Some years ago the government made arrangements that allowed council house tenants to acquire their properties at a price that was well below the cost of building them or their value. This ‘right to buy’ was a popular move and quite a few such tenants pulled together family council house tenancies to form family property companies. Some of these new property companies have perhaps behaved more vigorously than most ‘buy to let’ landlords and student accommodation seems to have been one of their most successful endeavours. I know some of these in London to this day. This was all easily financed and enabled the ex-council house tenants to relax and enjoy life.
One effect of this move by government was, obviously, to reduce the amount of affordable housing available to those who need it. Another effect was to make affordable housing a particularly unattractive investment choice for councils for fear of further efforts to confiscate their assets.
Government is now putting pressure on councils to make more affordable housing available. Councils simply don’t have the funds to do this. And, especially in the south of England, large scale council house developments are not likely to be appreciated by the rest of their voters.
Meanwhile, government has decided that private landlords of properties are vile creatures whose aspirations are an appalling blight on life in England. So government is now making sure private landlords can’t evict troublesome tenants, whether they pay any rent or not, and is raising all kinds of bureaucratic controls to increase their costs. The astonishing result of these policies is that fewer people are investing their capital in ‘buy to let’ properties. As property prices have risen in real terms, more and more people can’t afford to buy a house or a flat. So demand for rented properties has increased and so have the passing rents. Meantime, more landlords are seeking higher returns and lower risk by using short-term and holiday lets, especially in the more attractive bits of the south east of England.
One effect of these policies is that the courts are having their arms twisted not to let any tenants be evicted. The regulations are being used to make sure almost any eviction notice will end up in court and the lawyers are encouraged to have a lovely time picking holes in the procedures that have been followed by the owner. This is because an evicted tenant becomes a liability for the local authority and they haven’t anywhere to put them.
A child can see that all this is plain silly.
If the government had any sense, the affordable housing problem could be solved in five minutes. If a landlord were to be offered tenants by the local authority that might be suitable for his property then quite a lot of ordinary let properties could be made available as affordable housing. But the local authority would have to make sure that the housing benefit paid was actually in line with the rental value. And the housing benefit would have to be paid to the landlord, not to the tenant. And the local authority would have to undertake to have back any tenants who turned out to be disastrous. And the local authority would have to offer to hold a sum on behalf of the tenant and the landlord so it could be used as a deposit for the tenancy in case things went wrong.
If the local authority could be persuaded to use common sense instead of regulation and to avoid flooding all this with paperwork, it would be far cheaper than trying to build more affordable housing.
Image Credits: John Haynes https://www.geograph.org.uk/photo/1883379 CC BY-SA 2.0 .
Whilst I agree with some of William’s analysis I do not agree with his solution. The concept of a house as an asset rather than a home has blighted the British economy for many years and the problem was made much worse by the dreadful right to buy scheme that sold municipal (council) housing at less than its replacement cost. I have no problem with selling municipal housing to genuine tenants but only if the proceeds are used to replace that property with new municipal housing. I do not agree with the idea that everyone must strive for home ownership but believe that everyone should be entitled to secure tenure at an affordable rent. The only way that this can be achieved is to provide sufficient municipal housing to meet demand with rents variable according to ability to pay. This would be a boost to the economy as it would provide work to the builders and would be cheaper in the long run as it would avoid all the health, homelessness and crime costs of the current situation. The sad truth is that there are an awful lot of bad landlords exploiting the current system and the best way to deal with this is to take away the need for the sub-standard and dangerous accommodation they provide. Sadly councils do not have the resources to police these rogues and end up paying way over the odds to house people in awful bed and breakfast accommodation that is frankly dangerous to their physical and mental health.
Not to forget many are now second homes or air B&B
Now that the interesting accounts of Ben Griffen have been taken down,and his love of Rye,but cannot afford to live in this town, I commented why Rother district Council sold off a brownfield site,( the Camber field() and what other surplus sites , the Rye Partnership and East Sussex County Council own in this town, to help the people who work here, and also live here,to get on the social housing ladder
Like all debates, the answer’s somewhere in the middle. Obviously, not all landlords are rotters – some, I know, are understanding and extremely compassionate, and most private landlords aren’t owners of multiple properties, but owners of a single property. However, families in Rye have had to leave their homes to make way for a lucrative rental opportunity, and that really is unconscionable. Personally, I think we should be licensing new Air BnBs. The existing Section 21 ‘no fault eviction’ notices that the Renter’s Reform Bill is supposed to end, sadly still contains loopholes that could be exploited to evict people, and that needs to be fixed. And the advent of the Bill sadly saw a spike in S.21 notices presumably in advance of the new laws… But the bottom line is, we need more social housing and we need real political vision and energy – something akin to the post WW1 pledge to build ‘fit homes for heroes to live in’… In the pre-election melee, we hear all those kinds of seductive pledges. But who will actually deliver when development is so controversial? Our short-sighted party political system is geared to tactical advantage, not strategic planning. So, until we overhaul the electoral system, I see little hope of achieving the generational change our community and country need….
As usual lots of talk from the Government without a long term strategy. What needs to be discussed is the meaning of ‘affordable’ and secondly R Sunak needs to get the housing Minister to urgently look at the rental market, not a plaster short term but reasonable rents for young people and families and urgently put a rent cap into place now.
My grand daughter had to move further out from Sydenham because the landlord wanted to sell, short eviction notice which they fought and eventually found a place for her family (2 children) which costs them £1,400, no benefits as their combined salary is just above the line. They and many others will not get on the ladder which raises another point, we should reset the expectations of generations to come that owning a house for them is not round the corner and rental is probably more likely in the future
It is for that reason that Government needs to now deal with this crises of housing needs and rent policies.