Why I’m rejecting Help to Buy

I’m rejecting Help to Buy, here’s why you should too.

Firstly, apologies, the title is a bit of a necessary white lie. I’m actually rejecting all forms of state assistance to buy a home currently on offer. But frankly a title that says “Why I’m rejecting, Help to Buy, Rent to Buy, the expanded shared ownership programme plus other miscellanea relating to Government schemes to purchase a home” doesn’t quite have the same ring to it. But you get the point.

As someone who has worked ‘professionally’ since graduating, who has had to move homes on an above average basis, who has experienced in-work poverty (that sucks kids, don’t try it) and who has been unable to save for a house because you know, life. It might be a bit odd to some to reject the assistance available. Particularly given the breadth of schemes on offer.

List of Schemes Currently in Play

  • Help to buy – Equity Scheme
  • Help to buy – mortgage guarantee
  • Starter Homes
  • Shared Ownership
  • Rent to Buy
  • Right to Buy v2.0 for LA tenants
  • (Voluntary) Right to Buy for HA tenants
  • ISAs to save

Why the hissy fit?

Fundamentally money that was going to be spent on housing the most in need in this country will now be spent elsewhere. Yet many of those who on the face of it would be set to be helped by Starter Homes (those unable without the cash and/or credit to buy, but ineligible for social housing) probably won’t be able to afford it. Had to rely on figures from Shelter here, because the Government appears to have lost the fag packet on which they did their sums.

As someone who puts a great emphasis on social justice the latest set of proposals from Government are incredibly nauseating to take. As someone who works in Performance, where methodology and reasoned decision making is important this blasé approach is deeply concerning. But it as a taxpayer that I’m fucking fuming. Money is being thrown around in the wrong way, often at the wrong people. In attempting to make it rain for the middle and lower middle class this Government has decided to stretch the definition of a affordability to its very limits. In doing so it is continuing the creeping death of social housing and the distortion of a highly dysfunctional housing market. That doesn’t end well, for anyone.

Right to Bollocks

The political bung that is the Right to Buy extension to Housing Association tenants, albeit in a voluntary form and with some tweaks after an agreement between Government and the sector (well, most of it), highlights the absurdity of thinking going on. Much needed council housing will be sold off to pay for other people to buy much needed social housing. Even with a like for like replacement (even 2 for 1 in London) it is unlikely that a net loss of social housing will be avoided. But that’s not the point. Replacements have never matched the numbers being sold, and despite some debatable sums being thrown about, the jury is very much still out. Often once sold the same property is then let at market rent. In many instances the person renting the RTB property is then claiming housing benefit. Meaning that the lucky owner profits twice at the expense of the general public. That is utter madness and piss poor value for money.

At a time of increasing homelessness and at best stagnated progress on inequality it is a disgrace that these policies are being pushed through without a social housing element. This country needs more of all kinds of housing. Not just the type that hopes to win votes. In the end this is what matters. Cameron et al. have decided to abandon those at the bottom of the pile to help those higher up. I want no part of that. Period.

You can find more of my stuff here and follow me on Twitter here.

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A Problem Shared, A Problem Halved?

In many ways the Shared Ownership product is a rather useful metaphor when looking at the Social Housing sector in the UK. Those who know it, who ‘get it’ tend to champion it to the bitter end. Outside of the bubble rumour, misinformation and gossip tend to undermine something that, in the right place, at the right time and the right people can be an invaluable alternative to mainstream housing. Oh that’s the other thing, it’s totally outside the norm for most people as well.

Some Light Reading

If you haven’t had a chance I would strongly recommend reading Orbit and the CIH’s report on making Shared Ownership the 4th mainstream tenure. It rather accurately and succinctly sums up the product and doesn’t shy away from drawing out some of its deficiencies (in its current form) notably:

  • Inflexibility around moving between shared ownership properties
  • Potentially costly requirements tied to stair-casing
  • Failure to market a consistent product
  • Localised variations to a nationally offered product
  • Considerable difference between supply and demand
  • Limited lender appetite

There are of course some significant pros, for the most part:

  • A pathway to full home ownership for those marginalised by the existing market
  • Security of tenure for those looking for a way out of private renting
  • Flexibility (to a point) to adapt one’s housing situation to their financial one
  • Affordability in an increasingly disjointed housing market

The Broader Context

The Government has substantially increased funding available for Shared Ownership, tying in to a belief (ideological as much as anything) that Home Ownership is the main tenure that should be supported. After the inevitable willy waving, and blaming of a party that hasn’t been in power since 2010, the detail is interesting to say the least. A total of£4.7bn has been set aside for Shared Ownership and Affordable Homes for the 5 year period 2016 to 2021. That mulla will fund:

  • 135,000 homes for help to buy and/or Shared Ownership
  • 10,000 for rent to buy
  • 8,000 for supported and older people accommodation (these could fail to materialise if LHA restrictions, currently delayed, are implemented)
  • 0 social rent properties

The last figure on that list isn’t actually included in the prospectus, indeed you can’t actually find any reference, aside from rent to buy,to renting – either social or affordable. With the current funding stream for that out of favour tenure due to end in 2018 grant funding for none home ownership products could very well cease. That should set all sorts of alarm bells ringing, especially at a time when every form of homelessness is on the increase. But you know, politics, money goes where votes are. And baby, there’s a bucket load in home ownership.

