← Older posts
Newer posts →
Scott Dawes
 

By Scott Dawes

Party Conferences: Half Way House

Amid the blur of fringe events, policy motions, twitter-tattle, and media sound bites, it was easy to get distracted during this year’s party conferences. Some key questions emerged: like, what pyjama patterns should we expect from our public figures? Can a speech have a deficit deficit? And is Lib Denim really a vote winner?

But let’s step back from the noise of conference season and look at what the myriad of announcements might tell us.

Labour’s conference did not see the expected publication of the Lyons Review, so we had to rely on some interesting teasers: the creation of “new homes corporations”; a commitment to double the number of first time buyers; reiteration of a ban on letting fees; and building 200,000 more homes a year by 2020.

All of this sounds positive – not least because many of their proposal are similar to those Shelter and KPMG proposed in our Building the homes we need report. The big gap was that, with Labour at pains to avoid being seen as big spenders, there was a noticeable lack of specific investment pledges; in fact, no new capital investment borrowing and no powers for Council’s to borrow more.

Labour also avoided tough questions on structural welfare reform. The focus on the gap between wages and the cost of living seems to be manifesting itself in solutions weighted heavily in favour of the former. But boosting wages isn’t a long term solution to rising house prices, and consequently not to the increasing number of in-work families claiming housing benefit.

Despite these draw backs, Ed Miliband did suggest housing would be the spending priority for a future Labour government, which is cryptic but encouraging. Labour are arguably giving themselves wiggle-room but sooner or later serious policies need serious money.

The Conservatives, on the other hand, remain firmly in the territory of aspiration. A new announcement on 100,000 discounted homes for first time buyers under 40s will have caught voters’ eyes, and could signal a positive willingness to intervene to get more homes built. As with Labour’s proposals, we’ll need to see the detail before passing judgement, but making these new homes cheaper by removing Section 106 affordable housing commitments is a bit like robbing Peter to pay Paul.

The Conservative’s Rent-to-Buy scheme, which we know polls well with consumers, is a bit more imaginative and of course completes the trio of Conservative rhyming housing offers, alongside Right-to-Buy and Help-to-Buy. They have earmarked £400 million in loans to get social landlords building – the only party to make a specific, and sizeable, spending pledge so far. However, while schemes like this could help some people to buy a home who might not otherwise be able to do so, without addressing supply, voters will be left wanting.

Where the Conservatives have also been keen to talk money has been in the form of benefits. With the housing benefit bill rising – driven partly by more working households needing help to pay the rent – the Conservatives have pledged to lower the total household benefits cap to £23,000, and to freeze benefits at current levels. Both blunt tools and likely to make life worse for families, particularly renters. With the economy recovering, wages stalling and more working households needing housing support, it’s unclear how these policies will play out at the election.

In addition, 18-21 year olds might be barred from claiming housing benefit altogether. Although this is less of a money saver if you exempt families, care leavers and disabled people, it clearly shows a willingness to cut welfare costs further – even if it proves controversial – to try and win a few more votes come May.

In essence, the Conservatives continue to grasp that voters are concerned about housing and that they need offers that play to those anxieties. But so far, this has meant treating symptoms not causes: it’s really the lack of genuinely affordable homes that is pushing up the housing benefit bill.

The Lib Dems, back in the labyrinthine SECC in Glasgow for the second year running, were characteristically doing their own thing, for better or worse.

Tessa Munt’s policy motion, which made ending retaliatory evictions party policy, echoed closely our own 9 Million Renters campaign. Rarely, there is an almost instant opportunity to achieve this; MPs will vote on banning the practice on November 28th. But if the Lib Dems don’t capitalise on this, it could raise doubts on how deliverable their other pledges really are.

Party President, Tim Farron, led the charge on affordable homes. It is now Lib Dem policy to create a Housing Investment Bank; improve tenure mix; give more powers to councils to acquire cheaper land; create new home zones; and put the housing minister in the Cabinet – not too bad at all, but lacking concrete funding commitments.

Worryingly, housing did not feature in their pre-manifesto document, and Nick Clegg failed to mention housing in his key note speech – something both Ed Miliband and David Cameron did. It is curious that, although housing is a consistent top-5 voter issue and Lib Dems are committed to building the most homes (300,000) of all major parties, they just aren’t selling it to the public. If they’re not careful, they could be left behind by other parties.

So where did conference season leave housing overall? The good news is that all of the major parties are grappling with the issue – each in their own way, but crucially ramping up the political focus. The challenge for all the parties now is to combine a decent policy, a costed plan and an attractive offer to voters. Housing is going to loom large in the General Election and, at this stage, the issue remains up for grabs.

