By Danny Dorling
Many years ago, shortly after the 2001 census was taken, it became apparent that the majority of children who lived above the fourth floor in tower blocks in England were black or Asian. At the time I wrote that this concentration was only possible because prejudice, poverty and locality are so closely linked – especially in London, where the richest tenth had become 271 times better off by wealth than the poorest tenth of the population. Since then those divides have widened.
The housing crisis in the UK is now so bad that despite its recent criminalisation, squatting in England is on the rise, especially in London. The Metropolitan police say that most buildings that squatters live in have been abandoned or are otherwise empty, but still such sensible actions, to use an empty usually industrial building to sleep in, are deemed criminal.
When people's only choice is criminalised, the legality of the law itself is discredited. In the first two years after the law in the UK was changed to make squatting a criminal offence, at least 588 people were arrested for squatting, mostly in winter. Some 200 of these were actually prosecuted but only 51 were then convicted. The law has effectively been used to harass homeless people.
During 2016, report after report lamented the state of housing in the UK and especially in London, not only its physical state but its cost, which rose both due to rising economic inequalities (with a minority of private landlords becoming very rich) and also then caused those inequalities to rise even further and faster because of rising rents depleting disposable income.
Over a year ago, in April 2016, researchers at the Centre for London explained that "London's housing crisis is by now infamous: it is the top issue for London voters and for London businesses, who are increasingly worried about recruitment". There were then calls for capital gains tax to be increased to end speculation. John Healey, the shadow housing minister, told public audiences that now "by wealth the top 10 per cent of households have 877 times more than the bottom 10 per cent". In just a few years the wealth divide had increased more than three-fold. John was saying this because he too could now see the need to tax high housing wealth.
The UK law is designed to criminalise people simply seeking shelter while it protects investors, including many from countries such as Kuwait, Russia and Saudi Arabia, who often buy property to leave it empty. In 2016 London estate agents were promising such investors "…expected cumulative capital growth of 19.1 per cent over the next five years". But eventually even the rich will lose out as inequality increases because there will come a day when housing prices can no longer rise any higher. Investors trying to pre-empt that will start selling and be the trigger for housing price falls. When prices fall landlords often evict tenants to try to get a quick sale.
Evictions from private rented accommodation in London doubled in the year to 2016. The rise began shortly after the financial crash and is still accelerating at the time of writing. From 2010 to 2015, loss of an Assured Shorthold Tenancy (AST), most often through being unable to pay the uncontrolled rent, became cited three times more often as the reason why a family with children became homeless. ASTs are now the most usual form of tenancy in the UK. These figures are only recorded for families with children. Such families are the main vulnerable group for which the government in the UK (outside of Scotland) believes it has any housing responsibility.
For other Europeans, the UK serves to illustrate the inequality effect, and what happens when the laws of a country are changed in favour of the affluent because they have become so rich that they can effectively buy the interest of political parties – often through obtaining media support – and hence politicians, and then, by getting the laws they want, they control the judiciary. However, rising economic inequalities are only sustainable for a relatively short number of years and the anger now building up in the UK testifies to that. Public support for right-wing politicians when there is great inequality relies on finding scapegoats to blame, diverting the blame from the politicians and businesspeople who are maintaining the existing inequalities. Almost all European countries both have lower income inequality than the UK and also ensure by law that tenants who rent their homes enjoy much longer tenancies. To be able to do this, they have to give tenants a degree of certainty about how much rents can rise during the time they live in a property, otherwise the landlord can easily evict them simply by raising the rent. This is why rent regulation is so important. It is the only defence against arbitrary eviction.
• In Germany half of all householders rent privately. Often they are renting via very standard leases, which are offered over their lifetime. This compares to standard tenancy agreements in the UK that at most give you a right to stay for the first 12 months and allow your landlord to evict you at just two months' notice. Tenants in Germany often furnish their home and also decorate it, fit kitchens and cupboards and live very much like people with a mortgage live in the UK. Rent caps are enforced so that landlords cannot set whatever rent they wish for new tenants. Rents are also not permitted to rise at all quickly. Tenants' groups organise to complain when landlords are not penalised for breaking the law.
• In Sweden private-sector rent levels are set through negotiations between representatives of landlords and tenants in a very similar way to how trade unions and employers negotiate over pay levels, rather than encouraging individuals to try to bargain individually about their pay. In 2014, the whole of Stockholm was limited to increasing rents by only 1.12 per cent as a result of this. Just as in the UK, there are shortages of properties available in Stockholm, but of course the rent caps do not cause these shortages, just as not having rent caps in the UK doesn't result in a great increase in the supply of high-quality rental housing at reasonable cost.
• In the Netherlands the rent charged for any property is fixed by government. Government officials inspect it for quality and then fix the rents permitted depending on its quality. The factors involved in assessing quality include the amount of space both inside and outside the property and the quality of the building, such as whether it has double-glazing. Location is not a factor in assessing quality. For prime properties that are large, well built and also very well maintained by the landlord, no rent regulation is imposed.
• Denmark has two forms of rent regulation, one for properties built before 1991 and one for those built afterwards. Again worries are raised about whether rent regulation restricts the supply of housing but, when Denmark is compared to the UK or the US, it becomes clear just how much better its housing is. This is one of the reasons why children in Denmark fare so well relative to children in most other affluent countries. Denmark also does not suffer homelessness on the scale of countries with a supposedly more 'free market'. 'Free' housing markets merely give a free rein to those with most money.
• In France a new set of rent regulations came into force in Paris, in August 2015. These regulations state that private rents "must be no more than 20% above or 30% below the median rental price for the area". Of course the rules prompted anger among property agencies and landlords, who claimed they would deter investment. But the evidence of more unequal countries is clear: being able to charge whatever you like does not result in enough housing being made available. The Paris controls should also help reduce rent inflation there when financial and other firms move parts of their workforce to that city during the Brexit process.
The UK has extreme and rising wealth inequalities caused primary by injustices in housing. The UK, and especially London, is suffering form a housing crisis. Tenants in the UK have some of the worse housing rights in all of Europe. All these factors are linked, the wealth with the poverty, the greed of the very rich with the lack of freedom for the poor. All it takes to see how we can be better housed is to look to examples in the mainland and act on what we see.
This is an abridged extract from the book The Equality Effect, published by New Internationalist
Danny Dorling is Professor of Human Geography at the University of Oxford
