Posts with tag: right to buy

MPs to Discuss Amendments to Housing and Planning Bill Today

Published On: May 3, 2016 at 8:46 am

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MPs will discuss amendments made to the Housing and Planning Bill this afternoon, after the House of Lords made changes to the controversial new law.

MPs to Discuss Amendments to Housing and Planning Bill Today

MPs to Discuss Amendments to Housing and Planning Bill Today

There have been 13 outright Government defeats on the bill, as well as several equally significant concessions made by ministers to avoid defeat.

Numerous issues will be discussed, including planning regulations, estate agents, compulsory purchase and environmental standards for homes and drainage, as well as pay to stay provisions, which require those on higher incomes to pay higher rent if they wish to remain in social housing.

Additionally, the controversial Right to Buy extension will be examined. Last week, the Public Accounts Committee (PAC) slammed the scheme.

The PAC emphasised a lack of clarity around how the policy would be funded or what its wider financial impact would be.

The Chair of the PAC, Meg Hillier, says the Government should be “embarrassed” by its findings.

“Extending Right to Buy will affect many thousands of people, yet the department has failed to provide basic information to support its stated aims,” she insists. “Instead we have heard vague assertions about what it will accomplish and how.”

She continues: “The approach to paying for this policy seems to be entirely speculative. On the basis of evidence heard by our committee, there are no costings or workings out. We are not talking about a back of an envelope calculation – there is no envelope at all.”

The Housing and Planning Bill was introduced to the House of Commons on 13th October 2015 and completed this stage on 12th January 2016.

The bill then went to the House of Lords for discussion, which was completed on 27th April 2016.

Today, MPs will consider the amendments made in the House of Lords, before voting on the issue.

Once the House of Commons and Lords agree on the final version of the bill, it can receive royal assent and become an Act of Parliament.

We will keep you updated on all changes to the bill.

Right To Buy extension slammed

Published On: April 29, 2016 at 11:11 am

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A number of MP’s have moved to lambast plans outlined by the Government to extend the Right to Buy scheme to Housing Association tenants.

The Public Accounts Committee has released a report that questions how the policy will be funded and how replacement properties will be constructed.

Overcrowding

In addition, the MP’s argue that there is evidence that Right to Buy could actually increase overcrowding for those most in need of housing.

As an objective, the scheme is designed to allow Housing Association tenants to buy their own homes, with discounts akin to those currently enjoyed by council tenants.

The Public Accounts Committee has said that there is a danger that an increased discount for Housing Association tenants would lead to more fraud.

Speculative

Meg Hillier, chair of the Public Accounts Committee, noted that the approach to paying for the policy was speculative. She said, ‘there are no costings or workings out. We are not talking about a back of an envelope calculation-there is no envelope at all.’[1]

Previously, the policy has been criticised by the Local Government Association and the Institute for Fiscal Studies. What’s more, it has already been rejected by the Welsh and Scottish governments.

The Government has stated that the extension of Right To Buy, currently being piloted in five UK locations-will be funded by councils selling off their most valuable houses.

However, the MP’s against the move said the Government’s commitment, ‘will not ensure that these will be like-for-like replacements.’ They argue homes, ‘can be a different size and in a different area and may cost more to rent.’[1]

Right To Buy extension slammed

Right To Buy extension slammed

Difficulty

In their report, the MPs noted that it would be extremely difficult to replace homes on a one-for-one basis.

The Government however has insisted that all replacements homes will be constructed.

A spokesperson for the Department of Communities and Local Government said, ‘this Government makes no apology for helping people into homeownership. Our voluntary agreement with housing associations will mean 1.3 million tenants will have the chance to own their own home, while every home sold will be replaced with a new affordable property.’[1]

More information on the extension can be found here.

[1] http://www.bbc.co.uk/news/business-36163172

House Building Must Grow Fivefold to Meet Right to Buy Promise, Warns NAO

Published On: March 16, 2016 at 12:05 pm

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House building to replace homes sold through the Right to Buy scheme must grow fivefold to meet the Government’s one-for-one promise, MPs have been warned.

The National Audit Office (NAO) also explains that the Government pledge to replace homes sold through the scheme “does not necessarily mean like-for-like”. It says that replacement properties can be “a different size, and built in a different area, compared to those that have been sold”.

House Building Must Grow Fivefold to Meet Right to Buy Promise, Warns NAO

House Building Must Grow Fivefold to Meet Right to Buy Promise, Warns NAO

The warnings are included in an NAO report prepared for the Public Accounts Committee (PAC). MPs on the committee are analysing what impact the Housing and Planning Bill will have and whether it will achieve value for money.

