The long wait for meaningful reform of leasehold

Originally written as a column for Inside Housing.

Churchill was in no doubt that leasehold needs fundamental reform.

‘Who was more likely to be a contented citizen, the man who was a freeholder and who was in his property, or the man who was at the mercy of a colossal landowner?’ he asked in a Commons debate.

It says everything about the snail’s pace of progress on leasehold reform that the speaker was not Winston Churchill, the wartime leader and Conservative prime minister in the 1950s, nor even the more youthful Winston Churchill who was a radical land reformer as a Liberal MP in the 1910s.

Instead it was his father, Randolph Churchill, backing one of the first meaningful attempts at leasehold reform way back in 1884. Needless to say, the leasehold enfranchisement bill was blocked by a Conservative government full of property owners.

Flash forward 139 years and the same argument applies to almost five million leaseholders in England and Wales, the only two countries in the world that have still not abolished or radically reformed an archaic system that dates back to the Domesday Book.

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Modern methods, same old problems

Originally published as a column for Inside Housing.

If Britain’s biggest institutional investor can’t make it work, who can?

Not a medium-sized housing association, that’s for sure. Nor a leading partnership housebuilder. Not even a combination of England’s trendiest developer and Japan’s biggest housebuilder with support from the government’s housebuilding agency. 

I am, of course, talking about modern methods of construction (MMC) deployed at scale to build new homes. 

The shock announcement by Legal & General Modular Homes that it is ceasing production at its factory near Leeds is just the latest in a series of blows to the sector.

From the role that MMC played in what went wrong at Swan, to Countryside’s closure of its modular factory, to the collapse of House, the joint venture between Urban Splash, Sekisui House backed by Homes England, via a series of other bail-outs and closures, it’s becoming a depressingly familiar story.

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The parties start to set out their general election stall

Originally written as a column for Inside Housing.

If this week was a preview of what the main parties will be offering on housing at the next general election then it is probably best to look away now.

Perhaps the best that can be said is that, just as Thursday’s local elections only offer clues as to the outcome of next year’s big event, so the policies announced in the run-up to them may only be a taster of what’s still to come.

But that is being optimistic: otherwise we got some standard tropes from Labour about

home ownership and signals that the Conservatives could be about to reach back into their collection of greatest misses.

In a series of interviews on Sunday, Keir Starmer set out his ambition for Labour to be ‘the party of home ownership’:

This standard appeal to aspirational voters begs some obvious questions about how and what else.

Restoring targets for housebuilding recently scrapped by the Conservatives would be a good start and would come alongside existing Labour policies of ‘first dibs’ for local first-time buyers and a block on overseas buyers.

But whether that will be enough to generate 300,000 new homes a year (the targets hadn’t done that before they were scrapped) and whether even that will make homes more affordable must both be doubtful.

The following day (coincidence?) The Times reported that Rishi Sunak is putting Help to Buy ‘back on the table’ as a key plank in the campaign for a potential Conservative fifth term.

Government sources told the paper that the move could come in the Autumn Statement or the Spring Budget. ‘We cannot go into the next election without an offer for first-time buyers,’ said a minister. ‘We all know that homeowners are more likely to vote Conservative and we cannot cede this ground to Labour.’

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Fine words on social housing only go so far

Originally written as a column for Inside Housing.

‘Homes for social rent are a fundamental part of our housing stock—a lifeline for those who would struggle to obtain a home at market rates.’

It’s a sign of how much has changed in the last six years that statements like that from Conservative politicians (in this case housing minister Rachel Maclean in a Commons debate last week) have become almost routine. For good measure, she also reaffirmed  ‘the unshakeable commitment of the government to drive up both the quality and the quantity of this nation’s housing stock’.

The comments are part of a steady conversion by ministers to the merits of a tenure that not so long ago they seemed intent on dismantling. Since Grenfell, there has been a steady softening in tone and relaxation in policy, with Theresa May as prime minister and Michael Gove as housing secretary prominent among the converts.

But all the fine words and tweaks to policy are not yet matched by results. As MPs from both sides of the house pointed out in the debate, the current output of 7,500 social rent homes a year fails to match the 21,600 a year lost to the Right to Buy and demolition, let alone the 90,000 a year that the all-party Levelling Up, Housing and Communities Committee has consistently argued are needed.

