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16th Feb 2017 February Blog: Only in exceptional circumstances

It is our view that one of the root causes of what the red tops refer to as the ‘housing crisis’ is previous governments’ policy of selling off council housing. Of course what the media mean by housing crisis is in fact an acute shortfall in affordable housing, particular in prime areas and prime London is generally the focus of this debate.

The value of development land and the chance of obscene profits derived from the schemes are just too beguiling to the private sector that they naturally seek to maximise their returns by building as many high value (and unaffordable) units as they can. There is a plan in place, the London Plan, which seeks to compel them to include, within these developments, a certain percentage of affordable housing in order to promote, amongst other things, mixed and balanced communities. However, there is a get-out clause which states that in ‘exceptional cases’ the developer can make provision for affordable housing off-site or avoid it altogether as a cash-in-lieu contribution. These ‘exceptional circumstances’ seem to be extremely commonplace and to illustrate just how customary, a recent exposé by the BBC (Inside Out London) highlighted quite how usual this practice is.

There are many other contributing factors to this housing shortage, beyond mere population growth, and the space we have here is not enough to expand on what is by necessity an over-simplified view but the net result is that since 1980, when Margaret Thatcher took tea with the first council tenant to buy their home, Local authority-subsidised housing has evaporated and there has been no replacement to speak of.

But London is by no means alone, Graeme Brown, director of Shelter Scotland reiterated: ‘The haemorrhaging of affordable housing stock without building new stock was like filling the bath with the plug pulled out’. What he said Scotland was left with was a rump of poorer quality housing, in effect mini-ghettoes – and guess where the developers are choosing to swap out their affordable housing allocation to? It is to these very same poorer areas and so the divide between rich and poor communities is increased rather than balanced out which contradicts the original intention.

Now the government have had another housing brain wave; (and some may say ‘at last’) they appear to have diluted their obsession with home ownership and are changing tack to provide affordable rent measures. The current Housing Minister, Gavin Barwell, this month has unveiled, in a generally underwhelming White Paper, a new strategy that promises . . . wait for it, more investment in building homes for affordable rent with councils encouraged to get more involved. Hallelujah. The penny drops. There are some caveats of course and the definition of affordable seems to have swung from 70% of market rent to 80%, but it’s a start. He’s also proposing to increase the length of tenancy agreements and whether this will affect the private landlords we don’t know just yet. What will certainly be relevant is the proposed increased regulation of the private rented sector, the reduction of tenants’ fees (which no doubt the landlord will have to take on board) and all this on top of all the other government impositions – checking residency, money laundering, additional taxation etc. It’s not surprising that the private landlord is feeling somewhat persecuted.

It’s interesting that Mr Barwell also states the government would not make any changes to the current rules on the green belt, which allow building only in ‘exceptional circumstances’. We know what that means.

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