Here is another call to purchase existing housing to accomplish social objectives, this time from England1.
In its recent report, the New Economics Foundation presents an overview of the need for more social rent (truly affordable) housing that will be held away from the private housing market.
The need comes not just from the million people who are on waiting lists for social rent housing, but also from the amount of money that is collected from taxpayers and paid to private landlords. English taxpayers contribute directly to private landlords through the payment of a housing allowance. It covers part of the gap between rent and the amount that tenants with very low incomes can afford to pay.
Adding to the stock of social rent homes by buying existing housing is currently supported to a limited extent. The report notes that both Conservative and Labour governments have both supported acquisition programs on a much larger scale in the past.
This report is interesting because it gets more deeply into the ‘how’ of acquiring existing housing stock for social rent purposes. Broadly speaking, there are four strategies:
- taxation, including changing the tax charged on income gained through property sales.
- compulsory purchase orders and equity/discount models, such as factoring in the cost of energy upgrades when calculating the value of an existing property.
- rent controls, which could limit the income stream from a rental property, or constrain landlords’ eviction powers.
- reforming the Right to Buy program, which allows social rent tenants to purchase the property where they are living.
The New Economics Foundation is planning further discussion of these proposals in 2023. One interested party has lost no time to say why the proposals should be dismissed out of hand2.
Regardless of negative assessments, the report from the New Economics Foundation, along with the discussion which follows from it, will be of interest to others. That includes policy analysts, decision makers and advocates who are looking for policies to increase the supply of deeply affordable housing and control public expenditures. Read more at the New Economics Foundation: Beyond New Build: Repurposing Private Rented Housing To Deliver A New Generation Of Social Homes For England
Footnotes
- For an example from Canada try: Canadian Bank Speaks Up In Favour Of Social Housing
- Read more at Property 118: Think Tank claim Private rental property should be ‘acquired’ for social housing!
