Chapter 10: Social and affordable housing (John Walker)

Chapter 10: Social and affordable housing (John Walker)

SDG Target 11.1: By 2030, ensure access for all to adequate, safe and affordable housing and basic services and upgrade slums

Introduction

“Applying for social housing is just one of several different ways that people can secure housing for themselves and their families. Other options include renting privately, shared ownership schemes and owner-occupation. The supply of social housing is insufficient to satisfy demand, so there is an expectation that people who are able to obtain accommodation in other tenures should do so.” (Canterbury City Council Housing Allocation Scheme 2015)  

In our first Residents Vision (2014) attention was focused on the number and locations of houses to be allocated in the then emerging Local Plan. In this current Vision we concentrate on the issues of affordability and social housing which were highlighted in our recent residents’ questionnaire as a matter of great concern to local people. As a country we have failed conspicuously to provide sufficient affordable homes to rent or to buy, particularly for those on low incomes, and politicians at both national and local levels will need to change their mindset if progress is to be made on this issue over the next 20 years.

The present situation

In 2017 the City Council published its Customer and Community Profile which had this to say about the importance of good quality housing for all:

“The condition and location of our homes can have a fundamental impact on our health. Yet the gap between the housing haves and have-nots is widening and there is a danger of it becoming entrenched for generations. We know there is a strong correlation between housing inequality and health inequality. Neighbourhoods and housing matter to health in many ways from homelessness, the physical attributes of housing failing to provide adequate, safe, dry, warm and not overcrowded accommodation to neighbourhoods with concentrated disadvantage, where services are overburdened, basic amenities in short supply and issues such as high crime, challenging schools and poor transport mar the life chances for many.”

Figures published by the Ministry of Housing Communities and Local Government (MHCLG) for the year 2016/17show 19,059 households were waiting for a council property in Kent. Gravesham has the highest social housing waiting list with 3,629 on the register, followed by Canterbury with 2,709, 2,156 in Thanet, 1939 in Dover, and 1,454 in Shepway. Maidstone has the lowest at 603.

Since 2012, and against this background, 103,642 council homes and 46,972 housing association properties for social rent have been lost in England mainly because they were converted to expensive “affordable rent” properties or sold off under Right to Buy. Under this scheme hundreds of thousands of social homes have been sold off since its introduction in 1980. In recent years major cuts have prevented local councils building new homes. Just 1102 new social homes were completed in England in 2017- down from 36,700 in 2010 (Charted Institute of Housing 2018)

At the heart of the problem of affordability is the high cost of land for residential development. We have considered this issue in our chapter on “Housing and the Land Question.” In this chapter we try to define the extent of the problem and consider some of the options that are available to policy makers to help deal with the problems of affordability and the provision of social housing.

Provision of Social Housing

Social housing is defined as housing which is let at low rents on a secure basis to those who are most in need or struggle with their housing costs. Normally councils and not-for-profit organisations such as housing associations are the ones who provide social housing. A key function of social housing is to provide accommodation that is affordable to people on low incomes. Therefore rental increases are regulated by law which means that rents are kept at an affordable level. Not everyone is entitled to social housing. Local councils decide how to allocate it to meet local priorities, but generally offer places to people who are struggling with housing costs or in need of a more secure home.

Unlike the private sector where tenancies are offered on the open market, social housing is distributed according to the local council’s Housing Allocation Scheme. Since the Localism Act (2011) councils can decide who is or is not eligible to go on the waiting list for social housing according to need with certain groups being given “reasonable preference.” With a shortage of homes, the waiting lists for social housing have never been longer. There are more than 1.8 million households in England on the waiting list for a home – an increase of 81% since 1997. (Shelter England 2018)

The lack of homes means that some families living in desperate conditions are being forced to wait years for a suitable home. They may have to live for months on end in temporary accommodation such as hostels or Bed and Breakfast accommodation uncertain of where they’ll be moved to next, or how much longer they’ll have to wait for stability.

