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Affordable Housing - what to expect - the government has now lifted the borrowing cap in councils, but will this lead to more building by them?

This blog is about council housing and the severe lack of it.

But, before we get into the detail of that it’s important we get a number of things straight to summarise where we are today.

The housing crisis wasn’t created by some ‘housing crisis god in the sky’. It didn’t just happen by chance. The government created this crisis. They made it happen. Nobody else.

Yes, as a society the industry and businesses respond to government policies and there is no doubt that many have added to the crisis, but the simple fact remains that successive weak governments, poor housing government policies and ineffective housing ministers have created, what our Prime Minister called today a ‘broken housing system’.

Great she admitted this, but what the hell are we going to do about it?

Right to buy has been the biggest disaster and national scandal in the history of the British housing system

George Clarke George Clarke Architect and TV presenter

What a mess

Let’s just briefly run through the headlines of why we are in the mess we are in.

In 1970 half of all the houses built in Britain were council houses. The private sector built around 150,000 homes per years and another 150,000 were built by forward thinking councils who had their own in-house teams to deliver state housing for affordable rent. Great. We built more houses then than we do now.

Then Margaret Thatcher came along and destroyed it.

She prevented councils from building homes, slashing their budgets and getting rid of their council house building departments.

She then put it onto the private sector to build council houses by demanding that a certain percentage of the homes they build are to be ‘affordable’ or ‘social housing’ because she clearly didn’t want to call them council houses anymore.

This was in effect a development tax on the private house builders. The government and council will let you build ‘x’ number of private homes for sale if you build say 10% or 20% of that allocation of homes for ‘Affordable Housing’.

The reality was that, in many cases (not all but many), the private house builders would try and do everything they possibly could to negotiate their way out of building the affordable homes and if they did they were the lowest quality of housing placed on the worst part of a site. In some cases they were moved onto a completely different site bought elsewhere to “get rid of the affordable housing’ away from the posh private stuff.

This not only reduced the numbers of ‘council houses’ being built, but worse still the homes that were built by private developers was generally rubbish.

Stigmatising council housing

This has all added to the negative stigma against council house in Britain.

Because we built so few council homes in Britain, they go to the most in need, which then leads to accusations of ‘benefit scroungers’ or ‘free loaders’ on council estates, which is horrendous.

I was brought up in a new town where there was massive council housing provision. It was fantastic!

Most people on the estates worked hard, paid their taxes and paid their rent to the council every week. Proud people who were proud to live where they did.

But, Thatcher and successive governments since 1980, have destroyed this and created the greatest negative stigma against council housing that the country has ever seen.

A bit harsh?

Now you might think I’m being too harsh. Of course some homes were built and some good homes were built. But, not many.

Housing Associations, many of who do some fantastic work against all the odds, are great, but have hardly filled the gap. The number of housing association homes built in 2017-18 was around 40,000, which sounds good at first (albeit still not enough) but only half of these were built under the Affordable Homes Programme and only a few thousand were for affordable rent.

More than 20,000 were from private sale. So, even housing associations aren’t providing enough affordable housing for rent.

So, councils build virtually nothing, Housing Associations build very few homes for affordable rent and private developers do everything they can to avoid building their ‘affordable housing’ provision which, let’s face it, is rarely affordable anyway.

A disaster and a scandal

To add to the carnage, the Tory government brought in Right to Buy into the 1980 Housing Act.

Of course I’m not against home ownership and this gave people in council homes the opportunity to buy their property at a very affordable price, which gave them security and allowed them to remain part of a community and contribute to it.

But, it has been a complete disaster for affordable housing in Britain.

For me, Right to Buy has been the biggest disaster and national scandal in the history of the British Housing system.

There were 6.5 million council homes in Britain. There are now only 2 million because millions have been sold off.

For every 5 council houses sold only one has been built to replace it!