The bill, currently going through the House of Lords, plans to give 1.3m housing association tenants the right to buy their homes at discounted prices. The extension of the current scheme would be financed through the sale of high value council homes when they become vacant.

The Government has also vowed to replace each home sold by housing associations, as well as additional properties for those sold by councils, with at least two additional affordable homes for each one sold in London, where there is a chronic shortage of housing. Councils will have three years to replace homes sold to fund the scheme.

However, the NAO report warns MPs that the “pace of replacement will also need to accelerate to keep pace with the target in subsequent years”.

It states: “To meet the target of replacing the roughly 8,512 homes sold in 2014/15 by the end of 2017/18… would require quarterly housing starts to reach around 2,130, a fivefold increase on recent figures of approximately 420 per quarter.”

The NAO also criticises the Department for Communities and Local Government’s (DCLG) assessment of the impact of the policy. It claims the DCLG assessment, “when reviewed against good practice… has weaknesses”.

The NAO says that the DCLG’s assessment fails to give alternative options for achieving its aims, or a summary of other options considered at an earlier stage. It adds that while it identifies a number of groups that may be affected by the bill, “it does not seek to quantify the costs or benefits, and it omits some potential impacts”.

The NAO concludes: “Additionally, though dependent on certain assumptions, the impact assessment does not state those assumptions clearly, use evidence to justify them, or sensitivity analysis to consider the potential impact of uncertainties relating to them.”1

The Government has confirmed that secondary legislation will define what high value is when determining how much each council will pay to fund the sale of housing association homes.

The extension of the Right to Buy scheme to housing association tenants has been continuously criticised. Many believe that it will restrict the availability of affordable housing.

Also, it was recently claimed that many homes sold through the current Right to Buy scheme for council tenants are now being rented out by private landlords.

1 https://www.nao.org.uk/wp-content/uploads/2016/03/Memorandum-extending-the-right-to-buy.pdf

Average Tenant Has Spent £40,000 on Rent in the Last Five Years, Says Shelter

Published On: March 3, 2016 at 3:34 pm

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The average private tenant in England has spent more than £40,000 on rent over the last five years, according to a new report from homelessness charity Shelter.

The findings arrive as the Housing and Planning Bill continues making its way through the House of Lords today.

Shelter found that the average cost of renting a two-bedroom property is enough to put down a 20% deposit on a typical first time buyer home.

In London, the average rent on a two-bed home is much higher, at £89,000, according to the charity’s calculations.

The Chief Executive of Shelter, Campbell Robb, says: “Our drastic shortage of affordable homes is leaving millions of people stuck in their childhood bedrooms in a bid to save money, or in expensive and unstable private renting, with little hope of ever saving for a home to put down roots in.”1 

The Housing and Planning Bill seeks to introduce a series of changes that David Cameron believes will turn generation rent into generation buy.

It includes extending the Right to Buy scheme to housing association tenants, which Shelter says will aggravate the housing shortage.

Councils would be forced to fund the policy by selling off their most high-value assets. However, peers are warning that the policy could lead to a decline in the supply of affordable homes.

Average Tenant Has Spent £40,000 on Rent Over the Last Five Years, Says Shelter

Average Tenant Has Spent £40,000 on Rent in the Last Five Years, Says Shelter

Cross-bench peer Lord Kerslake, the former head of the Government’s Homes and Communities Agency, warns: “It’s very hard to make the numbers work and it’s very hard to find the land.”

Lord Kerslake has jointly tabled an amendment to the Housing and Planning Bill, which would force councils to replace the properties sold off with similar homes in their own area.

Peers are also expressing their concerns over the Government’s Starter Homes scheme.

These new build homes would be sold at a 20% discount to first time buyers under 40. The properties can be worth up to £450,000 in London and £250,000 elsewhere.

However, by urging housebuilders to prioritise Starter Homes, there are concerns that local authorities will throw out genuine affordable housing.

Kerslake comments that the policy would be a “cash bonanza” for homebuyers, many of whom could have bought their own home without the scheme.

“It’s a hell of an offer for people who have to be reasonably well-heeled to afford it,”1 he states.

A study by the Town and Country Planning Association has revealed that four out of five councils do not believe that Starter Homes are affordable.

Dame Kate Barker, who conducted a review of housing supply for Gordon Brown, told the House of Lords Economic Affairs Committee in December: “I do feel uncomfortable about a set of policies that are designed to be supportive of people who are just on the cusp of being able to buy and need nudging over the edge.”1

And the Shadow Housing Minister, John Healey, has said: “The forced sale of council homes will lead to a huge, irreversible loss of genuinely affordable homes to buy and rent.

