Rising homelessness is a clear sign the housing market is failing

Homelessness is an obvious manifestation of housing market failure. We need to tackle its root causes, says Kathleen Kelly.

Having seen a fair bit of ‘homeless at Christmas’ coverage I felt compelled to revisit the recently published Homelessness Monitor, which highlights the rising trend in homelessness and rough sleeping, pointing the finger at increasing housing market pressures.

Many of the numbers in the report are shocking:

  • Nine per cent of people have experienced homelessness at some point in their lives.
  • Official homelessness has increased 34 per cent in the last three years – a period that coincides with the start of the recession – and reverses the previous six-year trend of falling homelessness.

What’s really striking is the rapid increase in the loss of a private tenancy as a reason for homelessness – 22 per cent of all households accepted as homeless last year and now the single biggest reason given for homelessness in London.

I’ve blogged before about a private rented sector that’s not fit for purpose for either those saving to own or those squeezed out of other housing options by a lack of resources. Now is surely the time to think about how we can create a more stable rented sector that works for everyone (investors included). At the moment it looks pretty one-sided to me.

Political choices

The Homelessness Monitor highlights how political choices play their part in either preventing or driving homelessness but that’s not as simple as politics. After all, Tory reformers have done great work on homelessness and poor housing conditions – whether that’s setting up charities such as Crisis that are still active today or building early council housing for Liverpool’s working poor people.

Both these issues are still important today, given that more than half of people in poverty live in households where someone is working and that the market isn’t providing housing at a price many people (or the state) can realistically afford. Not to mention Grant Shapps’ 2008 comment that “the level of homelessness in society is likely to be a truer measure of how civilised we are than almost any other factor”.

To me that means it’s all about having the political conviction to tackle the root causes of homelessness.

What’s the solution?

An important part of the answer is building more homes, as there are simply not enough to go round. But that on its own isn’t ever going to be enough to tackle the complexities in some people’s lives that can lead to homelessness. So as well as building more homes we need:

  • a braver contribution to the debate about a fit-for-purpose private rented sector and more effective ways to control rent increases, which push people into poverty;
  • a sustained homelessness prevention agenda; and
  • integrated, or at least coordinated, services across housing, health and social care.

Homelessness costs the Government anything up to £1bn gross annually – but failing to spend on services for people who fall through the safety net doesn’t make homelessness go away. It just makes higher costs pop up elsewhere.