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3.1 million new social homes are required to solve England’s housing crisis as part of a 20 year home building programme, according to Shelter, a UK housing commission. This figure is said to match the number of households who will likely be failed by the housing market during this time.

These homes will provide solutions to those in greatest difficulty, including over 691,000 homes for older renters and 1.17 million for younger families who cannot afford to buy, known as trapped renters, according to Shelter.

This assessment has been put together by 16 independent commissioners, including Ed Miliband, and two former Conservative ministers, who have been asked by the charity to look at what can be done to increase the number of affordable homes in the country.

National Landlord Investment Show – MPU

It also gathered views from 31,000 people – a quarter of whom were social housing tenants as well as other members of the public and housing experts.

The commission argues that the government should act immediately to address the UK’s housing concerns during a time when around half of young people have no chance of ever buying a home, private renters on lower incomes spend an average of 67% of their earnings on rent, and almost 280,000 people in England are homeless.

An Ofsted-style consumer regulator working across social and private housing is also called for as well as a new national tenant’s organisation to oversee the process.

Is it worth the cost?

Analysis carried out for the commission by Capital Economics suggests the long-term economic benefits of increased social house building would ultimately outweigh the initial costs.

With an average yearly investment of £10.7 billion during the construction phase, Capital Economics estimates that up to two thirds of this could be recouped through housing benefit savings and tax revenue each year.

The programme would, therefore, pay for itself after 39 years and would be more cost-effective than other government schemes such as the Help to Buy scheme, according to researchers at Capital Economics.

 

Recommendations to Theresa May

The findings of the reports and the commission’s recommendations have since been submitted to Theresa May.

Conservative peer Baroness Warsi, who served in David Cameron’s cabinet, said: “We simply cannot afford not to act.

“The government’s budget for capital expenditure is £62bn a year – our housebuilding programme would cost only a fraction and is well within its financial reach.

“With current spending on housing benefit shockingly inefficient, it’s not hard to see what an investment in bricks and mortar could do to help solve the housing crisis and boost our economy.”

Mr Miliband said: “The time for the government to act is now. We have never felt so divided as a nation, but building social homes is a priority for people right across our country.

“This is a moment for political boldness on social housing investment that we have not seen for a generation. It is the way to restore hope, build strong communities and fix the broken housing market so that we meet both the needs and the aspirations of millions of people.”

Kate Henderson, chief executive of the National Housing Federation, commented: “This is a landmark report from Shelter and we are encouraged by the overwhelming public support for social housing they have uncovered.

“The report also calls for a rebalancing of the relationship between housing associations and their tenants.We support this ambition and have been working with our members and tenants to ensure that housing associations are among the most trusted, accountable and responsive organisations in the country.”

Sinead Butters, chief executive of Aspire Housing and chair of Placeshapers, said: “We want the regulator to regulate consumer standards as robustly as economic and governance standards – they are intrinsically linked.

“We worry that splitting the regulator in two wouldn’t help drive up standards, and would create unnecessary bureaucracy. This has to be the moment when all parties agree – more resource and stability for the regulator, new or strengthened standards and proactive enforcement, not just relying on the serious detriment test.”

Communities Secretary James Brokenshire said: “Providing quality and fair social housing is a priority for this government and our Social Housing Green Paper seeks to ensure it can both support social mobility and be a stable base that supports people when they need it.

“We’ve asked tenants across the country for their views and the thousands of responses we’ve received will help us design the future of social housing.”

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Jim Kersey
Jim focuses on the socio-economic impact of housing. His reporting for Property Notify often touches on topics such as changes in sentiment among investors in various housing sectors, as well as the impact of various developments on the average person.

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