TRIGGERnometry - Why We Have a Housing Crisis: Liam Halligan

Episode Date: March 2, 2020

We're hosting a discussion on the housing crisis on Qutee, join us: https://www.qutee.com/q/the-housing-crisis/?cred_type=creation&points=1 Liam Halligan is an economist, journalist and author of Home Truths: The UK's Chronic Housing Shortage – How it Happened, Why it Matters and the Way to Solve it  https://www.amazon.co.uk/Home-Truths-chronic-shortage-happened/dp/1785904698 Support TRIGGERnometry: Paypal: https://bit.ly/2Tnz8yq https://www.subscribestar.com/triggernometry https://www.patreon.com/triggerpod Find TRIGGERnometry on Social Media:  https://twitter.com/triggerpod https://www.facebook.com/triggerpod https://www.instagram.com/triggerpod About TRIGGERnometry:  Stand-up comedians Konstantin Kisin (@konstantinkisin) and Francis Foster (@failinghuman) make sense of politics, economics, free speech, AI, drug policy and WW3 with the help of presidential advisors, renowned economists, award-winning journalists, controversial writers, leading scientists and notorious comedians. Learn more about your ad choices. Visit megaphone.fm/adchoices

Hello and welcome to Trigonometry. I'm Francis Foster. I'm Constantine Kissen. And this is a show for you if you want honest conversations with fascinating guests. Our brilliant returning guests this week is an economist, journalist and the author of this brilliant book, Home Truths, which is about the housing crisis. Liam Halegan. Oh, it's me. It's me. It's you. Welcome back to Trigononometry, my friend. And congratulations on your success with the podcast. Well, it's partly thanks to you. You were one of the very few people. who came on the show initially. Yeah to twist my arm.

I did have to twist your arm. All those Russian tactics. I did have to twist your arm. But you were very kind. You came on, and now we're very glad to welcome you back. You've written what I think is a book about probably the crucial issue

of our day at the moment. I don't see a bigger issue that's a challenge to our society in real terms right now, the housing crisis. And one of the things I didn't know before reading the book was it's so much worse

in this country than it is around the West, which I didn't know was the case. So before we get into talking about it, lay out the scale of the problem for us. Well, the scale of the problem is that home ownership in the UK has gone from 73% of households a decade ago to a little more than 60% now. But within that, home ownership among 25 to 39-year-olds has actually absolutely plummeted from well over 60% to well below 40%, that crucial family forming age. At the same time, today's young adults,

are spending more on rent and are less likely to own their own property than in any decade since the 1930s, which of course was the decade of the Great Depression and massive countrywide, indeed worldwide austerity. And it's not just that, you know, nice professional people called Jonathan and Sophie can't buy homes. It's that many, many other people can't even get social housing, lower down the income scale. And it's not just a shortage of homes to, because we haven't been building enough. It's also a shortage of properly affordable homes and indeed social housing,

sometimes called council housing, that means we've now got a proper homelessness epidemic, massive overcrowding in this country, so-called concealed households, which I write about in my book, Home Truths. And this situation is more acute in the UK than practically any other Western country. The average house now costs

about eight times annual earnings, annual average earnings. That's the average across the country. It's much, much worse in London than the southeast, of course, but multiples are way above historic levels in the Midlands, in the Northwest, the West Country, even parts of the Northeast, where the economy is a little bit slower, with all respect. I thought you were just going to say where no one wants to live. The Northeast is a story.

There's pockets of... We have a big bit of... banter with our northern fans. Sure, sure. It's grimop north. And that eight times average earnings, average multiple is up from four times just 20 years ago. So if you're a couple and you're both earning, right?

You're both full-time working. You can't get a mortgage for eight times annual earnings. That's before childcare. And that is the nub of the crisis. We've built too few homes, far too few homes. And that's why rents and prices to buy are now way, way, way, beyond earnings. And you touched on the homelessness situation.

I want to just explore that a little bit. You mentioned a stat in your book that I found utterly heartbreaking. The charity shelter said that it was one and every 200 people they estimate are homeless in this country. That's right. That doesn't just include homelessness on the streets, which is rough sleeping, which is obviously ghastly, and it's often elided with issues to do with mental and family breakdown and so on. It's also people who are in temporary accommodation,

bed and breakfasts and so on. Yeah, I'm from a first generation home ownership family, right? I'm from a working class, Irish family, North London, common story. My dad came over in the 50s, managed to buy a house in the 60s, and it completely revolutionised his view of England. He made his peace with England, gave him some stability. My mom grew up in a council house, one of ten kids. The fact that they were able to buy a home, they're non-professional people, they're working people,

completely transformed their life chances and their children's life chances. And so I set out to write a book as a kind of love letter to home ownership and why we mustn't lose sight of the merits of home ownership. But I ended up writing quite a lot of the book, post-Gremfell, about social housing, about the lack of social housing,

and indeed homelessness because, you know, we've built hardly any social houses, basically since the end of the 1980s. The figure plunged during the 90s. Under Blair and Brown, we built almost no council homes, and we're only building single-digit thousands

each year now. You know, back in the 60s, 70s, 80s, we were building 60, 80, 100, 150,000 council houses a year, and you have to have that, stock of council housing, of social housing, because you're always going to have like a fifth something like that of the workforce who just don't earn enough. They need sub-market rents. Yeah, it's not their own fault. They're just doing jobs that don't command enough salary to

buy a house or rent a place on the open market. And what we've done, Francis, instead of building social houses that the state can own and give people stability, some kind of stable tenancy, we've instead given private landlords housing benefit to house those people and often housing them in much more substandard conditions and we're now spending 25 billion pounds a year on housing benefit, which is absolutely huge. It's like half of what we spend on schools.

