of a human being, a place to live.

Over the last century, the structures of home ownership in Britain changed dramatically, from a situation where most people rented their home (with an average of 4 people per household), to a situation where the majority of homes are privately owned by their occupiers, with the famous 2.4 people per household. As the population of the UK grew by some 50 percent in that century the number of houses tripled. Since the 1970s the numbers in rented accommodation has steadily fallen, and now represent only 8 million out of 25 million households. Over that century, we saw numerous initiatives from rents controls, to council houses and housing associations to try and ensure proper provision of housing, none of which worked over the long run.

In the aftermath of the Thatcher regime, housing has been left almost exclusively to the open market, with councils at best being able to cut deals with developers to build “social housing” in exchange for planning permission on lucrative projects. Between 1988 and 1996 production of new houses fell yearly (especially compared with the simultaneous clearance of slum housing stock). In 1988 a net gain to the housing stock of 234,500 houses was made, compared to net gain of only 178,000 in 1996. This fall can be seen more clearly in the general reduction in output (in terms of raw materials for houses) of building products over the same period, with bricks being the best example, falling from 4,654,000 tonnes in 1989 to 2,939,000 tonnes in 1999.

Much of this malaise will be due to the falling investment by the state. In 1988 the state (central and local governments) spent a total of £5,273 million on housing expenditure, this plummeted to £2,825 million in 1999. Some of that fall was achieved by transferring housing stock from the public to the private sector in 1999. As has been noted in the columns of this journal before, the state is currently in the processes of divesting itself of as much capital as possible, hoping to transfer it into the private sector where it can be both valorised for profit, and used in a capitalistically more “efficient” manner. This has obviously, though, had some knock-on in terms of building of new houses.

This is particularly so with regards to being unable to manage the demand thrown up by the uneven nature of the market system. Given that workers must migrate to where they can find work, in some areas, such as London, the cost of houses is much higher than in areas of low employment, such as Hull. As the labour time that goes into their building and maintenance will be about the same, the difference is the price of the land on which they are built. What this illustrates is the difference between the cost of the house itself and the cost of the land it is on.

Land monopolists

In an agricultural economy, the rental value of the land would be derived from the differences in the quality of the soil. That is, land which could produce more, say, grain per hectare per hour of labour would give up a higher rental value than the least productive land (that is, land which could be exploited only for the given rate of profit in the economy). This remains partially true of land for industrial use. In the big cities, such as London, however, there is not the remotest chance of returning the land to agricultural use, and so it becomes human geography that provides land an income, from firms wanting office space, or volumes of people (with particular disposable wealth to hand) wanting housing.

Rent is derived not from any inherent feature or use of the soil, but solely through the titular owners’ parasitic capacity to prevent capital from being invested in an area without them being given a share of the surplus value generated (usually any in excess of the average rate of profit prevalent in the economy). This capacity is derived solely through their possessing property rights legally enforced upon others. The price of land itself, not being a product of labour, is calculated by taking the income it can generate and projecting it as a rate of return on capital over a number of years (so land that, say, generates £1 million rent per annum at a rate of 10 percent would have a nominal value of £10 million).

This is, in part, recognised in the national accounts, in that the “subsoil value” of land is now listed alongside computer software patents and electromagnetic spectrum rights as “non tangible fixed assets”. It is not the quality of these “things” that creates their rental/asset value, but merely proprietorship over them.

Pressure on wages

In recent years – as part of the “property owning democracy” gimmick – government policies have tended to encourage workers to buy houses and use them as a form of savings and investment to try to climb the property ladder. This increases the number of housing transactions (as some people speculate), and also means that the government is locked into policies which must attempt to ensure the continuing appreciation house prices (or which at least prevent negative equity).

According to the Office of National Statistics, in 1998 the average person was paying 17 percent of their gross income on housing costs. Obviously, that is a percentage of wildly differing incomes, so the top 10 percent of incomes would be paying £120.80 per week on housing, whilst the lowest would be paying £19.80. Even then these figures are somewhat deceptive, since many of the lower income households were only meeting their full housing cost of an average of £59.40 per week through housing benefit (which is tapered to achieve the 17 percent cost).

