Posted by: Colin Wiles06/07/2012
I’ve been spending a lot of time recently doing presentations to groups of staff, councillors and tenants around the country on current issues in housing.
I always mention the fact that the present changes are the deepest and most far-reaching I’ve seen in my thirty years in the sector. But I’m always trying to simplify and clarify what’s going on in housing so, in that spirit, here is my list of the Top Ten issues that are having the greatest impact. I’ve thrown in a few predictions as well. It’s a list you or may not disagree with but it’s offered up for discussion.
- Overall housebuilding in England is down to its lowest level in peacetime for a century. The latest figures from the HCA suggest that completions across all sectors could fall below 100,000 this year. It’s worth recalling that in 1968 a massive 352,000 homes were built in England. In the fifties, the then housing minister Harold Macmillan would have been forced to resign by now. This lack of new supply is keeping house prices high and pricing an entire generation out of the housing market. CLG projections show that 230,000 new households will be forming each year between now and 2033, so we really need to be building a quarter of a million new homes to keep up with demand.
- Planning reform. The new National Planning Policy Framework was published in March and aims to simplify the planning system, stimulate growth and “to boost significantly the supply of housing” and “meet the full objectively assessed needs for market and affordable housing…”. Regional targets have been scrapped and we’ve returned to bottom-up planning. It’s too soon to say what impact this will have but early indications are that many local authorities are scaling down their housebuilding targets from the previous regional figures. This is worrying.
- The affordable housebuilding programme has been cut from £8 billion to £4.5 billion over the four years to 2015. Nearly all newly provided homes will be “affordable” with rents at up to 80% of market rents, not to forget the same higher rents for conversions of existing stock. This programme is likely to trap thousands of people in high rent properties and signals the demise of social housing as we know it. The latest report from the National Audit Office suggests that the programme may not deliver and will raise the housing benefit bill. Expect another statistics war and growing pressure on the housing minister when the expected completions fail to materialise.
- The unstoppable growth of the private rented sector. It’s doubled in size since 1980 and has now overtaken social housing. Most new households are now entering this sector, including families with children, but growing numbers of landlords are refusing to take people on benefits, so the bubble of rising rents may burst before too long. We can expect to see a worsening of conditions at the lower end of the market as more rogue landlords seek to make a fast buck. That means more sheds in gardens, beds in lofts and, given that 40% of the sector is non-decent, possible fatalities. The clamour for regulation will grow. The imminent Montague report may prompt institutional investment and could see the PRS replacing affordable housing as part of planning deals on new builds.
- Power to the people. The provisions in the Localism Act for neighbourhood planning, the right to challenge and the right to bid could re-generate communities across the land. Alternatively, they could be a damp squib. The danger is that it will be the well-heeled, wealthier communities that take up the new rights and poorer areas will be left behind. It is therefore critical that housing providers work with their residents to encourage communities to take up these new rights.
- Reform of local authority housing finance. The £21 billion of housing debt doled out to local authority housing revenue accounts gives councils more freedom to take control of their business plans and perhaps start building limited numbers of new council homes. It will also have an impact upon ALMOs and slow the transfer of stock. Can we expect a new golden age of council house-building? I don’t think so. If anything, there will be a net loss of stock to right to buy.
- “Am I bovvered?” regulation. A “new” regulator for social housing, within the HCA, but only offering a backstop service so far as consumers are concerned. Early signs are that the regulator is not intervening in complaints about serious detriment. Can we expect to see a Barclays’ style scandal over the next few years as rogue staff take advantage of the lack of supervision?
- New tenancy strategies and allocation changes will lead some local authorities to tighten up on who they house. Housing waiting lists around the country will shrink, allowing the housing minister to claim that he is solving the housing crisis. Fixed term tenancies will lead to a greater turnover of stock in some areas.
- The bedroom tax will affect 670,000 households but only 250,000 lettings take place each year. Lord Freud says people affected should move, take in a lodger or pay the rent. What happens to tenants who get into arrears because they cannot move to smaller properties? Judges are unlikely to be sympathetic to possession actions, so you can expect to see landlords carrying a large cohort of under-occupying tenants with arrears who cannot be evicted.
- And finally, Universal Credit will replace all income related benefits and housing benefit from 2013 onwards for working age tenants. Joe Halewood believes this will have a greater impact upon the social housing sector than the right to buy and will lead to the closure of many hostels. The impact upon larger families is potentially devastating. Huge doubts still hang over the I.T. system that will deliver UC, and the target for 80% of transactions to be on-line seems wildly optimistic. There’s still a lot of water to go under the bridge on this one.
From Inside out
An independent look at the housing sector and beyond from Colin Wiles