Lessons from Newcastle?

Yesterday, I went to the launch of ‘Homes for Citizens’, a pamphlet from the Fabian Society, supported by Crisis and the housing association Moat.

Like all housing associations Moat are trying to pick their way through the government’s ‘affordable rent’ package and assessing what their role should be.

They are maintaining security of tenure for their tenants. However, they propose housing should be made more flexible by allowing landlords to change how much people pay for their home depending on their level of income. Tenants could also change their tenure to one of shared ownership if they could sustain those costs.

There’s plenty that’s attractive in this vision. In all cases, the tenant stays in their home as long as they wish. A scarce resource (homes with low rents) is more efficiently distributed and those who pay higher rents provide extra revenue for the housing association to invest. It seems a fair way to expand social housing to those not in the categories of greatest need so that it serves a wider range of people.

The operation of this however sounds like a nightmare and it’s a brave housing association who’d take it on, even if the law allowed it. Brian Johnson, Moat’s Chief Exec, said rent re-appraisal would be done on a periodic basis, perhaps every 2-5 years and could go up as well as down. This would risk mirroring the work disincentives of Grant Shapps’ mad plan to expel the employed from social housing: if you get a job, we’ll hike up your rents. And it would significantly change the relationship that a housing association has with their tenants. They’d need to assess household finances, means test and work out who was hiding income.

It did remind me however of a conversation I had with an area manager of a housing association in Newcastle. That’s Newcastle Australia. She described visiting her tenants on a regular basis to check the condition of the property, provide information about work and training and ask about any repairs that needed doing. She also calculated their rent while she was there, which was 35% of household income (so no work disincentive cliff-edges). If their income had changed since the last visit, she’d recalculate and that would be the rent until the next visit or unless the household notified her of a change.

I’m sure in Newcastle plenty of people try to hide income to keep their rent down and the arrival of your local housing officer after someone in the house has just found a job isn’t entirely welcome. But, secure tenure in a home, with finances that flex with your circumstances isn’t impossible to do and has a lot going for it.

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