Imagine a society where the manufacture and importation of computers was strictly limited and controlled, such that a computer that would normally cost £1,000 actually cost £10,000. People would save for years to be able to afford one, or would even take out a special loan to buy one. And for anyone who owned a computer, it would be a valued family heirloom to be handed down to one’s children, or perhaps sold to pay for one’s retirement. This would be an inefficient and frankly barmy way to run an economy, but it’s what we do with housing.
The average house in Edinburgh costs £208,000, which, at about 9 times median wages, is clearly unaffordable to the majority of Edinburghers. Houses are not expensive because they cost a lot to build, however: using traditional construction techniques an average house would cost £50,000-60,000 to build. And if houses were mass-produced in factories (as they would be in any self-respecting modern economy) and then assembled on site, they could be build for around £20,000 each. So why should someone have to pay 10 times that to buy one, or similarly have to pay through the nose to rent? Either way, it’s a rip off and should not be allowed to stand.
One way to manufacture houses cheaply would be to make them out of shipping containers. American company PFNC has manufactured a prototype house out of a shipping container which would cost £10,000 to mass produce (that’s an all-in price that includes assembling it on site and fitting it up to water, sewage, electricity, etc). A single container has a floor area of 40 foot by 8 foot, so this would be adequate for a single person. Using two shipping containers placed side by side, a two or three bedroom apartment could be built, costing £20,000.
The largest shipping container housing project built so far is Keetwonen student housing in Amsterdam with contains 1,000 apartments (See on: Google Maps; Bing aerial view) . Units there are described as “well insulated, surprisingly quiet and comfortable. Each resident enjoys a balcony, bathroom, kitchen, separate sleeping and studying rooms, and large windows.”
My plan for affordable housing
Edinburgh’s council house waiting list is currently around 28,000, and growing at the rate of 1,000 a year. Furthermore net in-migration to Edinburgh is approximately 6,000 people a year, and they all need somewhere to live.
I propose to build approximately 5,000 council houses out of shipping containers, every year. Each house would on average be made of 2 shipping containers. Most of these would be in high-density housing and situated near to main bus routes, tram stops and railway stations so that residents can easily travel around Edinburgh. When the cycle-sharing scheme is up and running, there would be bicycle terminals near the housing, too.
As well as this I propose to build 4,000 houses for sale every year. These would each cost £20,000 to build and be sold for £60,000.
All these houses would be built to high standards of insulation and sound proofing.
How much would this cost?
Nothing. I repeat: it would cost Edinburgh council nothing. In fact, the council would make a profit.
Consider the houses for sale. At 4000 units built per year, making a profit of £40,000 on each, the council would make £160 million a year. To put this into perspective, Edinburgh council currently spends £1,098 million a year of which £223 million comes from council tax. This amount of extra money could protect Edinburgh services from spending cuts and reduce the level of council tax.
Now consider the council housing. It’s a common misconception that council housing is subsidised. Actually it is not: council rents fully cover the cost of building and maintaining the homes. Since these new council houses would be a lot cheaper to build than current ones (although of the same quality), and tenants would be paying the same rents, the council would make a profit on renting each one out.
Building houses creates jobs
Ideally the factory which makes the container housing units will be located in Edinburgh. If we assume that the factory is built in Edinburgh, 75% of the value in the housing is produced in Edinburgh, and the average worker earns £23,000, this scheme will create 5870 jobs.
And that’s just the start. As the scheme proves to be successful, it’s likely that other local authorities, building contractors, private individuals, and people in other countries will want to buy container homes, creating even more jobs and prosperity for Edinburghers!
The other parties
Two good measures of the availablity of affordable housing are (1) the length of council house waiting lists, and (2) the average market price of a house as a multiple of median income. The larger these numbers are, the less affordable housing there is.
These numbers have increased over the following governments:
- Labour in Westminster, 1997-2010
- Labour and Lib Dem, Holyrood, 2003-2007
- SNP, Holyrood, 2007-now
- SNP and Lib Dem, Edinburgh council, 2007-now
From their records, it follows that the Labour, Scottish Nationalist and Liberal Democrat parties don’t care about affordable housing. More exactly, they care enough to give it lip-service when they want people to vote for them, but they don’t care enough to actually do anything about it.
And as for the Tories — Prime Minister David Cameron thinks that council tenants who make a success of their lives should be punished for it by being kicked out of their homes.
If you judge them by their behaviour, all the other main parties think that only rich people should be allowed to buy a home, even though as I’ve explained houses are in fact quite cheap to build.