The fall guys – Part Two
Posted: July 28, 2015 Filed under: Housebuilding, Housing associations, Television | Tags: Channel 4 News Leave a commentOriginally posted on July 28 on Inside Edge 2, my blog for Inside Housing
So does it really cost housing associations £150,000 to build what housebuilders can deliver for £90,000?
The first part of this blog examined last week’s Channel 4 News reportclaiming that: ‘Government plans to build more affordable homes are being frustrated by the poor performance of housing associations.’ I concluded that it made some legitimate points, especially on executive pay, but otherwise did not stand up to serious scrutiny.
This second part of the blog is devoted to what I think was the most serious charge:
‘According to private housebuilders, the cost of delivering a house is £90,000 but when you ask housing associations they say they have to spend £150,000 to deliver a home. Now they’ll tell you that the homes are better but is it justified that they build only two-thirds of what private housebuilders do with the same amount of money.’
This is the key fact (or factoid) in the report. It would not be a complete surprise if private housebuilders could deliver homes a bit cheaper than housing associations. They build in bigger volumes. Building homes and trading in land is what they do and they are not distracted by other considerations such as managing homes for tenants. And, as the report pointed out, housing association homes may also be bigger or built to a higher standard. Against that, housebuilders carry more risk and so take higher profit margins than the contractors who build homes for associations.
The fall guys – Part One
Posted: July 28, 2015 Filed under: Housing associations, Television | Tags: Channel 4 News Leave a commentOriginally posted on July 28 on Inside Edge 2, my blog for Inside Housing
Here’s my attempt to separate fact from factoid in one of the most controversial TV news reports on housing in years.
I couldn’t watch last week’s Channel 4 News investigation of housing associations on the night but I think the issues it raised are important enough to come back to it in detail.
The clues that something was not quite right about this report were there even for people who know nothing about housing. The musical soundtrack (ironically a song about the campaign for justice by a wrongly convicted boxer) and the quirky graphics (houses appearing and disappearing) were there as distractions. The fact that in the studio discussion that followed the anti-association case had to be made by the so-called ‘Tax Payers’ Alliance (the self-appointed scrutineers of government spending who refuse to say where their own funding comes from) was further evidence.
The closing commentary confirmed this impression. We were told that:
‘There’s a fierce philosophical row between the Tories on the one hand and the Left on the other about the future of associations. One side wants radical change and the other is desperate to protect its ability to serve the community as it sees fit.’
Really? That may be how the Conservatives would like to present it but it demonstrates a complete lack of awareness of the political context for housing. As associations see fit? I’ll let the fact that this point was illustrated by film of a protestor from ‘the Left’ holding a banner from Defend Council Housing saying ‘No Privatisation Sell-Offs’ and ‘Invest in Council Housing Now’ speak for itself.
But what really shocked me from a programme that I admire and watch regularly was that this welter of unsourced statistics and rampant editorialising went out as the main story of the evening. The failure to understand housing and housebuilding was so complete it would be almost comical – except that this report plus trailers in The Spectator and The Times are part of a media and political narrative with deadly serious implications for the future.
Frustrated hopes
Posted: July 6, 2015 Filed under: Housing associations, Legal, Shared ownership Leave a commentFirst posted on Inside Edge 2, my blog for Inside Housing on July 6
What’s stopping shared ownership from fulfilling its potential as the fourth housing option?
Ever since it was launched, shared ownership has seemed to promise more than it delivers to people who can’t afford full ownership, want something better and more affordable than private renting and want something more or don’t qualify for social housing. Its part-rent, part-buy status and the fact that it requires less grant than social housing have ensured support from both Conservative and Labour governments and it’s become increasingly important to the finances of the providers that offer it. Yet somehow something is missing.
It’s a conundrum the government is trying to resolve through changes introduced in April and a review of longer term options out this summer. It would do well to take heed of a new report from Bristol, Kent and York universities and the Leverhulme Trust launched at an event at the House of Lords last week that I chaired.
From a wider policy perspective, shared ownership has huge potential. As Lord Best put it at the launch, we could create three to four times more home owners through shared ownership than through the Right to Buy.