 

Martha Mackenzie
 
I’m the Stakeholder Relations Assistant at Shelter, I joined the Public Affairs team in July 2012. I have been working on a wide range of projects, most notably engaging with local authorities through our rogue landlords campaign. In my spare time I’m studying for a MA in legal and political theory. When not chained to a desk I can usually be found running or cycling around London.

View all posts by Martha Mackenzie

By Martha Mackenzie

Tackling revenge eviction – a step closer

Guest blog by Sarah Teather MP 

I’m delighted to be working with Shelter and the Government to tackle revenge evictions.

In my 11 years as an MP, a number of victims of revenge eviction have come through the doors of my constituency office in Willesden Green needing my help. But there is little I or anyone else can do to stop landlords evicting tenants simply because they have reported dangerous or unsanitary conditions in their homes.

Section 21 of the Housing Act 1988 gives landlords the power to evict renters without a reason. These powers are often used when a landlord wants to sell a property or move into it. But because Section 21 eviction notices can be issued without a reason, the system is open to abuse by rogue landlords.

This is bad for everyone: tenants, good landlords and local authorities.

It’s bad for tenants. If rogue landlords evict tenants and re-let properties instead of fixing problems, poor conditions prevail. The threat of eviction also means many stay silent – as many as 12% of all tenants have not reported a problem for this reason.

But it’s also bad for good landlords. With many tenants too scared to report problems, landlords will often only find out about problems when a tenancy ends. Most landlords want to know about poor conditions so they can do something about it.

Finally, it’s bad for local authorities. Currently, many councils are hesitant to serve a statutory notice on a landlord’s property because they fear the tenants will be evicted and will need re-housing. Removing the threat of retaliatory eviction means local authorities will feel more confident in tackling conditions in the private rented sector.

Some groups are more at risk: if you live in London, receive Housing Benefit or are from an ethnic minority, statistics show you are more likely to be a victim of revenge eviction.

This is brought into stark relief when you realise that 17% of BME renters in London have been victims in the last year, compared to the 2% figure for the UK as a whole.

That’s why I decided to use my Private Members’ Bill to stop retaliatory eviction. A small change in the law will make a big difference to England’s 9 million renters.

Shelter and housing professionals have been calling for this change for years. Their tireless work and the Government’s welcome support for my Bill means we now have a fantastic opportunity to end revenge eviction once and for all.

Take action today – email your MP and ask them to vote for the Tenancies (Reform) Bill on 28th November.

Martha Mackenzie
 
I’m the Stakeholder Relations Assistant at Shelter, I joined the Public Affairs team in July 2012. I have been working on a wide range of projects, most notably engaging with local authorities through our rogue landlords campaign. In my spare time I’m studying for a MA in legal and political theory. When not chained to a desk I can usually be found running or cycling around London.

View all posts by Martha Mackenzie

By Martha Mackenzie

The Tenancies (Reform) Bill – what doesn’t it do?

Since the government announced their support for the Tenancies (Reform) Bill, it has occasionally been wrongly criticised for doing things it doesn’t actually do.

This is understandable – the draft bill hasn’t been released yet, and a lot of people care passionately about private renting. In view of this, I wanted to take this opportunity to address some of its criticisms.

There is a reason this bill has such broad support– it is sensible and credible. It will make a huge impact on the lives of renters, without placing additional burdens on law abiding landlords.

What does the Tenancies (Reform) Bill do?

The bill prevents landlords from evicting their tenant(s) in response to a local authority intervention about the condition of their property. They will be unable to serve a no-fault ‘section 21’ eviction notice for 6 months following the issue of a local authority improvement or hazard awareness notice.

Landlords who have not protected their tenants’ deposit or have not licensed their property when they are required to do so are already prevented from serving these eviction notices. This bill is simply bringing landlords’ other legal requirements into scope.

Will renters be able to use spurious complaints to frustrate their landlords?

No – the bill protects landlords from spurious complaints.

  • Landlords will be prevented from serving a section 21 eviction notice if their local authority has issued an improvement or hazard awareness notice. These notices are only served if a landlord is in breach of their legal duty to rent out a property that is safe and free from health hazards.
  • The bill cannot be used as a last minute delay to eviction. If challenging an eviction notice, the tenant will have to prove that they made a complaint about conditions before the notice was issued. They will lose their ability to challenge the eviction notice, if they do not do so within the two month notice period.
  • The bill specifically prohibits renters from raising issues that are their own responsibility. Environmental Health Officers are well trained in assessing whether a defect is longstanding and genuine or exaggerated and manufactured.

