Social housing sales outstrip building of new homes

28 Nov 18

Social housing sales outstripped the creation of new units in England by a factor of three to one last year, government figures revealed.

Ministry of Housing, Communities and Local Government statistics, published today, showed there were 20,891 sales of council and housing association rented homes.

Of these, 12,059 sales were by local authorities and 8,832 by housing associations.

Sales were down by 10% on the previous year but still above the level in 2012 before increased Right to Buy discounts were introduced. Then, there were just over 8,000 sales from the social rented sector.

The majority of sales (77%) were under the Right to Buy scheme, with the remainder through other means of sale and disposal including Social HomeBuy, Voluntary Purchase Grant or transfers to the private sector.

The figures showed that the average discounted offered by local authorities under Right to Buy was 42% of the selling price, 15 percentage points higher than in 2011-12.

In the housing association sector, Right to Buy discounts averaged 51% of the selling price, 20 percentage points higher than in 2011-12.

However, housing supply data published by MHCLG last week revealed there were 6,463 social rented homes delivered in 2017-18 – 84% fewer than in 2010-11.

Commenting on the figures, Greg Beales, campaign director at the housing charity Shelter, said: “These figures make it painfully clear – we’re still delivering far fewer social homes than we’re selling off.

“There is no easy way to gloss over the fact that for every three homes sold, only one gets built. This is nothing short of a disaster when hundreds of thousands of people are currently homeless, and millions more are struggling in deeply insecure and expensive private renting.”

Mark Robinson, chief executive of the Scape Group, a public sector partnership focused on building public infrastructure, said “radical solutions” were needed to close the gap between the number of social homes being sold and those being built.

“One hundred per cent of the councils we surveyed would like to be able to fund and build more housing for social rent, but lack the necessary resources. I believe that the answer lies in the past.

“We must empower councils to build social housing themselves – as they were in the 1970s before housing associations started to occupy a key role as non-governmental delivery agents.”

Meanwhile, the Local Government Association has said permitted development rules, which allow developers to convert office buildings into housing without planning permission, are exacerbating the social housing crisis.

Since 2015, 42,000 housing units have been created from office stock without going through the planning system, the LGA found.

“Permitted development rules are taking away the ability of local communities to shape the area they live in, ensures homes are built to high standards with the necessary infrastructure in place and have resulted in the potential loss of thousands of desperately needed affordable homes,” said LGA housing spokesman Martin Tett.

  • Vivienne Russell

    Vivienne Russell is managing editor of Public Finance magazine and publicfinance.co.uk

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