The Great Housebuilding Shortage: a new phenomenon?

10 June 2015 | William Carrington

If we are to believe all the column inches this year that say we are facing up to an imminent housebuilding crisis, then we have missed the target of building 250,000 new homes every year since the Barker Review of 2004.

Read this extract: 

It was to an interested crowd of reporters which had gathered in his office.

‘What will you do with the people you displace, Mr Kerry?’ asked one of the journalists.  ‘I refer, of course, to the slum of people who are entitled, if they possibly can, to live near their places of livelihood,’
‘I have provided for that,’ said Mr Kerry.  ‘I recognise the necessity of making very ample provision in that respect.  I shall create my own slums,’ he smiled.  ‘It is a hateful word, and it is only one which I employ to designate a congested area occupied by the poor.  I shall not, of course, attempt to make any provisions for the mendicant, the semi-mendicant, or for what I might term the casual itinerant class.

My idea of a poor family is one in which the combined efforts of all its adult members do not produce enough money to provide the necessities of life.  For these at intervals in my residential belt, I am erecting co-operative flats.’

He took from the large portfolio a series of drawings, and laid them on the table before the crowding pressmen.

‘You will see,’ he said, ‘that in point of design we have copied the elevation of some of the most beautiful hotels in London.  Indeed, I think we may say that we have gone beyond that.  These buildings will be absolutely complete in themselves.  Tenants will only be admitted who agree to the co-operative system.  Stores providing every commodity will be found in the building itself.  There will be baths, gymnasia, playgrounds, a hospital, a crèche, and a free library.  Each building,’ he said briefly, ‘will be self-governed, will contain its doctor, its dentist, and its trained nurses, all of whom will be at the disposal of the citizens of this little community free of all charge.

‘A system of elevators will make the highest floors as accessible as the lowest – indeed, the highest rents will be for the top floors.  All the employees in the community will be subject to the discipline of a committee which will be elected by the tenants themselves.  Although we shall provide fireplaces, the whole of the building will be run on a system of central heating; hot water and electric light will be included in the rent, and we hope to give every family six thousand cubic feet of space.  Each building,’ he concluded ‘will have accommodation for a thousand families.’

‘What is your object, Mr Kerry,’ asked a curious reporter, ‘in buying so much valuable property in the centre of the West End and then destroying it?  Isn’t it so much money thrown away?’
Kerry shook his head.

‘What happens,’ he asked, ‘when a policeman rides his horse into the centre of a crowd?  Is it not a fact that the crowd swells out and covers almost a third as much space as before?  At any rate, this is a fact: that a thousand square feet stolen from the heart of London means that ten thousand feet more are occupied on its outskirts.  Briefly,’ he went on, ‘in the heart of London you are restricted as to space.

There are many businesses which would willingly and gladly extend their present premises to twice the size they at present occupy but for the prohibitive cost, and very often the absolute impossibility of securing adjacent premises renders this impossible.  We have said “You have got to get out of this anyway,” and now we have given the firms which have been disturbed – and which generally are now mine,’ he said with a smile, ‘an opportunity of taking space adequate to their needs.  People are coming to the centre to shop – do not doubt that – this is the rule of all towns.  We merely extend the boundaries of the exclusive shopping district and give an incentive to private enterprises to assist us in our work of beautifying London.

‘I am satisfied as to this,’ he said. ‘That we shall have the satisfaction of knowing that we shall enrich thousands and impoverish none by what we have done.  You may now understand my action in regard to my sales.  It was necessary.  Tack and Brighten, Modelson and Goulding, they abutted into the square of my dreams; they are now my exclusive property.  I bought Goulding’s this morning,’ he said with a little twitch of his mouth at the recollection of an agitated and almost tearful Mr Lette, making his unconditional surrender.

‘My sale will continue to the end of the year, until, in fact, I am ready to pull down and start rebuilding, And in the meantime,’ he added, ‘I have guaranteed the dividends of all the firms which I have not purchased, but which are directly affected as a result of my action.’

Here was enough for London to discuss; sufficient to set heads shaking and nodding and tongues wagging from one end of London to the other.  Here began, too, the London land boom which was the feature of the memorable year.  It was found that King Kerry had acquired great blocks of property here and there.  Sometimes they comprised whole streets, but he had left enough for the land speculator to build his fortunes upon.  Automatically, the value of land rose in certain districts by one hundred and two hundred per cent, and it is said, though there is little evidence to support the fact, that in one week King Kerry himself, on behalf of his syndicate, made a profit of over a million pounds from the sale of land which he had recently included in his purchases, but for which he himself had no immediate use.
It is a fact that when his plan became generally known he received the heartiest co-operation from the Government, and, though he might not touch Crown freehold, every facility was given to him to further his scheme.

He had planned a garden city to extend in an unbroken line from Southwark to Rotherhithe and on to Deptford – a new City Beautiful, rising out of the dust of squalid, insanitary cottages and jerry-built dwellings.  His plan was given in detail in an issue of the Evening Herald, which attained a circulation limited only by the capacity of its output.

It was obvious now that money had flowed like water into London, and that it was not alone the six men who had set out to accomplish so much who had assisted in the fulfilment of King Kerry’s plans, but all the great insurance companies of America, all the big railways, all the great industrial concerns had contributed largely.

It was computed by a financial authority that the big ‘L Trust’ had incurred liabilities (and presumably they were in a position to meet those liabilities) amounting to eighty million pounds.  Somebody asked King Kerry if this were so.

‘I will tell you’ he answered good-humouredly, ‘after I have counted the change in my pocket.’

King Kerry rented a little house in Cadogan Square.  It is characteristic of the man that he lived on the property of others.
In my opinion, this amply demonstrates that the debate has raged since this was first published in 1915.  Taken from (and with permission) The Man Who Bought London by Edgar Wallace who co-created and wrote the screenplay for King Kong.

So, not a new phenomenon but one which will continue in all likelihood, for the rest of the century!

About the author

William Carrington

Chairman, LonRes

William co-founded LonRes with Anthony Payne in 1999. He began his property career in the mid 1980s with a small family firm based in Knightsbridge. In 1992, he joined forces with Charles Boston, establishing Boston Carrington Pritchard based in Sloane Street, where he specialised in Landlord and Tenant work. William is a director of CLEA Ltd, which owns The London Magazine, and remains a consultant to Boston Radford Surveyors.

William Carrington