Housing Crisis

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Councils are not building enough social housing

Why? Because the amount they can borrow to build social housing is restricted by government. And because the treasury takes a large portion from Right To Buy sales. Councils can access low-interest loans through a government body, the Public Works Loan Board (PWLB).
They can then invest in commercial property in the hope of a bigger return compared with the interest on their loans. Since 2011, no government money has been made available to build homes in England for low paid people to rent.

Also, the housing minister has no legal or decision making power, there is no dedicated housing ministry.

Adding to the problem

The Localism Act 2011, The Bedroom Tax, the crack down on squatting, the benefits cap, planning laws changed to assist developers.

The situation was made worse by the introduction of Univeral Credit, that left thousands of claimants without money for rent and facing eviction.

 

An unaffordable housing market is guaranteed

Due to “viability assessments”, which allow developers to limit contributions to infrastructure and affordable housing. The current definition for affordable rented housing is defined as 80% of the market rent, while social rent is defined as 60% of the market rent. But a new definition of affordable housing is to be introduced that does not include social housing.

Private sector rents rise due to a lack of affordable social housing.

Tory policy on affordable housing reduces to putting developer' profitability before long-term community development.

The Return of Rachman

The private sector has responded to the freeze on benefits for single people by converting properties into houses of multiple occupation (HMOs). This is a worrying development bringing back memories of the Rachmanism of the 1960s and 70s.

 

Eco-Towns 2017 - only one is started

10 Eco-Towns were proposed in 2008, in 2012 only four got the green light.

The reason the scheme has foundered is several fold. Grant Shapps slashed public funding for the scheme by a half. Most the money for this scheme was coming from the private sector and when they don't want to know, it's a sure sign the opportunities to make a fast buck are largely absent. Absent because the building spec' for these eco sites was rigorous, far more rigorous than Bob the builder et al was used to bodging to - these builds were supposed to be carbon zero dwellings. Add to the mix, lobby groups such as the Campaign to Protect Rural England protesting against the schemes, and perhaps, more importantly the government reneged on its promise to ease up planning regulations for the scheme.

 

 

 

 

 

 

 

Stop Press

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Mr May has pledged to solve the housing crisis - personally?

 The prime minister insists that dealing with the housing shortage is a matter of personal urgency for her; a “burning injustice” to be tackled.

 

Headline Grabbing Housing Announcements

 

2015
Garden City For Ebbsfleet announced by George Osborne?

No one told George that a few houses with gardens does not a Garden City make!

2017
New Garden Towns and Villages announced

The required infrastructure and transport links were not gauranteed.

 

Homes and Communities Agency Hides behind new name

The HCR’s remit was to promote social house building/affordable homes, they seem to be struggling with that. The HCR was set up in 1998, today in 2018 50% fewer affordable homes are being built. Also, mysteriously, the HCR changed its name after the Grenfell fire, to Homes England and was selling itself as: “A new national housing agency to boost housebuilding”.

Policy Failure

One new housing minister every year since 2010

The 'housing minister merry-go-round' contributes to the failure of a housing policy.

Grant Shapps, 13 May 2010 – 4 September 2012
Mark Prisk, 4 September 2012 – 7 October 2013
Kris Hopkins, 7 October 2013 – 15 July 2014
Brandon Lewis, 15 July 2014 – 16 July 2016
Gavin Barwell, 17 July 2016 – 9 June 2017
Alok Sharma, 14 June 2017 – 9 January 2018 
Dominic Raab, 9 January 2018 – 9 July 2018

Current Minister for Housing, Kit Malthouse, July 2018

Note: 
Mr Malthouse is the 17th holder of the position in 20 years.

 

 

Siren Voices

 

Voices calling for a massive social house building programme are overlooking the behaviour of local authorities, who don't want more social housing.

You don't have to go to Kensington and Chelsea for evidence, try Cornwall, where many influential voices are against social housing because they fear that the tone will be lowered by 'problem' families arriving from Kensington and Chelsea. In Cornwall house prices are high, wages are low and they prefer to keep their local housing problems hidden.

 

 

 

UP

The Housing Crisis 

Right to Buy introduced, October 1980 

Big discounts offered as an incentive, , very small deposits and 100% mortgages from councils on offer distorted house prices.

1999: few new houses being built. Discounts reduced.

 

2012
Right to Buy v2.0

Discounts increased substantially, house sales boosted

 

April 2012 to November 2015

40,603 homes were sold under right to buy. 
Work began on a mere 3,694 properties.  
A replacement rate of around one home for every 11 sold

Help To Buy 2013

This scheme is easy to understand, it involves people who can't afford to buy a house subsidising those who can.

 

Help to Buy Isa launches

From December 2015 the government was giving away free money to people saving to buy their first home.

 

 

Grant Shapps-Green-Fox said:

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that there would be one for one replacement for council house sales in 2011. The true figure was one for eight.


On 3 January 2014 the government announced plans to increase the maximum discount for council house sales to 70% of its value.

 

2015

Right to Buy extended to Housing Associations

Housing associations have turned into profit hungry property developers, engaging in social cleansing for the purpose of gentrification. There are not enough affordable homes, there are an estimated 300,000 homeless families and 30% of homeless rough sleepers are working.

 

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The Help to Buy equity loan scheme, which was due to come to an end in 2016, extended until 2020.

 

 

Solution

Councils should be allowed to borrow to build new homes and keep 100% of receipts.

The one for one replacement pledge should be stuck to.

Housing Association should be told to get back to the task providing affordable social housing and stop money grubbing.

The Minister for Housing must have a ministry and the power to make decisions.

“Viability Assessments” must be binned and the Wimpey boys must be told that they will stick to agreed social housing building on new developments.