It's really, really massive. Rather than the state borrowing money to build housing, homes and then it doesn't have to pay the, and it's got that asset on the state balance sheet too, so it net net's neutral, and they don't have to spend all that huge amount of money on housing benefit. So in the book, you outlined how you use the term nimbies, not in my backyard. Yeah, that's a common term now. Yeah. So for people who are saying, well, I don't want houses being built in my backyard, all the rest of it. But over, since 2010, the perception has changed, because we all accept we're in this crisis.

Why is it not being solved then? It's starting to change. NIMBY is now a well-known acronym, slightly less well-known, but gaining fast is YIMBY. Yes, in my backyard. There are YIMBY groups, yeah, Yimbi groups that I've been in touch with

all across the UK, all across many big cities in the Western world, particularly young people who want more homes built, so they've got a chance of, you know, renting somewhere decent or even better, buying their own place and getting a stake in in a growing economy. What's happened since about 2010 is that the government has started to give more planning permissions. Local authorities have started to give more planning permissions to build more homes. But a lot of the big developers,

particularly in the UK, they act as what we call in economics and oligopoly. It's like a monopoly of a few number of suppliers. So they deliberately go slow on building out those planning permissions and the fact that they hold the planning permissions stop smaller firms that build quicker getting them. So prices are kept artificially high in the face of relentless demand. In the book, I call it contrived scarcity. And the big house builders do this. They boast about it in opaque language in their annual report. So from their point of view, controlled supply. The logic is if they hold on to these planning permissions in the land, that the price of that is going to go up so it's a no brain for them. They make a lot more money speculating on land than they

do on building houses. Particularly if they can make more money building fewer houses on a much bigger margin. And the margin for some of these big house builders is like 25, 30%, which as anyone in business knows, is a stonking margin. It's a sort of thing you make when you've got a brand new technology and you've invested in years in patents and developing things. These guys are knocking up houses the way the Victorians did. And now it's easy. You've got plastic plastic plastic. plumbing, right? And so they're making massive, massive margins. But look, I totally understand that for people existing in a location, new building, there's no upside. It's a lot of disruption. There's not going to be new schools and hospitals. There's not going to be new transport facilities.

So it gets more crowded. Of course, they're going to object. And that's why, of course, their house price might even suffer. And that's why the politics of planning at the local level is so fraught. But what I argue in home truths, and it's like the centrepiece of all the proposals that I've laid out, is that when you give land planning permission, the value of that land can go up like 100, 200, 500 fold, just the stroke of a bureaucrat's pen. That massive gain, we call it planning uplift. In most other countries in the Western world, and particularly in Asia, big parts of the states, a lot of that planning gain goes to the state, particularly the local authority so they can use that huge value uplift to fund new schools, new hospitals, new roads.

So people are like, yeah, we'll take the houses because where we live will get better. And actually, our value of our house will go up and we'll take the disruption. Of course, some people object, but it's a much more balanced conversation. Here in the UK, we've had these very opaque mechanisms called a Section 106 and a community infrastructure levy, which are complicated ways of saying the state tries to claw a little bit money back, particularly from the big house builders, but they're often rebuffed. And the big powerful house builders at the local level say, we're not going to build these houses this year unless you let us off these community obligations and this amount of money

we say we would pay for local facilities. And these happens behind closed doors. And it means that often new housing does not come with the public facilities, if you like, the community assets, the extra infrastructure that makes it worthwhile. for existing residents. So we have to learn to share this planning game. And in Home Truths, I say, we should

share that planning game straight down the middle, 50-50, between the local authority and the house builder slash developer, whoever owns the land. It's often a sort of offshore trust, by the way, in this country. And that would mean that the local politics

of planning would be completely revolutionized. And the UK would start spending as much on infrastructure, you know, 3, 3 and 1⁄2% of GDP that many continental European countries do and Asian countries do, rather than spending what we currently spend, 1, 1,5% of GDP, because it's all out of, you know, straight taxation rather than planning gain. So, you bring up politics and the local politics issue is complicated, and I understand the point that you're making.

But also in the book, you go through and you give quote after quote from politician after politician who keeps saying the housing crisis is a crucial issue, we must address it, we must tackle it, and yet it doesn't, it's not happening, right? So why is there this lack of political, I mean, one of the things I've always thought is that in an overinflated housing market, if you're a government that allows the housing market to correct, the people who own houses may well never vote for you again, right? So there is that inherent problem, isn't there, where the politicians have a disincentive to actually address this problem?

That's right. You've put your finger on something very important there. And by the way, I'm going to steal this mug. You're welcome to it. Does it still counter stealing if I tell you I'm going to steal it? In the book, I talk about the Iron Triangle of vested interests that are keeping policy where it is. So it's in a state where the big house builders control everything and can have contrived scarcity to keep prices high. We're massively undersupplying. the demand for housing. So prices keep going up and up ahead of earnings. I don't want to see a house price crash. I want to see prices is leveling out. So earnings over a period of time can catch up. That's a completely different scenario. But the Iron Triangle of vested interest, as you say,

and the politicians understand this implicitly, is existing homeowners. They don't want more houses built for the reasons we've discussed. But that's starting to change, as you say. Social attitudes are starting to change because people, even well-heeled people, are understanding that they're well-heeled, well-educated children can't buy home.

Why are you talking to Francis when you make that? Because I'm clearly the one in this place who doesn't own a fucking home. Well-heeled and pointing in Francis. In his Fred Berry show. Geezers are not owning. But it's true. Like, your world heel, you come with your oligarch money.

Yeah, he's got his... If you think this is an oligarch jacket, We're in London, N1. He's got his yacht parked outside. So you've got existing homeowners, right? That's starting to change. You're right. Politicians don't want to mess with existing homeowners.