Enemies of the state
Posted: July 5, 2015 Filed under: Home ownership, Housebuilding, Housing associations, Housing benefit, Right to buy | Tags: Conservatives, David Cameron, George Osborne Leave a commentOriginally posted on July 5 on Inside Edge 2, my blog for Inside Housing
Bring it on. We are determined take you on. Who do David Cameron and George Osborne have in mind?
If you haven’t seen it yet, you need to read their op-ed in Saturday’s Times on ‘Here’s how to build a homeowning Britain’. They mean England of course. You can read extracts on the Number 10 website but that only gives a flavour of the full article so I’ve posted it here.
Ahead of the Budget, they promise that ‘a shake-up of inheritance tax and crackdown on nimby councils will give young people a foothold on the property ladder’. It is not just an explicitly, distinctively Conservative vision for housing but also a declaration of war against anyone opposed to that vision. Here’s my take on the key points:
‘Having your own place is an important stake in our economy. It’s also one of the best expressions of the aspirational country we want to build, where hard work is rewarded.
‘It’s also about social justice. We don’t want this to be a country where if you’re rich you can buy a home, but if you’re less well off you can’t. We want it to be One Nation, where whoever you are, you can get on in life.’
‘Here’s how to build a home owning Britain’
Posted: July 5, 2015 Filed under: Affordable housing, Help to Buy, Home ownership, Housing associations, Housing benefit, Right to buy, Starter homes | Tags: David Cameron, George Osborne 1 CommentHere is the full text of the belligerent op-ed on housing by David Cameron and George Osborne in Saturday’s Times. My post on the implications is here.
Here’s how to build a home owning Britain
David Cameron and George Osborne
A shake-up of inheritance tax and crackdown on nimby councils will give young people a foothold on the property ladder
At a time of uncertainty abroad, here at home we will be delivering a budget next week with economic stability at its heart, offering security for working people.
Encouraging home ownership is central to that. Having your own place is an important stake in our economy. It’s also one of the best expressions of the aspirational country we want to build, where hard work is rewarded.
It’s also about social justice. We don’t want this to be a country where if you’re rich you can buy a home, but if you’re less well off you can’t. We want it to be One Nation, where whoever you are, you can get on in life.
Read the rest of this entry »
Peer review
Posted: June 3, 2015 Filed under: Housing associations, Local government, Right to buy | Tags: House of Lords, Lord Best, Lord Kerslake Leave a commentIf the opening salvoes are anything to go by, we are in for a long battle in the House of Lords over the right to buy.
The Conservatives do not have a majority in the Lords. By convention peers do not vote against legislation that was in the government’s manifesto but that still leaves plenty of room for amendments. It’s also hard to see how the government could claim financial privilege to reverse Lords amendments, as it did with the Welfare Reform Act.
Tuesday’s debate was only a short one on that bit of the Queen’s Speech but it was also a preview of the key themes that will be debated over the next few months and some of the key peers who will be making the arguments.
Homes for votes
Posted: April 14, 2015 Filed under: Housing associations, Local government, Right to buy | Tags: Conservatives 1 CommentSo does the ‘buccaneering’ Conservative plan to extend the right to buy to housing association tenants stack up?
I was on 5 Live earlier talking about the big idea in today’s Tory manifestoand as usual only got to say half of what I wanted to say. The package beforehand was interesting: tenants from a housing association estate in the Old Kent Road were enthusiastic; but people on an estate in Dartford where the homes were long ago sold off could see the consequences as housing benefit ends up going to private landlords.
I argued that it’s a great idea in theory: if you can help people buy their own home and have enough money to build replacements, why not do it? In practice though, we’ve never come close to achieving this. The government promised one for one replacement for council homes sold in 2012 but the rate so far is one new home started for every 11 sold.
Extending the right to buy to housing associations was meant to be part of the original right to buy in the 1980s but dropped because it was too expensive and because so many associations are charities who have to use their assets for charitable purposes. If Margaret Thatcher couldn’t make it work then, how will David Cameron make it work now? If it’s such a great idea in England, why is Scotland ending the right to buy in 2016 and Wales consulting on doing the same?
Jules Birch 