I have been asked to write about homelessness in the run up to Christmas. It goes to the heart of the all consuming and worrying issue of poverty. It is not just a property problem.
Some think the issue is that homes are too dear in the UK. In parts of the country, especially London, they are very dear, but there is plenty of demand for these expensive homes. Many of the dearest ones now are there for rich foreign migrants into London, but much of the rest of the housing stock in the prosperous areas stays at high price levels because there are tax paying locals who can afford it.
In other parts of the country home prices are much lower, and have fallen further since the Credit Crunch. Here there are often more empty properties, and more propeties on agents books awaiting buyers. Lower prices would eventually clear this market. Current prices can be sustained if more jobs and higher incomes can be generated in these locations to underwrite and sustain the property market. Policies for economic recovery and for growth outside London are part of the answer.
The government is trying to address the issue of expensive land prices that are part of the pricing in the dear areas. They are issuing a large number of new planning permissions which they hope will drive the land prices down, and lead to more development. So far this has been offset by broken banks and regulatory pressures against more lending. The authorities have also come up with Funding for lending and Quantitative Easing to try to tackle the mortgage famine.
One way to cut homelessness is to reduce inward migration. Migration has been one of the big pressures on housing, and some of the worst housed people are recent arrivals on low wages, and especially illegals on no regular and legal wages.
Some homeless come from former members of our armed forces who find adjustment to civilian life difficult. I have proposed a scheme to encourage housebuying for people in the forces so they are not homeless on exit. When I checked last week the government told me they were still working on this important issue and recognise the need to do more.
Some homeless have serious drug or alcohol problems. The government is intensifying its response to these difficulties, seeking to get people onto rehabilitation programmes.
There is a general shift to buying your first home at an older age. Most young people are not homeless, but they form their own household at an older age than previous generations. This is partially owing to high house prices compared to their starter incomes. Here improving the supply of new properties, and reducing the demand from others in sensbile ways may bring about a price adjustment to price more young people into this market. I am a strong supporter of home ownership. I also think young people should have the option of forming their own household in their twenties and buying a property where they have a normal job. More needs to be done to get back to this position.