Because in general, the political geometry has been that they are the majority of voters. Absolutely. But as home ownership's gone down, as we said at the beginning, that's starting to change. The second side of the Iron Triangle of vested interests are the house builders and the landowners, right? Massive, massive donors, particularly to. to the Conservative Party. Right, right? They've got a kind of headlock on conservative governments.

Half a million quid they gave, didn't they? One of them. It's massive. It's absolutely massive. Second only to the financial services industry, the construction industry, in terms of political donations to the Conservative Party. And then the third leg of that,

the third side of that iron triangle of vested interests, another massive interest group, the banks. The banks are now up to their neck in property loans. Now all the building societies have become banks, been amalgamated into the banks. Something like 65%, 70% of all loans in this country extended by banks are linked to property, right? So the Treasury will tell every housing minister, oh, don't mess with the housing market, because if prices level out will go down a little bit, then the collateral that the banks hold will become worth less, and you'll have another banking crisis.

I think that's massively overstated. I think that's completely alarmist. We have such massively high multiples of housing on earnings. There's so much increase that we've got in the tank over the last 10, 15 years that house prices could level off and even go down a bit, and it wouldn't touch at all the strength of the bank balance sheets or threaten a crisis. I think that's completely apocalyptic. So you've got this iron triangle of vested interests,

which means that politicians want to talk big about building more, but they don't actually change incentives to make it happen. They don't tackle this Iron Triangle and vested interests. But in the last few years, something has started to change, not just those social attitudes that France's alluded to. What's also changed is that politicians, particularly the Tories, they're starting to hear this coming up all the time, even in the shires. And when Jeremy Corbyn came within just a few thousand votes, frankly, of power,

in 2017, a lot of that was a surge of support from young people. And it wasn't just people in their 20s who you sort of expect to vote Labor, right? If you don't vote Labor in your 20s, then you're a bastard. Didn't you're the Orwells say that? You're the Orwell. To paraphrase the great man, and if you don't vote Tory in your 30s, you're a knob. Did he say that? You didn't quite say it like that. He was an educated man, live. You get the point. But a lot of those first-time Corbyn voters in 2017 were first time Labor voters who gave the Tories a hell of a scare. Yes, May was crap a campaign, all the rest of it.

But a lot of them were into their sort of adult life and they still hadn't been able to buy a home, generation rent, and they were angry. And they're still there. And they're still angry, right? Now, in the last election, of course, Corbyn took a hammering, but he still

did very, very well, because he lost a lot of working class votes. He still did very, very well among that kind of educated, professional labor voting class who haven't got houses. And those people are still there. And they're not going to get any less angry as they get older.

When I wrote Home Truths, just before Christmas it was published, I've had a lot of people writing to me saying you're exactly right. My life, my girlfriend's life, my boyfriend's life, we're on hold. We're in rented accommodation. We're not having

kids. We're stalling. And there's an astonishing graph in the book that shows that back in the early 90s, the average age for a woman in the UK to have their first child was 27, right? That's since gone up to 28, right? But back in the 90s, at the age of 27, only 15% of women in the UK were in rented accommodation, right?

Now it's 40%. Wow. So you see the point. You've got a lot of people, young adults, renting often when they don't want to, right? Yeah, great. This life, the, the, one of the archetypal sitcoms, if you like, well, dramas of the 90s.

Yeah, they're all kids in London, they're renting, they're having a great time. At certain times in your life, you want to rent. If you're more itinerant person, you want to rent. I'm not saying there shouldn't be a private rented sector, there should be. But our private rented sector has gone from 10% of households to over 20% of households in little more than a decade. And you've got a lot of youngsters locked into rental contracts, locked into a rented house situation. when actually they want to be owning homes.

They're often from families where their first generation at university, their parents were manual workers, non-professional people with respect, their parents bought a nice house and they can't. So you've got some sort of reversal in generational fortunes here, which tears at the social fabric. Look, I spend a lot of time telling you what's wrong with the world, so let me tell you about something that's actually right. Sleep, specifically getting more of it, better quality.

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But Liam, you make this point, and I think this is why I think it's such an important issue, that it's not just about economics or housing. The impact of this kind of challenge on society in general, I mean, you're talking about demographics, right? Demographics is going to be a part of this. You're talking about social cohesion. Yeah, it's affecting the birth rate now. Right. So tell us about that. Demography is destiny, right? Yeah. It is affecting the birth rate. it's also affecting the, you know, people's view of, of capitalism. Capitalism for a lot of people isn't working.

If you can't get any capital, you don't like capitalism. So it does lead to more radical politics. A society of homeowners tends to be a more stable society, a society. A lot of academic work shows where people are happier. There's more civic and community work. You have a stake. you know, British people don't mind other people getting rich, but as long as they have a chance,

and home ownership since the Second World War has allowed a awful lot of working class people to get a stake, to get a little bit of capital behind them, to have some life choices, right? They can downsize and buy himself a smaller place, give some money to the kids, and everyone's happy. If you have this generation of 30, 40, now into 50-year-olds who are renting when they want to buy,

what happens when they stop work? And they can't afford to rent. Where's the social housing for them? I mean, the housing benefit bill is going to go to the moon. That's the thing about if you have a mortgage and buy, you pay lots of money for your home. But when it's yours, it's yours. And then you're living in it, rent free.

And you have that asset. You have that security. And now the UK home ownership, this nation of homeowners, is well below the EU average. And I personally think that's a reverse. of our national fortune. And the current decline in a home ownership is such

that we're going to be on course to be having occupiers as a minority of households by the end of the 2020s. I think that's a terrible thing. I think that will completely change our national character and indeed our politics. And Liam, I mean, the government have tried to introduce certain schemes,

for instance, a help-to-buy scheme. So, for instance, when I was a teacher, there was a lot of, you know, advertisement saying, you know, we'll help you get onto the housing ladder. You can get this new property and wherever it is. And it's a way for you to make a step up and to make that difficult first sleep. Was that a good thing?