Opportunity Knocks

Considering the historic mis-match between demand and supply for Shared Ownership any increase in this type of housing tenure is welcome. Particularly a product that allows those worried about the insecure nature of private renting, but ineligible for social housing and unable to afford outright ownership, a type of housing that meets their needs. It also allows the sector to right some historic wrongs.

I can count on one hand the number of non-housing people who know about Shared Ownership housing. They all now own one, this is largely typical of when people know about S/O they like the idea (if not always the reality). Finding Narnia is often easier than finding, and then buying a S/O property. And that is before you hit the administrative cock ups our side.

Having worked in and studied the sector for a while the horror stories of bungled S/O are legend. Legal documents without HAs on them (bit awkward when the lender sort to repossess), all sorts of faux pas around tenant rights and responsibilities. A fundamental lack of knowledge about the product outside of one bloke who left in the late 90s. In short S/O doesn’t have a glorious history. This funding regime can provide a consistent, coherent product that can help one element of the 3 sub-crises that make up our current of the housing crisis. And gloss over years of ballsing it up.

The Catch

This Government seldom gives without taking something, the Housing and Planning Bill, along with the latest funding regime, are designed to steer HAs away from social and affordable rent provision. Though in truth some don’t need much steering. So far there has been a complete blindness to the need of a diverse set of policy interventions from Cameron et al, home ownership is truly king. Don’t get me wrong, S/O is a darn good product, but it is not for everyone and it is not a silver, gold or even rainbow coloured bullet for our housing woes.

Whilst some in the sector might be getting moist at the thought of becoming even more a provider of housing for sale instead of rent, it is worth remembering why we are here. If you are having a bout of amnesia, just look at the DCLG figures homelessness. Might be worth showing your local Tory MP as well, because the recent rise is largely their party’s fault.

You can find more of my stuff here and follow me on Twitter here.

A guide to recognising your saints

For those slightly out of the loop Right to Buy is basically the sector’s kryptonite (the green version, not the red one, no-one is going to go BS-mental on Metropolis just yet).  It raises passion, anger, worry and acts as a unifier to a sector so often at odds with itself.  Though funnily enough, like green kryptonite it does severely weaken us.

The reaction of the sector to the potential rolling out of Right to Buy has been fairly standard (i.e. we all went a bit cray cray, myself included).  But what has been surprising is that all these emotions appear to be coming from people outside of the sector as well.  Media that has usually at best been ambivalent, and often borderline hostile, have come out against the move (here’s looking at the Daily Telegraph).  Hell even the general public is a little bit unimpressed (hats off to YouGov for that poll), not even those who considered themselves pro-Tory.  Commentators, ‘experts’, housing insiders and a whole host of politicians have come out against it.  Embarrassingly for the Conservatives, so did they, well at least to members of the Coalition in 2013.  Talk about shooting yourself in the foot.

In terms of popular policies Right to Buy is up there with the best.  But a counter attack via the Daily ‘racist in public so you don’t have to’ Mail (fyi still one of Russell Howard’s best jokes) has highlighted how negatively the policy has been received this time round.  But as Colin Wiles notes even at the Daily Fail not everyone is on board.  Peter Hitchens providing some unflattering comments on the policy (that being said I still always prefered his late brother, Chris).  Either way you know things are getting nasty when pay gets involved.  I could make snide comments about Conservative MPs, duck ponds and public money.  But I’m above all that.  Actually I’m not, what an utterly moronic set of circumstances.

So what does this all mean?  Well the answer, is partly provided by Julia Unwin and the guys and gals over at the Joseph Rowntree Foundation.  Julia et al quite rightly point that the debate over housing has long been skewed to home ownership. And that arguably the most efficient way of helping to alleviate poverty and provide stability and security (social housing) is ignored.  Right to Buy, rent to buy, the promise of buckets more housing (to buy) are all geared around a political consensus that buying votes is preferable to renting.  Consequently each party is keen to show that they will provide the best opportunity people to purchase their own home.  Sadly for all the fluff and bluster little has been put forward as to how to increase supply as well as actually deal with an acute affordability issue.  Though the boys in blue fare particularly poorly and the public is definitely not convinced.  Especially those who rent, with the Tories polling badly around housing policies.  On a side note a majority of the public appears to back greater borrowing to build more affordable housing.

