Regardless of your views on social housing, you’d have to admit there are far more obvious, and natural, targets for people to choose to protest against rising rent levels in London and elsewhere. So it’s with a strong sense of irony that I find myself defending the sector against accusations that have been levelled at us during the course of the last week.
As mentioned in this blog, Genesis is part of a group of housing associations known collectively as the G15. Between us we’re responsible for around a quarter of all the new homes that are being built in the capital. Yes, that’s right: social landlords are stepping up to do their bit to address the chronic shortage of UK housing. At Genesis, we’ve gone one step further; we’ve made a deliberate business decision to diversify our portfolio, providing homes to more people with different needs across the housing market. We’re not just building homes for social rent, we have a mixture of properties that includes housing available for private rent and sale at current market levels, too.
An example of this is our Stratford Halo development, providing over 700 new homes on one site with homes for rent on the private market and social housing in the same scheme. A relatively small amount of public money was used to finance the shared ownership, affordable housing, social housing and homes for people with care and support needs (there is an extra care scheme on the site). The least one might expect from a social landlord with a longstanding tradition of providing homes for this end of the market.
However, the remaining 400 properties at Stratford Halo i.e. the homes for rent and sale on the private market, were financed through a ground-breaking deal with M&G Investments, valued at around £125M. As part of the deal, we sold the homes to M&G, who then leased them back to us on a 35 year agreement. It’s an innovative arrangement that provides more housing for people on the open market, without a cost to the public purse – something we believe housing associations may have to do more of to be able to continue delivering more new homes in the light of decreasing government funds.
As for the suggestion that the homes are unaffordable; much has been made of the fact that the rent, on the private market, for a two-bedroom flat at the Halo starts at around £1700 PCM (for a brand new, high quality home in a complex with a concierge service, roof gardens and other amenities, I might add). At the last count virtually all of these ‘unaffordable’ properties had been leased or have agreements pending, so that quashes that idea.
As a social landlord we do empathise with concerns about property prices and access to homes, especially for young people. It’s not unreasonable to have aspirations of owning your own home. The simple truth of the matter is that there are not enough homes, either existing or being built. This applies across the housing market and not just social housing. As a housing association, we believe we have a social responsibility to provide housing for a wide range of people, from families to single people, people with care and support needs or who may otherwise be in hospital and so on. At Genesis, we also believe that housing associations have to adapt to survive and adopt a more commercial approach to help fulfil our social responsibility, as outlined in the Smith Institute report that we sponsored earlier this year.
It is a shame that commentators do not ask questions before they leap into the unknown. Genesis is proud of where it has come from but also realistic enough to know that if we are to address today’s housing problems then we need to find new solutions.
Neil Hadden is Chief Executive of Genesis Housing Association.
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