Regeneration or Gentrification?

How to improve housing conditions in an area whilst keeping the cost of living there within the reach of people on low incomes has been a key issue in housing for as long as I can remember, and especially in London. In the 1970s I was involved in campaigns to protect low-cost housing against gentrification in Paddington and then more widely. At that time a lot of social housing was being built (Tory Westminster alone was producing nearly 1,000 homes a year, mostly on former railway land), so the gentrification process was restricted to the private sector.

In the 1960s people like Rachman made huge fortunes by removing established tenants and packing houses with immigrants who could not get housing elsewhere, profiting from overcrowding. As market conditions changed, in the 1970s the practice of ‘winkling’ became common. Speculative landlords still bought run-down inner city property and shifted established tenants out, but now they were more likely to convert the houses for a newer richer group who could afford higher rents or to buy.

In Islington the campaign against the notorious estate agent Prebble became the focus of regular demonstrations outside their offices in Upper Street – and heavy-handed police action it also has to be said. There were long campaigns to save traditional local communities across Inner London, including Barnsbury, Covent Garden and Pimlico. In some boroughs, councils and progressive housing associations intervened by buying out landlords, rehousing the tenants and improving the properties for future social tenants.

Thatcher ended council municipalisation programmes after 1979 but this was also followed by a major shift in emphasis amongst housing associations from the purchase and refurbishment of street properties towards new build. In turn this was followed by the deregulation of the private rented sector, leaving us with an unfettered market that has been busily gentrifying the capital as shortage has grown and values have risen. We have seen the gradual transformation of many of London’s traditional working class communities into much more affluent and expensive neighbourhoods. The process is well known but, with a growing number of hotspots and the advent of the global super-rich, it is now spreading well into outer London. By restricting the ability of people on low incomes to live in more affluent areas, the welfare reforms are probably the final nail in the coffin of these historic communities.

The ability of poorer people to stay in affluent neighbourhoods has become more and more dependent on the availability of social housing in those areas, a big and hugely valuable legacy of generations of housing policy in inner London. In the 1980s the focus rightly turned to look at the quality of the many estates built between the wars and after WW2. Well-intentioned ‘estate regeneration’ schemes started in an era when the supply of social rented homes was sufficient to enable extensive ‘decanting’ to take place, and tenants were normally promised the right to local rehousing in a new or refurbished home at social rents. A succession of Government schemes brought estate improvements which benefitted existing residents.

The phenomenal rise in property prices in London brought attention to inner London estates because they sit on extremely valuable acres in good locations. If only their latent value could be released, whole areas could be transformed and new neighbourhoods created. In the most valuable places, like along the river, new ‘quarters’ could be created and profits could be used to build new social housing elsewhere. Government, national and local, realised that regeneration could be done with little or no subsidy as long as sufficient private homes for sale could be included. As public borrowing remained constrained, private borrowing by developers, including housing associations, became the natural model.

The politics of housing through this era meant that council housing had few friends. The new generation of Tories were mainly hostile and council housing was not quite a New Labour thing. Developers obviously wanted as much private housing as possible and many housing associations were transitioning away from social housing provision towards mixed tenure development with social housing a smaller and smaller proportion. The perceived wisdom was that council estates, even in otherwise rich parts of London, were drab ‘monotenure’ concrete monstrosities dominated by unemployment and criminality. It was obviously much better if they were replaced by bright new developments of ‘mixed tenure’ homes.

Of course some of the estates were shockingly built and many were also badly managed, but even so it has been rare for tenants to call for redevelopment rather than refurbishment. The normal call is for the community to be preserved, for refurbishment to take place and for better management and maintenance to be put in place.

Despite the appearance of being high density, many estates use land inefficiently. Spare land and rising values meant that opportunities for adding to the stock (or densification) began to open up, sufficient to finance and facilitate a wholesale regeneration or redevelopment. The finance tail was finally wagging the housing strategy dog. The bigger the scale, the grander the vision, the greater the planners’ desire to sweep away nasty council estates and replace them with ‘mixed communities’, the less influence residents seemed to have. Big estate regeneration schemes in London involved the loss of tens of thousands of social rented homes that were replaced by more housing, but much less social housing. Regenerated estates contributed little to meeting the needs of the waiting list, often they were a net drain. In a borough like Brent, which has had four or five major estate regeneration schemes, the wider implications for supply have been felt for many years.

In recent years some Labour boroughs have insisted on the complete reprovision of the social rented housing involved in the scheme, but this has rarely been achieved. Despite often good intentions, rising costs during a scheme tend to create pressures to increase the number of homes for sale and to reduce the amount available for social rent. More recent, the obscenity of unaffordable ‘affordable rent’ has added another layer of confusion as promises focus on badly defined ‘affordable homes’ rather than social rented homes. Some developers think that the social housing element will depress private sale values and will do anything to wriggle out. And on top of it all, we now have a London Mayor who actively intervenes to promote ‘regeneration’ that has next to no social rented provision and who uses his powers to block or prevent Labour boroughs who wish to ensure a fair share of social renting in redevelopments.

Last week the Homes and Communities Agency and the Mayor launched the bidding process for the latest miniscule housing pot, this time it is the £150m fund for estate regeneration schemes to start in 2015/16. Some of the reasons for regenerating estates given in the prospectus sound ok: they include estates that were built at quite low densities that do not always use land well. And I would support the prospectus’s statement that ‘The best regeneration projects actively involve residents so that the new homes and area are re-developed to meet local needs, provide well-designed and high quality new homes and reflect a sense of community identity.’ However in practice it is hard to believe that this is what most estate regenerations are about.

The rules around the new scheme help explain why ‘regeneration’ has moved away from the aim of serving the interests of existing residents and people in housing need towards a corrupted vision of what a mixed London neighbourhood should look like. Despite all the talk about how poor these estates are, the Government money is delivered as loans not as subsidy. The Government’s investment must be returned, schemes must ‘work with the grain of the market’, and total public funding will be required to be less that 50% of the total project costs. It says ‘Funding will only be delivered to private sector partners’ and the delivery body must not be classifiable as a public sector body.

It is a good thing therefore that the London Assembly’s Housing Committee has launched an investigation into the ‘Demolition and Refurbishment of London’s Social Housing Estates’. I hope their work will focus on the loss of genuinely affordable housing through so-called regeneration over the past few years and look for improvements in future. I also hope that Labour London boroughs will take a stronger line – protecting existing communities and delivering social housing must be the top priorities.

Developers are eyeing up estates across the capital in the currently febrile property market. Council estates have been the bulwark against gentrification since the 1970s. They are the largest remaining pool of genuinely affordable homes and must be protected. London Tenants Federation have estimated that more than one-third of new social rented homes built in London from 2007 to 2013 were just replacements for others that were demolished.

The first evidence session for the Assembly investigation comprised mainly tenants’ groups (and including the often forgotten leaseholders) from around the capital and makes interesting viewing – it can be found here .

LTF is to be congratulated for the work they have done in this field. They have issued advice to tenants facing regeneration and redevelopment proposals – which can be found here.

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