Elsewhere the BBC Panorama programme the Great Housing Benefit Scandal showed that for once a TV could tactfully highlight the plight of ordinary people on benefits.  Showing the suffering of folks like you and me (only they are poor, apparently that makes them different) at the hands of sub-quality housing as opposed to being some glitzy Jeremy Kyle look at the poor people hate-fest.  It also did a very good job at showing some of the sorry excuses of landlords out there.  Before the National Landlords Association gets its knickers in a twist I doubt any of those highlighted in the show were paid up members.  Good private sector landlords do exist.  But it is hardly surprising when a few rogue private landlords put profit before both the quality of the housing they provide and the unfortunate souls who reside in their dwellings.

So where does this all leave us?  Well frankly in exactly the same place we always have been.  A country with a housing market that is fundamentally failing to meet the needs of the suckers who live in it.  I will leave you with a quote from a mate of mine, it neatly sums up the situation for a lot of people.

“I just want a house, not a mansion or anything like that, just some stability for my little boy. I’m fed up of moving all the time.”

As always you can follow me on Twitter here or find me using the handle @ngoodrich87, you can view the rest of my blogs here.

The Power of Nightmares

If you haven’t managed to I strongly recommend taking a look at a couple of documentaries by Adam Curtis.  The first provides the name for this blog, The Power of Nightmares, the second is Bitter Lake.  Both focus on the power of meta-narratives that seek to explain the world we live in.  Both highlight the often unintended consequences of doing so.  Particularly in Bitter Lake which links the over-simplification of worldviews to the spiralling violence in the Middle East.

Whilst a Neighbourhood Office can be pretty frenetic at times I would balk at comparing it to the various swathes of carnage ripping up parts of the world far away from our shores.  However the central messages from Mr Curtis and his dark, compelling and surreal documentaries ring true for social housing.  For years politicians have used highly negative narratives when looking at the welfare state and social housing.  Providing a justification for dismantling one of the central support systems for the general public.  Where once was assistance is now dependency, where once was a council house now stands a privately owned building sold for a lot more than it was lost for.  Benefit claimants are shirkers, not people.  So the story goes.

Within the pervading political explanations of the modern world is a set of basic assumptions.  And as with Bitter Lake these assumptions, which in turn have driven policy, have led to unintended outcomes.  The emergence of Neo-liberalism from pariah to main stay of both political thought and economic policy brought about a seismic shift in housing tenure. Home ownership has come to dominate the UK Housing market. With this domination a set of ideals, of pre-scripts, have become buried within our nation’s psyche.

Table Numero Uno – Trends in tenure, 1980 to 2013-14

Trends in tenureWe are one of only a few countries in Europe where a property is seen as a money-making endeavour above other beneficial factors of home ownership. Where buy-to-let small-scale landlords have been positively encouraged. Programmes like Homes Under The Hammer or Location, Location, Location typify our approach to housing. We believe house prices will always increase for short-term profit. Yet somehow housing will remain affordable for our children. This is a lie and a dangerous one.

At the same time we have been fed a myth that living standards will always improve. That consumerism is a good thing. That the wheels of the economy will keep on turning and benefit us all. The fact that our current recovery is based on, and now threatened by, ever-increasing individual debt as credit replaces cash savings is ignored. Roll the dice baby, papa needs a new pair of shoes.

The latest Conservative Party policy announcement beautifully illustrates the point. A scheme that provides cheaper home ownership, via public subsidy, at the possible expense of actual affordable (social) housing for the most in need is only possible where the pervading narrative is utterly warped from the reality it seeks to explain. It is about housing, stupid. The utter lack of it. The continued loss of social housing via right to buy. The inability for those of my cohort to even begin to countenance the prospect of buying due to the inherent costs.  Some half-baked initiative to help schmucks like me is akin to pissing in the fucking wind when the mess that is our housing system is seen in its entirety.

As Colin Wiles has noted yet another demand side initiative is not the answer here.  More needs to be done on the supply side.  And with the Private sector so utterly unable to meet pent-up demand approaches like Starter Homes and Help to Buy miss the point.  But given the worldview in which they have been formed, where the state cannot provide the solution, it is perhaps hardly surprising.  What we need is a Government that will reverse the drop in social housing and invest in housing and infrastructure, properly.  Alas I do not see this coming from the boys in blue.

