Today’s Tories don’t know people want MORE social housing, not less

[Image: Cornwall Council (of all places!)]

[Image: Cornwall Council (of all places!)]

The Tories seem to be suffering from cognitive dissonance – an attempt to believe two opposing ideas at once.

Not only have they forced people to pay an unwarranted and crippling ‘bedroom tax’ for living in social housing with more bedrooms than they have decided – arbitrarily – are necessary (and let’s not forget that these were the only homes available for most tenants, due to the appalling shortage of social housing created by Margaret Thatcher’s ‘right to buy’ policy)…

Not only that, but they are planning to make the situation worse for social housing tenants in the future, by extending ‘right to buy’ into housing association properties!

Let’s make something perfectly clear: Housing association properties are not government assets. They belong to private companies whose commercial well-being depends on rental income.

Many housing associations – if not all – have been hit hard by the Bedroom Tax, which makes it more difficult for tenants to meet their rent-paying obligations.

This means that the proposed sale of housing association properties – at discounts of between £77,000 and £102,000 would cripple those organisations’ ability to replace the stock they would lose.

This is a policy designed to deny cheaply-rentable housing to people who need it in the future. It is also designed to boost the more expensive private rental market; according to Tax Research UK, half of all former council properties sold by right-to-buy tenants are now in that sector.

It would also lead to a rise in house prices, as people taking advantage of the offer move to sell their homes on, at a profit. This will make housing less accessible to the poor, and the buildings more available to private landlords, who can then charge higher rents – possibly to the very people who just sold the properties.

Meanwhile, the Labour Party Manifesto, launched yesterday (Monday), includes a whole section on “Building new homes”.  On page 46, it refers to “getting the public sector building again. We will build more affordable homes by prioritising capital investment for housing and by reforming the council house financing system.”

Does this mean Labour will be encouraging the building of more council houses again?

That would be terrific.

Especially for the hundreds of thousands who have been pushed towards poverty by the Bedroom Tax.

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32 thoughts on “Today’s Tories don’t know people want MORE social housing, not less

  1. joanna may

    I resorted to the useless act of shouting at the tv, have the public forgotten all the disabled the coalition have culled? How can they be anywhere near labour, and national min wagers not paying tax is the most ridiculous idea ever!!! where will the tax to pay for stuff come from? it won’t be from his rich pals that’s for sure!!! And lastly what has happened to the money from selling off the council housing? and now they want to get rid of social housing!?!

    If this crappy lot get in I give up!!!!!

    1. Florence

      The IFS has said again that these changes to lower rate tax thresholds will always favour the better-off. You can be sure that part of the £12 billion to be clawed back from the poor will be in the form of failing to raise the benefit taper start & cut-off points so the net effect will be the actual households affected will not see a penny more, and will probably see a lot less, under UC in particular.

      (Even Landlords are now worrying about the overall benefit cap and the proposed UC changes whereby for earning above a certain amount in a month a family will automatically lose UC for six months. So much for better off in work! Yeah, I know, it was only ever a lie, but it’s amazing how many people STILL buy into it.)

  2. john keen

    Mike, Watch for the wording “affordable housing” it is far more likely to refer to more housing to SELL as opposed to more social housing to rent at affordable rates.

    it is quite laughable that in a time when people are struggling for money to survive that some “genius” -hoping to garner more votes- decides it would be a brilliant way to save these people from poverty by the opportunity to BUY a nice new house.

    Which part of the condition of poverty do you suppose they are failing to understand?.

    How does making more houses for purchase solve the problem of a lack of social housing required for those who CAN NOT afford to buy a house?.

    1. joanna may

      Not only that but if you do buy a house, as I understand it if you lost your job you won’t be able to get benefits, so you would have to sell the house and live of the proceeds until they disappear and you end up homeless!! What kind of hope is that!!

      1. boromoor

        Yes you’re right, at one time they’d pay the interest on the mortgage with housing benefit if you weren’t working, not now though. A Tory con trick, the fear of losing their homes will make workers more compliant and less likely to strike or make demands for better wages or conditions.

  3. bevchat

    These Tory proposals to extend the RTB scheme to HA tenants are just going to create an even wider gap in Social Housing availability..Also, depending on where you are in the country is how much each of those prospective properties up for grabs will cost both tenants and the HA…Will they be sold at todays Market price, or will they be given the same statutory discount that previous Council tenants were given on the RTB scheme? I can not see HA’s wanting to lose out on revenue if they sell their properties off at a discounted price…they stand to lose a lot…especially in areas such as London, the South, South East, South West and Middle England….Another consideration, what if those buyers lose their jobs? How are they to pay their mortgage? They may well find themselves not only out of work but Homeless to boot…so forced back into the rental market in the private sector if they are lucky!!! Or find themselves on a very long Social Housing waiting list….Its madness!!!!

