Housebuilders are putting forward a new way to tackle the affordable housing crisis: simply change the definition of affordable.
In its submission to the spending review, the Home Builders Federation (HBF) says reviewing and clarifying the definition would ‘encourage greater flexibility and innovation by local authorities, developers and affordable housing providers, especially nil-grant private sector solutions’.
It says this would allow more homes to be provided with no public subsidy, open up affordable housing to a wider group of qualifying households, give access to homeownership to people who can’t otherwise afford it and reduce the threat to development viability posed by ‘excessive local authority affordable housing demands’.
No prizes for guessing that the HBF thinks that HomeBuy DIrect should count as affordable. It says many local authorities resist this at the moment despite the fact that the PP3 defintion of affordable includes ‘shared equity products (eg HomeBuy)’ and that they also resist including private sector ‘low cost homes for sale for intermediate rent’ despite them being included in the definition.
No prizes either for guessing that it says both HomeBuy Direct and Kickstart should be protected in the spending review.
The HBF also wants a review of the cumulative impact of policy and regulation and the way that a succession of demands on developers from section 106 to zero carbon are undermining the viability of sites - again predictable, but surely urgently needed after the credit crunch and housing market crash undermined the old section 106 model.
And it also pleads for more clarity on the proposed new council tax incentives for development, warning that the current hiatus could carry on form months and lead to lower housing completions in 2011 and beyond.
None of this is a criticism of an organisation that is simply arguing its corner but it’s an illustration if any were needed that the spending review will be as much an argument between different forms of housing investment as it is for housing investment as a whole. While the groups lobbying the government can agree on the desperate need for new homes, what sort of new homes should they be?
The CIH, NHF and National Federation of Almos also made the case for new housebuilding in their spending review submission but their programme would be 70% for social renting and only 30% for low-cost homeownership.
The temptation for ministers is obvious. In its response to the online consultation on the coalition’s Programme for Government earlier this week the CLG said rather optimistically that ‘government is committed to increasing the supply of affordable housing’.
Moving the goalposts on the definition would make that an awful lot easier to achieve.
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Readers' comments (3)
Anonymous | 09/08/2010 12:52 pm
I am glad you have picked up on this Jules. The fact is you can't provide subsidised housing without subsidy, so the inevitable effect of cutting grant will be that affordable housing is not as affordable as it used to be.
Peter Marsh, head of the TSA suggested the following in a recent article in Social Housing magazine: "Allowing some of those properties [which become vacant] to be re-let at rents which are higher than social rents." and "Taking those properties which fall vacant each year and looking at those which are let in very high capital value areas, a targeted programme of sales could produce three new social homes for each one sold".
The general public has always been sceptical about affordable housing, asking "What is affordable? Does it mean that people on low incomes can afford it?". To which the answer is "not necessarily".
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Anonymous | 09/08/2010 6:03 pm
Spot on.
"Affordable" is a quintessentially Labour word of Machiavellian duplicity.
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Chris | 09/08/2010 9:13 pm
affordable - that you have the financial means for; "low-cost housing"
affordable - that can be afforded; believed to be within one's financial means
affordable - inexpensive, fair, cheap, reasonable, moderate, modest, low-price, low-cost, economical
This would suggest that affordable housing can be housing of any tenure that is within the price realisation of average and below average incomes (there would be a consideration that maybe the latter receives some form of support towards affordability, e.g. welfare payments)
On this basis there is very little affordable housing in Britain.
What the word affordable has to do with 15th Century Florence I am at a loss to understand. Is affordable really an adjective for deviousness, I think not. Indeed it only came into use in its current sense in the 16th Century. Prior to that the ‘to further’ group of meanings applied solely.
As the origins of the word predates the formation of the Labour Party, just a little bit, it is probably untrue that it is a Labour word. Indeed, I cannot see how it could be construed a lie, unless it is on the basis, as I have mentioned, that there is little affordable housing in this country.
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