Lies , Damned Lies , and........ English???

[gordonrussell]

Today government plans were announced to ' reboot ' the right-to-buy scheme for council tenants in England.
Housing minister Grant Shapps said on national radio this morning that the proceeds from these sales would enable the government to build "the type of homes that the government builds now , called affordable rent homes......which will be in the social sector enabling people to rent from the housing waiting lists...."

But what exactly does 'affordable rent' mean?
It sounds fairly simple , but is it ?
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BBC Radio More or Less programme 2.12.11
on Affordable Housing statistics - transcript
‘Affordable Homes: they’re rather mysteriously defined, they might actually not
be new homes, and they may very well not be affordable.’
Following a Today Programme interview with Grant Shapps on the number of
affordable homes that have been and will be built, Tom Harford and Fiona Wood
discuss what is an affordable home
Fiona Woods – What is Affordable Housing?
The definition of Affordable Housing is housing provided to specified eligible
households whose needs are not met by the market.
…There are several categories. The first is old-fashioned social rents – that’s what
most people would call council housing. These are determined by a set formula
that does take local incomes into account. But this type of housing has fallen out of
favour.
The main type of new housing supply is called Affordable Rent
TH: what does ‘Affordable’ mean in this context?
FW: It usually means that the rent does not exceed 80% of the market rate.
However the Department say that on rare occasions it could be more, and
sometimes it will be less
TH: Ok so it could be more or less than 80%, but even if it is 80%, surely 80% of the
market rate in a really expensive area would still be, well, pretty expensive?
FW: Right. In fact Hackney Council told us it’s considering not introducing the
system at all for exactly that reason.
There is another category called Intermediate Housing.
TH And Intermediate Housing is affordable because…?
FW: It’s below market rates. This includes things like Shared Ownership, also
known as part buy, part rent.
TH: So these houses are cheaper than if you were going to buy them on the open
market.
FW: Well the properties themselves aren’t necessarily cheaper.
TH: I thought you said it was below market rates?
FW: You might reasonably assume ‘cheaper than the market rate’ would mean a
house that would, say usually cost £220,000 would be say £200,000
TH: That’s seems like a reasonable assumption
FW: Well that’s not the case. Shared Ownership properties are valued at the going
market rate. What makes them affordable is the way you pay for them. Rather than
taking out a mortgage on the whole thing, you buy a bit at a time and pay rent on
the remainder. Because the rent part is subsidised the idea is that your monthly
payment will still be cheaper than if you take out a regular mortgage.
TH In the end when you have bought all of the house you will have paid the
market price for the house?
FW: Yes, and these properties aren’t necessarily at the cheaper end of the market.
In fact we looked at one Shared Ownership scheme in Hackney, in London, where
one-bed flats are valued at between £200 - £250,000. When I asked a local estate
agent what the average price of a one-bed in this particular part of the borough is,
they put it at a lot less than that, more like £170- £200,000.
TH: What’s the justification for the Affordable Housing going on the market at a
higher price?
FW: Well that particular Housing Association said it’s a fair price for a house of
that standard; that it was independently valued and is comparable with similar
properties.
TH: So let me get this right. This Affordable Housing we’re talking about could be
among the most expensive properties in the area?
FW: Yes. And one more interesting fact we stumbled across has to do with how
Affordable Housing units are counted
If you dig down into the statistics you find a bit of a quirk. When an additional
Affordable Home appears in the Government statistics it doesn’t necessarily mean
an additional house or living space has been provided.
So for example an existing social tenant who buys their home through ‘Right to
Acquire’ is counted as an increase in Affordable Housing, despite no housing being
created.
TH: I’m confused now. The Government is allowed to say an extra unit of
Affordable Housing has been created, despite the fact that there aren’t any more
people having somewhere to live?
FW: yes. The Government’s justification for counting these purchases in the figures
is that these tenants will be assisted by a grant from the Government when they
buy their home. Now when that house is sold, that Government grant will be spent
on additional Affordable Housing.
TH: That’s interesting. Didn’t George Osborne, the chancellor, announce this week
that the Govt is going to make it much easier for social tenants to buy their homes?
FW: Yes he did, it was in the Autumn Statement.
TH: And presumably when these purchases are made, they too will be counted as
an increase in the stock of Affordable Housing?
FW: Yes. One thing that’s interesting though is that the UK Statistics Authority has
told us it’s writing to Department of Community and Local Government Ministers,
asking for their statistics to be formally accessed against the Code of Practice.
Though they won’t tell us on what basis.
TH: So Affordable Homes: they’re rather mysteriously defined, they might actually
not be new homes, and they may very well not be affordable. Thank you.
-----------------------------------------------------

[faceless]

"the type of homes that the government builds now "

how many of them have their been in the last 30 years?

[gordonrussell]

Good question.
Trying to get that figure online tends to throw up " such and such council builds its first council houses for 30 years" strangely enough .

A Guardian article of 20th Jan 2010 claims "In total, Britain has built 13m houses over the past 50 years, according to Halifax, but nothing matches the peak year of 1968, when both private and council housebuilding hit record levels."
and " The number of people renting from their local council hit a peak in 1981, at 33% in total. The impact of Margaret Thatcher's right-to-buy legislation has hit the sector, with only 18% of homes today socially rented, with a marked shift away from local authorities and towards housing associations."
http://www.guardian.co.uk/money/2010/jan/20/house-prices-britain-property

Some figures like "Only about 300 new council homes were built in England last year." made by BBC News 12th July 2007 and less reliable "Under Thatcher/Major 40,000 council homes a year got built.Under Blair/Brown just 350 a year got built." by a poster to the Thurrock Gazette 13th March 2012.

It might be as slipperly as VAT , but I will try to get that figure.