This means that any increase in demand for housing due to labour migration, or other events outside a general rise in wages, will increase the share of wages needing to go into housing, and thus create upwards wage pressure. An example of this is the current plan to raise the London weighting on salaries from £2500 to over £4000. This effectively means a potential transfer of wealth from productive capitalists to landholding ones (as well as some of the financial intermediaries involved). Given that the workers could press for higher wages (thus cutting profit rates), to off-set these rises in housing costs, unlike employers landowners have no direct interest in holding such costs down. Since the employers need their workers – and during periods of growth, more and more workers – they have to surrender this indirect tribute to the landowners.

This is why capital was once willing to accept rent and housing market controls to prevent the landowners taking its profit. Hence why, now, the state pays a portion of rent to smooth out the proportion of wages spent on housing. Given, though, the size of the housing benefit budget, and the notorious capacity of landlords and tenants to make “fraudulent” claims, the state is under pressure to curb even that mechanism for taming housing costs.

What all this means is that the anarchy of capitalist production – with its self-seeking economic agents, periods of boom and slump, its uneven migratory population pressures – creates a clear contradiction between profit seeking and providing for human needs. In a world in which everyone could be easily housed, even in a country like Britain we find millions leaving in what even the government classifies as housing unfit for human habitation and actual homelessness on the streets, while nearly everyone has financial worries over satisfying this basic human need.

Pik Smeet

Cooking the Books: Another reform stops working (2024)

The Cooking the Books column from the September 2024 issue of the Socialist Standard

The front page of the weekend edition of the i paper (3/4 August) read:

'Thousands of ‘affordable’ homes stand empty despite housing crisis.

• New homes built under Britain’s ‘affordable housing’ rules remain empty because housing associations do not have funds to buy them under ‘crazy’ system, i is told
• Entire developments are also delayed as potential buyers pull out due to budget squeeze, with major housebuilders unable to find purchasers for 1,000 homes each
• Properties earmarked for homeless families among many vacant for up to three years.’

So-called affordable housing is not necessarily affordable to all of those who need housing. What it is, is inferior housing produced so that it can be let at a lower than average rent. It is provided for under Section 106 of a housing reform — the Town and Country Planning Act 1990 — which empowers local authorities, when granting planning permission, to make an agreement with a speculative housebuilding company under which the company offsets some of the side-effects of its housing development. One such offsetting measure can be to provide a certain amount of ‘affordable housing’. Local authorities can’t require too much of this, which costs the company money (as they could otherwise build and sell higher quality housing), or the company will walk away and no extra housing at all will be built. But that’s not the problem here.

Section 106 housing is not allowed to be sold to individuals and is normally bought by housing associations and local councils to let to tenants at a lower than average rent (reflecting its lower than average quality). According to the paper’s report, housing associations have not been buying these houses as much as they once did as they are short of money, and housebuilding companies have stopped some housing developments because they are losing money on unsold ‘affordable’ housing.

When socialists say that capitalism cannot be reformed we mean that it cannot be made to work in a way different from how it does — as a profit-making system in the interest of those who own and control the means for producing what society needs to survive. It cannot be reconfigured so as to work in the interest of the majority of the population who are excluded from ownership of productive resources.

This does not mean that within the framework of class ownership and production for profit measures can’t be introduced aimed at dealing with problems that the system continuously generates, for the owning few as for the excluded many. In fact, one of the remits of a government is to introduce measures aimed at solving a problem for the few or at mitigating one for the many. Governments are proposing and implementing such ‘reforms’ all the time.

As far as the excluded many are concerned, the word ‘mitigate’ is appropriate since the problems they face can never be solved within the capitalist system; all that can be done is to soften the impact to some extent. But even this doesn’t always last. If it involves the government spending money, this tends to get reduced in an economic downturn.

Some reforms work for a while but then give rise to another problem. The scandal exposed by the i paper is an example. A reform enacted to help lower paid workers access housing that they can afford is not working as intended. A further reform is required to try to mitigate this new problem. It’s like whack-a-mole. You mitigate one problem and another pops up.

Houses intended for the lower paid standing empty while people need them is indeed crazy, not to say outrageous, but is not simply due to a reform not working as intended. It’s the sort of thing that will keep reoccurring in one form or another when, as under capitalism, houses are built to be sold at a profit rather than just to be lived in.