Britain is Building
HERBERT N. CASSON
THE BUSIEST trades in Great Britain are the building and house-furnishing trades. The biggest building boom that Britain has ever known is now in full swing. Houses are being built at the rate of
a thousand a day. In the last twelve months, three hundred thousand houses were built. This is three times as many as were built in the best year before the war.
British brickyards are overwhelmed with orders. They have not been able to produce enough. Almost every day. ships come to Britain loaded with bricks from Belgium. Many timber merchants have had to double their stall's. Practically every furniture factory is working overtime. Decorators and paperhangers have never in their lives been as busy as they are today. Britain is building houses.
After the war, there were eight million houses in England and Wales. Since then, nearly two and a half million houses have been built. And sixty-eight per cent of these have been built by private enterprise, without a dollar of State assistance.
Mr. Lloyd George, who has been the chief slogan maker of Britain for the last thirty years, concentrated attention on house building in 1919 by his slogan. “We want homes lit for heroes.” Unfortunately, he set up a Housing Department which promptly took control of all building operations. There was no opposition to this department, as the British people had been completely under the control of bureaucracies during the war.
A bill was actually passed to spend live billion dollars on housing. All private enterprise was to be wiped out. For about six years the building business was practically nationalized. The Government promised to build a million houses; to abolish completely the slums in every city; to provide “homes for heroes.”
THE GOVERNMENT meant well. It had public opinion behind it. But the story of what it actually did would make an amusing comic opera. It completely demoralized the building trades. It put a stop to nearly all building operations. In the year 1920, when the Housing Department was in complete control, not a thousand houses were built in Great Britain,
In the three years following 1920, only 160,305 houses were built. Four-fifths of them were built by the muddling Housing Department. They were badly-built houses, but they were the most costly of their kind ever built in Britain. Many a house cost as much as $15,000. And these houses were intended for wage workers.
By 1924, the Housing Department had muddled itself to a standstill. Slowly it relaxed its control. The private builders plucked up courage and built 67,546 houses in that year. Prices of materials began to fall. Many of the most competent masons, carpenters and bricklayers had gone to the United States or the Dominions. A large number went to Canada. But the private builders sought out those who were left and began to reconstruct their demoralized trade.
Strict Government control lasted for six years. Then when the restrictions of red tape began to be cut, nearly another six years were required for recovery. New workers had to be engaged and trained. The activities of private enterprise had to be re-established. The Government did not at any time encourage or aid the private builders, but it had learned by six years of State control failure to let them alone.
At the end of the period of State control, the shortage of houses caused a great amount of inconvenience and privation. About half of the big houses had been given up by people who could no longer afford to live in them. These were turned into flat houses. As many as five or six families were packed into one house. As for the poorest people, they lived in congested slums or in little shanties of wood or corrugated iron.
The urgent need for more houses compelled the Government gradually to abandon its dictatorship over the building trades. There still remain many obsolete building regulations which, it is estimated, add $125,(XX),000 a year to the costs of building in Great Britain. I was given this estimate by Mr. Alfred C. Bossom, a distinguished English architect who is now a member of Parliament, and who is endeavoring to have these obsolete regulations abolished.
BY 1931 a building boom had begun. More than 130,000 houses were built in that year by private builders. Since then the boom has continued. At present it has reached its highest point and is confidently expected to go higher. To any tourist, the most striking feature in Great Britain is the vast number of new houses and houses in course of construction, most of them on the outskirts of the towns and cities. At last, in spite of a bad start, Britain has succeeded in solving her housing problem.
' More than a quarter of the new houses have been built on the farms that surrounded London. The area of Greater
London is now eight hundred square miles. At least a hundred square miles have been added since 1923. There is no longer any congestion in London, except in a few slum areas that are already marked out for demolition.
A new generation of building contractors has sprung up in Britain. Most of the successful builders are under thirty-five years of age. One young man of twenty-nine is at the head of five building companies. Another of thirty-four is selling a thousand homes a month. The boom in building did not begin until young men sprang to the front and modernized the methods of the building trades.
A close co-operation arose between these young builders and the building societies. Quite a few of the builders, it is believed, were helped financially by the societies. A builder designs, builds and sells a house. The buyer of the house pays about ten per cent cash and the remainder in installments. Usually, he completes his payments in fifteen years. He arranges terms with the building society, not with the builder. The building society advances the price to the builder. On a $3,000 house, a builder usually makes a profit of $500.
This plan has been found to suit all three —the builder, the house buyer and the building society. The builder is paid cash and has no bad debts. The house buyer can buy a $3,000 house with a down payment of $300; and the building society makes a loan with the house as security. By this simple plan, without any State help of any kind, the British housing problem has been solved.
A British building society is a unique institution. It is a savings bank, offering from four to five per cent for money. It advertises for money. It earns its revenue by loaning money to house buyers on mortgage. It is a sort of mortgage trust. It will lend ninety per cent of the price, yet its percentage of loss is remarkably small.
There are 1,013 building societies in Great Britain. There have
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been many amalgamations. There were twice as many societies in 1900. The total assets of all British building societies amount to $2,500,000,000. On their books there are nearly a million borrowers, all of whom have bought houses. The management expenses are kept very low. In 1933 the expenses of all the societies were only $13,674,000.
