House building in the 1930s – golden age, myth or totally irrelevant?

The ‘build more houses’ supporters often hark back to using house building figures for the 1930s to support their assertion that we can and should emulate policies from that period now.  They often link this with the claim that the introduction of the 1947 planning system and the opportunities (greatly over-estimated) for people to object put an end to this ‘golden age’. 

 

But what is the reality? What happened in the 1930s and is it relevant today.

 

The assertion

Ant Breach of Centre for Cities states “And interwar Britain's housebuilding boom saw new cheap houses concentrated in the most expensive parts of the country undergoing the greatest expansion and fastest wage + jobs growth. On the eve of WWII, 1/3 dwellings in Birmingham were less than 20 years old.” [Ant Breach, ‘X’, May 2024].

 

“Perhaps the only lesson that can be learnt from the 1930's housebuilding boom is that it is untrue that housing is always a problem. There once was a time when houses which people liked were built at reasonable prices and in plentiful quantity. If the housebuilding industry could do as well in the 1990's as it did in the 1930's then there would be little or no homelessness, bars to labour mobility, dependency of Social Security, and who knows? perhaps even fewer problem estates. The 'affordability' problem in relation to housing might be no more than a historical curiosity.”

[Boyle, C, 1992].

 

The figures

On average, some 250,000 private sector dwellings and 50,000 public sector dwellings were built each year, so a total of roughly 300,000. It looks impressive.

 

The context

But what factors led to this expansion of housing?  There were several factors unique to the 1930s that are crucial to any understanding of the situation. These were linked to the impact of the Great Depression.

 

Labour – at the beginning of the period, unemployment was high so there was plenty of ‘surplus’ labour which could be drawn into work without creating wage inflation. Labour was cheap and there was a lot of it around!.

 

Land – agricultural land was cheap with land sales more common arising from the collapse in agricultural prices.

 

Costs – one effect of the depression was to reduce building costs. It was a buyers market.

 

Finance – the depression led to high savings rates resulting in sufficient funds particularly to those supplying mortgages. “Building society mortgage debt rose from £316m with 720,000 borrowers in 1930 to £636m with 1,392,000 borrowers in 1937…”. [Crafts, N. 2013]

.

 

Interest rates – to stimulate the economy these were low, after 1932 being reduced to close to zero.

 

Don’t forget the 1920s – building rates were lower in this decade – estimated at 200,000 a year. Result – Meant that the 1930s saw an element of catch-up.

 

And what else?

Competition from international investors – rather low.

Second home and holiday let demand – again rather low if at all.

Less planning control – but that created lots of problems in terms of land misuse. Loss of land in an over-populated country was not generally seen as a problem.

 

Sources

Boyle, C., September 1992, THE HOUSEBUILDING BOOM IN ENGLAND DURING THE 1930'S, Lessons for the 1990's?, Conall Boyle, University of Central England In Birmingham, From the Proceedings of IAHS (International Association for Housing Studies) European Network for Housing Research.

 

Breach, Ant, May 2024.’X’.

 

Crafts, N. 2013, https://www.theguardian.com/housing-network/2013/apr/19/1930s-house-building-economic-recovery