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Only a tiny number of expensive social homes are being sold

As I mentioned yesterday, part of the response to the Policy Exchange proposal that expensive social homes should be sold when they become vacant, has been to suggest that this is already happening when "appropriate". But I then gave the example of Conservative-run Cheshire West and Chester where despite the suggestion from the leader that a pragmatic approach is being taken, the reality is that no high value properties are being sold.

I am afraid that that is the overwhelming reality in terms of both local councils and housing associations. The Homes and Communities Agency has just published some figures regarding the housing associations - "Private Registered Providers." Among the information covered in the "Stock Movement" section is for the "number of units sold for non-social housing." Scroll down and you see a very large majority of noughts.

The London and Quadrant Housing Trust claims to be the largest housing assocation in London. So do the Peabody Trust. I won't attempt to arbitrate on that point. But both should surely feel a great responsibility to use their assets to provide as much extra housing as possible for the large numbers in the capital in overcrowded and temporary accommodation languishing on council waiting lists. Yet neither have sold a single high value property even though such an approach could make such a difference.

These associations are among the G15 Group of the 15 largest housing associations in London with 410,000 homes. Others in this group that have refused to sell a single property, regardless of the amount of extra houses they could build to replace it, are Affinity Sutton, AmicusHorizon, Catalyst Housing Group, Circle, East Thames Group and Network Housing Group.

Among the remainder the sales have been modest.  In the latest year, A2 Dominion sold 19, Family Mosaic sold 11, Genesis Housing Association sold four, the Hyde Housing Association sold 69 (although I'm not clear if these were in London). The Metropolitan Housing Trust sold three, the Southern Housing Group sold two and the Notting Hill Housing Association just one. Even for those few sales it is not clear that the reason was their high value.

Were all the G15 to apply the Policy Exchange criteria they would be selling around 4,300 of their most expensive properties a year as they become vacant. Even using rather cautious estimates the proceeds would allow them to replaced four times over - a net gain of around 13,000 homes a year.

Not that I suggest that there is only a housing shortage in London, or that this particular sample of housing associations are exceptional in their wanton refusal to adopt a policy that would so dramatically help to alleviate a shortage. Both in terms of their reliance on taxpayer funding and their charitable status their must be a requirement from the Government for a very clear change.

With local councils, the argument that they are accountable to their electorate for needlessly failing to reduce the housing waiting list is powerful. On the other hand the transparency agenda could be extended so that they have to declare and (attempt) to justify how many properties above the average property price for their district they choose to relet each year. There can also be no suggestion from any council doing this that it should require any central government housing funding.

In any event let's not pretend that everything is fine already. Have a look a Table 648. The latest figures are for 2010/11 and I certainly know that my council will have perked up since then. But among inner London boroughs, Southwark sold just 23 properties, apart from the right to buy, and that was topping the table. For the whole of London it was 370 non-right to buy sales. For England it was 2,730. Even that derisory total includes many properties that are not high value.

Indeed, look at the total capital receipts on sales of those properties in England last year. It came to £212 million - an average of just £78,000 a property. That implies that very few properties sold will have been on the basis of the Policy Exchange criteria.

Policy Exchange estimate that 339,000 local authority social homes are above the average house price - adjusted for number of bedrooms and region. On a 3.5% turnover that means nearly 12,000 a year should be sold. So local councils could be financing far more homes a year, around 40,000 to reduce the waiting lists for their residents.


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