Challenging times or opportunity to change?

On the one hand it opens up the prospect of associations being able to adopt proper asset management strategies in order to stimulate new supply for the first time since the introduction of grant and the regulatory framework that has grown up around it. 

On the other however the failure of government and the HCA to persuade local authorities that the new model should be seen as an additional weapon in their armoury tackling housing shortages means that this opportunity might go begging in a lot of places. 

Housing associations are being put in the invidious position of attempting to make something work that our local authority partners do not want. That is not to say either that we should let this opportunity go or we want to move away from our traditional customer base.

It’s a fact that there is insufficient government funding for the scale of affordable housing programmes we have seen in the recent past. It is indeed distinctly possible that the 2011-15 programme is the last government funded capital subsidy housing programme for the foreseeable future.

Given that possibility, housing associations should be taking a long hard look at how they position themselves for the future.

Last week saw the launch of a report produced by the Smith Institute and sponsored by Genesis called ‘The end of the affair: implications of declining home ownership’. 

The report indicates the number of owner-occupied households has dropped by 265,000 since 2005 and in percentage terms from 70.9 per cent in 2003 to 67.4 per cent in 2009/10. 

What has this got to do with associations? Well a new swathe of frustrated would-be home owners could create a new market for our services.

Why should housing associations not provide market rent or near market rent solutions for such households? The intermediate rent model, much disliked by Treasury, was the first attempt by the Housing Corporation to move into this territory. There is not a great distance between Intermediate Rent and Affordable Rent, if we leave aside the thorny issue of which households it is targeted at.

The key issue is to stimulate an increase in housing supply of all tenures. The more housing there is, the more affordable it becomes. Housing associations can be at the forefront of the debate needed on how. 

The state has invested over £40billion of taxpayers’ money in housing associations through social housing grant and its predecessor, housing association grant. Why not unlock that resource and permit associations to use in the development of new homes – no new government funding would be required.  

Councils are being freed up by HRA reform. Associations should be allowed to manage their assets in a way more suited to the 21^st Century than the 1970s when the current rules were framed. There is a lot to play for. Let the debate begin.

Neil Hadden is chief executive at Genesis Housing Association.