Last weekend a group of young professionals, forced by a spiralling housing market to rent rooms in shared houses at exorbitant prices, moved into a new development in London’s Stratford East — an area booming in the wake of the 2012 Olympics. To mark their arrival, they held a housewarming party.
But these youngsters had not rented their own home in Stratford. Instead, the group of housing campaigners had entered the development to hold a party in protest at the government’s failure to tackle the rising cost of rent — and role of social landlords in that failure.
The development in question was an apartment block designed for private rent on the open market, but built and managed by Genesis Housing Group, a social housing provider. Rents on a two-bedroom property reportedly start at £1,700 a month. Based on affordability criteria set out by housing charity Shelter (roughly, that housing costs should only consume 35 per cent of take home pay) these properties would only be affordable to families with an income of £76,000.
This is not the first housing protest that London has seen, and direct action will rise in line with rents. But it is arguably the most important: it is the first indication that social landlords may be conspiring in their own demise.
Genesis is one of 15 largest social housing providers in London, which together are preparing to build 4,000 properties for market rent and more than 1,000 for outright market sale. And like many others, Genesis has now opted to take advantage of a £1bn government funding pot to help build more new homes especially for private rent.
Social landlords claim they have an important role to play in this sector — they offer stability and security with lengthy leases so renters can bring up families in their homes, they are experienced and trusted landlords and will use the profit they make on private rent to cross-subsidise social housing.
But the ever-swelling Generation Rent sees things differently: the poacher has turned gamekeeper and wants its own bit of the booming property business that government is helping to prop up. ‘Private renting is expensive and gives people no security – the last thing we need is more of it,’ the Let Down campaign’s spokesperson states.
It doesn’t matter that Genesis claims the campaigners’ statements are factually incorrect; the point is that the perception of social landlords has been sullied, just like local authorities before them.
By getting into bed with government over ‘Build to Rent’ and other schemes perpetuating the status quo in the housing market, including the much-criticised ‘Help to Buy’, housing associations are placing themselves at risk of becoming seen as part of the problem and a cause of the housing crisis. Their reputation is at risk in part because welfare reform policies are being unfairly blamed on them, but also because large social landlords have become part of a broader commercial property sector. And it’s not just over market housing: they have held the government’s hand over the implementation of the ‘affordable rent’ scheme, a misnomer of gargantuan proportion, which allows housing associations to charge social tenants up to 80 per cent of market rent.
Many Conservative politicians will be delighting in the fact that those social landlords are under attack. David Cameron has just this week hit out at ‘unacceptable’ housing chief executive pay offs, the last in a long line of criticisms of a sector that stands accused of entrenching welfare dependency.
By cooperating with government in a desperate attempt to secure what little scraps of public money are left for housing, housing associations are excusing what amounts to the death of social housing by a million cuts and private sector initiatives. By becoming commercial landlords and supporting market policies antithetical to their own values, I fear they have hastened their own demise.
Hannah Fearn is a journalist and commentator on social policy. She tweets @hannahfearn
Comments