No, it was a disaster. And it is a disaster. Liam Hades teaches. Yeah. What did you teach? What did I teach? I taught, well, look at the disbelief on his face. I did.

I taught year six the last year of primary. Talk English and maths, yeah. Good man. We're going to cut this out. No one gets. That's the only time I've seen genuine respect and living. It's not. It's like complete horror.

I'm just covering it well. Does it get back in? So... Help to buy scheme. Yeah. So one of the great things about writing home truths is reaching out to an understanding. There is actually, believe it or not,

quite a consensus of opinion across politics about what I've written. So on the cover of my book, you'll see praise quotes from Shelter, you know, the quintessential housing charity pretty much on the left, but massively respected around the world as a sort of, for their practical help they give homeless people, but also their research expertise. And then you've got Andrew Neal,

you've got the Centre for Policy Studies on the right. You've got, you know, Tory chancellors praising the book, other ministers. because there is a consensus and one of the consensus is actually from think tanks on the left and the right was that help to buy was a bad idea

and is a bad idea because when you've got massive pent up demand and still constrained supply if you give people the ability to buy with even more money funded by taxpayers

prices are just going to upload which is what happened so the margins that the big help to buy only helps you if you buy a new build so what helped to buy did and it's cost like 20 to 30 to 30 billion so far is it just massively increased the profits of the big house builders who were then

giving loads of campaign donations but they weren't didn't actually end up building more homes the big house builders are still building far fewer homes than they were before the financial crisis and we've had very few small builders now because they were all wiped out by the financial crisis and they haven't been able to get a foot in the door they can't get hold of land because the big guys have got it all sewn up that's why it is as I say an oligopoly some people would say it's a cartel, which is actually illegal. The big house builders would deny that. I think there is very compelling evidence now, which the big house builders deny, Your Honor, of a cartel of actual restrictive practices. That's why I call in the book for a full competition commission inquiry,

where we actually examine if the market is operating properly. I don't think it is. the House Lords Economic Affairs Select Committee, the chairman Michael Forsyth, read Home Truths. They're now doing an inquiry into house building industry. I gave evidence to it. And I repeated that recommendation that we see now Competition Commission inquiry. Just to get numbers on the concentration

of the house building industry is pretty difficult at the moment. They're being very coy about their actual output. So we'll see if the House of Lords takes up that recommendation and what happens. But Help to Buy is great for a short-term headline if you're a Chancellor. And it's good for some of the people that it helps, right? But a lot of the people that it helps, and I've made documentaries for dispatches about this, have ended up in lashed together, substandard new build homes because the big house builders know they're a captive audience

because they're using help to buy, right? And so you end up with this situation where all that's happened is that Helped to Buy has pushed up the price of increasingly bad quality new build homes for those who can get access to help to buy, and the like 95% of home buyers who can't get access to help to buy have to face even more higher prices. And then you highlighted the bonuses that these chairman were getting

these companies. Insane. And it's in the tens of me. I don't mind people making money. Again, if they've done something incredible and brought new technology online, you know, I'm a capitalist. I like profit. But these are like mediocre executives overseeing badly run companies with ghastly customer service records.

I'm looking at you, Pissimmon. And they're using, as I said, technology that's been around for, you know, available to anybody. You know, go to a builder's yard and all the secrets are there. talk to any number of blokes propping up bars around the UK. They're telling you how to build a house. And yet they're making bonuses of like tens of millions of pounds a year. That is a clear signal. The market is not working, right?

I like capitalism. But capitalism needs to work. And what we got here with the house building industry isn't capitalism. It's a grotesque distortion that's giving capitalism a bad name and is working only for the firms and not for the customers and broader society. And you mentioned the term rabbit hutch Britain in your book. Can you just expect? Because I think, again, I mean it's the lefty, but I found that very upsetting. You know, but there's this thing that particularly that just blew my mind, which is councils

are using thermal drones. Oh, unbelievable. Yeah. It's fucking crazy. So there's two things there. So on the rabbit hutch Britain, what's happened? Because all the planning gain, all the uplift goes to share, to landowners, and developers and these shadowy opaque land agents, right? It means everyone's got an incentive to just sit on land and do nothing, right? And so land prices have gone exponential in the face of massive demand for new homes. And that means that when a big house builder does get hold of some land, it costs, you know,

shitloads of money. So the average house that's sold in Britain now, the average new build, the land, the land, the land accounts for 70% of the price. Back in the 50s and 60s, the land would account for like 5% or 10% of the price. That's how messed up the market for land now is. That's why we need to share this planning gain to calm it down to take the speculation out of it

or some of the speculation out of it, as I say. But when you're building a house and the land is 70% of the price of the land, you're going to squeeze as many houses on your building plot as you can. That's why you go to a lot of these new build estates. and there are good new build house builders in this country. I'm not saying new builds are always bad, but a lot of the more ropey end of the market,

they'll be very, very small, the gardens will be almost non-existent, you'll find the drive is too narrow. You drive the garage car in the garage, you can't even open the doors. Yeah, but I've seen you British people. You don't use your fucking garage. Let's be honest.