All this in the same week as research by the National Housing Federation (NHF) showed that two million children are living in overcrowded homes with no personal space because they cannot access a suitable and affordable home.

Much of this is obviously down to the fact that the Treasury remains unconvinced about these arguments. True, £11.4 billion for the Affordable Homes Programme (AHP) over four years represents huge progress on the days when it seemed like there would be no AHP at all. True, the government has titled the balance slightly more towards social rent and Right to Buy replacements. But this is still a fraction of what is required and the AHP been badly eroded by inflation.

And so much of the baleful legacy of 2010 to 2016 is still in operation and yet to be unravelled. As Inside Housing reported last week, affordable rent is now generating rents at double social rent levels in some areas. Pointedly, the biggest gap of all is in the Surrey Heath constituency of Michael Gove, where the rent on a three-bed affordable rent home is £1,125 a month compared to £557 a month at social rent.

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Gove’s confession only goes so far

Originally written as a column for Inside Housing.

If it’s broken, who broke it? If there were mistakes and errors, who made them?

It was quite an Easter week for Michael Gove as he moved into confessional mode first in a think tank report and then in a Today programme interview.

‘That the current housing model– from supply to standards and the mortgage market – is broken, we can all agree,’ the housing secretary wrote in an introduction to the report from Bright Blue and Shelter. ‘That change is necessary is undeniable. We are bringing about change – and we are determined to see it through.’

And, asked on the Today programme on Thursday (listen from 08:12), if he had gone through ‘an awakening’ on housing, he said that: ‘The thing that affected me most was the Grenfell fire. What the Grenfell inquiry, in particular, has subsequently brought to light were a chain of errors. I’m very happy to reiterate that there were some mistakes and errors that were made not just by the coalition government but by governments before which contributed to social tenants not getting the support that they deserve, not having their voices heard. And so change had to come and we are delivering that change.’

Note that Mr Gove leaves us with the same key message: others made the mistakes that broke the housing model and now he is here to fix things.

Some of what he’s saying is quite true – he has reversed much of the deregulation of the past – but the interview still begged more questions.

What exactly was he admitting to – and how much of the blame was he really taking for himself and his Conservative colleagues?

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What’s gone wrong with our housing – and what could go right

As symbols of failure, take a former council house in south London chopped up into six bedsits, housing association tenants waiting in vain for repairs and private renters searching non-stop for homes

As a symbols of success, take Vienna’s century of genuinely affordable rents, Barcelona’s long-term housing strategy and Singapore’s melding of the market and public ownership.

The Rental Health series stretching across BBC radio and television had all of that and more, from lots of jobs but no homes in the Highlands to the dire state of the rental market in Yorkshire to the mechanics of local housing allowance and Section 21 to people looking for housing alternatives in vans, co-housing and boats.

Those symbols of failure don’t come much starker than the three-bedroom council house on the Bampton estate in Forest Hill featured in the brilliantly appalling BBC Panorama documentary What’s Gone Wrong With Our Housing?

The first tenant moved into the home in 1971, bought it under the right to buy for £15,000 in 1984 and sold it for £85,000 in 1988. It is now owned by a private landlord who has converted it into six bedsits rented out for £960 a month each.

Most of what amounts to £60,000 a year in rent is paid in housing benefit by the government that sold it for a quarter of that.

As if that was not enough to make the point, the same private landlord has done the same thing to three other houses in the same terrace and is pocketing £250,000 a year.

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State of the housing nation

Originally written as a column for Inside Housing.

So where next? The publication of the UK Housing Review this week is a chance to take stock and ask where the housing system may be heading.

The sense is one of considerable flux, for home ownership as the housing market downturn continues, for private renting as the momentum behind increased regulation grows and for social housing as landlords face competing demands for scarce resources.

The paralysis of policy signalled by a Budget that mostly ignored housing could be just a temporary lull ahead of a UK general election.

As ever, the review puts all that into context. For starters, John Perry’s chapter on housing expenditure shows where total government support (in grants, loans and guarantees) for housing is going. The balance between the private market (59 per cent) and affordable housing (41 per cent) may not be quite as skewed as it was in the heyday of Help to Buy but it is still tilted in one direction.