The Halifax Building Society is by far the largest. It has assets of $463,000,000. In its vault in Halifax it holds 180,000 mortgages. Its net profit in 1933 rose to $2,184,-
000. For twenty-one years it has been the largest building society in the world. The man to whom its success is due—Sir Enoch Hill—is still at the head of it. He is in his sixty-ninth year. I íe is well known in Canada and the United States.
The building societies play a prominent part in the life of the British people. They reach the mass of the people. They accept small savings. They give advice about houses. They are much closer to the people than banks, as they are, in a true sense, co-operative societies. Their depositors and their borrowers are small people, mainly wage earners. A working man feels as much at home in the office of his building society as he does in the office of his trade union.
The various transactions in the office of a building society are interesting. A clerk calls in to pay the monthly installment of $5.50 on the house that he is buying. A waiter comes to deposit his tips. When he has saved $250, he will buy a house. A clergyman calls in to make his weekly deposit of $5. He will allow his money to accumulate at compound interest and provide him with a fund when he retires. A builder comes in to make arrangements for advances to the purchasers of two hundred houses which he has planned to erect. A doctor comes in to arrange for the buying of a house and practice belonging to a fellow doctor. And so on.
The Demolition Problem
ANEW Housing Act was passed in 1930 and this act has proved to be very useful. It dealt mainly with the demolition of houses in slum districts. Private builders could not deal with this task, as they have no power to condemn and destroy unsanitary and dangerous buildings.
Under this act, local authorities were empowered to deal with the following three broad categories:
1. Clearance areas in which all the buildings are to be abolished.
2. Improvement areas in which unfit houses are to be demolished or made fit, and overcrowding abated; and
3. Individual unfit houses, not in clearance areas or improvement areas, which are to be demolished, to be closed, not to be used for human habitation or to be made fit.
Up to September 30, 1934, more than 500 local authorities took action under this act. They declared 3,920 areas to be slum areas, and marked out 73,046 houses for demolition. There were 325,809 people living in these houses. For every new house built, the Government allows a subsidy of $75 a year. This is on condition that the house is a non-parlor house with three bedrooms, housing five people.
In 1934, which was the first building year of the Government’s slum clearance campaign, 15,058 houses were built and 19,301 were begun. The aim of the Government was to build 50.000 houses a year, and in December it claimed that in 1935 it would reach the 50,000 mark.
The total advances made by local authorities in the matter of housing since 1918 now amount to $415,297,300. Counting in the money spent by the Housing Department during the six years after the war, it is safe to say that Great Britain has spent seven billion dollars on housing in the last seventeen years. As an Englishman would say, this is “not so bad.”
The average building price for small, nonparlor houses during 1934 was $1,445. There were only two houses built for less than $1,000 in 1933 and none in 1934. As to houses built by local authorities, the most usual cost price was $1,500. All such houses are called “Council Houses” in England. They are expected to be let at a rent that yields little or no net profit.
As to houses built by private builders, the average selling price is from $2,500 to $3,000. A $3,000 house will have a drawingroom, dining room, a large tiled kitchen, three bedrooms, bathroom, separate lavatory, radio set, electric clock, gas stove and gas boiler. Also, it will have space for a garage. Very few English homes have central heating. This is partly because the English people prefer the wasteful but cheery open coal fires, and partly because no company, as yet, has set out to teach the economy and advantages of central heating.
AVAST amount of town planning is being carried on in Great Britain. No one can build what he likes or where he likes. Every scheme for building must be submitted, with full specifications, to the local authorities. There are at present 1,254 planning schemes that have been adopted. These apply to a total area of 12,150,089 acres.
In general, not more than eight houses per acre are allowed in rural areas. No building must be more than eight stories in height, as the British people dislike skyscrapers. During 1934, permission was refused to erect shops in residential districts. Even schools, clubs, restaurants, dance halls, etc., were prohibited in residential neighborhoods for fear of injury to local amenities. No one is allowed to erect a bungalow on a street of large houses. No building is allowed on a well-built street if a charge is made and sustained that it will “spoil the street.”
Since the war, there has been a glut of big houses in Britain and a shortage of small houses. In 1914, four per cent of the houses in London were big houses, owned by wealthy families. Today half of these big houses are being used as schools, or flat houses or for business purposes. There are not as many very rich families as there were in 1914. On the other hand, there has been a vast improvement in the small houses. The mass of the British people are today more comfortably housed than any other people in Europe. There is no doubt about that.
In the building of cheaper houses in Britain, much has been done by philanthropy. Last December, for instance, a five-story building of twenty working-class flats was completed. It was the gift of Mrs. Meyer Sassoon in memory of her son. I he cost of the building was $27,000. Every flat contains a living room, hall, kitchen and three bedrooms. The rent will be $2.75 a week, including rates and water rate. 1 his is the lowest rental, for fiats of such a size, that has ever been reached in London.
So, after a long period of bureaucratic blunders, Britain has found a way to house almost all her people comfortably. The upper and middle classes have been let alone, to make their own arrangements with private builders or building societies. So have the better paid working people.
As for the less fortunate millions, it has been found wiser to grant small subsidies for the building of better houses than they can afford. A certain minimum standard of living has been set for the British people, and in order to raise as many people as possible up to this standard, the burden of taxpayers has been increased. Britain remains a land of private enterprise; but the British policy, to which even the taxpayers agree, is that the strong must help to bear the burdens of the weak.