To fix the housing crisis, Theresa May needs public and private sector collaboration

Posted On: 
13th March 2018

There will never be sufficient progress addressing the housing challenge without the private and public sectors working more closely together, says Joe Garner, Chief Executive, Nationwide Building Society.

There is much talk of Brexit meaning a divided Britain, but whether Remainer or Leaver, young or old, on the left or right, we can all agree on one thing: the problems in the housing market still need addressing. As the PM flagged in her recent housing speech we need to ensure that through the Brexit process nobody feels they have been left behind. She clearly identified one of the biggest barriers to social mobility we face today is our failure to build enough of the right homes in the right places.

Much of the brunt of the housing issue is felt by young people and families - subject in some cases to landlords who don’t treat them with respect, tenancies which aren’t stable and house prices which aren’t in their league. Together these can create a feeling of resentment. Anyone who cares about the fabric and fairness of our society is likely to care deeply about this issue.

That’s what mutuality has always been about: helping each other so we can achieve more. While Nationwide Building Society has the scale to make a difference, addressing the housing challenge requires cooperation and action between many different parties. Looking back through history, the only time that supply has broadly kept pace or exceeded demand was when both the public and private sectors have been firing on all cylinders.

A current coalition of the willing might combine a Government seeking to deliver the Prime Minister’s personal mission to build more homes with campaigners, landlords, tenants, housebuilders and lenders. In confronting this challenge, we have new techniques which can help us build smarter, cheaper homes – more quickly. Whilst construction methods have made rapid advances, the central objective remains the same. Put simply, how can we ensure that every home is one in which we’d be happy for our own families to live?

The primary issue is supply. While the supply of homes remains squeezed we won’t be able to solve this challenge. Though the major developers and their traditional building techniques are a key part of the answer, we should look to innovation too.

For example, to challenge existing practice we’re funding a multi-million pound housing project in our home town of Swindon. Our site may only provide 200 homes, but we hope it might be a test bed for delivering housing in a new way. Although we are not doing the actual construction ourselves, we’re putting local people at the heart of the planning and design process, influencing everything from the look and feel to the layout of properties. In short, we are sticking our neck out as a lender to get diggers in the ground and get building, and others could do the same.

Ensuring everyone has an affordable and safe place to call home extends to rented homes too. The number of families living in the private rented sector has ballooned over the past decade, increasing by around a million, with a number living in homes that no-one would want their children to grow up in. The most dangerous homes are already illegal to let out. But some tenants appear to be trapped in the gap between what is legal and what is acceptable; in the quarter of sub-standard private rented homes which fail to meet the Government’s Decent Home Standards due to issues like damp and mould. 

Nationwide Building Society – through our buy to let lender, The Mortgage Works, has committed to only lend on new homes broadly equivalent to the Decent Homes Standard. By educating and supporting our own landlords, we’re hoping to positively influence the behaviour of others across the country; ensuring they understand and meet their responsibilities and setting a higher bar for what tenants should expect. It was for this reason we joined others in supporting the Fitness for Human Habitation Bill, sponsored by Karen Buck MP, to give tenants greater power to take legal action against the worst landlords.

And when it comes to unscrupulous landlords, we want to make sure we’re not lending to them at all. The Government is establishing a database of rogue landlords, and we’re keen for that information to be shared more widely. 

There’s a lot that banks, building societies and developers can and are doing to help. But we’ll never make sufficient progress without the private and public sectors working more closely together. Alongside Government, councils, construction companies and other organisations need to work together to consider solutions as a whole. Last year Nationwide convened a Partnership Board of powerful players to drive best practice in the private rented sector, including ARLA Propertymark, Shelter, Countrywide, the Nationwide Foundation and the National Landlords Association. We need collaboration like this to ensure the sector works for everyone. 

It is incumbent on all of us to do what we can to fix this. The time for action is now.  We’re keen to play our part, and hope to encourage others to contribute.