The good news is that public spending on affordable homes has risen in real terms since the dark days of the coalition government. Investment under three Affordable Homes Programmes is set to peak this year – but the looming cliff edge is an indication of the big decisions that lie ahead:

Current spending plans (as in the Budget) rely on eye-watering (and unrealistic) austerity after the next election so that they comply with the chancellor’s fiscal rules. Key decisions lie ahead in the spending review after the next election regardless of who wins.

What is getting built is also skewed. There were 59,175 affordable housing completions in England in 2021/22, the highest for 11 years. However, more than 20,000 of those were for affordable home ownership and 28,000 for affordable rent, leaving just 7,528 for social rent (plus another 3,080 for similar London Affordable Rent).

Contrast that with Scotland, which managed 9,757 affordable completions in 2021/22 including almost as many social rent homes (7,306) despite having a population about a tenth of England’s.

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Budget leaves housing frozen out

Originally written as a column for Inside Housing.

In a Budget where everything had to begin with E there was little hope for housing.

Neither Rishi Sunak’s economic priorities nor Jeremy Hunt’s e-list (enterprise, employment, education and everywhere) left much room for an issue on which the Conservatives appear to have given up.

On energy, there was good news for tenants on pre-payment meters and for everyone with the extension of the price guarantee.

However, there was no more support for a policy that would do more than anything else to reduce dependence on unreliable overseas energy supplies and Vladimir Putin.

Investment in the decarbonisation  of existing homes would cut energy demand at the same time as it cut carbon emissions and bills for tenants and home owners and delivered on the government’s new priority of energy security.

Energy efficiency even begins with the right letters but that either counts as a double negative or was quietly forgotten.

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Making (some) things right

Originally written as a column for Inside Housing.

‘Making things right’ is the government’s theme of the month for housing and two new pieces of legislation represent significant steps in that direction.

Unfortunately they also beg some real questions about what’s happening, and not happening, elsewhere.

The Social Housing (Regulation) Bill passed its final hurdle before Royal Assent with its third reading in the Commons on March 1. The proactive consumer regulation regime and inspections that were dropped in 2010 will now be restored.

While its long-term impact remains to be seen, the Bill was considerably strengthened by last-minute government amendments to implement ‘Awaab’s Law’ time limits for landlords to investigate and fix damp and mould problems and to mandate professional standards for social housing staff.   

On March 3, the Supported Housing (Regulatory Oversight) Bill got its third reading in the Commons before moving on to the Lords.

The private member’s bill introduced by Conservative MP Bob Blackman (also the architect of the Homelessness Reduction Act in 2017) aims to stop the exploitation of vulnerable tenants by rogue landlords in the exempt accommodation sector.

The two Bills, and the spirt of cooperation in the debates on them, highlight a significant change in attitudes within government since Grenfell.

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Downturn is a chance for a reset – but will the politicians take it?

Originally written as a column for Inside Housing.

Housing market downturns are often dominated by debates about their consequences – whether they be falling house prices and negative equity, arrears and repossessions or builders going bust – and what to do about them.

But an important new report from the Joseph Rowntree Foundation argues that we should be thinking less about house prices and the immediate response to the downturn and more about the housing system as a whole and the long-term opportunities for a reboot.

We are already in a downturn even if the shape of it remains unclear. Toby Lloyd, Rose Grayston and Neal Hudson consider different scenarios ranging from back to normal (rising prices) to an outright crash but think market stagnation is the most likely outcome.

That may sound mild when seen in terms of house prices alone but the consequences would be dire: home ownership would remain inaccessible, driving up private rents and making it even more of a struggle for low-income households to keep a roof over their heads.

Arguably we are already seeing stagnation in housebuildling as the big developers slow down development and the industry as a whole warns that completions could fall to less than half their pre-pandemic peak while blaming government regulations.

The conventional response would be to support supply and boost demand but that would be very much like a rehash of what happened after 2010, when various forms of Help to Buy did increase housebuilding but also produced a boom in housebuilders’ profits, share prices and bonsues without much quid pro quo.

For all the efforts to boost the home ownership chances of first-time buyers, the private rented sector continued to grow. And millions of people in housing need were the losers as austerity put the squeeze on social rent and forced housing associations into affordable rent and market sales.

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