You are viewing 1 of your 1 free articles
John Perry is a policy advisor at the Chartered Institute of Housing
Social rented housing is disappearing at a time we need it most
It is time for the government to make good on its promise to build more social rented homes, says John Perry
Something has to be done to stop the loss of social rented homes.
Building of new homes for letting at social rents has fallen to a trickle – just 5,380 in the last financial year. In the past five years just 50,290 have been built and most of these were financed by social landlords without grant aid.
Theresa May has promised to revive social renting “in those parts of the country where the need is greatest”, but will this be enough to reverse these losses?
The Chartered Institute of Housing has just updated its annual calculation of the loss of social rented homes since 2012, when the new policies of providing only homes at affordable rents began to kick in.
“Why is this happening? For housing associations the biggest factor is conversions.”
Over the five years, despite the modest levels of new build just mentioned, the social rented stock has fallen by 151,000, or 4%.
Why is this happening? For housing associations, which have 47,000 fewer properties let at social rent, by far the biggest factor is conversions.
This happens when properties are re-let at a higher, affordable rent when a tenancy change takes place. Some 102,000 lettings have been converted so far.
In fact, conversions have supplied more homes for letting at affordable rent by housing associations over the past five years than new build.
READ MORE
The second most important factor is the ‘Preserved Right to Buy’ – the right that a former council tenant who is transferred carries with them. This typically results in about 4,000 sales per year.
New building for social rent continues, but it’s now down to only a few thousand homes per year and can no longer make good the losses in the rest of the stock.
Not surprisingly, local authorities have lost the most social rented homes over the five years – about 104,000.
The biggest factor here is Right to Buy, which has produced about 57,000 sales. Demolitions have resulted in about 15,000 homes being lost. Stock transfer to associations, now virtually halted, probably accounts for about 30,000 more.
Local authority new build for social rent is nowhere near enough to make good these losses: in five years, they have provided an extra 5,330 homes.
“Looking ahead a further three years to 2020, we believe the net loss could amount to another 80,000 units if current policies continue.”
Less than 1,000 of these received grant aid. And as everyone knows, replacement of Right to Buy properties is insufficient, but in any case doesn’t help as most replacement units are themselves at affordable rents.
Will these losses continue? Looking ahead a further three years to 2020, we believe the net loss could amount to another 80,000 units if current policies continue.
This projection assumes more losses at a similar rate through Right to Buy and demolitions, fewer conversions, but some new losses too from the ‘Voluntary Right to Buy’ and from high-value sales of council stock.
So, what can be done to stop the disappearance of social rented homes?
If Right to Buy isn’t ended, then at the very least all the receipts should be recycled and invested in new homes at similar rents to those lost. Then government should confirm that it doesn’t plan to go ahead with high-value sales, and if Voluntary Right to Buy goes ahead there should be similar replacements.
But of course the real answer is building a lot more homes for letting at social rents. Since the prime minister made her promise in October, there has still been no news on how it will be implemented.
We need a programme from the newly rebranded Homes England which shows how it will grant-aid social rented homes on a sufficient scale to stop the loss of these crucial homes at a time when we desperately need more of them.
John Perry, senior policy advisor, Chartered Institute of Housing