It's always storage or a fucking workshop. So you've got, yeah, it's where you sleep when you're drunk, right? I do you know what that So the houses are very, very small And we're building The small it We're building homes these days

Again, with the smallest living rooms And the smallest bedrooms Again, since the 1930s Absolutely crazy And you talk about heat-seeking drones, Constantine Yes, because I also write in Home Truths And I go back to where I grew up In Kingsbury, North London

Pretty, you know Fantastic place to grow up massively ethnically diverse now as it was when I was a kid, a huge privilege to grow up there. And I went back there and I walked down the street where I grew up and I walked around the neighbourhood. And if poking down the side of houses, you can see, so many gardens now have sheds in them that are clearly residential accommodation, often put up illegally and people renting there, not paying council tax. And so what Brent, council did in northwest london and this is happening not just in london but in solford in bristol

uh manchester the oxford this beds and sheds crisis they used in brent they used heat-seeking drones to see if people were sleeping you know at night to see if people were sleeping in outbuildings because the heat of bodies they could see so they could actually say to people these people are living there you didn't put the rent on your tax return they're not paying council tax to try and um you know, curtail this illegal activity because it's not just a tax thing because often these outbuildings,

you know, electricity, plumbing, it's medieval. It's unhygienic. And so that is, again, is a sure sign that the market is not working when we're crowding residential accommodation illegally into gardens in suburban Britain. That is what is now happening.

And yet there's, You talk to central government about this. They're like, oh, really? I mean, they have no idea. They have no, there's no audit of any of this. There's no grip on the scale of this issue, the Benson Sheds issue, which is absolutely massive. In Russia, the way we'd solve it is we'd put missiles on the drones.

But I do like, you're the one who raised heat-seeking drones. It's like it's in your blood, mate. We must bomb it to the ground. But Liam, let's turn to an issue that I know a lot of people watching this will be having at the back of their mind right now and you tackle it head on in the book, which is, you know, people are not stupid. They do the math and they go, look,

we've had a mass wave of immigration over the last 15, 20 years. Obviously, if you don't have enough houses, lots of people come, immigration caused the housing crisis. You tackle that issue quite directly in the book. I do. There's a whole section. There's a whole kind of subchapter on that. And you have to tackle it head on.

The problem isn't immigration. the problem is that we haven't been building enough houses. So immigration has exposed and made worse the problem rather than causing the problem. And in the book, there's quite a detailed series of paragraphs that are very closely argued comparing the UK and France, right? And over the last 20 or 30 years, France has actually had more immigration per head than the UK.

France has built twice as many houses as the UK. So house prices in France have gone up, but not nearly as wildly in front of earnings as they have in the UK. So you just need to build more houses. And then people will say, oh, but we're full. Really? If you look at the landmass of England, what percentage of the landmass of England

do you think is taken up with residential accommodation? It's 1.1%. And that includes gardens. There is tons of space, right? We haven't built a new town in this country, like Milton Keynes or Welling Garden City or Harlow in my lifetime. And I'm, you know, I'm 50. It's completely crazy.

We have had our own demography leading to increases in population and immigration too, particularly since 2013 and accession. But the answer isn't, I mean, I voted Brexit. As you know, one reason was partly because I accept that a big part of the population doesn't want to stop immigration. we are an Asian of immigrants. They just want to make sure there are controls so there can be some kind of

ability to accommodate and provide for schools, hospitals and all the rest of it. So the pace of immigration means that lifestyles aren't undermined, particularly for people at the lower end of the income scale. Completely fair. It happens in New Zealand, Australia, you know, Canada.

All great racist nations. The most liberal countries in the world, effectively. It's crazy. No, we're totally on board with that. I don't, it's not, the problem isn't immigration. The problem is, as the French example shows, we just haven't built enough houses.

So if you build more houses, you know, we are building fewer houses per head of population in this country than Bulgaria, right? With all respect to my Bulgarian friends. Before we, I think we were the slowest construction rates of any country in the EU before we left, I think with the exception of Malta.

I mean, it's completely mad. This is a country just like full of people that know about building. And people say, oh, where's the label? Well, let me tell you, I'm from an Irish building family. There are a lot of people who are plumbers, who are bricklayers, who are driving cabs. Because in their part of the country, the building works just too slow. And the big house builders treat them so badly.

So if you had some decent house builders with access to land, if you had the sharing of planning gain, if planning permissions had to be built out in a certain period of time or companies were fine, so it was like a contract to build rather than an ability to build, then you could have a much, much higher rate of house building in this country to accommodate the way of immigration that we've had

and to accommodate the immigrants that we will continue to have, albeit in a more controlled environment. We've got an exciting new, sponsor, haven't we, Constantine? Yes, we do. It is, in fact, the economist. And the economist is a fantastic publication, because it just doesn't just deal with economics. It also deals with politics, science, technology. If you want to read what some of the finalist, journalistic minds are writing about today, then the economist is a publication for you. Yeah, I was reading an article there very recently, incredibly insightful into the US Democratic primary. So if you want

that kind of insight into all kinds of things, politics, economic, etc. I really recommend it. It's been a trusted source of intelligence for people for over 170 years, so they're doing something right. When you say a trusted source of intelligence, you make it sound like the Soviets used it. Thanks for that little bit of casual racism, which we now have to cut from the ad. And there's a very, very divisive issue which you've sort of touched on, which is the green belt. Oh, goodness. You know, because it gets very emotive. People get very upset about it, you know, building on Ginglin's green and pleasant land. Yeah. Look, we have...

