The Housing White Paper marks a significant change in the government’s approach, but sadly it has not provided all the answers to the housing crisis.
Sajid Javid and Gavin Barwell went to great lengths, and to almost every radio and television studio, to set out the government’s vision on how to fix our broken market. And what struck me most was the very positive switch to a housebuilding programme that is not just aimed at homeownership.
They’re looking to tackle all parts of the market, from greater protection in the private rented sector to speeding up house building.
They’re giving local authorities greater power and control over what is built in their area – and by whom.
It’s a sensible plan, but the devil, as always, is in the detail.
Building the homes we need
However while the government rightly recognises the need for a range of new homes, including affordable rent, there was no additional financial support.
At Sovereign we’ve scaled up our development programme to around 1,500 homes a year, despite continually falling grant rates – and we’re doing this because of the growing demand in our area.
Having recently merged with Spectrum Housing Group, we’re now looking to transfer our efficiency gains into even more new homes. Our increased financial strength means that we can take on more risk, especially when we’re able to work in partnership with local authorities and developers.
But the focus on supply is making rating agency Moody’s nervous, saying the increased developer, funded by debt rather than grant, is credit negative for the sector.
Planning for the future
It may not have grabbed the headlines, but the beginning of a consultation on our rents post-2020 is probably the most important part of this White Paper for housing associations.
We plan our business over a 30-year period, so greater certainty on our future income means we can be more confident in going to the market to bring in more investment.
We look forward to contributing to that work with the Department of Communities and Local Government.
Building partnerships, building homes
I’m sure our local authority partners have also been reflecting on what the White Paper means for them. What impact does the requirement for a local housing plan have? How can they speed up developments and what do the greater powers to build on their own land mean in reality?
I’ve always believed housing associations and local councils have much in common, particularly in our purpose and our desire to build the homes our communities need. I hope the White Paper gives us the tools to work even more closely to achieve this shared goal.
Finally, while there’s certainly much to be applauded in the White Paper, it still fails to deal with what is, for me, the fundamental issue with our broken housing market.
Simply, we take a short-term view. We work in Parliaments, when we should be working in decades.
To really fix our housing market we need a long-term strategy which builds on the combined strengths of local authorities, developers and housing associations, encourages support from local communities, and which provides the right financial and regulatory support centrally.
The government took a positive step in the White Paper. At Sovereign we’re keen to play our part in increasing supply, especially for people on low incomes – and we look forward to developing new and innovative partnerships to maximise the opportunities to make this happen.