Evening Standard comment: The housing bubble continues to swell

The housing bubble is still swelling, judging from the figures from the Office for National Statistics. Londoners are, inevitably, enormously exercised about the issue: a YouGov poll suggests 55 per cent of respondents think it should be the biggest priority for the next Mayor, ahead even of public transport.

The problem is the inevitable result of the excess of demand over supply; too many people chasing too few homes. On the supply side the answer has to go beyond the prescription that we should build more, though the Chancellor’s pet project, a new Garden City at Ebbsfleet, will significantly increase the amount of housing within commuting distance of the capital. Within London itself, much depends on the kind of housing we choose.

As a recent report from the Prince of Wales’s think tank, the Foundation for Building Community, has pointed out, we can obtain an enormous increase in capacity without damage to the built environment by adopting mid-rise building models. Mansion blocks are an Edwardian solution to high-density housing that are ideally suited to the needs of a contemporary city, being six to eight storeys high with a mix of communal and individual living space. Indeed the Peabody and Guinness Trust buildings are still sought after, generations after they were first built to house the urban poor. The Haussmann apartment blocks in Paris are similarly mid-rise, high-density and exceptionally attractive. And mixed-tenure developments are socially preferable to blocks targeted at the wealthy.

As to demand, continuing pressure from mass migration on housing obviously contributes to rising prices. London’s global popularity as a destination of choice for migrants has implications for housing as well as public services. Planning has lagged behind the influx of people.

The figures are looking good: inflation is down for the sixth consecutive month — 1.6 per cent in March according to the Office for National Statistics — and unemployment is falling. Tomorrow’s figures for wages may show the rate of growth in earnings outstripping inflation, whereas until now any modest increase in take-home pay was eaten up by rising prices. Yet the paradox is that the polls do not appear to give the Government much credit for the recovery: the Tories still lag five points behind Labour. Granted, it will take time for most people to register the change in the rate at which costs are going up; the problem for the Government is that this may not happen in time for May’s European and local elections.

Shadow chancellor Ed Balls says he intends to ask in the next election: are you better off than at the last election? And he is probably right to assume that many people will answer: “Not by much.” It will take time to erase the memory of large increases in the cost of energy, food and fares. Yet the Prime Minister and the Chancellor are, by a margin of nearly two to one, more trusted than Labour when it comes to economic competence. The strategy of tackling the deficit is working. Translating that into votes is the next challenge for the Coalition.

The new production of Dorian Gray at the Riverside Studios features sprigs of two acting dynasties, Vanessa Redgrave’s granddaughter and Edward Fox’s nephew, raising yet again the question of whether our life choices are down to nature or nurture. The answer, as ever, must be both. Indeed in these notable thespian families, the mystery is how any of their members escape the stage.