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Alarm over low number of new homes created for social rent

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The alarm has been sounded over the low number of homes being created in England for social rent, despite the rate of affordable home creation increasing by 12 per cent last year

Government figures showed that 47,355 subsidised dwellings were added to the market either by construction or acquisition in the 12 months to April 2018.

This was up from 42,223 in the prior year and represented the highest volume since 2014/15 as well as the second highest since 2011/12.

A record 10,880 of the affordable homes entering the market last year were offered for shared ownership, where a buyer pays some rent to a housing association as well as securing a mortgage for part of the purchase price.

The number of homes marketed for affordable rent – generally costing up to 80 per cent of the private sector monthly payment – was up too, rising 10 per cent from 2016/17 to 26,838.

There was also a 10 per cent increase in the number of new homes for social rent, where local earnings are taken into account when setting costs, to 6,463 in 2017/18. 

However, this remained well below historic norms, comparing poorly with the 57,023 homes for social rent created under John Major’s government in 1992/3, and 39,559 as recently as 2010/11 when David Cameron’s coalition government came to power.

Anti-poverty body the Joseph Rowntree Foundation this summer found that affordable rents for typical two-bed properties worked out 30 per cent more expensive than social rents.

Shadow housing secretary John Healey said: ‘These figures confirm the disastrous fall in the number of new affordable homes for social rent under the Conservatives.’

These figures confirm the disastrous fall in the number of homes for social rent under the Conservatives

Polly Neate, chief executive at homelessness charity Shelter, said: ‘The gap between the number of social homes we need and what is being delivered is vast. This just isn’t acceptable when nearly 280,000 people are homeless in England today.

‘It’s clear we’ve hit crisis point, and this is nothing short of a national housing emergency. The government must seriously ramp up its efforts to get more social homes built. That means much more funding, reducing the cost of land and removing “get-out clauses” used by developers to drain the country of the social homes we need.’

RIBA president Ben Derbyshire described the plummeting drop in creation of homes for social rent this decade as ’deeply concerning’.

He added: ‘The recent lifting of the Housing Revenue Account (HRA) borrowing cap provides a welcome move but we urgently need increased public-sector investment in well-designed social housing at scale. The government, working with our talented architects, can deliver the next generation of social housing – the successful homes and communities that this country so desperately needs.’

Prime minister Theresa May stunned the industry at the Conservative Party conference earlier this year when she announced she was scrapping the HRA borrowing cap – a decision hailed by housebuilders as ‘exciting’ and by surveyors as ‘very positive’.

Communities secretary James Brokenshire said this week: ‘It’s great to see that affordable homes delivery is up 12 per cent from last year, adding more than 47,000 homes. This shows that our plans to make the housing market work for everyone are making a difference.

‘But we are restless to do more through our £9 billion Affordable Homes Programme and by scrapping the borrowing cap for local authorities so they can build a new generation of council homes.’

May in September called for a new wave of high-quality social homes after pledging £2 billion in long-term funding deals for housing providers.

Knight Frank residential research associate Patrick Gower this week said May would be ‘encouraged’ by the latest data.

‘The proportion of all new-build completions that were affordable homes crept up to 24 per cent, from 23 per cent the previous year,’ he noted.

‘The number of affordable homes that started on site climbed 11 per cent to 53,572, indicating that the number of homes likely to complete in the coming two to three years is also likely to increase.’

Meanwhile new figures released by industry tracker Glenigan show that while social housing starts remain steady, it is a bleaker picture for private housebuilding.

Glenigan’s economics director Allan Wilén said: ‘Quieter conditions in the wider housing market appear to be restraining private housing project starts, with developers focusing more on building out existing sites.

’Private residential starts during the three months to November were 15 per cent down on the same period a year ago. On a seasonally adjusted basis starts were 13 per cent down on the three months to August.’

Comment

Félicie Krikler, director at Assael Architecture

These official figures on the terminal decline of social housebuilding in the UK are extremely disappointing. The 80 per cent drop in the construction of homes for social rent is a call to action.

Designing and delivering quality social housing must be part of our local and national housing strategies, with clear and well-defined steps in achieving the goals that we set. We believe that we should not just be judged solely on the number of homes we build, but on long-term quality and on how we deliver housing for vulnerable groups across the country.

By applying our expertise and knowledge we can design social housing fit for young families, focusing on the residents’ health and wellbeing, and ultimately ensure that we deliver long-term social value. But planning barriers to delivery must be removed and policymakers must do more in facilitating and supporting the development of homes for social rent. The recent Raynsford Review is a step in this direction, and we hope its recommendations will be taken into account and acted on with urgency.

As an industry, we have the ability to redefine social housing through design: building quality homes that create real communities. While today’s news is sombering, I believe there is hope. 

 

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