Friday, May 28, 2010

It's Not Difficult

I think I’d rather be told straight “You’re wrong!” But ours is not the kind of issue that promotes outright opposition. The strongest resistance we normally get goes something like this “Of course I agree that bringing empty homes into use is a good idea, but in practice it’s just too difficult.”
It’s an annoying put down because it would be petulant to get cross in response. But that doesn’t mean I agree.
These words most commonly come from the lips of local authority councillors or people running housing associations. What it generally means is that they know they have to create more homes, but the way they know how to do it is to do a deal with a developer who is building a large new housing development. The skills and knowledge you need to pull off deals like this are not to be sniffed at. Many housing associations are very good at it. And it works – or at least it did.
What it also implies is the skills they used to have to negotiate the purchase of individual houses and the skills to renovate them are no longer needed.

But now housing associations have a problem. Last year just 118,000 homes were built in this country – half the government’s target. That’s half the number of potential deals they need; and unless millions of pounds of taxpayers money is poured in, half the number of new social homes.

Now lets look at a different type of housing supplier; a private landlord. Between them private landlords provide about the same amount of housing as councils and housing associations. Very few try to do deals with developers and hardly any build new homes. Where most acquire property is through buying existing second-hand homes. Visit a property auction house and you will see most that homes are bought by private landlords, what’s more most of those they buy have vacant possession and need to be improved before they can be let. Private landlords it seems still have the skills to buy and renovate empty property.

Now, of course, private landlords operate on a different scale to councils or housing associations. A recent ARLA survey showed the average private landlord owned seven properties. The National Housing Federation’s latest figures show that the average housing association has more than 2,000 properties. But if bringing an empty home into use isn’t too difficult for a landlord who owns a handful of property, there’s no rational reason why it should be too difficult for a landlord who owns thousands. The housing market has changed, and if social housing is going to keep pace it needs to borrow the skills of private landlords. Bringing empty homes really is a good idea, and it’s a highly viable way of creating new housing. It’s only too difficult if you don’t know how to do it.

Thursday, May 20, 2010

Government Announcement on Empty Homes

My optimism yesterday, was not misplaced. Today the government has published the full coalition agreement. You can see it here. In it is this very encouraging commitment “We will explore a range of measures to bring empty homes into use.”

Wednesday, May 19, 2010

What does all this mean for housing?

The housing business is moaning and groaning. The housing press is sounding downbeat too. Why? Apparently our new government hasn’t had much to say on housing. It barely mentioned the subject in the coalition agreement and it has downgraded the housing minister post so the incumbent will no longer attend cabinet. Does this matter? and what do we know about the government’s willingness to do anything about getting empty homes into use? I thought it time to have a look. Firstly lets have a look at the cast:

The Cabinet Minister in charge of local government, communities and housing is Eric Pickles a man who led Bradford Council in the early 1990s and will undoubtedly be an influential member of the government. Tim Williams says that Pickles’ experience is a double-edged sword for a man who will unquestionably wield it to the budget. He knows what he’s doing, but on the other hand may be too familiar with local government, and knows where the bodies are buried. It strikes me that these are both commendations for somebody who is in charge. Either way Pickles doesn’t look like a man to be messed with. When Hazel Blears was given this job a couple of years ago, there was an air of levity amongst commentators with few resisting the temptation to talk about her size. This time nobody has dared mention Mr Pickle’s size!

Grant Shapps has the distinction on being the housing minister who had the longest wait. As he is fond of saying, he shadowed four Labour housing ministers over nearly as many years before finally getting the job himself. So any criticism of inexperience is surely unfounded. He will be tasked with amongst other things replacing the national affordable housing programme, which funds housing associations, and overhauling the planning system.

Finally Liberal Democrat Andrew Stunnell, has been appointed a junior minister, probably with responsibility for housing . This may be a bit of a surprise, although he was Lib Dem housing shadow prior to Sarah Teather. And he is clearly highly regarded enough by his party leader to have formed part of the negotiating team that struck the coalition deal with the Conservatives.

By the way; much as it would have been great for her to be here too, Sarah Teather was appointed an Education Minister.

So will this rather motley crew be willing to do anything about getting empty homes into use. We know what they have said. In opposition Grant Shapps proposed changes to housing association funding to allow them to buy and lease private empty property. He also proposed powers for the public to force public owners of empty properties to get them into use. The Liberal Democrats proposed that empty homes should form a major part of a policy of increasing housing, pledging to get 250,000 empty homes into use.

All very different from the Labour government’s approach, which was to give local authorities powers to force private owners to put their houses in order

What strikes me is that the two coalition parties’ approaches aren’t so very different. They are both about encouraging housing associations to get involved in privately owned empty homes, they are both about incentives rather than coercion, and they both acknowledge that reused empty homes are a cost effective way of creating new housing. The fact that this issue wasn’t in the coalition agreement may in fact be a good sign. It may suggest that it isn’t contentious. If there are differences it is unlikely to be over approach, it’ll be scale. Will there be some minor tweaking to HCA funding, or will the government see this as a significant way of creating more homes?

Perhaps the answer to that lies in the influence of these new ministers. With due respect to Andrew Stunnell, this is likely to be a Conservative rather than Liberal democrat led issue. Although they have made far less play of it Conservative pledges to overhaul the funding system, reduce costs, and create a panning system that encourages rather than forces areas to accept more homes, could create a system that makes it a lot easier to get empty homes into use than build new homes. So perhaps the surprising conclusion is that whilst the housing industry may be moaning If you think that more should be done in getting homes into use there may be a lot to be very optimistic about.