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Page last updated at 11:11 GMT, Thursday, 9 October 2008 12:11 UK

House building and the Crunch

Jerry Thomas
The Politics Show
London

With London accounting for 70% of England's households in temporary accommodation - over 200,000 of them in overcrowded conditions in the capital - some would say that London is in the grips of a housing crisis... we look deeper into the matter...

Bricklayer
Massive programme of house building required?

In London, there are 54,000 households living in temporary accommodation.

The government's would-be solution is a massive programme of house building.

House building

However, with the credit crunch biting, the government's plans for building new homes on hold and building projects across the capital currently stalled, will these houses be built anytime soon?

One of Gordon Brown's first acts as prime minister was to announce a massive programme of house building.

Soon after entering 10 Downing Street, in July 2007, the Prime Minister, Gordon Brown said: "Through this decade and right up to 2020 I want us - in environmentally friendly ways using principally brown field land and building eco-towns and villages - to meet housing need by building over a quarter of a million more homes than previously planned.

"A total of three million new homes for families across the country by 2020."

He went on to say: "Putting affordable housing within the reach not just of the few, but the many, is vital both to meeting individual aspirations and a better future for our country."

Targets met?

Home for sale
Housing targets awry?

There is still a long way to go until those targets are met, but right now, things are not going completely to plan.

And when the government promises to deliver new homes, it does not mean that it is going to build them.

That nearly always comes down to not-for-profit housing associations or private developers.

But currently, developers cannot find buyers because of the credit crunch, which means that the houses are not being built.

Housing starts declining

Building began on just 635 private homes in London during August, the lowest figure since records began.

Housing associations also rely on borrowing money, but they are given cash from the government and so have fared slightly better.

They have built only 659 homes in August. And the building of social rented homes has slowed to a trickle.

Previously, in the aftermath of the Second World War, the government undertook a massive programme of house building, the significant difference being that they actually built the homes themselves.

Council housing

But since then, the reputation of council estates has suffered, restrictions on building more houses were introduced by central government - creating a shortage of social rented accommodation available, exacerbated further by Thatcher's "Right to Buy".

At the time of the prime minister's announcement in 2007, Shelter's Chief Executive, Adam Sampson, lobbied for council houses to be built.

He said: "Shelter is calling on the prime minister to announce the building of 20,000 extra social rented homes a year in the comprehensive spending review."

Only 230 council homes have been finished across London since 2000, but Croydon is bucking the trend with the first new council housing planned to be built in the capital in the last three years, in an initiative that will see the first council housing built in Croydon in 20 years.

Councillor Mead, Cabinet Member for housing, Croydon Council said: "I believe that the quickest and most effective way of addressing the acute housing shortage and overcrowding in the borough is through investment in council housing."

Croydon exceptional

"Croydon," he went on to say, "has an excellent reputation for looking after its tenants and, as a strong local authority, we should be given the means to construct good quality, eco-friendly, council homes.

"Phase one of our new house-building programme is just a start.

"My intention is for us to be building a hundred homes in the borough every year and we're now working towards achieving this ambitious target."

With the government's astonishing intervention to shore up Britain's banking system, some are now asking whether the clock might turn full circle, with the state re-visiting its post war commitment to building council houses for those in need.

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