Category Archives: Housing Bill

Right to Buy and the rural housing sell-off

One unequivocal fact in the housing debate is the need for affordable housing in rural areas. Often ignored amid the monotonous focus of ‘housing crisis’ discourse related to urban areas, peripheral parts of the UK face huge struggles in the face of uncertain employment opportunities and the attractiveness of rural property in the UK market. The upcoming Housing and Planning Bill which has quietly navigated its way along the political channels to the point at which it is a seemingly an inevitable conclusion to a process which has seen sparse evidence of coherent public or political debate.

Within what could be deemed a generally contentious bill among those working in the housing industry, the most hotly contested aspect is that of the extension of the Right to Buy. Right to Buy has stood the test of time since its inception in the 1980s and is now proposed to be extended to a wide variety of different modes of housing provision, including housing associations and bizarrely including sectors such as co-operatives which were initiated in direct opposition to the principles of Right to Buy.

Of course it is nonsensical to be blankly opposed to the concept of home ownership, not least given its political resourcefulness among the electorate, and while being advertised as a ‘voluntary’ measure, the prospect for any individual or family of securing a huge discount on a property in an era of negative interest rates will be undoubtedly attractive given the upward curve of property appreciation in the last 30 years. However what is blindingly clear to those who operate in local authorities is that this measure will come at huge financial and social cost. Rural communities appear to be particularly poorly documented when it comes to the affordability crisis among those unable to yield the necessary capital to leap haphazardly on to that all important first rung of the housing ladder.

For instance in the recent debate on the Housing Bill in the House of Lords, Exmoor was cited as an example of an area characterised by idyllic countryside, prime for second home owners yet also inhabited by a local population who no longer work in industries such as agriculture but work on a seasonal basis often in low-paid ‘cash in hand’ jobs which renders them far outside the boundaries of mortgage lenders’ requirements. In such areas, building contractors charge a premium for the difficult accessibility to sites which are available for construction and property values are approximately 8 times average salaries, making the area arguably more unaffordable than London’s burgeoning housing market.

The details of the proposed Housing Bill extends the Right to Buy to Housing Associations and rural local authority housing for social rent. The percentage of affordable housing in rural areas stands at only 8% compared with 20% in towns and yet these proposed measures will result in the sell-off of housing stock which can then be painlessly sold on for profit after 5 years with no requirement whatsoever for the local authority or Housing Association to replace the home with another in the same area.

The flimsy promise of a ‘1 for 1’ replacement for homes sold off under Right to Buy is plagued with the caveats of the definition of ‘affordable’ housing which includes the government’s ‘Starter Homes’ which 79 councils across the UK tellingly regard as unaffordable. Hastoe Housing Association, one of the larger rural housing associations with 7,000 homes across 62 local authorities has been one to openly decline the offer of Right to Buy by central government, citing concerns that ‘the offer brings a serious risk that the current low volume of rural affordable housing will be further depleted.’

right-to-buy-sales1

Young people are thus faced with the decision of remaining in the communities they grew up in unstable jobs or move on to local towns or cities where demand in house prices is comparatively lower. Along with numerous other side effects of this process, it results in the further emptying out of rural communities, inhabited purely on a seasonal basis or exclusively by the retired community. In order to alleviate the growing scarcity of affordable rural properties in peripheral areas of the UK, this Housing Bill must be heavily amended to avoid irreversible weakening to local authorities and housing associations who carry out such essential work for local communities. If the long term aim is to reform local councils then it is by allowing them to be proactive in the way they actively develop land through more innovative financing measures, not by impeding their path to recovery.

As politicians debate the Housing Bill, will it really do anything to slow an inflated housing market?

Social housing in South London


In addition to the array of New Year TV commercials for sofas, kitchens and package holidays beamed across our screens in recent days we have also been treated to scenes of young, joyful couples taking out brand new Help to Buy ISAs from their friendly local bank managers. Housing is, for now, a mainstream subject which manages to hold the attention of the British public.

Later today, politicians will debate in the House of Commons over the Housing Bill which is the first political instrument to be announced in 2016. On Monday David Cameron announced his Conservative government would ‘roll up its sleeves’ in order to directly intervene in actually building for the first time since Thatcher’s government transformed the Isle of Dogs in the 1980s. If the idea of a majority Conservative government intervening in order to ease a housing crisis flies in the face of the party’s old school track record on free market economics and the support for big business, then the surprise is wholeheartedly intended.

Ever since the Conservative party conference following Jeremy Corbyn’s victory, Cameron’s message has been to portray the party as that of the centre, there to help ‘working Britain’ as Labour struggles to find its feet. As ever, the specific detail of the proposals break up the simplistic message all too easily. The main headline this week, which neatly depicts the government as an interventionist saviour, is to build 13,000 starter homes across six different sites through the subsidy of smaller builders. It must be said that any help to SMEs in construction must be supported given the decimation of that part of the industry during the years of the financial crash, when thousands of subcontractors went out of business.

When examined in more detail, however, the idea of 13,000 starter homes being built (priced, let’s remember, at £450,000 in London) between now and 2020 is a fairly underwhelming total. The move is small enough to be low risk while significant enough for Cameron to use as ammunition when the time comes later today. The other headline is that of a £1.2bn subsidy to the larger housebuilders to build on brownfield land to produce another 30,000 homes. When you combine this policy with other, less publicised policies, such as the introduction of automatic planning permission ‘in principle’ for brownfield sites, this is no more than another leg up for developers and an undermining of the UK’s planning system. Other more controversial policies include an extension of right to buy, forcing councils to sell off its high value vacant housing when 2 million people are on local authority waiting lists.
There are numerous positives to the Housing and Planning Bill, including the encouraging support for Self and Custom Build housing by forcing local authorities to provide adequate numbers of serviced plots to meet demand. However until there is a serious attempt to dampen the current attitude of a policy hellbent on pumping up an overvalued property market then housing will become ever less affordable. The issue is, unfortunately, far more complex than the convenient idea of simply building more homes. The answers lie in addressing the high cost of construction given the limited numbers of available contractors, developing a coherent private rental sector, developing other models such as custom build and allowing councils to be proactive in housebuilding instead of forcing them to sell off stock in an attempt to further stigmatise the public’s view of council housing. In an uncertain time for housing, 2016 will provide plenty of political opportunities, particularly in the upcoming London mayoral election, for the topic to remain of upmost importance to many of the electorate.