have in this country demarcated national parks, right? No one's saying build on them. No one's saying build on areas of outstanding natural beauty. No one's saying build on, you know, parts of the Greenbelt that have aesthetic merit and provide access to ordinary people to exercise and get think and live and get some fresh air. But the Greenbelt isn't being concreted over. And hang on to hats, guys, the Greenbelt is now over 140% bigger by area than it was in the late 70s. Because councils keep adding to it. The Greenbelt was meant to be around London five miles wide. It's now almost 50 miles wide in places. You get these massive commutes because people are like jumping over the Greenbelt twice a day to go live in some rabbit hutch, you know, an hour and a half

from London. Are mental health issues anyone? Family breakdown anyone? And a lot of the Greenbelt Belt is urban scrub. It's of absolutely no aesthetic value whatsoever. It's just like a sort of cordon sanitaire so the bien-ponson don't have to have any oiks living next to it. It's like an ethnic cleansing mechanism. Sounds appropriate to me. I'm serious. No, no. So let's keep some of the Greenbelt, but let's get this in perspective. The Greenbelt is growing and growing all the time as councils keep adding to it because they know it's popular because it locks in the advantages that people have. What I'm saying is if we share planning gain, if we give more access to land to small builders, if we make planning permissions into contracts to build rather than permissions to build,

get houses built, use that planning gain to build infrastructure, then the politics of planning changes and there'll be a lot less local support for the NIMBY's and to continue to lock people out. People know their kids need somewhere to live. Families are breaking up because kids have to move miles and miles and miles away from their aging parents. This is having massive, massive negative implications for ordinary British folk. And the Greenbelt is one of the big issues we have to grab. And I'm glad that in the book, even the likes of Vince Cable and the Lib Dems of past masters at increasing the size of the Greenbelt or Yimbi Central, even Vince Cable says in my book

in an interview that you can't be serious about solving the hands. housing crisis without examining parts of the Greenbelt and giving them over to house building. Liam, I just want to come back to the immigration issue simply because I having seen, you know, YouTube comments and people reply. There's a very simplistic way of thinking. And I think the angry people become, the more simplistic the thinking becomes. So it's very much like, well, we've had a lot of immigration. If you put two and two together, you get four, you know.

But one of the points you actually make, and before I say this, as, you. I'm someone who very much agrees with, even though I voted Remain, with what you said about Brexit. You know, people have a right to feel that they want to have the level of immigration into their country that they are comfortable with. They want people to have the time to integrate.

And it's still net positive. It's still, you know, $100,000,000 every year. Yeah. Which is, but not $350,000 every year. There is a level of immigration. Right. I mean, there is a level of immigration

that's reasonable for a country to have. And we need it. Yeah. But for that to be rising more and more, is not what people want. And I fully accept that, and I actually agree with that personally. But anyway,

my point is, one of the points you make in the book about immigration is that actually a lot of the people who are coming and building the houses are actually immigrants. So in some ways, I just want you to address that very issue

because I know it's something that a lot of people in very tokenistic, simplistic language talk about, that the housing crisis is the result of immigration. It's massively exacerbated. And actually,

personally, before I read the book, I kind of believed it. Yeah. The housing crisis would be the result of immigration if we didn't have the ability and the space to build more houses, but we clearly do. And actually, house building is good for the economy. Every single recovery from recession

in recorded British history has been associated with a big increase, a big boom in house building, except the recession that followed the global financial crisis. And that recovery from recession since the global financial crisis has been the slowest, most lukewarm, most limp recovery from recession we've ever had, partly because we're not building homes. When you build homes, you inject cash and activity into sort of, you know, communities. You know, people borrow locally.

They buy materials locally. They use local labor, local DIY, local, you know, curtain makers and furniture suppliers and and then, you know, nannies and it creates a virtuous circle of activity and you get big boost to local economies when you have house building. So we clearly can build more houses. We clearly have the space to build more houses. As I said, only 1.1% of the landmass in England, the most crowded of the four parts of this United Kingdom has residential housing on it. And so my family, came over from Ireland and part of the reason you know there was a lot of racism around then part of the reason the Irish were able to win the respect of English people and I've talked to

many many people about this my you know for much of my life it's a big theme of my life is that English people saw Irish people getting up in the morning working their nuts off digging the roads building houses yeah and that a lot of Irish second third generation Irish people in this country, the wealth that they have stems from that original effort of house building. So house building is a great way for the immigrant community to make a stand and build them some wealth and respect and acceptance for themselves and their families. And that's absolutely fabulous. So we do need some immigration and we do need some, you know, bricklayers and plumbers and all the rest of it. I'm not saying, you know, stop it stone dead. But at the same time as having

some immigration, you also need to build a lot more houses to cope because in the last 30 years, we've built something like 3 million, too few homes. We need roughly about 250,000 new houses a year. And the last time we built that amount was the 80s. In the 90s, the 2000s and the 10s, we built, you know, less than, you know, between one and one and a half million. So there's a huge, huge backlog shortage of homes, which now the implications of that on price and affordability are coming to pass. So yeah, let's have immigration, but let's have it controlled. Within those quotas, let's have people who can help us build. Let's get, you know, our own people living in the UK, wherever they're from, trained up. There's a tremendous living to be made. If there is

building, more of a building boom, plastering, bricklaying, plumbing. And these are good trades that a lot of people would like doing if they had the training and if they had the opportunity. And we touched a moment on, for a little part of the interview, on council housing. You mentioned Gremfell. And Gromfell was an incredibly emotive, understandably so, issue. Do we have a problem now with council housing, the cladding, all the rest of it? Is council housing? Is council housing? fit for human occupation now? Some of the council housing in this country is very, very good. It tends to be council housing that was built in the 30s and the 50s,

low-rise, low-density council housing. The kind of council housing that a lot of my mates grew up in the suburb, Kingsbury, Wembley, where I grew up. We were all first-generation owner-occupiers or kids living in council houses. What happened in the 60s, there was a change in legislation which meant planning gain wasn't shared and house prices went to the moon and councils couldn't afford to buy enough land

for low-density, low-rise council housing so they started building tower blocks. It's absolutely linked to this change in legislation, 1961, an act that I'm trying to get reversed as people who read the book closely will understand that led to lots and lots of tower blocks. Now, in Grenfell, the issue was the cladding, and we're still in the situation as the Grenfell inquiry rolls on. It must be absolutely hellish for the families so tragically affected.

