Wednesday, 15 January 2014

"Right to buy" in East Devon

The District Council currently 'manages' 4,300 social housing properties:
East Devon District Council - Housing
but has a very long waiting list:
East Devon District Council - Devon Home Choice scheme

It has recently released the following figures:

In the last 10 years (since 2003):
96 Council properties have been sold under the Right to Buy scheme
20 new Council homes have been constructed.
13 homes have been purchased by the Council

For the past few years, the Council has run a modest build/acquisition programme in accordance with our Housing Revenue Account Business Plan ambitions. We plan to use HRA surpluses to invest in acquiring new affordable housing so as not to increase our current borrowing at a time when income is under threat through welfare reform.

Selling and buying council houses - a Freedom of Information request to East Devon District Council - WhatDoTheyKnow

There is considerable detail concerning District Council policy from over a year ago here:
Futures Forum: East Devon and affordable housing: November 2012

In part, these 'limited' policies were developed in answer to central government at the time:
Revamped Right to Buy is chance of a lifetime for tenants - Announcements - GOV.UK
UK social housing tenants given enhanced Right to Buy their homes

There were concerns raised, however, about the 'right to buy':
When there is a big shortage of Council housing the obvious thing to do (for the coalition government, at least) is not to build more of them so as to lessen the shortage, but to encourage more of them to be sold. This is at a time when over 1.8 million households, comprising 5 million people, languish on the housing waiting lists.
Never fear said the government, there will be a policy of ‘one for one replacement’: a new home built for every home sold. Well, not quite, since the government has admitted that some Councils will not have sufficient money to build replacements, blithely accepting that there would be a decline in available housing in some areas. Where Councils will have insufficient money to build replacements the Government will simply snaffle the receipts and new homes would supposedly be built elsewhere. However, ‘one for one replacement’ on the national level is unlikely to happen, as the example of Swindon underlines.
For all the talk of ‘localism’ and ‘giving power back to the localities’, the government has imposed a dictat on Councils. In order to spend the money received from the sale of homes, each Council is obliged to sign an agreement that they will cover no more than 30% of the cost of new homes with receipts from the sales. The other 70% they would have to fund from their own resources or through additional borrowing.
Of course, even if each home sold was replaced by a new one that would still do nothing to tackle the shortage of homes available. It would mean that the numbers would stay the same, and housing waiting list numbers would continue to rise. In reality the relaunch of ‘right to buy’ will produce a decline in the numbers of Council houses available.
‘Right to Buy’: the myth of ‘one for one replacement’ | Keep our Council Homes

The government, one year on, considers this a policy success:
10,000 homeowners created through the Right to Buy - Press releases - GOV.UK
Four-fold increase in council tenants buying their homes | Exeter Express and Echo

And yet social housing is not being replaced:
Just one home built for every seven sold through right to buy | News | Inside Housing
The housing takeaway | Analysis | Inside Housing
Let Councils Borrow To Build More Homes, Says London Assembly | Londonist
London assembly calls for right-to-buy suspension | Local Leaders Network | Guardian Professional

One rather bizarre effect has come about, according to a report this week:
BBC News - Councils are renting sold Right to Buy homes, says report
Over a third of London's right to buy homes now privately rented » Housing » 24dash.com

There are 'new initiatives' on offer, however. 
The Autumn Statement made it clear that local authorities could borrow more to build social housing:
Autumn statement paves way for councils to build new homes | UK news | The Guardian
Futures Forum: “We need the Government to address the chronic lack of affordable housing..."

But the District Council has made it clear that it does not want to...
"increase our current borrowing at a time when income is under threat through welfare reform"
Selling and buying council houses - a Freedom of Information request to East Devon District Council - WhatDoTheyKnow

A proposal to sell off expensive social housing have had a mixed reception... 
including from East Devon:
Report author Alex Morton said: "Expensive social housing is costly, unpopular and unfair. That is why almost everybody rejects it. 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."

But councils in the Westcountry, struggling with long housing waiting lists, dismissed the idea. Conservative councillor Jill Elson, East Devon District Council's cabinet member for sustainable homes and communities, said: "The Government and its policy advisors should concentrate their efforts on finding realistic ways of delivering more affordable housing rather than these theoretical policy distractions that could only make a marginal difference in some very high-value areas."

Call to sell-off of upscale council houses which could raise £4.5bn | This is Cornwall

The District Council has invested in new social housing:
Futures Forum: “We need the Government to address the chronic lack of affordable housing..."

And it has been confirmed that the social housing at Cranbrook will not be up for sale:
I would confirm that the social rented units will remain available for those people on Exeter & East Devon’s waiting lists in perpetuity.
As is the case with all urban shared ownership properties, once the local person has purchased their share, they do have the ability (if their circumstances improve) to purchase further shares of their home until they own the 100% of the property.  This does happen occasionally, but is very rare.
In this case, and should they wish to sell, each Housing Association is given 8 weeks to find another local person to purchase the property as a shared ownership home.  Only then, and if no-one can be found to purchase the property, may this home be sold on the open market.
All the above is regulated by the Home and Communities Agency who provide funding for the affordable housing.

It is clear, though, that this issue is not going to go away, either at local or at national level:

HOUSING, it is increasingly clear, will probably be one of the hot topics of the 2015 election–at least on the left. This morning, Polly Toynbee, the Guardian’s chief hand-wringer, reports on the creation of new slums in east London. As she says, “Labour and Tory governments neither built nor intervened in a market failure where private developers didn't build despite astronomic price booms”. She even quotes our reportingThe Economist and Ms Toynbee then depart–she thinks that the state should build more; we think that the private market could do better. But the key problem, both agree, is the the shortage of housing.

British housing: In defence of right to buy | The Economist
Andrew Neather: Boris Johnson has a long way to go on his housing pledge - Comment - London Evening Standard

See also: 
Conservatives and the cult of home-ownership - FT.com
Futures Forum: "Housing supply is poised to become a battleground before the next general election"... The popularity or non-popularity of building more housing
Futures Forum: Renting vs Buying in the South-West
Futures Forum: Help to Buy: housebuilders and homeowners benefit...

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