Between 1933 and 1939 the unplanned, uncontrolled and largely unregulated developments carried out by the speculative builder/developers were responsible for the re-housing of a significant part of the working-classes. During that time almost three million houses were built, the majority for sale and the ‘housing situation was transformed from a position where there were 610,000 fewer houses than families in 1918, to one in 1938 where there was a theoretical surplus of over 500,000 houses’ (1). The politically driven homes for heroes campaign of 1919 had run out of money as early as July 1921. There was an urgent need for modern homes, especially to house the lower paid, which the central government could not fulfil because of the severe economic conditions of the time.
The building societies, however, had very large deposits invested in government securities which were not earning a satisfactory return. The considerable additional yield available if the funds were lent as mortgages gave them an incentive to co-operate with the builders who wished to construct low-cost housing. It was not financially possible for the developers to build houses to rent even though the majority of members of the working classes had traditionally rented their homes from private landlords. In order to achieve sales of the houses the societies needed to convince working-class people, who had historically only thought in terms of hourly wages and weekly rentals, to commit themselves to payments over periods of twenty-five years.
A new breed of builders/developers emerged who were able to take advantage of readily available bank finance and low land costs and who used the free market to break the controls which the builders merchants exercised over the prices of materials. They reduced the cost of materials and used piece workers to de-skill the construction process to build the houses. Notwithstanding the criticism levelled against such houses, they have stood the test of time. They were often flexible enough to adapt to changes in living fashions. Those houses which were hit by enemy action during the Second World War showed that they were also robust enough to withstand serious damage.
There were different approaches to development which were used by speculative builders. The very large number of small, cheaply built houses which were built by developers such as Leo Meyer in Kent in the 1930s used piece-work as a standard employment practice. He openly flouted local by-laws and built houses where the specification did not meet local authority standards. Because of the speed of construction and the limited number of inspectors the houses were built before the sub-standard construction could be discovered. Meyer’s houses sold for between £450 to £600. Meyer’s attitude contrasted with that of J.W.Laing who owned a well capitalised, high-status building company. Laing insisted upon vetting purchasers and demanding a £50 deposit even though this ‘will reduce sales by sending the undesirable purchasers to your competitors’ (2). Unlike Meyer, Laings employed a large labour force and would often impose covenants on the estates they were building.
The work in this thesis shows that, contrary to earlier studies, the majority of the houses built were of the smaller type acquired by people on modest incomes who were described by the building societies as being members of the working class. Frank Lord, the president of the Federation of House Builders said, in 1934, ‘in a review of last years work beyond all expectations we have built up to the end of September, 309,000 houses most of them small houses for the thrifty working-classes.'(3)
The occupiers were brave young people who ventured away from their families not just to live but to buy homes in distant parts of the United Kingdom. In the early 1930s when the new estates were being developed, Britain faced severe economic problems. There was a run on the pound and Britain came off the Gold Standard, the wages of the Civil Service and unemployment benefit were cut by 10 per cent, and the Navy at Invergordon went on strike. Unemployment was at three million by 1933. Against such a background, the development and sale to working-class owner occupiers took place. Sustained employment gave confidence to those in work to take on commitments and to put down roots in new places. Moving away from their previous lives in poorer inner-city dwellings where there were established views on life, jobs, politics and religion, they tended to became less bigoted, more outward-looking and self-confident. The houses they owned and occupied reflected these views, and they imposed these aspirations upon the houses; the houses did not impose a collective, centralised view upon them, as was the case with those housed in municipal dwellings. Many appreciated that ‘Home ownership represented the realisation of that independent status prized by all working people, but vital to the position of the would-be labour aristocrat. Among artisans it long remained a dominant inspiration’ (4).
The building industry accounted for 30 per cent of the increased employment between 1932 and 1935. The workforce making electrical appliances trebled, retailers expanded, and clinics and schools opened. These effects were not all the direct result of the new estates being built, but it is unlikely they would have happened at such a pace without the stimulus of the new homes being built. For the first time in history, Britain had a large proportion of its population in homes they owned. The nation of shopkeepers was on its way to becoming a nation of home owners.
The building boom which occurred during the few years immediately before the outbreak of the Second World War took place without direct government instigation or any national plan. It happened because of the unfettered nature of capital markets and the drive of the speculative builders. The capital commitment to the new homes was immense, as 7.2 per cent. of the total investment in the United Kingdom between 1900 and 1939 was accounted for by new dwellings. In addition, the proportion of the total investment spent on dwellings in the period 1930-8 was 32 per cent, and this compared dramatically with the figure for 1900-9, when there was a great deal of activity in the building industry and yet the proportion was only 13 per cent (5). The turning point was 1933, when both the private and public sector began to become more active. ‘From 1933 both sectors make a strong recovery, the private sector doubled its capital expenditure and the public and semi-public enterprises showing a more modest but still substantial rise of 63%’. The size of the investment, most of it in the South of England, and the relatively short time scale during which it took place, makes this a matter of considerable importance. Government played only a passive role in the housing boom which developed at this time choosing not to restrict or direct its growth. The result was the substantial rehousing of the English lower-paid, and a change in attitudes towards home-ownership.
The publication, in August 1996 of Is the UK Different? International Comparisons of Tenure Patterns (7) by the Property Research Unit of the University of Cambridge and the London School of Economics showed that owner-occupation is seen as desirable in 12 countries within the Organisation of Economic Co-operation and Development and that ‘deregulation tends to generate sudden changes in the proportions of owner-occupiers’ (8) Of the younger households in the United Kingdom the majority, 74 per cent, were found to be home owners. This rapid change in the structure of home-ownership was started in the 1930 by the change of attitudes of the building societies and the builders which amounted to a deregulation. It produced a situation where the proportion of all households which were owner-occupied in 1930 was probably between 6 per cent and 10 per cent, a figure which rose to 29 per cent by 1950 and was 67.8 per cent in 1994 (9).
In just six years not only had large numbers of low-paid workers been housed but social attitudes were changed, a change which would alter the future political balance of the country. Working class people could aspire to more material possessions for themselves and a better future for their children.
(1) C.Mowat,Britain Between the Wars 1918-1940,(London, 1968), p 508
(2) J.W.Laing, Guaranteed Mortgages in House Building, 1934-6 (London,1936), p. 88-91.
(3) 11 January 1935, Illustrated Carpenter and Builder, p. 60.
(4) Committee on the Savings of the Working Classes 1850, p. 413.
(5) Charles H. Feinstein, Domestic Capital Formation in the United Kingdom 1920-38 (Cambridge, 1965), p. 36.
(6) ibid.,p.48.
(7) A. Freeman, A. Holmans, C. Whitehead,Is the UK Different? International Comparisons of Tenure Pattern(London, 1996).
(8) ibid., p.52.
(9) ibid., p.128.