WIDER POLICIES
English Housing Policy

Key policies:

• Sustainable Communities: Homes For All.
• The 2004 Housing Act.

The supply of affordable housing

It is widely agreed that there is a shortage of affordable housing in England for people on low incomes and that this shortage has been increasing. For example, the 2004 Barker Review of Housing Supply, sponsored by HM Treasury concluded (recommendation 27) that: "The provision of social housing should be increased. At least 17,000 additional houses are required each year compared with current provision to keep up with demographic trends. Addressing the backlog of housing need would raise this to 23,000 per annum (assuming substitution from sub-market to market housing, as market affordability improves)." These estimates of 17,000 and 23,000 are in addition to the 31,000 that were completed or acquired in 2004/05.

 

As a result of the relatively low numbers of new social homes in recent years, the social rented sector is now 18% of the total housing stock compared to 23% in 1991. Furthermore, this reduction in the amount of social housing has not been accompanied by an increase in private rented accommodation for people on low incomes.

 

In this context, the two main current government policies relating to affordable rented housing are:

• Sustainable Communities: Homes For All.
• The 2004 Housing Act.

Sustainable Communities: Homes for All

The 2005 strategy document, Sustainable Communities: Homes For All, states that the government is committed to tackling existing shortages by increasing the annual supply of new social homes by 50% and by bringing empty homes back into use.

Increasing annual supply of new social homes: On new social homes, it plans to deliver an extra 10,000 social rented homes per year by 2008. Note that this figure is still lower than the minimum of 18,000 which Barker estimated was required to keep up with new need, let alone tackle the backlog.

Bringing empty homes back into use: On bringing empty homes back into use, it estimates that there are around 300,000 private sector homes in England which have been empty for more than six months (indicating they are not just empty between buying and selling), about a third of which are usable. It estimates that Empty Dwellings Management Orders introduced as part of the 2004 Housing Act - see below - will enable local authorities to bring approximately one quarter of the usable homes (i.e. around 25,000 homes) back into use by 2010.

The two commitments above notwithstanding, overall government housing policy is still very much centred on the view that home ownership is preferred. For example, the 2003 strategy document, Sustainable Communities: Building For The Future, explicitly stated that "a return to social housing is inappropriate, since home ownership is the tenure of choice". For many homeless and potentially homeless people, whilst ownership may be an aspiration, it is simply not a viable option due to its cost.

The 2004 Housing Act

The 2004 Housing Act included the following aims:

Improve access to private rented sector: One of the stated aims of the 2004 Housing Act is to improve access to the private rented sector. It aims to achieve this through the mandatory licensing of 'houses of multiple occupation' and private licensing of private landlords, on the grounds that such licensing will make renting a more attractive option for potential landlords. However, the licensing will only apply in low demand areas and thus, even if successful, will have only a limited impact on single homeless people given that many of them are homeless in high demand areas.

Increase supply of affordable housing: The 2004 Housing Act also aims to increase the supply of affordable housing by extending the right to build affordable homes to companies that are not registered social landlords (RSLs)^[1].  However, no indication is given as to how much of an impact these policies will make, or whether these homes will be for sale or for rent - an important question in the context of housing homeless people.

Empty Dwellings Management Orders: The 2004 Housing Act also makes a provision for Empty Dwellings Management Orders. These will allow the local authority to act as owners if a property has been empty for a long period of time and if its owners have turned down voluntary offers of help to make it useful again. So, for example, the local authority will be able to seek permission to force a lease on an owner of an empty property and then undertake refurbishment to make the property ready for letting. Such a provision will presumably increase the number of homes available for rent, although the extent to which this would impact on homelessness will depend on how many homes are subject to such orders, where these homes are available, and whether they are rented at ‘affordable' levels.

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End notes

[1] New powers are being given to the Housing Corporation, which will allow them to work with bodies other than RSLs. This aims to improve competition, improve value for money, and therefore increase the supply of affordable homes. Back to text

Page last modified on 06/07/2007 at 10:42