Council houses are sold off at such a large discount that, once the Treasury has creamed some of the money off the top of the sale to pay for other things, local councils don’t have the funds to replace the council house they’ve been forced to sell.

The effects of net immigration and a growing population have made the demand for social housing higher than ever at a time when we are not only not building any, but we are selling them off to the private market!

What a joke!

To add got the tragedy, even if councils did have the funds available (which they so don’t) they don’t have any of the the in-house skills to start council house building again because all the talented people who did work in council housing departments have now joined the private sector or have retired!

The problem gets worse

Of course, Right to Buy now means that so many council houses have now been removed from the affordable rental sector and have entered the private sales market.

The problem gets worse, because many people who bought their houses for a considerable discount have now sold them on at a premium making a very tidy profit from the council’s loss.

Worse still, it has recently come to light,  that many private landlords have bought up these former council properties and are now renting them back to councils or the private rental sector making substantial profits from private tenants or the state benefit system.

A staggering 40% of former council houses sold through right to buy are now rented out by private landlords!

And worse

It gets even worse! There are reports that some councils are actually buying back Right to Buy properties making a staggering loss on homes they were forced to sell under the scheme years ago.

How stupid is it that councils are using tax payer’s money to spend millions on buying back former council homes they were forced to sell under the right to buy scheme for just a few hundred thousand pounds? It beggars belief!

What a scandalous waste of tax payer’s money!

So, it is up to government to sort out the mess they created.

Yes, the government has now allowed councils to borrow again by lifting the ridiculous borrowing cap they imposed on councils, which prevented them from building homes.

This should hopefully lead to more council homes being built, but is there any point if councils are forced to sell them off at a substantial loss in a few year’s time?

The government make lots of grand announcements, but they are not actually doing anywhere near enough.

3 pillars

State housing is one of the 3 pillars of the welfare state (the other two being health and education) and state housing hardly even exists in this country.

Councils need to start building high-quality, low carbon, ecological council houses for long-term affordable rent and they need to do it fast.

Council land belongs to us the tax payer and that land should be made available for truly sustainable and affordable state housing.

Funding needs to be made available by the government for this to happen.

And it can’t be just a numbers game.

It’s not just about how many homes we build, but what we build to. There is no point in building crap housing that will only require more tax payer’s money to maintain and upgrade in years to come.

Urgent need

We need to build new council housing stock that will last 200 years and we need to do it in a new zero carbon way. I’m currently working with Manchester City Council to build an innovative, new council estate, but I have to say it isn’t easy with all of the old, conventional, backward thinking government policies in place.

We need new, innovative and exciting policies in place to create a new form of beautiful council house. No longer should there be conversations about cars and car parking spaces dominating new-build housing estates when we are striving to be a low carbon economy.

And we shouldn’t be designing out or completely getting rid of green public spaces, community gardens or public squares because councils don’t have the funds to maintain them. Surely, we can do better than this!

1 out, 1 in

We also need to revisit the Right to Buy scheme, which has fuelled the property market and in effect privatised state housing.

For every council home sold, it must be sold at a price to allow councils to replace that council house for a new one.

There needs to be a 1 for 1 policy. If not then the entire scheme should be scrapped!

Time to fix things now

If Theresa May really believes the housing market is broken then she needs to fix it. Not in the future, but now.

To do it, there needs to be a cross-party agreement put in place with sensible and effective policies that will transform the housing system over the next 30 years, whichever government is in power.

The planning system needs a massive overhaul too to promote and fast-track innovative, green and sustainable council house building projects.

The very best architects and planners should be employed to put quality, beauty and the environment at the very heart of every council house that is built.

The last 50 years has seen the complete and utter destruction of truly affordable housing in Britain.

It is going to take a brave and bold government to sort it out once and for all.

Is there a Prime Minister out there with the guts to do it?

George Clarke is an architect, writer, lecturer and TV presenter, a founder of TV production company Amazing Productions, and creative director of George Clarke + Partners.