Kevin McCloud discusses the affordability of housing

Our editor-at-large continues his investigation into the state of the UK housing market.

By Kevin McCloud | 16 January 2017

Our editor-at-large continues his investigation into the state of the UK housing market.

Kevin McCloud discusses the affordability of housing1

Continuing last month’s discussion of the affordability of housing, I’m keen to explore some alternatives to the status quo.

In north Bristol, HomeChoice Bristol has a number of three-bedroom council houses available for social rental at approximately £100 per week. That’s £5,200 per year, about 24 per cent of average national earnings, and falls well below the 35 per cent that housing charity Shelter deems the affordable threshold.

It sounds like good news for tenants. But the available stock in Bristol is extremely limited – while 2,000 homes become available each year, there are 10,000 households on the waiting list – and the current Government’s Right to Buy initiative is going to see the stock of affordable social housing diminish even further.

In truth, most people seeking homes in north Bristol, as anywhere else in the country, are faced with the choice of either renting a social home from a housing association (a tantalising yet diminishing possibility); finding, if they’re lucky, a home for shared ownership (these currently represent a tiny proportion of what’s on offer) or renting from a private landlord.

The latter route costs almost exactly double what they would pay for renting social housing, thrusting their outgoings to 51 per cent of net earnings. On top of which, tenants face the insecurity of short-term tenancies and the extra costs of agents’ fees.

A new organisation dedicated to delivering financial and social returns, Bristol & Bath Regional Capital (BBRC), is attempting to inject a dose of sanity and principle into the private rental sector, a sector that this Government sees as some kind of magic wand.

BBRC has worked with community housing action group Acorn to put together an Ethical Lettings Charter, setting out some long overdue principles for private lettings, including guaranteed rental terms, low-to-zero fees and reasonable market rates.

The result, it’s hoped, could be a private market in which tenants enjoy the same security as the social rental sector.

However, a healthy market needs more than privately rented homes. It also requires, as I’ve implied above, a goodly dose of houses for the social rented sector.

There are still, thank goodness, local authorities in the UK that want to build or buy homes for their tenants; even some, such as Basingstoke and Deane, that are considering taking social housing stock from developers in partial lieu of land payments on larger schemes.

Furthermore, a healthy market needs to offer a variety of tenure models, from outright ownership through to outright social tenancy at the extreme ends, but including, in the middle, shared ownership, private sector rental and assisted schemes, where help from mortgage companies, developers and government alike ought to be easing the burden of excessive prices.