Rents fall in areas of good housing supply

The housing crisis can be addressed if two key principles are addressed: supply and affordability. It is obvious, I know.

In the past I have, wrongly, called for an approach that based on ‘build, build, build’. No longer.  With the shortage of land in places like Brighton and Hove, it is what is built, and it must be affordable.

The phrase ‘affordable’ has been corrupted by government, which uses the phrase in the context of rented accommodation as 80% of the market. That means in this city rents of £784.80 a month for a one bed flat are regarded as ‘affordable’.  A flat costing £784.80 is more affordable than one where the rent is at the average charged (£971 per month).

Most developers are, understandable, attracted by securing the maximum return on their investment. They are risking huge sums of money, and they want a return on their investment consummate with that risk.

But that does nothing to help the housing crisis. Homes for sale in the city have long been beyond the means of many local people.  I was on BBC Radio 5 Live recently discussing the housing situation in Brighton.  On the programme was a self-employed plumber who has been struggling for years to buy his own place.  I think he said he is in his early 40s, works hard and determined.

In parts of Battersea in south London (SE11, SW11, and SW8) the number of properties available to rent has increased by 28.1% since the beginning of the year. This has led to a 6% decrease in rents being charged over the same period.

Now most of these properties are buy-to-let investments, and will beyond the means of ordinary people. But the lesson is important. If we can develop homes for rent with a mix of social and ‘affordable’ rents, then the market will begin to readjust, and the hopelessness experienced by many renters will be eased.

Is it right and is it possible to ban tenants from smoking in social housing accommodation?

I hate smoking. Always have.  Back in the late 1980s I was regarded as being completely unreasonable if I asked that just one colleague smoked at a time in a staff meeting held in a small room.  It was about individual freedom of choice, I was told, although no consideration was given to my freedom to choose not to work in a smoke-filled environment.

How things have changed.

However, the proposal from Professor John Middleton from the Faculty of Public Health, who has said that tenants moving into social housing should have a no smoking clause in their tenancy agreement. His intentions are very worthy – to protect children from second-hand smoke.

There will, inevitably, be the freedom of choice argument against Prof. Middleton’s proposal. There is also the legality.  Without primary legislation, I cannot see how such a clause in a tenancy agreement can be enforced.  Smoking might be disgusting, it might be anti-social, it might har, the smoker and those around them, it might be inconsiderate.  But it is not illegal to smoke …. Unfortunately.  Policing what a tenant does, beyond the legal terms of the tenancy agreement and the law, is not the role of landlords.

But good on Prof, Middleton for raising the debate.

Will we have the fifteenth housing minister since 1997 by the end of June?

In July last year I wrote that we now have our fourteenth housing minister since 1997 and concluded that none had got the job done.  I was hoping that Gavin Barwell would be different and I have to say he did make some progress, albeit small.

With the calling of a general election for June, the chances of a fifteenth housing minister is increased.  Mr Barwell is defending a majority of 165 votes and the seat is 47th on Labour’s target list.

Far be for me to make a prediction regarding the overall election results, or the result in his Croydon Central constituency, but whatever the result, Mr. Barwell is unlikely to be the housing minister in seven weeks time. He will either lose his seat, be moved to another job if his party forms the next government, or he will be in opposition.

Discuss.

Actually please don’t!

All I will say is that housing is the issue that impacts more profoundly on the lives of so many people and I hope it takes centre stage in the election. Unless the housing crisis is tackled soon, it will remain with us for generations, long after the changes in our trading arrangements with Europe have been forgotten!

You might wish to discuss that!

What I want to see in the parties’ manifestos

The political parties are yet to publish their manifestos for the June general election. I have three simple requests to all parties for policies to be included in those manifestos:

  1. Make a commitment to building council houses, in massive numbers, as an investment for current and future generations. Abolish the Right to Buy so that these homes remain in public ownership in order that they continue, in perpetuity, to meet housing need, and not investment opportunities.
  2. Make an unequivocal commitment to end rough sleeping by the end of the 2017-2022 parliament. In a country as wealthy as the United Kingdom, it is an outrage that people are living on the streets, and their presence should shame those in a position to end rough sleeping.
  3. Put an end to benefit cuts. More than half of all voters think that benefit cuts have gone too far, according to an Ipsos Mori poll published on Thursday. Denying 18 to 21 year olds the right to claim benefit support to help towards their rents will drive young people into homelessness, into crime, and into sex work. What politician wants that as part of their legacy?

Private rented housing is “out of reach” for under 35s, says the Chartered Institute of Housing

The Chartered Institute of Housing (CIH) recently carried out research into the gap between rents in the private rented sector and what Local Housing Allowance (LHA) will pay.

LHA is based on the 30th centile of the range rents charged in the private rented sector. Except it isn’t. That was how it was supposed to be (having previously been reduced from there 50th centile). In fact, the level of payment has been frozen for three years and will be frozen until 2019/20. LHA no longer reflects in any way the reality of rents in a locality.