The bill does not add a discretionary element to section 21 possession cases. Renters will not be able to use spurious complaints to slow down court proceedings. If an improvement or hazard awareness notice is served, the eviction notice is invalidated. If it is not, then the landlord is free to proceed.

Will the bill trap tenants in their home?

Absolutely not.

  • This won’t stop renters from moving home – they’ll still be able to hand in their notice with the existing degree of flexibility. If they want to leave the property rather than remain there while the landlord repairs faults and improves conditions that remains their right.
  • If repairs are so significant that a tenant cannot be expected to continue living in the property, it is likely that an Environmental Health Officer will serve a ‘prohibition order’. The Housing Health and Safety Rating System (HHSRS) – what local authorities use to assess private rented properties – advises Environmental Health Officers to serve a prohibition order where remedial work cannot be carried with the tenant in residence.
  • In this situation the local authority must offer temporary or permanent alternative accommodation to the renter.

Will this place an extra burden on local authorities?

The bill will actually help councils carry out their core work – this is why local government is so supportive of it.

  • Councils across the country are working hard to improve their local private rented sector. However, budget constraints mean that their response to poor conditions is usually reliant on complaints from renters.
  • Despite high levels of poor conditions, the numbers of renters reporting problems remains relatively low. The main barrier to renters reporting is the existing lack of protection from revenge eviction.
  • Empowering renters to report poor conditions will help local authorities tackle poor conditions. Often under-resourced, a greater number complaints would allowed them to more strategically target rogue landlords.
  • Protection from revenge eviction will also help local authorities prosecute rogue landlords. Renters’ testimonies are crucial in ensuring a successful prosecution. Yet renters often refuse to give evidence in support of a prosecution for fear of eviction. They may also have already been evicted in retaliation before the case is brought.

Will this slow down the courts?

No, the bill includes measures that will ease the burden on the courts.

  • A government working group has been looking at ways to stop this from happening. This group identified that the introduction of a prescribed form for section 21 eviction notices (so that a precise format has to be used before the notice is valid) could significantly improve the current system. A prescribed form would require certain basic information to be given to the tenant and minimise opportunity for error.

Furthermore – as outlined above – tenants will not be able to use spurious complaints to frustrate the eviction process. This bill does not add a discretionary element to section 21 cases.

The vast majority of landlords won’t be effected by the bill. Landlords who ensure that their properties comply with health and safety standards will still be entitled to issue a section 21 notice with the same degree of freedom that currently exists.

This bill will only inhibit rogue landlords: only those landlords that flout their existing legal responsibilities will be affected. Law abiding landlords should only be affected positively – the bill will give tenants the confidence to report repairs, and stop them from becoming a major issue.

Pete Jefferys
 
I’m a Policy Officer at Shelter and interested in how we can get housing up the political agenda, secure a better deal for private renters and get affordable homes built. Outside of policy, I love exploring new parts of London, sport and going back home to Devon.

View all posts by Pete Jefferys

By Pete Jefferys

We need to build homes faster

We need to be building at least 250,000 homes per year just to keep up with our growing, ageing and changing population. Disgracefully, there hasn’t been a single year in the last 25 when we’ve built more than 200,000. Last year we built just 110,000.

Is there any other area of public policy where we’ve failed so badly for so long? With such failure it’s no wonder that there’s a growing consensus that more radical action is needed.

Normally the focus of debate on housing supply is limited to the controversial and often combative process of getting more sites to achieve planning permission. But one piece of the puzzle that doesn’t get enough attention is our slow ‘build-out rates’- how quickly the homes on a site with planning permission are actually built.

In England, average build-out rates are much lower than in some other countries. We build-out new sites at a rule of thumb rate of around 50 homes per site per year, because this is the optimum rate for selling homes at the highest price. Build any faster and you’d need to discount the price in order to sell them all.

This isn’t about builders being greedy though. They need to sell the homes they build at the optimum price, because that’s the price they factored in when deciding how much to pay for the land in the first place. In a highly competitive land market, you need to pay more than everyone else for land which means making more optimistic forecasts of your sales prices (or about how cheaply you can build) than your competitors. Therefore once you’ve paid for the land, you have to build slowly and sell at the optimum price in order to justify your initial investment.

This back-to-front model of development based around paying as much as possible for land upfront constrains almost all of the ‘outputs’ in housing supply – price, quality, size – all for the sake of paying the maximum possible price to landowners to secure the site.

