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Sell expensive council properties but use proceeds to boost affordable home ownership - not just social rent

JohnsonCllr Andrew Johnson, Cabinet Member for Housing, London Borough of Hammersmith and Fulham says it’s right to sell empty expensive social properties, but what the proceeds should be spent on should vary according to local need

Along with many others involved in housing within local government I read the recent Policy Exchange report entitled Ending Expensive Tenancies with great interest. Whilst I wholeheartedly support the notion that some social properties, which are deemed to be expensive, should be sold when they become void, perhaps the bigger question is what to do with the receipts generated.

Policy Exchange proposes using them to create the biggest social house building programme since the 1970s. Yet is that the right approach? Well yes and no. Certainly within some parts of the country we do need more social housing, however, we also need more housing in general in a range of tenures. It really depends upon what your baseline starting point actually is. The average across England, based upon figures provided by Policy Exchange is 17.6%, whilst in Hammersmith & Fulham it’s nearly 33%.

So if you’re starting from a high base do you really need to build nothing but social housing when the real demand is for housing in the middle? The answer is no you don’t, you need to consider how you use what you already have more effectively, whilst at the same time providing a greater range of options for those who wish to progress into other forms of rented accommodation or home ownership.

However, before we can do this we need to have a sensible debate about who should be eligible for social housing. Of course, there is a need to provide for the vulnerable and those who would be genuinely unable to consider alternative housing options. But we also need to give a far greater priority to working families on modest incomes, or those who make a contribution to their local community or have served in the armed forces. Yet we can only do this by actually understanding what the real level of demand actually is.

There were some 1.83 million people on the waiting list for social housing in England in 2011, with over 300,000 in London. But is that an accurate reflection of the true level of ‘demand’? Controversially I would say not. In Hammersmith & Fulham we have over 10,000 on our register, yet anyone can currently apply irrespective of whether they would qualify for social housing or not. Like many councils we are currently reviewing our allocations policy, as over 50% of our present register have no identified housing need, or would ever receive a social home. Yet, these statistics are what is used to assess the demand to build more social homes. Until we have this debate about what we believe is the actual baseline figure of demand it will be very difficult, if not impossible, to establish just how many more social homes an area needs. However, one thing is clear, that if they do not qualify for social housing then alternative housing options need to be considered. Be that intermediate rent, local cost home ownership or private rent.

What are we in Hammersmith and Fulham looking for? Effectively we’re calling for local authorities to be given the freedom to be able to retain 100% of the receipts raised from disposals, or indeed Right to Buy sales, to spend on what they see as their local housing priorities. For some that may be more social housing, but for others it could be to provide more intermediate housing for rent or sale to create a ladder of housing opportunity for social tenants or those looking to get onto the property ladder. It could even be to create a form of a deposit fund to enable tenants to gain access to the property ladder through a form of Discount Market Sale property, thereby freeing up their former council house to be re-let to another applicant from a slimmed down housing register.

So in essence, yes we need to consider selling expensive social housing voids and yes for some areas the money should be used to provide more social homes, but local authorities need to use the receipts for other affordable housing purposes too. Be that for expanding low cost home ownership properties like we are starting to do in H&F, or simply to enable more tenants to progress to other housing options, thereby enabling more effective use of existing stock. Of course, for some social housing is the only realistic option they have, however, for many there are other options if only we put in place the ladders of opportunity to enable them to move into other forms of rented accomodation or even own their own homes.

In many parts of the country we need more homes, of a variety of tenures. But what we really need is the freedom to be able to determine how we use our housing assets effectively to help provide what is needed in our local area. In Hammersmith and Fulham it’s intermediate housing we need more of, not simply more social rent.


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