Where is housing policy failing?

New Year’s Eve lies well behind us now as a milestone, sadly marking the end of another year of failure in housing policy. Home ownership feels like an impossible dream for the masses. Untold numbers of people are being pushed into homelessness. Where is it all going wrong? Housing Association Magazine’s Joe Bradbury takes a look:

The extent of the problem

The catastrophic decline in social housing has left millions feeling insecure in unaffordable homes they’ll never own.
Homelessness is now at its highest peak since records began. Prior to Christmas, homelessness charity Shelter revealed that 280,000 people are recorded as homeless in England alone and at least 320,000 throughout the whole of Britain – an increase of 23,000 since 2016 when the charity first published its landmark annual report.
Shelter’s extensive analysis of official rough sleeping and temporary accommodation figures, along with social services records, showed that in one in every 200 people are without a home.

The impact on our children

A staggering 135,000 children in Britain are homeless or living in temporary accommodation; it is estimated that a child loses their home every eight minutes. This is the equivalent of 183 children per day, enough to fill 2.5 double decker buses.
As if these figures weren’t horrific enough, it’s widely known that a lot of homelessness goes undocumented, including sofa-surfing and some rough sleeping. This means the true level of homelessness may never be known, and this could all just be the tip of the iceberg.
How do we fix it? The first step is to know your enemy.

Housing crisis

The housing crisis came about when rapid increases in the price of property reached unsustainable levels relative to incomes, price-to-rent ratios, and other economic indicators of affordability. This created the situation we are now in where people with a full time income still can’t afford a home because the market values are astronomical.
Home ownership is no longer an option for many. Due to the sheer scale of inflation, house prices are now estimated to be almost seven times people’s incomes.
An increasing number of people are renting from private landlords. Over 9 million tenants in Britain currently reside in private rented accommodation, 1.3 million of which are families with children. Renting unfortunately doesn’t offer the security with increasing rents, hidden fees, loss of deposits and the constant threat eviction a persistent concern. One in three private rented homes in England alone fail to achieve the Decent Homes Standard.
Current mortgages stretch people too thin. A large portion of people who have managed to buy their own house have done so at a time where mortgages are so high and at the very top of their budget that there is no safety net and monthly repayments can be hard to meet. As a result of this many homes are repossessed each year across the UK.

We need to build more homes

Recent figures published by the National Housing Federation (who represents housing associations in England, social landlords to 5 million people) and Crisis (the national charity for homeless people) reveals the true scale of the housing crisis in England.
To both meet this backlog and provide for future demand, the country needs to build 340,000 homes per year until 2031. This is significantly higher than current estimates (including the Government’s target of 300,000 homes annually), which have never before taken into account the true scale of housing need created by both homelessness and high house prices.
They will also need to be the right type of homes. 145,000 of these new homes must be affordable homes, compared to previous estimates of the annual affordable housing need of around 78,000. This means that around two-fifths of all new homes built every year must be affordable homes – in 2016/17, only around 23% of the total built were affordable homes. 90,000 should be for social rent.
The cost of land for social housing also needs to come down so that landowners are paid a fair market price for their land, rather than the price it might achieve with planning permission that it does not actually have. This in itself is an enormous barrier to building.

In summary
2020 is a new year with a new government. As an industry we need to apply pressure where necessary in order to fulfill our obligation to the huge numbers of homeless people throughout the country. For some, it really is a matter of life and death.

This article and other blog’s by HA’s Joe Bradbury appear regularly on Mitsubishi Electrics’ The Hub