Under-occupation – the market solution?

A lot more is said than done about the issue of under-occupation of social rented homes.

Grant Shapps has allocated a piddling sum of £13m amongst the 50 councils with the largest numbers of under-occupiers.  Of course it is a move in the right direction, if a small one, and the linked announcement that a central unit will be set up in the Chartered Institute of Housing should be a valuable resource supporting local initiatives. 

Ministers say there are 430,000 under-occupied social homes in England – where tenants have two or more bedrooms more than they require (against the ‘bedroom standard’).  I support the focus on  tenants with 2+ additional bedrooms because tenants with one spare room over the rather ancient ‘bedroom standard’ do not regard themselves as under-occupiers. 

With an estimated 258,000 social renters living in overcrowded conditions, simplistic arguments are sometimes made that the problem could be ‘solved’ if selfish older tenants were stopped from blocking social homes needed for larger families.  Calls for draconian action of some kind to require under-occupiers to move to smaller accommodation seem to have been rejected – the government says it has “accepted the basic right of older tenants to stay in their homes, and that policies of encouragement are better than those of coercion….. Ministers are clear that they will not force people to move – but want to provide a helping hand to those wanting to do so.” 

Just like older home owners, older tenants have often raised their families in these homes and are emotionally attached to them, still have many family visitors, are part of the local community, have neighbourhood support networks, and now have time to enjoy the garden if they have one.  They have probably paid for the property a few times over in rent, and now contribute through rent pooling to the cost of homes elsewhere. 

Bespoke solutions are needed, with landlords who know their tenants talking with them individually and devising a solution that meets their needs and preferences.  It might involve financial incentives, a choice of suitable alternatives in preferred locations, and practical support with moving and other arrangements.  We need far more schemes like the London Seaside and Country Homes scheme, offering tenants genuine retirement opportunities if that is their choice.  It is regrettable that financial incentives to downsize have been cut back in many places – I suspect by an amount many times greater than Mr Shapps’ new fund.     

Mr Shapps says that he wants to “make it easier for those tenants wanting to move from larger family homes to smaller, more manageable homes, to do so.”  But where, exactly, are these homes?  Like people who are being decanted for development, older tenants realise that they have a little bit of negotiating strength for once.  They will only accept somewhere smaller if it is in some way better or suits their needs more than their current home.  The right to buy and the failure to reinvest mean that there are many fewer smaller dwellings on the ground floor in good locations with access to outside space.  Many top class sheltered housing schemes have had their onsite wardens removed due to changes in the Supporting People regime.  There is little new development.  As in so many other areas, supply and short-sighted funding regimes are the barriers to a sensible policy.   

Now for the warning.  Everything is not always what it seems with this government.  We should not forget the analysis of Mr Shapps’ friends at Localis.  In their report on social housing reform, which pointed the way to many of this government’s policies, they argued for a market approach not a change in powers:

“There has been a number of calls for Landlords to gain more power to require tenants to move to more appropriately sized accommodation to deal with under-occupation. Whilst such powers would assist with this problem, the move to market rents and personal subsidy would, in our view, address this in a more fundamental way as under-occupancy will become more expensive for tenants as their rents, but not their housing benefit, rise.” 

We have had a number of policy shifts in this direction already,  both through rents policy and housing benefit.  Call me cynical  but, despite the warm words, I think this is the real agenda.

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4 Responses to Under-occupation – the market solution?

  1. Pingback: Callous, coercive and destined to fail | Red Brick

  2. טיולים says:

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  3. Bernard Crofton says:

    Thanks Steve for that link: I hadn’t read that Localis stuff before.
    I particularly liked :
     A common and consistent tenure.
    This calls for tearing down the Berlin Wall of varying tenure
    and rent levels that operates between the private rented and
    social rented sectors to promote easier understanding and
    more transparency in management.

    So rent control then, with security of tenure, for private tenants? That’s easy to understand and transparent in management. More transparent than sealed rent bids for private rented flats, anyway.

    On underoccupation:
    It isn’t easy and it isn’t cheap. As a new lettings officer in the 60s, I was told for four weeks to do nothing but fix up “mutual exchanges” of corporation tenants. Eventual success? After four weeks enthusiastic work I got one “pair” to swap. And I was paid over £17 a week for 4 weeks to acheive that!

    Over the years I found solutions that worked. Build one or two new small units in a street, specifically for neighbouring over-occupying pensioners; give o-o’s their RTB discount in cash, etc.
    I understand Heydrich had more success with his methods of getting people to move.

  4. Dan Filson says:

    There may be a case for enabling those tenants in social housing who have two or more bedrooms more than they require (against the ‘bedroom standard’) to’cash in’ on their ‘asset’ which has considerable social worth, by means of some kind of incentive to move down, for example a guaranteed fixed rent in their new dwelling for a defined period of years. If no incentive can be conceived then what may happen is that they exercise a right to buy (I’m assuming legislation will enable this to resume if it is not currently permitted) using borrowed funds, and this would lose the housing unit to social housing for good. One option for the single dweller who has two or more bedrooms more than they require would be the removal of the single dweller discount.

    It may be social landlords already have a power to move under-occupying tenants in some obscure clause of their tenancy agreements but fail to exercise that power for reasons best known to nobody.

    I have always thought the highest priority is to get people housed in dry, warm housing at a price that is affordable and has sufficient space for their needs – nobody has an absolute right to under-occupy a much larger property than they need.

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