Sunday, 22 July 2012

Coalition "affordable rents" are not affordable

In one of my most recent articles for the Cornish Guardian, I hit out at how the Coalition is undermining the provision of truly affordable homes. It was as below:

The massive hike in the cost of housing since 2000 has done great damage to the very fabric of our towns and villages.

Hardworking families, making do on low local wages, are finding it ever more difficult to buy their own homes. More and more families are struggling to afford private sector rents, paying a truly disproportionate amount of their income to simply keep a roof over their heads.

And for so many, the dream of a “council house” remains just that – a dream – as we are still feeling the legacy of the Thatcher Government’s sell-off of thousands and thousands of publicly-owned homes.

The need to tackle the cost of housing is one of the most important issues facing central government, but Grant Shapps and his fellow ministers are failing to address it.
It is shocking that the Coalition Government has so drastically slashed investment in new affordable homes. Between 2008 and 2012, the Homes and Communities Agency invested £100 million in Cornwall. For the period 2012 to 2016, that figure has been cut to £19 million.

I have written previously about the decree from central government that new “affordable” rental properties should not be let out at low “social rents,” but at a new “affordable rent.”

This is set at 80% of the ridiculously inflated level of open-market rents, increasing the cost of housing to the less-well-off.

Instead of trying to make housing less expensive, these actions are further inflaming the housing market and will lead to higher costs in housing benefits. This is ridiculously counter-productive, but it gets worse.

A few weeks ago, I was studying the weekly advert in the Western Morning News for rental properties from various Housing Associations.

And there, hidden among the traditional adverts for two and three-bedroom properties, with rents set at £70 - £90 a week, there were adverts for new “affordable rent” properties. These included a two-bed flat for £140 a week and a three-bed house for £165 a week in St Austell, as well as a four-bed house in Trispen for £760 a month.

There is no way that such prices fall within 80% of average open market rents in these areas.

It turns out that central government is allowing providers of affordable housing some “flex” to increase the rents of their new properties if, for example, they are built to modern standards (aren’t they all?) or if the house is slightly bigger than the bare minimum, etc.

As a consequence, many of these new “affordable” properties are as expensive, or even more expensive, than what can be found on the open market.

This is madness. The Government has got it wrong and needs to rethink its whole approach to housing.

This weekend, I once again checked the Homechoice advert. It included a new “affordable rent” development in Falmouth (Westcountry Housing) with two-bed houses for rent at £621 a month and three-bed houses for rent at £660 a month.

Such prices are not affordable and I will be making further representations at County Hall on Monday.

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