This week Enfield Council released a report called “Rebuilding the Ladder: The Definitive Set of Reforms for First-Time Buyers.” The report is presented as a serious attempt to find ways to help people onto the housing ladder. It talks about blocked aspiration, rising deposits, mortgage barriers and younger households being priced out.
A report for developers, not first-time buyers
The problems facing first-time buyers are real. But the report’s answer is not to reduce housing costs. Instead, its 12 “possible answers” are mostly ways to get people to stretch their finances so new-build homes can keep selling at current, or higher, prices. It is not a rescue plan for first-time buyers at all, but a charter to maintain the profits of developers, landowners and property companies.
We are used to seeing this kind of lobbying by property developers. What is notable about this report is that it was commissioned by Enfield Council, who now appear to be lobbying on the developer’s behalf.
None of the report’s 12 policy suggestions are specifically targeted at the needs of Enfield’s first-time buyers. Only two mention Enfield at all, and then only in passing. They’re not even London specific. None of the suggestions appear to have been critically assessed or subjected to any independent scrutiny.
Most of the policy suggestions in the Council’s report come from developers and housing lobbyists. The only answer from Enfield Council itself, proposed jointly with a property consultancy, involves the sale of social rent homes to first-time buyers, which is remarkable given the urgent need for more social rent homes in Enfield. One of the policy answers is proposed by the Leader of Waltham Forest Council together with the MP for Leyton and Wanstead, which, to be fair, is the only genuinely decent idea for first-time buyers in the report.
A “commission” in name only
Even the report branding is misleading. “Enfield First-Time Buyer Commission” sounds like an independent public-interest inquiry to help first-time buyers in Enfield. But the small print shows something much looser: an advisory forum to explore and test ideas, with the final decisions on what to include left to Enfield Council and Pocket Living, a housing developer. That is a much more commercial and political arrangement than the word “commission” suggests.
It is also notable that the membership of the so-called “commission” appears to have included no housing academics, despite London having a deep pool of academic expertise on housing policy. Nor is there any representation from independent professional or public-interest bodies, such as the Town and Country Planning Association (TCPA) or the Royal Institution of Chartered Surveyors (RICS), or from housing charities such as Shelter, or campaign groups such as Generation Rent. All of these could have added balance to the proposed policy ideas.
There was no public call for evidence, no published evidence base and no meetings in public. It was not an independent commission at all but a closed policy forum which gave itself a grander sounding title.
The report cannot decide what its own argument is
The report itself is also confused. One of the oddest things appears right at the start. In its opening section, it says first-time buyer confidence is being undermined by the “myth” that people cannot afford to buy and calls for government to “correct” that message through media and education.
Fine. But if it really is a myth that people cannot afford to buy, why does the report then spend the next 25 to 30 pages proposing subsidies, flexibilities, equity loans and lending changes that are likely to push up prices and increase the long-term debt burden on first-time buyers?
There is a political muddle here too. Enfield’s leadership talks about how hard it is for local people to get onto the ladder. Yet this report, published under the same administration by the Cabinet Member for Housing, opens by suggesting that first-time buyer affordability is partly being overstated and that people need to be educated out of the idea that they cannot buy.
The obvious questions are missing
If this report were genuinely about helping first-time buyers, some obvious questions would be front and centre but are clearly missing.
For instance, if high rents are stopping people saving, why is there nothing serious on rent controls or rent stabilisation? Likewise, if saving for a deposit is hard, why is there nothing on Lifetime ISAs or other saving reforms? And if affordability is the issue, why is there so little recognition that wages may simply be too low relative to housing costs?
If this report were genuinely about helping first-time buyers, you would expect serious discussion about restricting sales of homes to buy-to-let or overseas investors, especially in the new-build market, but there is nothing. You would also expect a detailed assessment of the impact of leases and service charge costs, as well as the impact of the building safety crisis, but again, silence.
There is nothing serious on landowners capturing huge uplifts. Very little on the business model and profit margins of major housebuilders. Almost nothing on whether too much value is being extracted before a newly built home even reaches a buyer.
More money in means higher prices
One of the biggest weaknesses of the whole report is that it mainly proposes ways of increasing buyers’ spending power, in other words their debt: looser mortgage lending, equity loans, deposit support, discounted sale flexibilities, and other complex routes to enable people to reach current prices. But it barely grapples with the obvious consequence. If you increase the flow of money into a constrained housing market, prices tend to rise, or at the very least stay propped up – which benefits landowners and developers, rather than first-time buyers. It does not solve unaffordability. It repackages it.
Another giveaway is the report’s emphasis on the new-build market. At least six of the twelve policy ideas are directly focused on new-build homes, and others are still shaped around developer delivery and sales. This is not simply a report about helping first-time buyers in general. To a large extent, it is a report about helping the new-build market keep functioning at current prices.
Seen that way, the report makes much more sense. It is not really trying to solve the affordability crisis for first-time buyers. It is trying to solve a sales problem for developers.
Enfield Council’s own record makes this worse
Let’s be clear. Enfield Council has a poor track record when it comes to supporting local first-time buyers. For instance, on their flagship development, Meridian Water, its partners have been specifically marketing new homes to buy-to-let investors (something the Council said they would not do). This keeps prices high, making life harder for first-time buyers. In terms of shared ownership properties at Meridian Water, the Council is not even monitoring how many are bought by Edmonton first-time buyers.
Once you strip everything back, the real message of “Rebuilding the Ladder: The Definitive Set of Reforms for First-Time Buyers” is simple: Homes are expensive. We do not want to lower those prices. So let us find more ways to enable people to finance them.
That is not a serious answer to the first-time buyer crisis. It is lobbying for developers.
Better Homes Enfield 