In Brighton and Hove the rates are £82.66 for a room in a shared house, £153.02 for a one bed flat, £192.48 for a two bed property. The average one bed flat in Brighton and Hove is now £971 per month compared to LHA of £612.08 for the same period.

In Eastbourne the rates are £67.00, £116.53 and £151.50, and in Hastings £69.77, £92.06 and £120.29. (There are higher rates for 3 and 4 properties).

It is worse for you if you are under 35 where you are restricted to claiming LHA for just a room in a shared house.

And if you think it is bad for under 35s, it is EVEN worse for those under 21 for whom the rate is zero (unless you are ‘lucky’ enough to qualify for one of several exemptions – merely being a rough sleeper is not enough).

So what has the CIH found? It has found that the gap between LHA and rents has widened to the point where private rented housing is “out of reach” for under 35s.

A couple of weeks ago I wrote how the senior civil servant responsible for housing policy at the Department for Work and Pensions, Darrell Smith, said that the government is now going to use LHA rates to set new, lower rents for specialist supported housing. Why? Because it is such a good barometer for the market? No. He said: “The one advantage of (LHA rates) is that they are already there, so it doesn’t cost the government anything to set it up. I know”, he continued, “that isn’t a great answer but that’s all I have got”.

Overly strict enforcement of regulations can lead to homelessness

This is the text of a letter I had published in today’s Brighton Argus (14th April 2017) in response to, and in support of, a letter from Mike Stimpson from the Southern Landlords Association who warned that the uncritical enforcement of regulations would result in an increase in rough sleeping

When someone speaks who has as much housing experience as Mike Stimpson from the Southern Landlords Association, we would be wise to listen. Few individuals have such in-depth knowledge, and he is one of the few landlords who will still accommodate people on the lowest incomes.

In his letter of 13th April 2017 he warns that a consequence of the enforcement of regulations relating to houses in multiple occupation will lead to more people becoming street homeless. We should all sit up and listen.

Regardless of what one might think of housing being provided through private landlords, the reality is that almost four times as many homes are let in this way compared to those provided by the City Council and housing associations. With spiralling house prices, fewer local people will be able to buy in the years ahead. We must work with private landlords to make sure housing need in the city is being met.

At the same time, Cllr Tracey Hill is attempting to ensure that family homes for rent are not lost. She rightly wants to avoid whole areas becoming blighted by studentification with small family homes being turned into accommodation for six or seven students.

Her efforts in this regard are to be applauded and should be seen as a challenge to our two universities where not enough accommodation is provided to houses the ever-increasing student population in the city. Whether we can reverse what already has happened is unlikely.

If there is an issue of a lack of basic amenities, fire risks and overcrowding, then enforcement action should be taken. Enforcement is right in some cases, but not in cases where there is cooperation by the landlords and where standards are marginally below what we would ideally like.

This week I heard of enforcement action being against a property that has been let as four bedsits since the early 1960s. I don’t know the property myself, but the provision of such accommodation is essential for someone’s housing journey. I myself once rented a property which falls beneath current minimum space requirements, but small though it was, it was my home and I was happy there.

The simplest way to avoid council houses for families being lost and becoming houses in multiple occupation is by ending the Right to Buy, and not extending it even further to housing association homes. One in four, and some studies suggest one in three, former council homes are now in the private rented sector charging rents four times greater than the previous council rents. How many of these homes in Brighton and Hove, are now let to students?

Shared housing is all that is affordable for many, and the only form of accommodation for which those under 35 can claim housing benefit. I am a harsh critic of government housing policy, but while it remains as it is, we need to ensure that there is a balanced provision of homes.

We need to get this right, and the City Council could do worse that having a very early meeting with Mike Stimpson to find a way forward.

House Price Disaster Forecast

House prices will leap more than £50,000 higher by 2021 on average despite Brexit uncertainty, with the average UK house price in 2017 will be £220,000, marking a £9,000 increase compared with 2016, according to the Centre for Economics and Business Research (Cebr).

By 2021, the average home is set to be worth around £272,000, its report predicts – a £52,000 increase compared with 2017. No doubt house prices in Brighton and Hove will increase by more.

In some quarters this is seen as good news. I think it is a disaster. The housing market is completely out of control. The only ones who will be able to afford homes in Brighton and Hove will be the rich and the very rich.

As someone said to me last week, the market in Brighton is a national and an international one. Housing need is local.

Last Wednesday I spoke at the Chamber of Commerce Construction Voices event. At it I said: “With each new administration on the local council, there has been an element of ‘optimism bias’, believing that they will be the ones to turn things around. Yet many major projects have failed, since as early as the 1970s, to get off the ground. Unless we massively increase the supply of affordable homes, unless we have greater imagination and perhaps new partnerships, we will not meet the housing needs of local people, and Brighton and Hove could slip into becoming a dormitory town with the creative minds looking elsewhere to flourish and grown. How long will it be before Hastings takes over from Brighton?”