Published: 9 Jul 2013 by Toby Lloyd

I tend to see everything in the housing system as interconnected. This is not to say that I’m a hippy who believes in the healing power of crystals. It’s because I see the impacts of a single, massive failure to provide enough, decent homes at prices people can afford: from the renters who come to us for help, facing eviction because their landlord has fallen into mortgage arrears, to the families languishing in grim bed and breakfast accommodation because of the dire shortage of affordable housing.

We know that prevention is better that cure, so Shelter tries to help people before they hit crisis point wherever possible. That means paying attention to problems further upstream from the acute problems of homelessness. It means advising people on managing debt and household budgets; it means campaigning for more homes in every tenure to reduce pressure in the system.

At Shelter we try to help everyone who suffers at the hands of our failing housing system, including those who are not actually homeless. And while our focus is always on those who need our help the most, we will never ensure that everyone has a home unless we reform the whole system – and that means the housing market too.

Our housing system is utterly dysfunctional, and this has devastating impacts on millions of people’s lives, and our collective social and economic health.

The housing system is so big, so complex, and so messed up that any serious attempt to fix it has to address the problems at the centre of the system, not just the periphery. Those sleeping rough are experiencing the very sharp end of a much bigger failure that reaches right across our politics, our economy and even our culture. And the heart of that failure is the mainstream, owner-occupied housing market itself.

Although falling as a percentage, owner occupation still houses 64% of England’s population – and even more of us aspire to it. We can argue about why ownership is so popular, and whether it should be – but there is no denying that it is.

Not all homeowners are rich either: in 2000 it was estimated that half of all those living in poverty were homeowners, most of them over 60 years old, many living with fuel poverty and appalling disrepair. So we should care about owners too.

More importantly, problems in the mainstream market have serious consequences for people in every part of the housing system, not just frustrated wannabe first time buyers. High house prices feed through into higher rents, as more people are forced into the private rented sector. The more better-off households there are competing for rented homes, the higher rents get and the harder it is for those on more modest incomes to find a home.

Worse, as the private rented sector grows to house 9 million people, more of those with the least market power will be at the mercy of the minority of rogue landlords and rip off letting agencies that prey on those with least choice. A generation shut out of ownership also creates new opportunities for exploitation, and means more people facing homelessness as a result of the loss of a private let.

Housebuilding firms follow the owner occupied market closely: when it fails, they shut up shop, worsening our chronic housing shortage.

House prices also dictate the prices developers can pay for land, and so impacts on affordable housing provision. As viability gets squeezed by high land costs it becomes harder for affordable housing providers to compete for sites, or for planning authorities to get affordable housing through Section 106 agreements. To try to meet the gap, social rents get pushed up too – in fact they have risen faster than house prices or private rents in recent years (though there are other reasons for this too).

Ultimately, the failure of the homeownership system means a growing disparity between the housing haves and the have nots, which will be exacerbated via inheritance down through the generations. It means a generation growing up with no hope of secure, affordable accommodation when they retire – adding to the demographic welfare timebomb. As the recent Strategic Society Centre report made clear, the housing disaster is setting up the collapse of our pensions system as well – not to mention social care. We literally cannot go on like this.

If we are to have a hope in hell of fixing these problems we absolutely have to address the causes of them as well as the symptoms. Yes, we urgently need public investment in more truly affordable homes for rent, and proper support for those that fall through the increasingly threadbare safety net. Yes, we must reform private renting to make it fit for the new generations of families growing up in it. But yes we must also provide a step change in the supply of quality, affordable, homes that ordinary people can buy.