  4. bevchat

    Just to say once you sign up to buy your home…unless you pay outright cash for it you do not own that property you are in effect still renting from the Bank/Building Society or Mortgage lender….A person does not OWN a property until the mortgage is paid off….Paying off a mortgage can take a lot of years depending on how long you signed up for borrowing that money for the property…..REMEMBER in this economic climate we are in there are no guarantees; nothing is safe anymore, jobs, homes, nothing…so you could well end up with NOTHING except a lot more DEBT and possibly homeless if you cant pay!!

    1. paulrutherford8

      No matter how much the property costs, if, as you say, the house isn’t paid for outright, the ex-tenant does exactly what the tories want. Its simply a way to get more profits for the wonderfully kind bankers who will be queueing up to lend the money.

      The amount of interest on a mortgage is more or less profit, so the only people who benefit will be, once again, the banks.

      Many tenants, including friends of mine, regretted buying their houses when Maggie first made them available. They were almost impossible to sell if, as many were, they were in the middle of large estates where [as where I lived], even angels feared to tread! People also forgot to think of the ongoing costs, including insurance, maintenance, etc., which added to what became a massive burden.

      People need to think very carefuly… and I would say don’t be taken in; avoid temptation and stay as a tenant!

  5. Jenny Hambidge

    How could the Tories sell off assets that don’t even belong to them? I just don’t get it. Please explain.

  6. Pete B

    I gather some Housing Associations are threatening to sue.They are not Council Houses owned by a local authority.They are none profit organisations I believe.

    Perhaps its just another Tory Lie.Say we want to sell Housing Association properties at a massive discount to Hard Working people,then after the election,back down and blame the Housing Associations for putting the spoke in.

    A piece here about Housing Associations threatening to sue the Tories.

    Housing associations threaten to sue over “right to buy”

    Source:

    http://eastdevonwatch.org/2015/04/14/housing-associations-threaten-to-sue-over-right-to-buy/

  7. Jim Round

    No mention of reforms of the rental sector (public and private) in any manifesto.
    People in rental accomodation want security, a fair rent, knowing that repairs will get done properly and when asked for, not having to put up with living with the thought of having Jeremy Kyle rejects living on the street and a house that doesn’t waste heat and energy.

    1. Mike Sivier Post author

      Labour plans to reform the rental sector (public and private). From the manifesto, page 46, Labour states it plans to get “the public sector building again. We will build more affordable homes by prioritising capital investment for housing and by reforming the council house financing system.”
      I hope this means new council houses.
      “For the 11 million people who rent privately, we will legislate to make three-year tenancies the norm, with a ceiling on excessive rent rises. A ban on unfair letting agent fees will save renters over £600. We will drive standards up by creating a national register of private landlords.”

      1. Jim Round

        Problem is, what is “affordable”?
        Homes built recently in London were supposed to be affordable, if you earned upwards of £100k a year.
        Landlord registers are meaningless, if one was kicked off the register, what would stop them registering under their wife/husbands/dogs name.
        Yes, anyone who has tried to get a repair done with less than savoury Landlords has court as an option, or withholding rent, only to be turfed out soon after for a dubious reason.
        I do agree about the fees, they need to be scrapped, might clear out some of the letting agents who are only in the game to make a quick profit from them.

      2. Mike Sivier Post author

        I think it depends how a register is run. If it is administered well, people’s identity would be checked and the authorities would be able to tell if someone was trying to register their own dog as a landlord.
        There was an attempt at legislation to make people safe from landlords carrying out revenge evictions, but because it was a private member’s bill, it was ‘talked out’ by Tory MPs Christopher Chope and Philip Davies. Labour may reintroduce it, if encouraged to do so – and if elected, of course.
        Your question about what is affordable is right on the point.

  8. Joan Edington

    Before I retired I worked for a Housing Association that was the product of a Council sell-off. It was hard-going since, as the article says, most of the decent housing stock had already been sold as RTB. When the HA was set up, as well as the stock being well over-valued by the Council (some money was clawed back years later after threats of legal action), a condition of the sale was that existing tenants should still have their RTB status. Not surprisingly, yet more stock disappeared.

    Like John Keen, I expect that phrase “affordable housing” to come up more and more. It is totally meaningless since even their prices are unimaginable sums to the people who are needing housing the most.

    1. Barry Davies

      New houses cost a lot to build and not surprisingly the builders want to make a profit, so how can they actually build what they call affordable housing, a one bedroom flat is highly unlikely to be of use to a family, or someone planning to have a family, so a three bed new build is going to be out of reach for the majority.

