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Affordable housing for all?

London's booming housing market has exacerbated the decline of affordable housing London's booming housing market has exacerbated the decline of affordable housing © Shutterstock

Before I arrived at CPRE as an intern, the little I knew about the nationwide housing crisis was limited to the rise in house prices in my hometown of London. However, after being asked to write this blog to coincide with the UN’s Urban October, whose theme this year is affordable housing, my perspective has changed greatly.

Every year, Urban October starts with World Habitat Day, which aims to “promote sustainable development policies that ensure adequate shelter for all”. It’s a welcome opportunity to think about the 1 billion people around the world still living in slums with little access to safe drinking water and sanitation. But in launching the day, the UN’s Dr Joan Clos raised an issue that also resonates closer to home, arguing that “handing over housing to the market has proved a failure in providing affordable and adequate housing for all”.

The most infamous symptom of the UK’s own housing ‘crisis’ is in London, where half of the new homes purchased by overseas investors could be within reach of first-time buyers. In several new developments, foreign buyers have bought every single apartment, such as the South Gardens development in Elephant and Castle. Housing developers make a lot more profit from luxury homes than from affordable homes (those worth 80% of average local market value), and so have a strong incentive to reduce the percentage of affordable homes in the development.

Most local authority housing policies specify that 30% of homes in a development should be affordable, but as councils need to meet house building targets developers can simply refuse to start construction until the council reduces the number of affordable homes included in the deal. CPRE’s research in rural areas has shown how developers typically end up delivering half the affordable homes they promised to win planning permission. With just 8% of rural housing currently affordable, CPRE is calling on the Government to “stop highly profitable developers gaming the system and give councils the hard cash to start building houses again.”

The social housing shortage

Exacerbating the problem, the decision to end public funding for social rented housing has seen building rates fall to under 1,000 in 2016/17 from around 31,000 in 2009/10. This was initially to save money in a time of austerity, but has been offset by a significant increase in the cost of housing benefit since 2010. And, as the National Housing Federation has pointed out, it is 23% more expensive to house someone in the private rented sector than social housing, and that extra money won’t be reinvested it in new accommodation (as it would be by housing associations). In the long term, it would seem a lot more sustainable and cost-effective for the government to spend public money on building the social homes that could benefit thousands of people, rather than housing benefits that subsidise a few private landlords.

All these failings have resulted in 250,000 people living in temporary accommodation, one third of whom are families and another 12% ex-servicemen. The root cause of homelessness is not the stereotype of laziness or drug-addiction, but landlords ending tenancies so that they can raise the rent. In a recent report, Waltham Forest Council stated that most of their homeless families do not require social support, but are in low-paid work and cannot afford their rents. If they could move into cheaper accommodation they would not be homeless, but there is simply not enough affordable housing to go around.

Since starting the research for this blog I have become more aware of the problems facing local people in both London and around the country. However valid the economic or political reasons behind the Coalition Government’s 2010 decision to cut the number of social houses being built, the number of people who need this housing is not going to fall. It is clear that in the long term, money needs to be found to build new homes for the most vulnerable of people, and to improve the quality of existing homes. This could improve people’s quality of life and make the best use of public money, allowing the UK to lead by example in providing “affordable and adequate housing for all”.

 

Find out more

Urban October and World Habitat Day

CPRE research on rural affordable housing from June and September

More blogs

3 October 2017

It would seem a lot more sustainable for the government to spend public money on building the social homes that could benefit thousands




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