The JRF has today (17 May 2011) called for urgent and fundamental reform of the housing market after the failure of policy-makers to learn the lessons from previous boom and bust cycles, which have led to the UK having one of the most persistently volatile housing markets in the world.
Convened by JRF in 2009 and consisting of interdisciplinary experts, the JRF Housing Market Taskforce has undertaken a system-wide review of the UK's housing market. Its report recommends a series of policy options that together would help create a more stable housing market, to protect existing home owners and enable more new households to get onto the property ladder.
Recommendations to help reduce house price volatility include:
Supply is central to managing house price volatility. The scale of the increase required, however, means that this alone will not reduce volatility in the market.
These existing taxation tools could help to reduce house price volatility in the shorter term. Both Stamp Duty and Council Tax should be linked to the real value of a property and regularly updated.
The current safety net for homeowners is inadequate and has required extensive Government intervention during downturns.
Speaking today at the launch of the report, Julia Unwin, Chief Executive of the JRF, said:
"Since the 1970s, there have been four boom and bust cycles in the housing market. This persistent instability distorts housing choices, inhibits house-building, and drives arrears and possession rates, putting people at great risk, and creates wealth inequality between the generations.
We have set out to provide a series of policy options that together would help provide long-term stability in the market. I urge policy-makers to look at these and act now, because the seeds of the next housing boom have already been sown.
The members of the Taskforce are:
Julia Unwin – Chair of the Taskforce and Chief Executive of JRF;
Kate Barker – author of the Barker review of Housing Supply;
Keith Exford – Chief Executive of the Affinity Sutton Group;
Elaine Kempson – Professor Emeritus and formerly Director of the Personal Finance Research Centre at the University of Bristol;
Peter Williams – Director, Cambridge Centre for Housing and Planning Research, University of Cambridge.