Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Like our new prime minister Sir Keir Starmer, I would like to think of myself as a Yimby not a Nimby. When it comes to house building, my slogan is, “Yes In My Backyard”. I had no idea the universe would take me quite so literally.
I did know, when I bought my first flat in London this summer, that planning permission had been granted to extend the Victorian workshop adjoining the bottom of my garden to add new housing. I had looked up the plans online, and convinced myself that it would be a temporary and tolerable inconvenience.
I suspect this government is about to run up against a lesson that I have now learnt the hard way: it is easy to support development in the abstract. It is less easy to keep that conviction, lying in bed at 8:01 on a Saturday morning listening to a crew of builders doing vocal warm ups, followed by several hours of what sounds like bashing an excavator into a concrete slab.
During my tenure as the FT’s property correspondent, fate has been determined to teach a foreigner some personal lessons about the UK housing market.
This began after several months of professional effort by me to try to pin down the elusive statistics on whether UK landlords are selling up en masse because of higher mortgage rates, my landlord announced that he wanted to sell our flat — because of higher mortgage rates.
After a year of hemming and hawing about whether to buy a flat, it was clearly time to get busy.
The search was educational. Buying a flat in England is like eating on an aeroplane: a short menu of bad options. The leasehold system, another of Starmer’s targets for reform, is an off-putting anachronism — making the “owner” of a flat really just a different sort of tenant to a “freeholder”, an arrangement fraught with opportunities for abuse.
We were lucky to find a flat where we share our freehold. But in general the arrangements for managing this, the most important investment the majority of people ever make, compares unfavourably with the condo system I was used to from my homeland of Canada — which has more standardised arrangements for governance and reporting.
At one attractive flat in a large block, I asked the agent how the co-freeholders were organised to run the building. “They have a WhatsApp group,” he said. “It seems to work pretty well.” I was sceptical, judging by the large patches of brown damp showing under the roof.
(Nearby, another lesson in how to stop your neighbour selling. Put on your door a large sign advocating for the rights of pet tarantulas. Reader, I promise this is true.)
It’s equally bizarre that you don’t necessarily get to meet your fellow freeholders before you buy, let alone check their financial status or references. I imagined telling a commercial property investor that I was planning to invest 100 per cent of my capital into a co-investment with parties I had never met.
I belong to a generation that is having to fight our way into home ownership. But once I finally had my keys in hand, fate had one more lesson for me to grapple with. Once you have scraped your way on to the property ladder, it’s hard to resist the temptation to pull it up after you — for the sake of preserving your little castle in peace and privacy.
Starmer wants to build 1.5mn homes over five years, a level of housebuilding not achieved in almost half a century. His government unveiled sweeping planning reforms last month, promising to “take the difficult decisions necessary to build what Britain needs”. The proposals include tougher housing targets for local governments, on the principle that “planning should be about how to deliver the housing an area needs — not whether to do so at all”.
These moves have been welcomed by housebuilders, but the industry should temper their optimism about what Labour can get done within a planning system that will still give local opponents a big voice.
When it comes to the complexities of national development goals and local politics, I fear that the new government — like the construction crew scraping their digger for the umpteenth time over the concrete outside — has only scratched the surface.