  9. Thomas

    There will be a lot more homeless people if we don’t evict the Tories from Number 10 Downing Street in this election. I may have my dislikes of some things that Labour does, but they are nowhere near as bad as Cameron is. Whilst I have not been directly bothered by this government yet, that will no doubt change if I get another five years of Conservative government.

  10. Alan Frost

    Tories unfunded manifesto promises leaves around a further £12 billion to find,on top of already planned £12 billion cuts. So expect the total cuts to fall even further on welfare , as if the cuts aren’t severe enough already – We should be very scared if not already. Also what sort of lower quality social housing can be expected if all the better homes are to be sold as you move out and replaced with cheaper alternatives. Most of the better homes will be bought up by the rich private sector landords, probably on the cheap. With the same stroke they have probably secured the best part of a further milllion votes of the back of selling out those who would like a decent social house they can afford.

  11. Rupert Mitchell (@rupert_rrl)

    Oh they know Mike!

    They just don’t care about what the people want as long as they and their rich friends can continue to profit.

    Time to get rid of this government/dictatorship for a proper decent management under Labour.

  12. Sasson Hann

    I think my not-for-profit housing association got it just right.

    What has made it a success is that when they took over the council stock in the early 2000s, they started a building programme; a mixture of both private and social housing. This continues today and the new homes are really attractive not just your ‘bog standard’ estates that were built during the 60s. They did this for around 10 years and then reinstated the RTB.

    The main drawback with RTB was that new homes were not built to replace those sold off. If housing associations were forced to adhere to what my housing association has done, I don’t see the problem. It’s still providing homes to rent at a reasonable rate, whilst also offering homes for sale if peoples’ circumstances improve or for existing tenants who are working (and who would never have a chance to own a house at today’s prices).

  13. lallygag26

    I agree with all your arguments about what people want – more council and social rent housing and generally more affordable housing even for middle income individuals and families.

    You do like to be accurate, though, and so I think your description of housing associations needs updating. Very few housing associations meet your description of ‘depending on their rental income’ unless they are co-ops, which will almost certainly be excluded from compulsory RTB. Most are very large businesses, with a sales and market rentals section which cross subsidises the social rents.

    Even Peabody and Guinness, with their roots in Victorian philanthropy, are now huge property developers building large prestigious flats for sale and buy to let. Two of the largest HAs are Sanctuary and Circle. Circle is part of a large corporate group which includes private health and social care in many guises and is backed by private equity. In other words they have strayed very, very far from their roots.

    I suspect that these companies will be quite happy to be obliged to reduce their social housing component. The property industry has been looking for ways to ‘harmonise’ the market, aiming for an ‘affordable’ rent strategy of 80% of market rents.

    If they are not happy, I’m sure they’ve got the lawyers necessary to stop it happening to them. And that will probably leave only the few remaining small scale genuine HAs vulnerable to this attack.

  14. HomerJS

    This is more than just a cynical ploy for votes. Once they have sold off as many HA houses as they can they will then use this as an opportunity to cripple housing associations. Once they become bankrupt their stock will be bought up by private landlords. Having bought at a low price the landlords will have some scope to keep rents relatively low. To avoid spending too much on housing benefit the Tories will have a cap and make tenants pay the difference from their Universal Credit.

  15. Gary

    It’s a case of ‘we’ll tell YOU what you think’. The idea around social housing have been floated for several years. The last I heard of it was on the BBC News about three or four years ago when apropros of nothing, one of their reporters was asking the public ‘should people expect to have social housing for life?’

    Before that there’d been a few whispers but I must admit, I found it shocking that even the Tories would try to end social housing as a concept.

    The policy announcement surrounding housing associations means they will experience the same trajectory as council housing since the 80s.

    This does not make the public better off, monetarily or in their lifestyle. It does not save money for local authorities or central government. If I am to be charitable I could say this is led by ideals. However, I fear it’s not even that. Deep down I know that what it means is that they are pursuing this policy to ensure that the housing stock ends up in the hands of their own supporters and donors who will privately rent these in a largely unregulated market.

    What must not be forgotten is why we had such a building boom of council property in the 1960s. There was a large privately rented sector. The properties were poor, there was no regulation and prices were high due to the shortages of homes to rent. To throw this sector to the dogs is to return to that time.

    I’m lucky, this won’t affect me. I’m an owner-occupier and my mortgage has finished. Even where I live in Scotland the right to buy has ended and new building programmes have begun. New programmes for insulation have been carried out on all properties and, at last, the tide is beginning to turn. Unfortunately, my daughter, who lives in Lancashire, doesn’t benefit from this. She’s moving house at the moment from one privately rented property to another. Despite the high quality there is little available and landlords and agents can saddle tenants with charges for keys, charges for any old thing. This HAS to end. Our children are being sent back to the dark ages.

