Introduction

Compared to the problems bequeathed to John Major in the early 1990s, NewLabour’s housing inheritance was benign. House prices fell in realterms by 10% between 1988 and 1993, creating ‘negative equity’(ownership of a dwelling worth less than the amount paid for it) for 1.7million households. However, house price inflation after 1994 eliminatedmuch of this problem and, aided by a sharp fall in interest rates, mortgageforeclosures fell from a peak of 75,500 in 1991 to 33,000 in 1997 (Wilcox,1999, p 154). Michael Heseltine’s ‘rough sleepers’initiative, launched in 1991, reduced the number of people sleeping rough inLondon by 700 and the Department of the Environment had started to extendthe scheme to other areas. The number of households in temporaryaccommodation arranged by local authorities fell from 68,000 in 1992 to48,000 in 1997. In England, the percentage of dwellings below the fitnessstandard declined from 8.8 in 1986 to 7.6 in 1996 and, in Wales, from 8.8 to7.2. In the same period, the percentage of dwellings below Scotland’s‘tolerable’ standard declined from 4.7 to 1.0 (Revell andLeather, 2000, p 14).

The Conservative’s White Paper, Our future homes: Opportunity,choice, responsibility (DoE, 1995a), indicated a disengagementfrom the strident market philosophy of the late 1980s. Under the 1988Housing Act, rents had been pushed towards ‘market’ levels,with Housing Benefit ‘taking the strain’ (Ridley, 1991, p 86).In contrast, the 1995 White Paper anticipated a reduction in the rate ofincrease, to be achieved by imposing grant penalties on local authoritiesand registered social landlords (a new name for housing associations plusother not-for-profit housing organisations) if they set rents above nationalguidelines. The White Paper also attempted to repair some bridges with localgovernment. It emphasised local authorities as ‘strategicenablers’ and promoted ‘local housing companies’, withlocal government representatives on their controlling boards, as extraagencies for managing stock transferred from direct local authority control.‘Mixed communities’, where a “balanced mix ofhouseholds, young and old, low income and better off, home owners andrenters, live alongside each other” (DoE, 1995a, p 35), wereencouraged.