20 Aug 2012

Is it common sense to sell off our social housing?

It is a blindingly obvious idea, according to the housing minister, Grant Shapps. What’s not to like?

Councils should sell off their most expensive properties and reinvest the money to build cheaper homes for their tenants in cheaper areas.

It’s an idea put forward by the think tank, Policy Exchange, and perhaps best summed up by its director, Neil O’Brien: “Social housing tenants deserve a roof over their heads – but not one better than most people can afford.”

And it’s that notion of what you “deserve” as a council tenant, which has sparked off a huge debate today.

The gist of the Policy Exchange report, Ending Expensive Social Tenancies, is this.

Expensive council homes – judged as properties worth more than the average in each region – account for just over 20 percent of all social housing.

Around 28,500 of those properties are freed up every year, when tenants die or choose to move out. If those homes were sold they would make more than £5bn leaving plenty of cash to build between 80,000 and 170,000 new homes.

Grant Shapps isn’t the only one who thinks it’s just common sense. Downing Street backed the plan today.

But among those who actually provide homes for some of the country’s 4 million council tenants – and don’t forget, there are a further 1.8 million on the waiting list – there was real concern.

Keith Exford is the chair of the G15, representing 15 of London’s largest housing associations. For him, this notion of social housing tenants being “undeserving” of a particular type of house in a particular area, is a very dangerous one

He takes issue with the narrative which surrounds it – the popular image of council tenants “living it up” in million pound houses. “I think there are far fewer of those properties around than is being suggested,” he says.

More realistic in his experience are people, many of them working for low pay, who’ve ended up by accident living in an area where property prices have spiralled.

“I think it would be a retrograde step if they say poor people aren’t allowed to live here. I think it would lead to a concentration of disadvantage.”

But while the debate rages, no-one – not even the Policy Exchange – is anticipating anything moving very quickly on this.

Nevertheless it’s an idea not to be ignored. There’s little question that this would be hugely popular, not least with Tory voters.

There is an interesting practical point, made by the director of the Social Market Foundaion, Ian Mulheirn. In principle, he thinks it makes some sense – local authorities selling off pricier properties to reinvest in cheaper ones.

His thought: whether in the current climate the Treasury would allow them to keep the cash or “snaffle it for themselves.”

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