“At a time when more affordable homes are desperately needed, the Government is forcing the sale of many of those that are left – not to tenants, but to buy-to-let landlords and overseas speculators.

“This will make finding an affordable home even harder for young people and families on ordinary incomes. But it’s also bad news for taxpayers, because it means more people renting privately and housing benefit rising to cover the cost.”1

However, a spokesperson for the Department for Communities and Local Government insists: “The Government is also supporting the boldest plan for housing by any government since the 1970s and is creating a bigger, better private rented sector that will increase choice for tenants.”1

Recent research found that the private rental sector is expected to grow to 30% of all households in the next 30 years.

1 http://www.theguardian.com/society/2016/mar/03/tenant-paid-40000-rent-five-years-shelter

Many Homes Sold Through Right to Buy Now Owned by Private Landlords

Published On: February 11, 2016 at 12:12 pm

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The Communities & Local Government Committee has warned the Government that many homes sold through the current Right to Buy scheme have ended up being rented out through private landlords.

Many Homes Sold Through Right to Buy Now Owned by Private Landlords

Many Homes Sold Through Right to Buy Now Owned by Private Landlords

The committee revealed that landlords are letting 40% of ex-council homes sold through the controversial scheme at more expensive rent prices.

The warning arrives as the committee discussed the Government’s plans to extend the Right to Buy scheme to housing association tenants. The extension would be funded through forcing local authorities to sell off their most valuable assets.

The Government also expects housing associations to build one affordable home for every property sold.

The Chair of the Communities and Local Government Committee, Clive Betts MP, comments: “The fundamental success of this policy will depend not just on whether more tenants come to own their home, but on whether more homes are built.

“As a committee, we are concerned that there are a number of unresolved issues with the Government’s policy, which could have a detrimental effect on the provision of accessible and affordable housing, particularly affordable rented property.”

He continues: “The Government needs to set out in more details on how it will meet its target of at least one-for-one replacement of the sold homes, particularly given issues such as the availability of land, the capacity of the building industry and the uncertainty of income from council home sales.”1

The concerns were raised after the committee found that a large number of properties sold through the original scheme have quickly become private rental sector homes.

Its report states: “The committee believes the potential for selling social housing assets at a discount, only for them to become both more expensive and possibly lower quality housing in the private rented sector, is a significant concern. The committee recommends measures to restrict homes sold through the Right to Buy ending up in the private rented sector need to the explored.”1 

1 http://www.parliament.uk/business/committees/committees-a-z/commons-select/communities-and-local-government-committee/news-parliament-2015/right-to-buy-report-published-15-16/

Housing and Planning Bill will Only Help Landlords, Claims Generation Rent

Published On: January 29, 2016 at 2:52 pm

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Unlicensed HMO landlord ordered to refund £84,877 to tenants

The Housing and Planning Bill is set to go the committee stage in the House of Lords, but are its policies designed for the benefit of landlords alone?

Dan Wilson Craw, the Policy Manager at lobby group Generation Rent, seems to think so.

Housing and Planning Bill will Only Help Landlords, Claims Generation Rent

Housing and Planning Bill will Only Help Landlords, Claims Generation Rent

“For someone so concerned about both turning generation rent into generation buy and balancing the books, David Cameron really should have helped to draft his housing bill,” he says.

He calls the measures on the Right to Buy scheme extension and Starter Homes initiative, “a very roundabout way of guaranteeing a larger private renter population, with a bigger bill for the taxpayer”.

Councils will be forced to sell off their highest-value assets in order to fund the Right to Buy extension to housing association tenants. Wilson Craw believes: “High-value council homes will go straight to investors, who will let them out at market rents.”

He continues: “Many properties bought under Right to Buy will end up with landlords when the owners decide to trade up.”

And it doesn’t stop there. Wilson Craw adds: “And the 200,000 Starter Homes sold to first time buyers at a discount will disappear into the open market after five years when those lucky few cash in their subsidised hand-out. The other two million aspiring homeowners are left with nothing.”

So what does this mean for the private rental sector? “With a fall in the number of homes being let at social rents, and far fewer homes being built than are needed to meet demand, more housing benefit claimants will be paying private rents that will rise ever higher,” he states.

Wilson Craw concludes: “Unless rents fall by enough to allow families to stop relying on housing benefit and start saving, the Prime Minister can kiss his dream of a home-owning democracy goodbye.”1 

Keep up-to-date with the developments of the Housing and Planning Bill on LandlordNews.co.uk, and remember to check daily for the latest landlord updates.

1 http://www.independent.co.uk/voices/comment/david-camerons-flawed-housing-policy-will-only-help-landlords-a6840656.html