Is UK Housing Policy Doomed to Fail … Again?

Let's treat housing as a public good and not a financial product

The UK government’s 2025 Spending Review landed today with a bold promise: a £39 billion affordable homes programme, aiming to deliver 1.5 million homes by 2029. It’s being pitched as a double win: a solution to Britain’s housing crisis and a stimulus for economic growth. But for those of us who’ve watched successive governments promise, pivot, and ultimately fall short, this feels all too familiar. Same old same old.

Yes, if fully realised – and that’s a very big “if” – this would represent the most ambitious housing investment in decades. It comes on the back of reforms to long-term rent policy for social housing and legislative moves to increase protections for Britain’s 11 million private renters. On paper, that sounds like progress. But does this really signal a shift in the structural foundations of UK housing? Or are we watching another rerun of political theatre?

Because here's the uncomfortable truth: when was the last time a UK government, of any party, actually hit its housing targets? Furthermore, when did a flurry of housing new builds result in meaningfully lower prices?

The logic that underpins today’s announcement is the same one we’ve heard for decades: build more homes, increase supply and watch prices fall. It’s an appealingly simple narrative. The only problem is, it hasn’t proven true. And it likely never will, at least not under the current configuration of the UK housing market.

If the housing crisis were merely a question of insufficient new builds, we would expect to see some evidence that increasing supply dampens house prices. But over the past 40 years, as construction targets have come and gone, house prices have continued to soar. The UK’s independent fiscal watchdog, the Office for Budget Responsibility (OBR), estimates that this latest plan – even if fully executed – would reduce house prices by just 0.8% by 2029. That’s barely £2,000 off the cost of the average home. Hardly transformative.

So, why won’t these headline-grabbing initiatives fix the problem? The answer is that the issue isn’t just supply. It’s demand. More specifically, how we have structured and incentivised demand.

Decades of permissive lending policies, the unchecked rise of buy-to-let landlords, the financialisation of housing and the free pass given to foreign capital investment (some of it questionably sourced) have turned homes into assets first, shelter second. Buy-to-let, in particular, has expanded since the early 2000s and rapidly so in just the past few years alone. But it has rarely been subjected to meaningful scrutiny.

Instead of addressing these issues, successive government policies have continued to feed demand. Think of the Help to Buy scheme, or those stamp duty holidays that always seem to get pulled out from the Chancellor of the day’s red box. Such measures don’t fix the problem, they just stimulate continued demand, which in turn creates upward price momentum.

Today’s announcement, whilst welcome in parts, fails to engage with these deeper currents. If today’s announced targets materialise into new social housing – homes that remain out of the private market and accessible to those most in need – then that would be something worth applauding. But unless we confront the systemic forces that inflate demand and distort housing as a commodity, any increase in supply risks simply being absorbed by a market that continues to privilege wealth accumulation over accessibility or affordability.

Put bluntly, if house prices continue to rise while wages stagnate, then "affordable housing" remains little more than an empty political slogan.

To fix this crisis, we need more than cranes in skylines. We need political courage. We need the courage to reform property taxation, to rethink buy-to-let incentives, to challenge the role of speculative capital. But we also need to do something truly transformative: treat housing as a public good and not a financial product.

So, has the UK government finally gripped the housing crisis, or is it still fighting the symptoms while leaving the root causes untouched?

Forgive the cynicism, but until we see evidence of deeper structural reform, today’s announcement feels less like a breakthrough and more like Groundhog Day. Yes, we need more homes. But even more urgently, we need a government brave enough to take on the system that made this crisis inevitable in the first place.

I’ve written elsewhere in Gridlocked pieces that neoliberalism isn’t working. There is no better proof point to my argument than the UK’s housing system. Free market dogma doesn’t work with housing. Let’s scrap it.

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