Others will be left with no choice but to live in the private rented sector. With short-term contracts, unpredictability, poor conditions and high costs, this form of housing is unsuitable for many families and households, especially those who are vulnerable and in need of a stable, secure home.

Registered providers, often known as social landlords are the bodies that own and manage social housing. These are usually non-commercial organisations such as local authorities, or housing associations. Housing associations are independent non-profit making organisations that can use any surplus they make to maintain existing homes and help finance new ones. It is now possible for commercial organisations to build and manage social housing though this is still not common.

The role of Central Government

For too long central government has been indifferent to the crisis of social and affordable housing. By 2020 it is predicted only a quarter of 30-year olds will own their own home, down from half in the 1980s. Over a third of young people born since the year 2000 will be unable to afford to purchase a property for the rest of their lives and will have to rely for their housing needs on the private rented sector which has been marked by insecurity of tenure and poor maintenance.

House prices have grown much faster than incomes and the economy more generally in the last four decades. In the last three years alone, the value of all housing stock in the UK has increased by £1.5 trillion to £6.79 trillion, over 3.5 times GDP. Much of the new ‘wealth’ created in the UK since the 1980s has derived from rising house prices rather than from earned income or productivity gains. In the light of this the government’s definition of affordable housing as 80% of market value is clearly unhelpful to the vast majority of first- time buyers whose incomes bear no meaningful relationship to house prices.

Against this background funding for local authority council house building has been decimated at a time when social forms of housing sound have been encouraged and funded.

The country needs to rethink its relationship with housing if it is serious about solving the growing housing crisis. Allocating more land for residential development in and around our towns and cities will help, but its only part of the answer.  As long as this land has to be purchased at over £1million per acre there is little prospect of any longer-term solution to the crisis of affordability.

The way ahead

A fundamental first step will be to identify where and how many social houses are needed nationally. Britain is the only advanced economy to have no planning for the provision of homes above the most local level, and this needs to change. Housing and the associated physical and community infrastructure needs to be planned and funded on a regional level, with the implementation of regional housing policy carried out at local authority level via Local Plans. A regional housing strategy would ensure that the “Duty to Cooperate” in the NPPF could be properly monitored and enforced.  Councils need to be encouraged to plan housing development collaboratively within a regional framework alongside building the roads, hospitals and schools we need to support our growing population. The authorities shouldn’t simply work in the isolation of their own fiefdoms.

It is also important to make it easier for small builders to enter the market – including self- builders. Even building at full capacity, the major house builders can’t build the number of houses that are needed: on average they build just 130,000 houses each year. To bridge this gap between supply and demand an army of small builders needs to be mobilised, i.e. in order that people can commission the construction of homes of their choice. This is the norm elsewhere in Europe – in Austria, for example, 80% of houses are built this way.

We need to develop our capacity to produce low cost, well designed factory-built houses, with good special standards, which can be assembled quickly on site in days rather than months. This is normal in other developed counties such as Norway, Sweden, Germany and Japan.

A lack of both affordable market housing and social housing is an issue which, if left unaddressed, could impede the social mobility of a generation and have a paralysing effect on businesses. Businesses will struggle to attract and retain a sufficient skilled workforce if employees cannot find affordable or social housing close to their workplace.

Recommendations

  1. Now that the government borrowing cap on local authorities has been lifted, enabling councils to approve the building of social and affordable housing for sale or rent, the City Council must embark on a major community house building programme to meet locally identified needs.
  2. Local Authorities must ensure that developers and landowners comply fully with their obligations to provide genuine affordable social housing. These obligations need to be factored into the price developer’s pay for the land before the land is purchased not afterwards.
  3. Central government needs to plan and properly fund the provision of social and affordable housing on a national and regional basis to ensure local authorities can meet their assessed housing needs.
  4. In order to speed up the rate of provision of social and affordable housing having good spatial standards, investment must be made into well designed, high quality factory-built houses that can be assembled on site in days rather than months.

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