By Ross Fraser
“Nobody’s perfect” (Closing line of Some Like It Hot: Billy Wilder 1959)
Red Brick readers will be familiar with local authority concerns about the lack of alignment between new housing association supply and the social rent housing they need to meet their statutory obligations to those in housing need.
But the problem goes deeper. New lets are only 12% of the quantum of social lettings each year. The government-enforced conversion of social rent lets into higher ‘Affordable Rent’ lets is of equal concern. Around 25% of housing association lets are now at the (so called) Affordable Rent.
The issue of affordability of housing association lettings is the primary reason that relationships between authorities and associations have deteriorated in recent years. Yet few authorities have acted proactively by sitting down with housing association partners and defining what affordability means at a local level, across a range of housing products (rental and for sale) and what changes will be required to housing association rent policy to meet local needs.
In Building Bridges – A guide to better partnership working between local authorities and housing associations, we argue that authorities should take the lead by setting up Local Housing Affordability Frameworks which research the topic of affordability on a local authority or sub-regional basis and negotiate a deal with housing associations in respect of new supply and relets. We propose that the cost of this work is shared equally by authorities and their housing association partners.
Authorities might be surprised by the commitment of the best associations – like Sovereign which refused ‘on principle’ to convert social rent lets into affordable rents or Family Mosaic (now merged with Peabody) which secured grant for Affordable Rent housing and then let it at social rents through extensive cross subsidy.
Building Bridges also explores the vexed issue of nominations and allocations. Authorities are getting frustrated by associations refusing nominations because the applicant won’t be able to afford a (so called) Affordable Rent. Authorities are alarmed by those associations that are letting new homes on Rightmove rather than making them available for council nominees.
But associations validly complain that housing registers are being restricted to the very poor or locally connected, when there is clear evidence of housing need and a desire for mobility amongst young professionals and aspirant working families and a need to jointly intervene in the private rented sector. As a result, housing registers are no longer an accurate measurement of local housing need. Authorities are failing to work together at a sub-regional level to ensure mobility across housing markets and are (perhaps understandably) focusing their housing strategy on social rent and neglecting demand for other housing ‘products’.
In Building Bridges, we propose a new tech-driven system of allocations (linked to the local affordability framework) that covers all housing products – social rent, Affordable Rent, market rent, low cost home ownership – and ensures a steady supply of appropriate nominations for each. Again, we propose that the cost of this work is shared equally by authorities and their housing association partners. We propose that this system is operated collaboratively – and can be led by the authority or, where capacity is limited, by a well-resourced regional housing association. Midland Heart housing association is already operating such a scheme in the West Midlands.
Yet if authorities have valid criticisms about associations they should realise that its government funding policy that is the primary reason that associations aren’t supplying the homes and allocations that they need. Sure, there is a quota of associations that see themselves as property developers rather than as part of the social housing sector but the vast majority of associations want a return to government funding of social rent.
Authorities should also recognise that (not everywhere but very often) their performance on planning needs to improve. Only 41% have local plans which comply with the NHPPF. And it’s the authorities without compliant plans that are worst offenders in helping bring new sites to market. Only a minority of authorities have a planning strategy that makes sites available for genuinely affordable housing for five years. This is completely indefensible. Clearly, the 40% cut in planning staff in recent years and the loss of ‘enabling’ officers have contributed to this problem but why don’t authorities follow the example of mega-cash-strapped Bristol and increase investment in planning and enabling notwithstanding their financial pressures?
In Building Bridges, we propose a range of actions that authorities can take to maximise social rent housing provision, support development that can cross-subsidise non-grant-funded provision of social rent and combat developer attempts to undermine section 106 agreements – which currently account for 45% of new housing association supply.
The message for authorities in Building Bridges is simple. If you engage proactively with associations on affordability and allocations, and manage the market, you are more likely to get what you need from associations. And get your own act together on planning.
Building Bridges – A guide to better partnership working between local authorities and housing associations was published on 25 September by the Chartered Institute of Housing, sponsored by Vivid Homes and the Association of Retained Council Housing and written by Ross Fraser, John Perry and Gemma Duggan. It is available online.