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The Politics Of Housing in 20th Century in GB

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During the First World War, no housing construction took place, inevitably leading to a housing shortage by 1918. Economic conditions deprived private developers of the opportunity to improve the situation, meaning that the government took on the responsibility. In the “Homes Fit for Heroes” Addison Act provided local authorities with the power and subsides to construct new homes. In the meantime, worries pertaining to affordability led to a continuation of the rent restrictions that had been implemented during the war until the early 1920s.

In the 1920s, local authorities became the primary suppliers of new homes for the working class, homes which were available to rent for prices exceeding those at the lower end of the private market. To encourage the private sector to build more houses, subsidies were implemented by the government Under the second Baldwin Government (1924-29). In general, housing policy in the 1920s paid attention mostly to bridging the gap in housing shortages, instead of worrying about different sections of the population. However, the conservative government of the 1930’s wanted the private sector to fund and construct new houses. Local authorities were told to concentrate on removing slum housing. This resulted in a sharp rise in private sector housing developing, which was helped by low interest rates, less limitations on planning, lower land costs, lower labour costs and improved living standards. All such factors helped to render housing more affordable. Improvements to living standards lead to an increase in ownership that persisted throughout the century. Prior to the Second World War ending, the government was well aware that a large-scale house-building programme would be required.

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In 1947, the Town and Country Planning Act was implemented, giving local authorities power to regulate the supply of private builds. At the same time, the New Towns Act was also implemented, allowing new towns to be build in order to lower congestion in the big cities. There were more than 250000 new, completed builds per year in the early 1960s. Even though there was a rise in private sector building in the 1950s and early 1960s, there was a decrease in private renting since the private sector recognized that building homes to sell would make more profit than building houses to rent. In 1961, the conservative government reintroduced general needs subsidies for local authorities, citing political controversy about private renting as the reason for doing so. This diluted the private sectors intention to lead in addressing the general demand for housing. Furthermore, new regulations were put into place for the private sector, and the Housing Corporation was set up to allocate relevant funding to housing societies and associations. This was thought to be a way of stimulating the private renting market.

In the first twenty years after World War II, more houses were being built. Furthermore, authorities strove to make sure that houses were up to an acceptable standard and fulfilled household demands. The two primary political parties worked together and promised to increase house-building targets. This promise however, ended in late 1960s due to constraints on housing costs. However, the housing supply question at this time was less of an issue, since the current supply was enough to meet the demand. Reductions in public housing investment in the 1970s lead to a further decrease in public capital invested in housing.

There was a rise in completions by private sector developers in the 1980s. However, overall completions continued to be comparatively low, at around 200,000 builds being completed annually. Housing was still a hot topic during elections throughout the 1980s, however the debate now focused predominantly on increasing home ownership. In 1980, the Right to Buy policy was implemented. Tenants were offered the opportunity to buy their homes for least 33% of the market price. Deregulation of financial services generated fierce competition and a wealth of choice for mortgage provisions, which further increased home ownership and house prices. House prices soared throughout the mid-1980s, which motivated more individuals to invest in the market. This however resulted in housing becoming more unaffordable. At the onset of the recession, many households were unable to meet mortgage repayments. Therefore, the government implemented various measures to support the housing market. Examples include social security payments made directly to lenders, suspension of stamp duty and giving housing associations permission to buy repossessed property.

The Conservative Government in power between 1979 and 1997 moved their focus away from public sector house-building and concentrated more on raising home ownership. As the New Labor Government came into power, there was a continuation of the housing policies implemented by the previous Conservative Government. This included increasing the role played by the private rented market and the council home sell-offs. The key exception was the implementation of the Decent Homes Program which was set up to guarantee that social sector homes and private rented homes meant for vulnerable families were still of suitable quality.

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