An economist explains why the UK has seen a sharp rise in the number of rough sleepers, and suggests a radical plan that could reduce house prices and rents by a half

Walking though Westminster, it is impossible not to be touched by the sight of the many homeless people sleeping in doorways. It is also impossible not to be struck by the myriad organisations that assist them, including the Salvation Army, other Christian volunteer groups and even the sandwich chain, Pret A Manger. The number of homeless people has increased in recent years. And the nature of homelessness has changed too.

Until a few years ago, you could safely say that the vast majority of those sleeping rough had complex problems. Maybe they were beset by mental illness after leaving the Army, or perhaps they had been abused by a step-parent and thrown out on to the streets. We could argue about the relative roles of the state, of civil society and of charities in addressing a wide range of problems. But homelessness, it could be agreed, was complex, and not only, or primarily, the result of bad housing policy.

When seeing someone stirring in their sleeping bag, beside wondering what practical steps might be taken to address the problem of homelessness, the words of Pope Benedict XVI’s encyclical, Deus Caritas Est, might have come to mind: “Love – caritas – will always prove necessary, even in the most just society. There is no ordering of the State so just that it can eliminate the need for a service of love.”

This has changed. In the five years to 2015, the number of people becoming homeless because their tenancies in rental properties ended rose by 154 per cent. Typically, these former tenants had no longer been able to afford the market rent for their home, even with the help of housing benefit. They were sleeping on the streets simply because they could not afford anywhere to live.