Selling expensive council houses can't accommodate the future

"What might be an appropriate tactical response in some cases could not be considered to be a comprehensive strategic solution."

According to the latest government figures, the number of households in England is expected to grow by 232,000 per year over the next twenty years. Last year, we completed just 109,000 homes, with rates falling again in the first quarter of 2012. How can we bridge this gap and what combination of tenures would best meet the needs of the population? With the economy in double-dip recession and access to mortgages constrained, most of these homes need to be for rent, although an element of housing for sale, possibly using a rent now, buy later model, would help to ensure more balanced communities.

A recent Policy Exchange report proposes that the volume of affordable housing could be increased by at least 80,000 homes per year by selling off social housing properties in high-value areas and replacing them with new homes in low-value areas. This might be an appropriate tactical response in some cases but could not be considered to be a comprehensive strategic solution to providing sufficient affordable homes.

There are a few difficulties with the Policy Exchange approach.

Firstly, it is a reactive approach that can only come into play once a home becomes vacant, so it is difficult to plan a new development when the timing of the cashflow to fund it is so uncertain. Inevitably, there would be a delay with fewer affordable homes available, before the new homes could be constructed.

Secondly, over the long term, we risk denuding high-value areas of all affordable housing, pushing families on lower incomes away from their places of work, reducing their disposable income and putting additional pressure on the transport system. It would also create greater pressure on public services in low-value areas. Having said that, many social landlords are making judgements about the appropriateness of their existing stock as they become empty, so this approach is already in place in some areas. Alternatively the homes may be retained by the landlord but let at 80 per cent of the market rent, which would generate a better income stream for the landlord while retaining the housing mix in the area.

The efforts of the coalition government to encourage house building, by streamlining the planning system and giving some support to stalled schemes, have failed because they are largely relying on the private developers to deliver the increase and they will only build where they can make a profit, difficult when first-time buyers find it so difficult to access mortgage finance. There are few private companies undertaking development for rent so this is a gap in the market that social landlords could exploit, at the same time as making a significant contribution towards bridging the gap between the number of new homes and new households.

Housing associations have access to relatively cheap finance, they have established development teams who know their areas and have good relationships with local councils, and they have the scale and housing management expertise to manage a large portfolio of rented stock efficiently. Under the current Affordable Homes Programme, most new affordable housing is being let at 80 per cent of market rent, well above social housing rent levels in most areas. This model requires relatively little capital subsidy (in many cases, none) but the higher rent levels are increasing the housing benefit bill for households on low incomes. Indeed the properties in high-value areas could be relet at market or sub-market rates and the cashflows from these used to support borrowing to build more homes.

Using their scale, financial strength and community knowledge, housing associations should be able to increase the volume of new rented housing without subsidy, while still being able to let at rents a little below the market rent level. These should be secure homes in which families could remain long-term without the fear of being pushed out at the end of a fixed-term tenancy introduced under the current regime. There would also be no requirement to means test the tenant population to identify the high earners who would be paying higher rents under the proposed “pay to stay” policy.

The government has begun to recognise that increasing the rate of house-building would also have a significantly positive effect on the economy, reducing unemployment and largely sourcing materials from within the country. An announcement is expected soon that the government will guarantee housing association loans, enabling them to further reduce the cost of capital and thus their costs of development. This is an opportunity to scale up the delivery of new homes for rent well above the level envisaged in the Policy Exchange report.

A man walks in late afternoon sunshine on the Heygate housing estate near Elephant and Castle on February 11, 2010 in London, England. Photograph: Getty Images

Chris Mansfield is a managing consultant at Hargreaves Risk and Strategy, a consultancy working in the housing association sector.

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“It was like a religious ceremony”: What happened at Big Ben’s final bong?

Both inside and outside Parliament, people gathered to hear the clock’s final midday chime before undergoing repairs.

“It’s just hacks everywhere,” a photographer sighs, jamming his lens through a gap in Parliament’s railings to try and get a closer look.

New Palace Yard, Parliament’s courtyard directly below Big Ben, is filling with amused-looking journalists, waiting for the MPs who have promised to hold a “silent vigil”, heads bowed, to mark Big Ben’s final chime before four years of silence while the tower’s repaired.

About four of them turn up. Two by accident.

It’s five minutes to twelve. Tourists are gathering outside Westminster Tube, as tourists do best. A bigger crowd fills Parliament Square. More people than expected congregate outside, even if it’s the opposite within the Palace. The world and his phone are gazing up at the sad, resigned clock face.


“It’s quite controversial, isn’t it?” one elderly woman in an anorak asks her friend. They shrug and walk off. “Do you know what is this?” an Italian tourist politely asks the tiny press pack, gesturing to the courtyard. No one replies. It’s a good question.

“This is the last time,” says another tourist, elated, Instagram-poised.

“DING DONG DING DONG,” the old bell begins.

Heads down, phones up.


It finishes the on-the-hour tune for the last time, and then gives its much-anticipated resignation statement:

“BONG. BONG. BONG. BONG. BONG. BONG. BONG. BONG. BONG. BONG. BONG. BONG.”

Applause, cheers, and even some tears.


But while the silly-seasoned journalists snigger, the crowd is enthusiastic.

“It’s quite emotional,” says David Lear, a 52-year-old carer from Essex, who came up to London today with his work and waited 45 minutes beneath Big Ben to hear it chime.

He feels “very, very sad” that the bell is falling silent, and finds the MPs’ vigil respectful. “I think lots of people feel quite strongly about it. I don’t know why they’re doing it. During the war it carries on, and then they turn it off for a health and safety reason.”

“I don’t know why they can’t have some speakers half way down it and just play the chime,” he adds. “So many tourists come especially to listen to the chime, they gather round here, getting ready for it to go – and they’re going to switch it off. It’s crazy.”

Indeed, most of the surrounding crowd appears to be made up of tourists. “I think that it was gorgeous, because I’ve never heard him,” smiles Cora, an 18-year-old German tourist. “It was a great experience.”

An Australian couple in their sixties called Jane and Gary are visiting London for a week. “It was like a religious ceremony, everybody went quiet,” laughs Gary. “I hope they don’t forget where they put the keys to start it again in four years’ time.”

“When we first got here, the first thing we did was come to see it,” adds Jane, who is also positive about the MPs who turned up to watch. “I think it’s good they showed a bit of respect. Because they don’t usually show much respect, do they?”

And, as MPs mouthing off about Big Ben are challenged on their contrasting reactions to Grenfell, that is precisely the problem with an otherwise innocent show of sentimentality.

Anoosh Chakelian is senior writer at the New Statesman.