Houses are not homes: a question for Andy Burnham

By the time Labour gathers for conference at the end of the summer, Andy Burnham could be the party’s leader and the country’s prime minister. If he gets the keys, the housing question he inherits is the one almost everybody in this industry has now quietly accepted has failed, writes Phil Cooper of Hope Architects. 

Labour’s 1.5m homes target requires roughly 300,000 net additions a year for five years. The actual rate is closer to 200,000. The OBR’s most recent forecast puts this Parliament’s likely delivery at around 1 million across the whole UK, not just England, and the Construction Products Association has said the government will miss the target “significantly”. Planning applications, the earliest reliable indicator of future supply, are running at less than half the level required.

The question Burnham should be asked is not whether he can rescue the 1.5m number. He cannot. Nobody can. The interesting question is what he should put in its place.

To answer that, you have to be honest about why the target is failing, and the honest answer is not the one Westminster wants to hear. It is failing because it asked the private housebuilding industry to do something the private housebuilding industry is not shaped to do.

The volume housebuilders are not a homes-supply industry. They are a land-and-finance industry that produces houses as a by-product of trading planning permissions, optimising sales rates, and managing build-out timing to support share price. That is not a moral failing. It is exactly what we have asked the sector to be, since before the era of Right to Buy began in 1980. The trouble is that build-out rate, the thing that protects sale prices and shareholder returns, is structurally incompatible with the volume the target demands. Asking Persimmon, Barratt or Taylor Wimpey to deliver 300,000 units a year is asking them to flood their own market and trash their own margins. They were always going to decline.

Someone will object that we have done this before. After 1945 we built nearly 300,000 homes a year for two decades, with a country in worse shape than this one. The objection is fair as far as it goes. We can build at scale when we decide to. But the post-war programme is not the unqualified success it is sometimes remembered as: vast estates were thrown up, and many were demolished within a generation because they had been built as housing rather than as communities. The numbers were hit. The places, in too many cases, were not. Any successor to the 1.5m target has to specify what we are actually trying to build, not just how many.

You can reform the NPPF and pour billions into the affordable housing programme, and the volume housebuilders will still build at the rate that suits their balance sheet. They are doing their job. Their job is just not the country’s job.

This is where Burnham’s record becomes interesting, because it suggests he has noticed the problem.

GM Mayor Andy Burnham speaking at Place RESI 2024. Credit: PNW

Housing First, his flagship homelessness policy in Manchester, commissioned an outcome, people housed and stabilised with wraparound support, rather than purchasing an output. It has produced an 88% tenancy sustainment rate and a 57% fall in rough sleeping in Greater Manchester. The £40bn council housing borrowing pitch he made to The Telegraph is the same instinct at industrial scale: the state as commissioner, not as customer. The Bee Network is transport built on the same logic. ‘Manchesterism’, read carefully, is a willingness to use public commissioning power to specify outcomes rather than rely on market behaviour to deliver them. So, apply Burnham’s own instinct, the why-before-how that runs through everything he has done, to the housing target itself.

Why do we want 1.5m homes? Not as an end in itself. We want them because we believe a country with more homes will be a country with lower rents, lower household costs, more new households forming, fewer people sleeping rough, better physical and mental health outcomes, higher labour market participation, fewer people economically inactive, and a more productive economy overall. The 1.5m figure is a proxy. The actual goal is a set of social and economic outcomes that, if delivered, would compound into a country that works better for everyone in it.

A proxy target can be hit in ways that do not deliver the underlying goal, and missed in ways that do. Three hundred thousand units a year of build-to-rent in city centres at full market rents would technically hit the count and move almost none of the indicators. Fifty thousand council homes a year, delivered with wraparound support in the right places and at sub-market rents, might miss the count by miles and yet be transformative.

The question Burnham should be asked, if he gets to Downing Street, is not “will you stick to 1.5m?” but “what are you actually trying to achieve, and what is the most efficient way to commission it?” His Manchester record suggests the answer is that he is trying to commission homes-as-public-good rather than continue to purchase houses-as-private-asset, and that the most efficient route is for the state to do it directly, through councils, housing associations, and the kind of large-scale public programme he has already pitched.

Houses-as-private-asset is worth pausing on. In Britain, more than almost anywhere else in Europe, families rely on the appreciation of their own home to fund their retirement, their children’s deposits, and their old-age care. That is not a fact of nature. It is a policy choice made repeatedly over 40 years, and it is an aberration by international standards. It also locks the country into a structural contradiction: the same homes that need to be cheaper for the next generation to form households need to be more expensive for the current generation to retire. No volume target can resolve that. Only a different model of how housing is owned, financed and delivered can.

I wrote on the Hope blog recently about how developers should commission architects for the upstream thinking they are trained for, rather than buying the downstream compliance work the market currently prices them on. The principle generalises. We have spent decades buying outputs (units, drawings, permissions, completions) when what we actually wanted was outcomes (places people can live well in, communities that hold, neighbourhoods that improve health and participation). The 1.5m target is the cleanest demonstration of how that logic fails at national scale.

Burnham’s likely premiership is the first real opportunity in a generation to ask whether England wants to keep buying houses-as-product from an industry whose model is profit, or whether it wants to start commissioning homes-as-public-good from a public framework whose job is the country’s wellbeing. The 1.5m target is a useful failure, because it has proved the first option will not deliver. The Manchesterism question is whether Burnham, given the keys, has the courage to drop the unit target, name the actual outcomes, and rebuild the delivery model accordingly.

The number to watch isn’t 1.5m. It’s whatever Burnham puts in its place.

• Phil Cooper is the founder of Hope Architects