A lack of investment in truly affordable housing means that many more Londoners will be priced out of the capital.
On Wednesday George Osborne announced the doubling of the housing budget to address the UK’s housing crisis. £2billion will go straight to developers to incentivise the building of new starter homes in an attempt to realise the vision of a ‘home-owning democracy’. The proposed £450,000 price cap means however that for many the new starter homes will be prohibitively expensive. Moreover yesterday’s proposals offer no reprieve for those struggling to pay inflated rents in the capital.
Parts of London such as Southwark and Lambeth are already experiencing state-led gentrification due to a potent mix of government policy, cuts to local authority budgets and international investment. This has so far seen a reduction in social housing, increased private rental and rising rates resulting in the displacement of low-income groups.
The government is set to accelerate this. In yesterday’s autumn statement George Osborne announced his plan to pay for services by selling off local authority assets. This is in addition to current proposals in the Housing and Planning Bill to sell off local authority accommodation to pay for the right-to-buy of housing association homes at discounted rates and new ‘affordable’ builds. The loss of more local authority housing would be devastating for many and remove existing protections for the poor and ‘vulnerable’ from dispossession and homelessness.
For the moment however, council estates remain home to a large number of Londoners and offer secure and truly affordable accommodation. This autumn we carried out research looking into the role social housing and the law currently play protecting those on low incomes, as well as the experiences and circumstances of tenants and the reasons for rent arrears.
Our findings suggest that owing to cuts to benefits and services local authority housing plays an essential role ensuring basic support needs of the poor and/or disabled are met. Unlike private and some housing association landlords, a local authority cannot evict a secure tenant for rent arrears unless they can demonstrate that it is reasonable in all circumstances for a possession order to be made. Even then, so long as the tenant agrees to make regular payments towards the debt, they will not be evicted from their homes.
This safeguard is essential for those on low incomes and/or benefits. For those already short of money, a sudden change in personal circumstances such as a relationship breaking down, bereavement or illness can quickly lead to rent arrears. Without the protection provided by local authority housing and the law many would find themselves destitute and unable to enter the private rental sector.
We also found that work doesn’t necessarily pay. Sixty-seven per cent of those we observed facing a possession order in court were in full or part-time work. Of those in full employment, particularly in care and service industries such as nursery nurses, teaching assistants, and cleaners, it was apparent that they were not paid enough to cover council tax, utility bills, food, travel and rent even when living in subsidised housing. Those on part-time or zero hours contracts also reported struggling to budget and manage rent payments due to precarious working conditions and inconsistent hours, while delays in housing benefit payments for over 50% of those observed were the original cause of rent arrears.
The research underlines the importance of retaining council housing. This is important for the UK as a whole, but especially important in the context of London where property prices and rents are some of the highest in the world, and where council estates are being demolished and regenerated for a new class of resident. If we believe that London and other British cities should be sustainable for all social groups then the government’s plans to sell off social housing as a short term fix to address the deficit should be fought at all costs.
Read the research report here: Why We Can’t Afford to Lose it: Local Authority Housing in London Protects the Poor from Homelessness
For more information about the project please contact Dr H White and Professor Loretta Lees.