Graph Numero Due – Households aged 25-34, by tenure, 2003-04 to 2013-14

25 to 32 Housing TenureOf small comfort is that housing is now seemingly on the agenda for politicians. However looking more closely at the policy announcements there is still reason enough to be glum. In a week where The Green Party fluffed its lines, where Labour promised 200,000 new homes built a year by 2020.  The Tories for their part have stated they are on course to do this by 2017. The focus is overwhelmingly on home ownership. Social housing is merely an aside. Indeed the Conservative Party has been so consistent in conflating social housing with its wider affordable housing provision aims I think they see schemes like Help to Buy, in their eyes at least, as an acceptable form of social housing (see equation below).

Social Rent = Affordable Rent
Affordable Rent = Affordable Housing
Affordable Housing = Cheap home ownership.
Providing cheap home ownership = Providing social housing(ish)

The policy announcements of this week are a start but they are nowhere near enough. Nice sound bites and vague promises around how much housing will be built. Or in the case of Brandon Lewis an absence of targets (guess you can’t miss them if you don’t have them…). Are all well and good but the lack of a coherent approach to housing policy has left this country in a very large pickle. Just got to hope we will eventually wake up.

If you feel so inclined you can follow me on Twitter here or find me using the Twitter handle @ngoodrich87, you can view the rest of my blogs here.

Das Capital

Right to Buy, the Russians acting like an empire (again), big hair, leggings and electro music being popular amongst the ‘yoof’, a Government pushing policies that continuously undermine those further down the food chain.  You’d be forgiven for thinking this is the 1980s with Thatcher in her prime.  Regrettably it is 2015 and it’s an election year.  Whilst Cameron and co may be stopped I can’t do a lot about the fashion choices and poor taste in music amongst the hell spawn younger than even I, sorry.

As if it needs spelling out Right to Buy is a bit like kryptonite to our beloved sector.  It is the perfect political weapon to decimate social housing.  In a country obsessed with home ownership and asset based capital it is a highly potent mix of aspiration and access to cold hard cash.  It’s better than Help to Buy, it’s better than Shared Ownership and pretty much every other initiative designed to assist those with lower incomes acquire a property.  Why?  Because you can buy the property you are currently living in, in the neighbourhood where you have built up substantial local networks.  More importantly you can do so for a fraction of the cost of even the best low cost home ownership products out there.  Though frankly as a sector we have been bumbling through the provision of those products for years.  Even better you can sell it on for large profit after a few years, especially if you are in the right part of London and the South East.  It’s the postcode lottery (the good kind, not the one where your local hospital is shit).

Unsurprisingly it is bloody popular.  The figures below show just how many people have bought their council/housing association property through Right to Buy (and it’s watered-down cousin Right to Acquire).  So it is no surprise that the announcement last week that Right to Buy may be extended to include Housing Association properties has caused nothing short of alarm.  Though nowhere near its heyday peak of the early 1980s allowing Housing Association tenants to purchase their home under Right to Buy will give the figures below a significant kick up the bottom.

On a side note for a beautifully biting critique of our reaction as a sector and attempts to nullify other policies of the Coalition I do suggest you read Rob Gershon’s piece in 24 Dash.  The chap has a wonderful way with words.

Depressing Chart 2 – Right to Buy Sales – England

Right to Buy SalesIn addition to decimating social housing stock (see depressing graph 2 below) Right to Buy provides piss poor value for money to the tax payer.  As a policy it has the dubious honour of being paid for by the taxpayer twice.  The first time to build the property then, after it has been sold, we pay again as the property is rented back by the Local Authority that sold them, at higher rents.  For a (slightly) oldie but goldie report on this utterly stupid situation please see Tom Copley’s report.  His report, a year old today (Mazel Tov my friend) highlights the cost of Right to Buy in London, but it is a situation likely to be repeated up and down the UK.  You know this, I know this but does the general public care?  Probably not.

Depressing Chart 2 – Dwelling stock by tenure, UK, 1980 to 2012
Dwellings by Sector

As Colin Wiles notes (I really do need to write my blogs quicker) Right to Buy is bollocks on a number of levels.  It is an ideological weapon to suit the needs of those who wield it, a means by which to rid the country of a housing sector that has no real place in the vision of the UK held by those in Government.  Interestingly, for me at least, Right to Buy’s second lease of life raise a number of questions in relation to the long term direction of our sector.  Is this another nudge towards going it ‘alone’?  How would it work if housing associations were allowed to buy their way out of historic debt/grants?  Will this serve to discourage future uptake of grant (no grant, no strings, no Right to Buy)?

So what do we do?  Fight the inevitable an uphill battle, because in essence we need to convince the general public that social housing is worth fighting for.  But more critically that they should sacrifice the opportunity to make a quick buck in order to maintain it.  Telling the Treasury to keep its dirty mitts off the Right to Buy sales receipts would also be worth doing.  Cheeky sods.

If you feel so inclined (I wouldn’t advise it, you will be disappointed) you can follow me on Twitter here or find me using the handle @ngoodrich87, you can view the rest of my blogs here.