In some Northern European countries though, build-out rates of 550 homes per site per year are achieved: more than ten times faster than the rate we build. Given the development model I’ve described, how can this happen?

It’s a mix of things. First, the development model in these countries isn’t back-to-front. Land is brought into the system via zoning or a development corporation (or both) at a more reasonable price. This means builders’ hands aren’t tied by having spent so much on land and so they can focus on creating high quality homes that can sell competitively in higher volumes.

Second, the development process itself is split up. A master-developer will make a margin by designing the site, connecting plots with infrastructure and services (water, electricity) and then sell those plots to small house builders to build and sell a few homes each. By splitting the process, no one is incentivised to drip-feed homes to control the price.

Third, including a range of different tenures and prices allows faster build-out, because they’re not all being released into the same market. Social housing is particularly suitable for rapid build-out, as there’s plenty of demand for it (just look at council waiting lists), so there’s no problem of market saturation and no need to drip out supply.

In our major report with KPMG, we recommend a series of reforms that would allow us to do development in England a bit more like this model.

We also recommend incentivising faster build-out on existing sites through the tax system.

While splitting sites and changing the development process is the main game in town, a simple reform to speed up the rate homes are built-out would be to put a cost on keeping plots empty once planning permission is granted. With Europe Economics we looked at what would happen to building rates if councils could charge council tax on sites with planning permission equivalent to the homes that haven’t yet been built.

The answer, unsurprisingly, is that homes on the sites would be built faster. In the first years of the tax an additional 13,000 homes would be built on sites in England already with planning permission simply because it would be cheaper to build and sell at a slight discount than pay the tax. The tax also has the added bonus of incentivising those who are simply land trading rather than building to sell their sites to those who will build.

None of these policies is a silver bullet in itself and we do of course need many other policies to increase land supply, investment and link homes with infrastructure. However, speeding up the rate we actually build homes once planning and investment are in place is a crucial step to building the homes we need.

Steve Akehurst
 
I’m a Public Affairs Officer at Shelter, and work on getting affordable housing up the political agenda. I’m particularly interested in how housing relates to living standards in the UK. Outside of work, I enjoy reading, writing and putting in painfully mediocre 5-a-side performances.

View all posts by Steve Akehurst

By Steve Akehurst

England’s ‘rent-trap’: just another reason housing is now a top 5 issue for voters

The last few weeks have seen senior politicians in all parties clamber over each other to promise bold action to solve our housing shortage. Both of the men most likely to be PM next year highlighted it as a priority in their last conference speech before the election.

Now, all parties still have a way to go to show the kind of leadership voters want – something we’ll come back to on the blog tomorrow. But for a minute it’s worth reflecting on the transformation: for a generation housing was treated as a marginal issue, something only a handful of anoraks prattled on about. Now it is right at the top of the political agenda. Four years ago housing sat ninth on the list of voter priorities, now it’s consistently in the top 5.

And if you want to know why that is, new research on the ‘rent trap’ by Shelter out today provides just another indication.

It shows that, after paying their rent, 66% of private renters in England are now unable to save a single penny towards a deposit on a home of their own – an increase of thirteen percentage points from 2012. Add in the fact that queues for social housing are at record levels and you reach a grim conclusion: two thirds of people renting are stuck there indefinitely.

Of course, not everyone wants to own (though polls consistently show a majority do). But for that option to now be completely shut off to two thirds of renters, no matter how hard they work or save, shows how out of control our housing crisis has become. Fundamentally, it underscores the failure of successive governments to build the homes we need.

Thankfully, this is an issue that can be solved with the right political will. Our work with KPMG shows it’s perfectly possible to plug our desperate shortage of homes within the next Parliament if it’s made a priority.

And, as our politicians are waking up to, with anxiety on the rise and NIMBYism in decline, there is a huge political prize open to the party which rises to the challenge.

What was particularly promising about conference season is that all three parties are now competing for votes on the real problem: the shortage of homes. Demand-side fiddling and relative cul-de-sacs like the ‘empty homes’ agenda are finally fading into the distance.

But voters affected by the housing shortage won’t be easily led, especially in this day and age. Parties wanting their vote will have to continue to relentlessly talk to their anxieties and experiences right up to polling day, and flesh out their plans for living up to their warm words. This will be no free ride, it’ll require leadership, but it will be worth it for the party which convinces. Because as our research today shows, the problem is worsening with every passing day. As an issue for voters, housing is not going away any time soon.

← Older posts
Newer posts →