Home / Blogs / Get your own house in order

Get your own house in order

Those who do not learn the lessons of history are doomed to repeat them”

My first reaction was: hey, haven’t we heard this before? My second reaction, on realising that yes, we have had something very similar before, was: what the actual (insert expletive of choice here)?

I’m talking about the ridiculous Tory manifesto idea to force housing associations to sell their homes to their tenants at a discount.

Ask anyone with a reasonably long memory and they’ll say that one of the worst things that happened to the housing market was the mass sell-off of council houses in the 1980s in order to get Mrs Thatcher’s Tory Government re-elected.

The policy was designed to ‘encourage’ (bribe?) people who would traditionally have favoured Labour to vote Conservative because they would have the opportunity to own the homes they had lived in for years, brought their children up in, become part of the community in.

Thatcher’s ‘home-owning democracy’ might have been a nice idea, had the money that was gained from those discount sales been channelled straight back into building more houses to replace those that had been sold. That is a sensible policy. Build stuff, rent it out for a while, sell it, then re-invest that money in your local community and build more houses that you can rent, then sell, then…etc.

That would have been an economic cycle that would allow people to feel they were getting somewhere with their lives, building up enough money to buy their homes and then maybe leave them to their children so that they too could own their own homes, or, more probably, sell them on and use the equity to move up the property ladder.

It would mean that councils could afford to actually ‘house’ the most needy of their residents, instead of sticking them in seaside bed and breakfasts, or they could more easily move people around their portfolio should the residents’ needs change.

That, of course, didn’t happen and ever since ‘social housing’ has come to mean an add-on to ‘local authority housing’. Councils – and the housebuilding industry as well – have become reliant on housing associations to fill the gap, building the homes that the councils don’t have the money for, housing the residents that the councils would otherwise have to deal with. Many local authorities – mine included – simply out-sourced all their housing operations to housing associations, often transferring all or most of the housing department staff in the process.

So what the you know what was going on in Tory policy HQ when they came up with Sell-Off Mark 2. This time, some people who live in housing association properties will have the opportunity to buy their houses, at a discount. So far so 1980s.

Except this time there’s the added complication of the third party – the housing associations. They have bought, or built, at market values, the properties they are now supposed to sell at a discount.

So they will no longer have the rental income, plus, there’ll be a dirty great gap in their capital assets. A gap that, the idea goes, will be plugged by local authorities. And because even the Tories know that local authorities are seriously strapped for spendable cash, this top-up for housing associations will be funded by the councils selling off their larger, most expensive properties when these become vacant.

Always assuming that the councils still have housing of their own and haven’t hived the whole lot off to the local housing associations that is…. Oh.

We need to get more units into the housing market, in places where people want to live. This idea will not get more houses built. End of.

It’s a rubbish policy and it will do more harm than good. For heaven’s sake, Cameron, think it through again.

About Fiona Russell-Horne

Fiona Russell-Horne
Group Managing Editor across the BMJ portfolio.

Check Also

Celebrate good times, Come on

If an earthquake were to engulf England tomorrow, the English would meet and dine, somewhere …