Time to end the freeze

Originally published on August 29 on my blog for Inside Housing. 

The freeze on the Local Housing Allowance (LHA) is a £1.2 billion question for which the answer seems obvious.

The problems detailed in analysis by the Chartered Institute of Housing (CIH) published on Wednesday are severe and they are getting worse.

LHA rates are midway through a four-year freeze that is the culmination of seven years of austerity. The result is that they have completely lost touch with the rents they were meant to cover.

The CIH analysis shows that 90% of LHA rates now fail to cover the rent of the cheapest 30% of private rented homes (bear in mind that this was itself a cut from the 50th percentile and that LHA was originally designed to enable tenants to ‘shop around’ for cheaper rents).

That leaves tenants facing rent shortfalls that grow larger with each year of austerity: outside London, two out of every three LHA shared accommodation rates have a weekly shortfall of £4 or more and half of other LHA rates are short by £10 or more; in London, the shortfalls for shared accommodation are more than £10 a week in every LHA area and at least £30 for all other homes.

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That was the (housing) week that wasn’t

Originally posted on August 20 on my blog for Inside Housing. 

An open letter to James Brokenshire on Monday puts a lacklustre Housing Week into true perspective.

Organised by the Conservative think tank Onward, the letter calls for a change in the law to allow local authorities to buy land for housing at fair market value rather than a price that includes the ‘hope value’ that includes planning permission.

The call for a change to the 1961 Land Compensation Act is supported by a wide range of organisations including think tanks from across the political spectrum as well as Shelter, Crisis, the Joseph Rowntree Foundation, National Housing Federation, National Landlords Association and Generation Rent and even the Campaign to Protect Rural England.

And it is also signed by former Downing Street insiders Will Tanner and Neil O’Brien MP, now director and an advisory board member at Onward.

Reform to allow councils to buy land at close to existing use value would go much further that tentative government moves on land value capture and open up the possibility of a new generation of new towns or urban extensions with funding for infrastructure and affordable housing.

There are caveats to this. First, any such measure would have to withstand resistance by powerful landed interests inside the Conservative party with pockets deep enough to fund a legal challenge like the one that overturned compulsory purchase powers in the original New Towns Act and led to the 1961 Act.

Second, while few would disagree that up to £9 billion a year in land value gains could be put to better use than lining the pockets of landowners, there might be less agreement about what to do next: a report by Onwardin June argued for a programme of discounted rent homes for young people to buy and appeared to argue for less, rather than more, social housing.

However, the contrast between this week’s call for reform and last week’s highlights is still a striking one.

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U-turns but no vision in social housing green paper

Originally posted on August 14 on my blog for Inside Housing.

For all its faults (and there are many), the social housing green paper is still a remarkable document.

What I think it is the first-ever housing green paper from a Conservative government represents progress in itself: rather than taking half-baked ideas from right wing think tanks and putting them straight into legislation, the government is actually consulting us on its policies.

But that is just for starters: the green paper runs up the white flag on two of the barmiest and most controversial elements of the Housing and Planning Act 2016 and goes on to propose what amounts to a rewrite of much more of what the government has done since 2010.

The two explicit u-turns mean that local authorities will no longer be required to pay a levy on higher-value council homes as they fall vacant and fixed-term tenancies will no longer be mandatory for new council tenants.

This is not a complete surprise – neither policy had yet been implemented – but it is an indication of just how much the Grenfell Tower fire has changed the politics of social housing.

And the non-implementation (or even repeal) of the forced sales levy means that there is no source of funding for a third policy that was a flagship Tory manifesto pledge in 2015 -the extension of the Right to Buy to housing association tenants.

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‘Housing week’ off to an uncertain start

For once this is a silly season that has some substance. If you can tear yourself away from the sun lounger or the latest pronouncement by the Etonian Katie Hopkins, mid-August sees a trio of government announcements that are crucial for housing and homelessness.

Last week featured another big benefits u-turn: confirmation that housing benefit will continue for supported accommodation removes a cloud that has been hanging over projects including homeless hostels and women’s refuges.

Monday saw the launch of the strategy that the government says will enable it to meet its target of halving rough sleeping in England by 2022 and ending it by 2027.

And what is billed as ‘housing week’ is set to continue on Tuesday with the launch of the social housing green paper – originally promised in the Spring, then before the parliamentary recess last month, but now appearing while most MPs are on holiday.

The timing does at least ensure some media attention, including an uncertain performance by James Brokenshire in the TV and radio studios on Monday morning.

After a lively appearance on Good Morning Britain, the housing secretary struggled on the Today programme when asked whether government policies are to blame for the relentless rise in rough sleeping and floundered when asked how much of the promised ‘£100 million plan’ is new money. (Somewhere between none and not much was the eventual answer).

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What the English Housing Survey says about owner-occupation

The third in a series of blogs looking at the latest English Housing Survey considers the state of home ownership in 2016/17.

Home ownership has stopped shrinking

The survey says 62.6% of households owned their home in England in 2016/17, down from 62.9% the previous year. Coming after a 10-year decline from a peak of 71% in 2004, that represents relative stability and the rate is now little changed since 2013/14.

The last time home ownership was lower was in 1984, just as the Thatcher right to buy boom was at its peak.

Or has it?

However, some more profound changes are going on beneath the surface. First, it depends whether you are talking about owner-occupation or home ownership – many more of us now own more than one home thanks to buy to let.

Second, it conceals the widening divide within ownership. Traditionally owner-occupation has been about first-time buyers getting on to the housing ladder but the tenure has matured as baby boomers get older and there are now more outright owners (34%) than people buying with a mortgage (28%).

Owner split

In line with that, the proportion of owners who are under 35 has halved in the last two decades from 18% to 9% and even buyers with a mortgage are older than they once were (only 46% are under 45). By contrast, 61% of outright owners are over 65.

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What the English Housing Survey says about private renting

Originally posted on August 2 on my blog for Inside Housing.

The second in a series of blogs looking at the latest English Housing Survey considers the state of the private rented sector in 2016/17.

Home to a fifth of us

The private rented sector has doubled in size over the last 20 years from 10% of households in 1996/97 (2.1m) to 20% in 2016/17 (4.7m). Most of the growth took place after 2003.

To put that growth into perspective, the private rented sector now accommodates a greater share of households than at any time since 1970. As recently as 1997, following rapid decline in the 1970s and 1980s, it was half the size of the social rented sector.

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