How has the Housing Shortage in UK Developed and How Can it Be Solved?

Abstract: Purpose with the thesis is to describe the housing situation in the UK, identify challenges and key solutions to them. To meet the purpose three research questions have been formulated: How has the British housing market developed since world war 2? Which challenges does the British housing market face? Which are the possible solutions to the challenges on the housing market? The method used is literature sources, statistics databases well as interviews and surveys with professionals within the field. Most information was collected in the UK where were based for two months. The result and analyses are divided up in a chapter containing the housing history for UK as a whole to get a solid ground and to better understand the statistics, the main problems and potential solutions. After presenting the history I have identified the main problems in the housing market and their solutions. Problems which have their roots in the past and have developed during the years and solutions which are either new or something which worked in the past. To get a short summary of the history the most important decades are summarised in the following table. Summary 1946-1979 The era had both the Socialdemocratic Labour in power and the right wing Conservatives. The planning agenda was first oriented towards physical planning where the physical was in focus to solve the problems. During the 1960s and 1970s it was the planning which was more focused towards scientific and economic solutions to solve the problems in the cities. New houses were built mostly by the public sector which built more than 1.7 million new homes. Along with the new dwellings towns where also built and dimensioned for about 20000-60000 inhabitants. Prefabrication was introduced in order to build many houses fast and cheap. The overall building of new homes peaked in 1968 and then declined thereafter because of focus on reinvesting in the existing housing. 1980-1999 During the 1980s with the conservative Thatcher in power the view was that the state had too much power, they spent too much money and there was a limitation on free market. This showed in the urban policies which were more entrepreneurial than before. The state put a cap on the public spending which affected the building of new housing. They also sold out their share of the housing market through the “right to buy” act. During the 1990s there was a backlash to the 1980s models and it become more popular to focus on publicprivate partnerships. 2000-2019 The first half of this era had Labour in power and in the other half the Conservatives. What characterised this time was that the population as well as the economy grew but the housing building was stable and low. This meant the gap between dwellings and amount of inhabitants grew. During the first part of the era Labour focused on building and investing in existing areas in order to create better communities but this was abandoned by the Conservatives which focused more on economic growth. The challenges can be divided up in two categories; how we ensure there is more housing built and how we steer and maintain existing houses. On the UK market and specially in London there is a unbalance in the relationship between supply and demand, where the supply is not big enough compared to the demand. The reason to why supply is not enough is because there aren’t enough buildings built and the demand has increased at the same time. In the past the council built their own houses in order to ensure there was enough supply on the market, however the last 40 years the housing market has been left to private sector. The existing properties are sold out by the municipalities in order to fund other sectors within the community. The buyers of different properties are often wealthy people who later let out to the people for a high rent. The thesis present six different solutions, both market oriented and public sector oriented. The solutions are the following: 1. Lowering Construction Cost through prefabrication 2. More Effective and Smaller living 3. Temporary Housing and Temporary Permissions 4. Local Authorities builds new housing 5. Reinterpreting “Land Value” 6. CLT – community owned land trust I have come to the conclusion that since housing is a complex matter we need different sorts of solutions. We need both market oriented and public sector oriented solutions in order to find a solution and an end on the housing shortage. Therefore all six solutions which was presented is valid on different scale solving different angles of the problems with housing shortage.