Councils urged to sell social housing
Local councils are being urged to sell off their most expensive houses in order to build cheaper homes with the proceeds.
Research by Policy Exchange, a conservative think-tank,
found that almost 22 per cent of the 3.8m houses and flats let to social tenants are worth more than comparable properties in their area. In London, the figure is one-third.
The Policy Exchange proposes that there should be a regional cap on the value of social properties.
“Expensive social housing is costly, unpopular and unfair. Social housing tenants deserve a roof over their heads but not one better than most people can afford, particularly as expensive social housing means less social housing and so longer waiting lists for most people in need,’’ said Alex Morton, the report’s author.
Neil O’Brien, the think-tank’s director, told the BBC’s Today programme those living in richer areas also face higher living costs, which is “no good” for residents of social housing.
The money saved by selling the properties when they become vacant – about 3.5 per cent of the buildings each year – could be up to £4.5bn a year, enough to build 80,000 to 170,000 new social homes, the report says.
The think-tank suggests its proposal could result in the largest social housebuilding programme since the 1970s, with up to 340,000 construction jobs created.
It could also reduce the housing waiting list, currently made up of 2.5m households, by up to 600,000 in five years.
Grant Shapps, the housing minister, supports the sell-off. He has been determined to revive the housebuilding sector and “help the thousands of families who for years have been left languishing on social housing waiting lists”.
Polling by YouGov shows that almost three-quarters of voters believe people should not be offered council houses worth more than the average house in their local authority.
But critics warned the move could lead to a form of social cleansing. “The idea is fundamentally flawed. It could effectively cleanse many towns of hard-working people who simply can’t afford the high prices of buying or renting privately,” said David Orr, chief executive of the National Housing Federation.
The report ignores the fact that there is not the mortgage availability or market for people to buy these homes, he said.
Karen Buck, shadow education minister, told the Today programme “an overseas, money-driven housing bubble” had inflated properties. Many of the lower-income households, on the other hand, have lived in their communities “forever”, she said, and would be driven out under the new proposal.
It was unlikely that the sale of housing stock would lead to more homes being built with the money, she said.
Housing has taken on growing political importance in the UK as demand for new homes continues to grow. The coalition is hoping that construction can spur economic growth across the UK.
A review of housing policy this week is expected to propose that the present obligation on developers to build affordable houses should be reduced.