  16. wildswimmerpete

    Gary, there was a boom of housebuilding in the 1950s to replace all the homes flattened throughout WWII, I remember seeing the new estates being built. Then came the slum clearances of the Sixties that saw the new tower blocks going up, although some were jerry-built (Ronan Point, 1968? – I watched the immediate aftermath of the collapse live on TV).
    “The properties were poor, there was no regulation and prices were high due to the shortages of homes to rent” Yes, Rachmanism. And it’s making a comeback.

    1. Mike Sivier Post author

      That’s one reason we need to get away from the Tories and push the focus of British politics back towards sanity.

      1. sibrydionmawr

        It’d be great if sanity were returned to the issue of social housing as a social good, as it used to be. Let’s not forget that council housing used to be available to all income groups, and was also sought after as something to aspire to. It’s now become ‘housing of last resort’ and become socially stigmatised, as well as fundamentally unaffordable in any real sense, as housing associations increasingly move towards charging an ‘affordable’ rent that is 80% of the local market rent.

        As a friend of mine (a housing officer with a housing association) informed me, affordability is something usually decided by people who don’t have to consider renting housing association properties, people such as barristers who can earn hourly rates in the hundreds of pounds, and who have no real concept of what is affordable to ordinary working people earning around the minimum wage.

        In the 90s even Shelter was of the opinion that social rents should be as high as 25% of income, whereas the Welsh Tenants Federation thought that no more than 15% should be the rate.

        We are of course, ignoring the elephant in the room when it comes to housing provision, and things aren’t really going to get any better until we get rid of that stupidity called capitalism.

        In many ways not a good example, but the former regime in the GDR (East Germany) did take the issue of housing very seriously, and perhaps somewhat paradoxically, were very near solving their housing problems by the time the whole edifice came crashing down. Rents were not only affordable, they were cheap. There was even choice built into the system, as those who wished to become owner occupiers (and thus free the state from housing them) would be granted land and materials that were otherwise hard to come by.

        It’s merely a matter of political will, and Labour’s very vague manifesto statement that they will be providing more ‘affordable’ housing is actually stating very little, and even you admit that you ‘hope’ that this means council housing. I’m sure that there will be token moves to give the impression that something is being done, and that a few council houses will be built, all for affordable rents that no minimum wage worker working full-time will be able to afford without housing benefit assistance, thus negating affordability.

        And of course. under Labour you’ll quite likely end up living under a bridge or in a tent pitched in some out of the way part of a public park if you are unemployed because social housing will be not only unaffordable, but increasingly have attached social and moral obligations.

      2. Mike Sivier Post author

        You were doing fine until the last paragraph.
        What evidence do you have that Labour won’t provide decent social housing, as it has in the past? None that I can see.
        Other than that, though, I thought you described the issue – for people in the UK – very well.

      3. sibrydionmawr

        That’s probably becuase I don’t have any evidence that they won’t provide decent social housing. But neither do I have evidence that they will provide adequate amounts of decent social housing at prices (to rent or buy) that people can genuinely afford, without recourse to benefits. Indeed, both Labour and the Tories produced decent (and also some downright awful) social housing in the past (pre-1980). SInce 1980 there has been insufficient social housing provided, decent or otherwise. I will counter that you don’t have evidence that Labour will provide decent social housing, in terms of standards and quantity – the manifesto merely mentions vague notions of affordable housing – whatever that is.

        To be sure, homelessness has increased under the Tories since 2100, but it was increasing under the last Labour administration too, at worrying levels, and only sticking plaster remedies were in place to deal with the fundamental problems of housing. We really only have the experience of the 13 years of Labour government between 1997 and 2010, and in terms of housing policy, the words ‘could have done much better’ seem a bit of an understatement.

  17. Darragh McCurragh

    While affordable housing is a nice idea, I have found that in many (continental) European countries housing is actually often more expensive due to all kinds of regulations. And to boot, social housing is even often more expensive than the free market apartments. I knew a woman with six children who due to a divorce found herself on social welfare. They found her a “social” apartment that came with a pooled garage. At the same time she got a written statement that she was not allowed to own a car on her social welfare payment (or else that would prove the payments were too “lush” and therefore needed to be curtailed. On the other hand they told her she needed to sublet the car space for the same reason. At the same time sub letting that space was against her lease contract – all more or less from the same city authorities. Oh my. I then found her more affordable non-“social” housing. Ever since I say: people want AFFORDABLE housing (or higher wages to make pricier housing affordable). Either way, I never found any politician who could think through all the implications without getting a brain hemorrhage …

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