You still have many, many, many hundreds of tower blocks with lots of social housing in them with the same cladding. So the cladding changing of that to use non-flammable material is very, very, very slow. and there's lots of rouse about who should pay for it, the local authorities, central government, the contractors, and that's going to roll on for a long time. So some council housing in this country is very, very good. It tends to be this stuff built a while ago. The more modern council housing tends to be lower quality, which is why lots of people don't want it.

But I would say that we need to destigmatize council housing. We need to accept that a lot of people do need council housing, and the government needs to use the strength of its own balance sheet to borrow to build that council housing in order to offset the massive housing benefit bill that we've got, paying for people to live in often substandard rented accommodation when they should be in a council house where they can have some stability in their own front door. Now, there's an interview in there with a guy called Marvin Reese, who's the mayor of Bristol, the first mixed race mayor of Europe, right, of Jamaican origin. He's a fabulous guy. I saw him speak at a conference and interviewed him.

afterwards. And he says, you know, you want to solve knife crime, you want to solve alienation of youth, give him a front door, give him a kitchen table. He reckons his council house literally saved his life. And when he talks about it, he gets very, very emotional. That's the best possible, you know, anti-knife crime, anti-gang policy you could have. Give people a front door on a kitchen table and a little garden. It makes a difference. And so I think we should be focusing on council houses and some people will be saying oh but what about right to buy what about right to buy? Now right to buy is

very popular in the 80s under Thatcher but Thatcher stitch up Hezeltine and students of politics are not I'm talking about because Heseltine who put that legislation through to make council the right to buy for tenants he said yes we'll do the right to buy

but the money must go back to the local authorities so they can replace it with another council house right now in the end what happened was the money, four-fifths of it went back to the Treasury and disappeared into the pot. So those council houses were not replaced. So what I'm actually calling for, and this will sound odd to some people, given that I'm a telegraph columnist, I'm calling for the right to buy now, which was reintroduced by David Cameron, to be suspended until we've actually

built more council houses. The Scottish Parliament and the Welsh Assembly has already suspended the right to buy, and I think that's the right thing to do at the moment while we have such a shortage of council houses. Not in England, I think that should now happen. The problem is that local authorities at the moment have no incentive to build social housing because if they build social housing and people live in it for a couple of years, they then have to sell it to them at a sub-market price, right, often less than the cost of building the thing, given that land prices are so high, and then four-fifths of that money that the local council gets back, that denuded amount, because the price is subsidised, goes to the Treasury.

So, you know, local authorities that look into going through all the thickets of admin and madness that it takes to build some social housing, it's very, very difficult. It's not going to solve their problem because the way the structures are incentivised now, they could end up losing that social housing from the public realm very, very quickly. Liam, as we head towards the end of the interview, you mentioned that the political landscape is gradually changing. Are you optimistic that this issue will be tackled in the next kind of 10 to 15 years? Okay. No, no, I'm not. And as we're sitting here, sort of news is breaking around us, right? So when Estimate Vey was appointed housing minister,

she was the 18th housing minister in 20 years. We've just heard from the reshuffle. She's been moved. So the housing portfolio is seen as like some ridiculous, stepping stone to the great offices of state. There should be, in the cabinet, housing secretary, and it should be a very big job with a big political beast, with big ambitions behind it. That's what McMillan had in the 50s. That's what you had in the 20s when Lloyd George was doing homes fit for heroes. Why did Lloyd George do homes fit for heroes? And I've got some of the

cabinet minutes in my book, because they were petrified. You just had the Russian Revolution. right? They didn't want the British troops coming back to the Victorian slums. They were going to be completely radicalised. You had governments falling across Europe to extremism. And so to make our country less extreme, more moderate politics, the state got, you know, house building moving, got private house building moving, got social house building moving. Actually, it was an incredible guy called Christopher Addison, who was the health secretary at the time. But housing was from, front and center, right, in the 20s. Housing was front and center in the 50s. Housing needs to be front and center again, because the political party that solves this housing issue will be in power

for a very long time. So Boris really needs to get hold of this. And sometimes I think he gets it, but sometimes I really think he doesn't. And Sajid Javid, who appears in my book quite a lot, saying some pretty radical things, agreeing with me on the record, planning gain should be split 50-50, an interview that made front-page news when the book was published just before Christmas. We've just learned that he's gone. Now, he was community secretary with housing in his portfolio, and he was putting out policy ideas that were really radical to try and shake up the industry. He accused publicly the big developers of sitting on land and having, in his words, a stranglehold on supply. That was in 2016. When he said that, he

revolutionised the debate on housing because stuff that I was saying suddenly went from being conspiracy theory to like government policy, right? In one speech, and I remember when he said it, it was the Tory party conference in the autumn of 2016.

Again, it was front page news. So the big developers will be delighted to see Javid go. And I've no idea where he went. This has literally happened while we've been recording, right? And I haven't talked to him, I don't know. Hey, by the time this goes out,

he could be prime minister, man. But I do know that a lot of the big developers will be very, very glad that he is now not the chance. Yeah. And Sajid, if you're listening, we'd love to have you on Trigonomagic. Come and talk why you fell out with Boris. Sajid, my usual fee. On this point about the party that fixes it will be in power for a long time, I actually think, given everything that's recently happened, unless this recent reshuffled precipitates a complete calamity and collapse of the Tory party.

