10 things about 2018 – part two

Originally posted on December 28 as a column for Inside Housing. 

The second part of my look back at the year runs from land to Brexit via renting and council housing. Part one is here.

6. The land question

If 2018 was the year of the tenant, then another issue was not far behind as the land question took on an importance arguably not seen since before the First World War.

A developing political consensus around the potential of land value capture as a funding mechanism for infrastructure and affordable housing found expression in a favourable report from the all-party Housing, Communities and Local Government Committee and an open letter signed by former Downing Street insiders and think tanks and organisations across the political spectrum. One report put the net profit made by landowners just for getting planning permission for housing at a cool £13 bn a year.

At the same time the chancellor appointed former Cabinet minister Sir Oliver Letwin to lead out an independent review of the slow pace at which homes get built. Letwin quickly focussed on slow-build out rates on large sites but concluded that the reason why they take an average of more than 15 years to complete has less to do with landbanking (hoarding land with planning permission) than the absorption rate (the fact that developers only build as fast as they can sell for a required profit in local markets).

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Who gets the most subsidy in housing?

Originally posted on November 21 on my blog for Inside Housing. 

A report out this week comes as close as we are probably going to get to answering one of the most vexed questions in housing: who gets the most subsidy?

Feather-bedded home owners sheltered from the tax paid on all other forms of investment? Social housing tenants who don’t know how lucky they are to get a tenancy for life at a subsidised rent? Fat-cat landlords lining their pockets with housing benefit? Housebuiders trousering huge Help to Buy-financed bonuses? The answer has changed over time.

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The legacy of the 1988 Housing Act 30 years on

This week marks the 30th anniversary of Royal Assent for the Act that set the framework for the housing system as we have known it ever since – but as its influence wanes is it going into reverse?

The 1988 Housing Act led to lasting change in social and private rented housing. Not everything happened at once – some provisions were amended in later legislation and some took time to have an effect – but this was what set the basic ground rules for what followed.

In the social rented sector, it meant private finance, higher rents, stock transfer and housing associations replacing local authorities as the main providers. In the private rented sector, it meant the end of security of tenure and regulated rents and the arrival of assured shortholds and Section 21.

But it also created a system that was full of contradictions that are now only too clear. The stage was set for the revival of rentier landlordism but also the eventual decline of home ownership, the fall of municipal empires but the rise of mega housing associations and a belief that housing benefit could ‘take the strain’ of higher rents that always seemed unlikely and drained away with austerity.

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Private renting ten years on

Originally posted on September 10 on my blog for Inside Housing. 

So what is the state of the private rented sector – and what can be done about it?

Ten years on from their official review for the government, Julie Rugg and David Rhodes of the University of York are back with an update for the Nationwide Foundation.

Despite finding some progress – the average condition of rental property has improved, the average tenancy has got longer and Build to Rent investment is at long last producing results – the problems remain depressingly familiar and in many areas things have got worse.

The private rented sector is now 40% bigger but that growth is more down to the decline of home ownership and social renting than a wave of new construction or an expansion of choice. Perhaps half a million homes sold under the Right to Buy are now private rentals.

Thanks to Buy to Let, the sector is even more dominated by individual ‘investors’ looking to boost their wealth by getting tenants to pay the mortgage – mainstream commercial property companies account for just 3% of the stock.

The review estimates there are now 2.3m adults in England who are landlords – of those, 9% are themselves also private tenants and (surely some mistake?) 1% are social tenants.

And the bottom end of private renting – the only option for tens of thousands of tenants on benefit – is under such pressure from welfare reform that it is becoming ‘a residual slum tenure’.

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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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The politics of longer private tenancies

Originally published on June 2 on my blog for Inside Housing.

When it comes to the private rented sector are we all Chavistas now?

Back in 2014, when Ed Miliband’s Labour proposed a standard three-year tenancy with limits on rent increases, Conservative party chair Grant Shapps was quick to accuse it of ‘Venezuelan-style socialism’.

Flash forward four years and the Conservatives have stolen Labour’s policy at the last two elections and announced plans of their own for three-year tenancies – and if they are not quite proposing limits on rent increases they are not ruling them out either.

Even two years ago it would have been unimaginable for them to propose anything like the proposals announced by housing secretary James Brokenshire on Monday and first reported in the Conservative-supporting Telegraph on Saturday night.

Indeed, far from increasing security for private renters, Conservative-led governments had spent the years since 2010 attempting to undermine it for social tenants.

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From housing ladder to housing treadmill

Originally posted on April 30 on my blog for Inside Housing.

Once upon a time the image of a ladder was a fair representation of the housing system. Not anymore.

The old days in which the home-owning majority saved for a deposit and got a mortgage, a significant majority put their names down for a council house and got one and the rest used the private rented sector as a temporary transition are long gone.

And a report out today from the Joseph Rowntree Foundation (JRF) suggests a new image has replaced the ladder for people on low incomes struggling with high housing costs and insecure jobs and tenancies: a housing treadmill, where people ‘were running to stay and were worried about falling off completely’.

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