Housing experts are behind plans to merge the two rented sectors as it would reduce the ‘stigma’ of social housing, give them the ability to move tenants to private landlords as well as driving up rental standards in some hard-to-let areas in the United Kingdom.
Housing leaders, lenders and thinkers have been actively involved in consultation with the Government who are looking at merging the two rented sectors. However, there are still some who believe that the Government should not merge the two sectors saying Housing Associations provide a completely different service to that of a private landlord and a merger of the two could see some tenants forced to move away from their local area. However, many experts in the field believe those in most need of help will suffer if some sort of merger does not go ahead. This is especially true, as the coalition has no intention of making a U-turn on the £500-a-week household benefit cap due to come into force in eight months-time. However, if the merger does go ahead it has been stressed that only registered landlords with properties that are covered by landlord insurance would be used to rehouse housing association tenants.
Leading homeless charity, Empty Homes, believes that if housing associations are merged with their private counterparts, it would see the worst private landlords forced to pull their socks up, which would be good news for tenants. At the moment the bottom end of the private rented sector is a captive market that has seen unscrupulous landlords exploiting their tenant. However, Empty Homes believes that if the two sectors were merged in some way to the extent where a tenant had a choice between the two, it would create competition which isn’t there at the moment.
A completely opposite view was put forward by housing expert Stephen Hewlett, who said: “I fear a merger of the two sectors will undoubtedly lead to people being forced out of the capital. Major retailers in the capital are already expressing concern over the availability of low-cost housing in central London for their workers. The merger of the two sectors seems like a big experiment really when a lot of things are already up in the air.”
There are fears that as many as 50,000 North East families are going to be affected by the ‘bedroom tax’. Figures from the NHF (National Housing Federation) highlight that housing associations across the North East do not have enough of the right-sized properties for the thousands of tenants who will fall foul of the new regulations.
One housing association alone estimates that 2,800 of its tenants will be classed as under-occupying their homes and they have only sixteen spare one-bed properties to move them to. This has seen a plea go out to all private landlords who have empty properties, to come forward and help with the situation. Local councils throughout the borough want as many of these properties as possible to be protected with a landlord insurance quote and used to house the affected tenants. The new under-occupation rules will not start until April next year, but when they are introduced tenants will have a choice of staying where they are only if they pay on average, an extra £40 each month if they have one spare room or £70 each month if they have two spare rooms.
Monica Burns, North East manager for the National Housing Federation, said “These new rules are futile and unfair. Housing associations in the North East have always been encouraged by Government to build bigger homes so families could live in the same homes for life and didn’t have to move when they had children. And as land was cheaper here that made good sense. Now those same tenants and housing associations are being penalised for having the wrong type of house. Many families on benefits will have no choice but to up sticks and move to private rented accommodation. The Government will then have to pay a higher rate of housing benefit to cover their rents for smaller homes.”
Even a household where each bedroom is in use could be hit with benefit cuts, because under the new rules children will be expected to share a bedroom up to the age of sixteen. Research estimates that 690,000 households in the United Kingdom will be hit by the new rules.
Second homeowners and private landlords who do not rent out their empty properties are to be hit with council tax increases as ministers move to end the madness of the system that encourages leaving properties empty.
The Government are about to announce their plan to abolish discounts on holiday homes that are only used at the weekend and they will also impose an extra premium on any home that is left empty for more than two years. The coalition feels that it is wrong for there to be around a million empty homes in the United Kingdom with 730,000 of these in England alone. It is estimated that bringing the homes back into use could half the number of people waiting on council housing lists across the country. The Government would like private landlords to forget about empty home insurance and instead install tenants and cover their properties with landlord insurance. Andrew Stunell, the Lib Dem communities minister, will confirm the plans to stop councils giving discounts and he will also push ahead with the empty homes premium.
Mr Stunell said: “We’ve lived with the scourge of empty homes for too long. They’re a blight on our communities and a waste of much-needed housing. It’s madness that councils have been forced to offer discounts on empty and second homes, which don’t take into account local circumstances and provide an incentive to leave homes vacant indefinitely.”
The Lib Dems have for some time been pushing for a clampdown on second homeowners after arguing some parts of the country have become ghosts towns during the winter when properties stand empty. Cornwall is one of the biggest losers through discounts offered to second homeowners as they miss out on more than £2m yearly. However, there are concerns that, with councils facing cuts of up to 10% in their funding, those areas without large numbers of second homes or empty properties will be forced to find savings elsewhere.
Latest statistics show that the borough of Boston has 411 long-term empty properties, with 295 of them being empty for at least twelve months. The high number is yet another reason for the deepening housing crisis in Boston, which has seen many people unable to either afford a home or move up the boroughs housing waiting list.
Most mortgage lenders are still looking for a deposit of at least 20%, meaning the average first time buyer in Boston will face seven years of scrimping and saving before they have enough for a deposit on even the cheapest properties in the area. Experts say that more new homes are needed to help the problem, but as there are so many empty homes in the borough, others feel that these should all be brought back into use before new land is built upon. Almost 250 of the empty properties are owned by private landlords and the others are owned by a registered social landlord, including housing associations Boston Mayflower and Longhurst.
Nathan Black, spokesman for Mayflower, which owns 31 homes which are currently not in use, explained there is often good reason why homes are empty saying: “We have thirteen prefabricated bungalows in Boston, which are vacant due to on-going refurbishment work being carried out on them, one property in Sutterton, which is empty due to it being for sale subject to contract and 17 sheltered accommodation properties, which are vacant due to on-going refurbishment work being carried out on them.”
Boston Council says they are working hard with other bodies to bring the homes back into use, with the help of a coalition grant. Returning empty homes into use by offering the owners help in bringing them up to standard is a policy being adapted by many councils across the UK. Private landlords are being traced and offered monetary reward to get the properties up to scratch, covered with landlord insurance and habitable for those needing shelter. However, many councils are qualifying the offer by placing time limits on the improvements and some landlords are still proving difficult to persuade.
Despite the average length of time being 11 weeks for a council property to remain vacant, two council houses in Alloa have been empty for almost two years. The two homes are due to be adapted for tenants with disabilities and council officials say the delay is due to the extensive work required as well as the tendering process.
The controversial delay comes at a time when thousands remain on the council’s waiting list for a new home and even though the percentage of vacant council properties in Alloa is less than 2%, putting it among the lowest throughout Scotland, Councillor Mark English feels that the time taken for the work calls into question the whole process. Social housing is in high demand across the country and the council are planning to build the first new council houses to be protected by landlords insurance in thirty years. According to figures from homeless charity Shelter Scotland, there were 3000 people on the council house waiting list.
Councillor English said: “A clear inspection of the processes involved seems to be required in this case to ensure housing is not left void for long periods of time. We have a housing shortage at the moment and many are desperate for a house. Properties which are left empty for long periods of time lead to a loss of income for the council. I am fully supportive of the need for the council to realise housing for the disabled is crucial to enhance quality of life; however, two years seems an excessive amount of time for a property to be vacant.”
The two properties have had eighty applications, of which thirty-two have a moderate or severe medical priority. The council say they are very close to starting the work and are looking forward to seeing new tenants moving into the refurbished homes.