in terms of the broader sweep of politics, the Conservative Party could well be in power for 10 or 15 years, given everything that's happened, given the disastrous Labour Party and how it's been acting lately. So they have an opportunity, but that opportunity, I think,

is tempered by the fact that if you are a party of the aspirational working class, which is what the Conservative Party now is in terms of their electoral base, you have to address this issue. Oh, unbelievable. Because otherwise, people aren't going to

feel aspirational if, as you say, they don't have capital. That's right. It's absolutely key. So, you know, I grew up in Margaret Thatcher's Britain and what was what I saw around me, you know, in my own social circles, as I became sort of politicised, I saw and heard working class people, even working class Irish people, right, at the time of the Mays prison riots saying, yeah, we like the Tories because there's more work about because they're given us a chance. Labor just want to keep us down and pay us benefits and if you're not in a union, you can go hang. And we're in a similar situation now where there's been a reversal where so-called bootstrap, working class, Tories are coming to the fore. But as Boris Johnson rightly says,

they've only lent their vote to the Tories. You know, these northeastern seats, these West Midland seats, the red wall in ruins, unless the Tories grabbed this and make their lives better by by bringing more prosperity to the regions, better transport links, more housing for kids, better quality, social housing, then they're going to lose that trust. So I think the Tories are on probation. But I would, you know, to solve the housing issue or address the housing issue by building social housing by not doing help to buy,

which just pumps up the demand side, but doing supply-side reforms that are hard. You've got to take people on. You need a lot of administrative grit and political courage to do it. That would do far more for the country and prosperity and the regions, and indeed for the Tory's popularity

than, you know, HS2 or some mad trophy asset that just makes it easier to get to London. And if you think about, you know, a lot of the housing stock we have is actually in the wrong place at the moment. So housing in the northeast is a lot cheaper. It's still high by historic standards

in terms of a multiple of the average wage, but it's a lot cheaper. But if you have better transport links in the North East, if you had enterprise zones, free ports, you know, less scrap corporation tax in those big northeastern cities. And watch businesses move there. Watch people move there. It's a nice part of the country to live in. Fantastic, you know, natural places to walk and air.

It's a better pace of life for a lot of people. But there's also a lot of housing there that's relatively well priced for young people to go and live in if the industry and if the enterprise was there. So it's partly about building more houses. It's partly about giving tax breaks to regions to better use the houses that we've got. It's only getting every customer's order right. It's only a point of sale system connected by Spectrum Fiberpowered business internet, helping you track hundreds of secure transactions. and it's all backed by 24-7 US-based customer support and local technicians. It's only everything.

Get business internet advantage free forever when you get four mobile lines from Spectrum. Visit Spectrum.com slash free for life to find out how. Restrictions apply. Service is not available in all areas. And on that note, thank you so much for coming on, Liam. The last question we always ask is, do you want to do it, Constantine? No, I want you to do it. I want to watch you do it. He says that to me many times. I didn't know it's that kind of podcast.

We've bonded. Anyway, what's the one thing we're not talking about as a society that we really should be? Well, I guess in my field of economics, the one thing that we're not talking about, and I sort of touched on it here, the phrase I'd used is antitrust, right? What is antitrust? Antitrust harks back to the likes of Teddy Roosevelt, so the Republican. president at the turn of the 19th into the 20th century, who forced by journalists, and he was forced by journalists, he took on the big conglomerates, the big syndicates, as they were then

called, famously the oil baron, John Rockefeller, but other big parts of the economy that had become silted up and controlled by producers where capitalism had stopped working for ordinary people. This was all beautifully portrayed in Mark Twain's satirical novel, The Gilded Age. And Roosevelt, in the end, took on the big vested interests and made capitalism work better. Got companies to break up, injected competition. Capitalism doesn't happen completely organically. Every now and then it needs a kick in the shins in order to shake it up and make sure that competition's actually working. Every now and then you need a government with courage and a political class and a

media class to get hold of these issues. Otherwise, capitalism loses its legitimacy and you get much more extreme interventionist, counterproductive policies taking over. I think we are now entering a new gilded age, and that gilded age is a very pejorative term, you know. Twain meant it as an insult. income inequality hasn't risen all that much, but wealth inequality has massively increased. And as ordinary people are unable to buy homes, as they don't have pensions, that wealth inequality is only going to get worse. Look, we still live in a country that Brexit vote showed eventually of one person, one vote, right? And if we have that policy of one person, one vote. In the end, we have to make sure that the system works for a broad range of people.

At the moment, it's only working well, and it's working very well for an ever smaller, an ever-diminishing sort of gilded elite. And in order to break that, you need antitrust. You need policies that inject competition that make sure we're on the side, not of big business, but of small business. On the side, not of cronyism, but competition. That's a great point. Very important point. I think one of the things we talk about a lot on this show is kind of the emergence of woke politics. I think quite a bit of it stems from what you're talking about.

You know, if people can't have capital, they can't buy a house. How do you expect them to be capitalist and then these extreme ideologies become that much more appealing? That's right. And I mean, you know, I'm not saying a lot of the identity politics agenda isn't important. I'm not saying that we shouldn't be. light to each other. But when ordinary folk who are literally trying to make ends meet hear endless television debates and endless stuff in their newspapers about, you know, issues that have no bearing on their lives, they think the political and media class

is increasingly remote from them and so they withdraw. And that's the situation we're now in. The political and media class increasingly doesn't represent ordinary people. We've done very well in terms of diversity of color and gender, but there's no diversity of opinion and class. I mean, the equivalent of me now wouldn't get the media opportunities that I managed to get in my 20s and my 30s. That's very, very sad. So we need to make sure that we have a political and particularly a media class that actually represents and is representative of ordinary people. and if we did have one, then books like Home Truths will be all over the place. Well, they will be after this interview.

Make sure you get this. It's a great book, very interesting read and some really useful. I hope that all the politicians read it, first of all. That would be good, although many of them already have. Liam, thank you so much for coming back. If people want to follow you on social media and where do they get the book, of course, tell them that. At Liam Halligan.

Just Google Liam Halligan Home Truth. You can get it on Amazon, any good bookshop, published by Byteback. out in paperback soon all right we go perfect we'll see you again in a week's time with another brilliant episode

guys take care take care and see you next week