The increase in social rent homes is insufficient to compensate for losses from RTB and demolitions
The London component of the funding from the government’s Affordable Homes Programme for five years, beginning in 2021, has just been announced. It’s an improvement insofar as there is more funding for social rent council homes than previously. Thankfully “affordable rent” (up to 80% of market rent) has been abandoned. According to the GLA the five year programme will produce 29,546 homes, council and housing association, 57% of which will be social rent. Around half of these will be council homes – 8,436.
Unfortunately when you compare this with the loss of homes through Right to Buy sales the new build is way below what is needed. Over the last five years the London Boroughs have lost more than 18,000 homes to RTB and demolition: 6,262 demolished, 12,028 sold under RTB. RTB sales in London are declining because of the continued rise in house prices, but even if they remained at the 2019-20 level of 1,459 for the next five years that would be more than 7,000. When you factor in the number of demolitions, the social rent building does not even compensate for the loss.
Of course, this is the responsibility of national government owing to the shortage of grant available for councils. The main emphasis of the government remains directed to ‘getting on the housing ladder’.
Why are councils building 3,500 “affordable home ownership” homes when then is such a desperate shortage of social rent homes? It’s not just Tory councils. Barking and Dagenham Labour council’s programme is two thirds “affordable home ownership” and only a third social rent. Ealing Labour council is building not far short of half of their homes for “affordable home ownership”. Some say they are building “affordable home ownership” homes because the finances don’t stack up. There is not enough grant for them to build just social rent. However, eight Labour councils are using the grant solely to build social rent homes. There are also wide variations in grant between boroughs the reasons for which are not obvious even when you take account of different costs of building.
What this programme underlines is the need for a concerted national effort to demand the end of right to buy and increase the level of grant necessary to fund a return to large scale council house building for councils.
Nationally, with more than 10,000 council homes sold under RTB every year and more than 2,000 demolitions a year, even a building rate of 13,000 a year who only be a standstill position.
Greater London Assembly funding
|City of London||200||150||50||£16,500,000||£82,500|
|City of Westminster||230||106||124||£24,079,955||£104,695|
|Barking & Dagenham||1,757||573||1,184||£171,033,390||£97,344|
|Hammersmith & Fulham||394||186||208||£32,304,000||£81,989|
|Kingston upon Thames||105||105||–||£13,125,000||£125,000|
|Year||Demolitions||Right to Buy sales|