How ‘perfect storm’ blew away planned social homes England needs

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How ‘perfect storm’ blew away planned social homes England needs

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Housebuilders say they have thousands of affordable homes ready to be built but no buyers

England has a housing crisis – more than one million families and individuals are on the waiting list for a social home.

Experts think 90,000 of these homes need to be built every year for a decade to house everyone – but less than 5,000 were completed in the past year.

And there are fears the problem will become even worse.

We spoke to organisations working in the planning, building and management of social homes who tell us they are in a “perfect storm” of financial uncertainty, unsuitable construction and huge bills for repairs.

The result, they say, is that thousands of sites earmarked for affordable and social housing are not being built despite the enormous need.

The Home Builders Federation, which represents housebuilders, told the BBC their members have at least 13,000 affordable properties, including social homes, ready to be built right now.

But they can’t start because there are no housing providers to buy these properties.

“It is a major and growing problem that is increasingly threatening affordable and overall housing supply,” says Steve Turner, executive director at the Home Builders Federation. “Small sites are being prevented from starting and larger sites are being halted as a result.”

Tragedies of Grenfell and Awaab

The largest problem, experts tell us, is that housing providers – predominantly housing associations – no longer have as much money to spend on buying new properties as they did before.

Housing associations are mostly not-for-profit organisations that buy up affordable properties and rent them as social homes to low income tenants at discounted rates, receiving a government subsidy to do so.

They’re having to spend more money on repairing the homes they already own, they say – meaning less to spend on buying new properties.

In the aftermath of the Grenfell *****,

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have spent billions of pounds replacing it.

The National Housing Federation (NHF), which represents housing associations, estimates it will cost their members £6bn.

They also say they are spending more money on fixing damp problems following the ****** of two-year-old Awaab Ishak, who ***** of breathing problems caused by mould.

A new law named after him will require landlords who own social housing

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.

Housing associations are making less money from renting out social homes, too, they say.

Marie Chadwick, policy leader at the NHF, explains that over the last decade the government has been cutting and capping the rent paid by social housing tenants.

“This equated to £3 billion in lost rental income for housing associations last year,” she says.

As well as having less money than expected, the frequently changing rent levels mean housing associations struggle to predict how much rental income they will have in future, they say.

They say that this uncertainty makes budgeting how much they can spend on buying new properties more difficult and reduces the amount of money banks are willing to lend them to fund these purchases.

High interest rates also make borrowing this money more expensive.

‘Financial havoc’

The situation has gotten so bad that several councils warn they could go bankrupt unless more social homes are built – because of the money they’re spending on temporary housing for people on waiting lists.

In the past year they spent more than £1 billion on temporary accommodation for people with nowhere else to go.

If their areas had more social homes, they could house these people instead of paying for them to stay in hotels and hostels.

Some councils still buy and manage their own social homes – but the financial pressure they’re under means they can’t afford to buy the new properties being offered by housebuilders, they say.

Claire Holland, chairwoman of London Councils, which represents the 33 based in the city, says the housing crisis is “

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” and that “the current

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is bleak”.

These financial problems, affecting housing associations and councils, were described to us repeatedly as the main reason why thousands of sites earmarked for affordable and social housing are not being built – despite England’s enormous need for them.

‘Not what we want’

There’s also the problem of the social homes not matching what the housing associations want.

A common complaint is that they are being offered too many one-bedroom flats and not enough family homes.

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Housing associations also say too many of these homes have gas boilers, which don’t fit their plans to be more environmentally friendly. The *** is legally obliged to reach net zero carbon emissions by 2050.

Several organisations told us that more of these planned social homes might have been bought if housing associations had been more closely involved at the start of the planning process.

Housebuilders say their homes were approved by councils and that changing them now to suit the wishes of housing associations would be costly.

“It’s a perfect storm,” says Ms Chadwick, an assessment several other people we spoke to agreed with.

“These factors have inevitably led to a reduction in plans for building new affordable and social housing at a time when they are needed more than ever.”

Government’s conundrum

What might help? Housebuilders say that homes previously agreed to be built as affordable housing, under what are known as Section 106 contracts, could be allowed for ***** on the open market.

They say this would allow them to build more homes and help meet the government’s overall target for house building –

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In return, housebuilders would give some money from these sales to councils.

But that doesn’t help councils get the social homes they need for families stuck on the waiting list.

Another possibility is for the government to alter the rules around the way housing associations can spend the money they are given or – as was often said to us – they could give them more money overall to buy newly built social homes.

But Labour has consistently said the public finances are tight after inheriting what they claim as

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The government is to announce a new budget this month and Polly Neate, chief executive of Shelter, says they must provide more funding.

Her charity and the NHF were responsible for the research

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– a target endorsed in May by a committee of MPs who specialise in housing issues.

The government says it recognises the need, with the ministry of housing telling us the next five years would see the “biggest increase in social and affordable housing in a generation”.

Ms Neate adds: “If we truly want economic growth in this country, we can’t afford not to build.

“The government must set a clear target and invest in a new generation of social rent homes – building 90,000 a year for ten years will clear social housing waiting lists and end homelessness for good.”

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