The importance of getting local authorities building tens of thousands of new council homes has been amply demonstrated by the large-scale cuts made to housing association development programmes in recent weeks.
It is also revealed in the growing figures of those in temporary accommodation (an estimated 84,740 households) and on housing waiting lists (up to two million) across the country. The numbers in temporary accommodation, such as bed and breakfast hotels, includes 126,020 children – a rise of 28 per cent in the last four years.
Councils in England built just 2,550 homes last year – their highest total since 1992/93 – but clearly an inadequate number, when compared to the demands on their resources and housing services.
Now councils are hoping to up their game massively, with plans for building upto 80,000 new homes over the next five years being assembled. The drag or disincentive of only being able to replace a quarter of homes sold under Right to Buy continues to undermine these ambitious plans.
And in the dash to house thousands more people in need, councils are desperate to not repeat the mistakes of earlier decades when some of the housing built en masse, quickly became unpopular and is often derided as ‘sink estates’, littered with ‘difficult to let’ empty properties.
Award winning design
Instead they are hoping to replicate the shining example set by Goldsmith Street in Norwich, a new council housing estate that is winning a host of design awards and has been hailed as a modern masterpiece.
Other councils with house building plans, such as York, have already been to East Anglia to see the award winning development and no doubt they will be trying to reproduce similar designs in their own environments.
But not everybody will be able to do this and given the ambitions to build tens of thousands of homes, it is highly likely that Modern Methods of Construction (MMC) will need to contribute a significant number of the new council homes.
Interestingly the new housing minister Esther McVey has said she would like Britain to become a world leader in MMC. We are currently a good few years behind Germany in this respect, but it’s helpful to have an aspirational target to aim for. The test of the ambition will be whether the Government backs this up with the resources necessary to become a world leader.
The recent increase in the cost of council borrowing via the Public Works Loan Board has already sent Treasurers and Directors of Finance back to their calculations and spreadsheets, to see how the higher interest charges will impact on their council’s housebuilding plans.
Another huge test will be whether MMC can deliver the sort of features and qualities that saw Goldsmith Street win the prestigious Stirling Prize, from the Royal Institute of British Architects. This has been added to the Neave Brown Award for Housing, which recognises the best new example of affordable housing in the UK and was won earlier in the year.
Popular with residents
Goldsmith Street consists of almost 100 energy-efficient homes, laid out in rows of two-storey houses, bookended by three-storey flats, each with their own front door, space for prams and bikes, and a private balcony. Each home meets the Passivhaus Standard, meaning energy costs are estimated to be 70 per cent cheaper than the average household.
When the television news crews were being shown around by the very proud (and lucky) tenants, the energy efficiency aspect of the homes got a particularly favourable commendation. One tenant said they had only used their heating twice since they moved in.
The new houses were obviously not cheap to build, but they are producing a really useful asset with a long life and providing comfort and stability to the residents, as well as reducing their use of greenhouse gases. Compare this to the unstable and unhealthy living conditions of temporary accommodation being endured by many thousands.
The latest Government figures show that councils in England spent £1.1 billion on temporary accommodation in 2018/19, including £344 million on bed & breakfast accommodation. Spending on B&Bs has increased by a staggering 111 per cent in the last five years as nightly charges and the numbers being accommodated in B&Bs have both risen sharply.
This money is effectively being thrown away. It produces nothing for the councils or for the families who are being ‘warehoused’ until something better comes along for them. At an estimated cost of £150,000 per new council home, the money paid to the B&B owners could have provided permanent, low-rent homes for nearly 2,300 families.
Help and support needed
In many respects this is precisely the sort of calculation that needs to be done, but only as part of a much more complicated set of questions and answers, which factors in a whole basket of issues including peoples’ health and life chances, as well as the security of having a settled home.
I have spoken with many councillors and council officers in recent months. They all see the existence and establishment of stable and successful communities as hugely important outcomes. They also feel that their efforts are not being supported sufficiently by the Government.
The long-running Brexit saga and the change of Prime Minister has hugely distracted Whitehall for the last couple of years. We are also nearly 30 months on from the Grenfell Tower disaster and might just be starting to see some movement on changes being made to building regulations and fire safety.
In the Queen’s Speech the Government announced its intention to implement a new set of building safety standards, consistent with the Hackitt Review and focussed on delivering a new safety framework for high-rise residential buildings.
However, more column inches were grabbed by Communities Secretary Robert Jenrick’s plans to introduce a new shared ownership Right to Buy, which will allow HA tenants to buy as little as a ten per cent stake initially, with staircasing allowed in increments of just one per cent.
People working in the social housing sector see this as a huge distraction and would rather the Minister was instead focussed on helping councils to design and deliver thousands of new council homes.
A broken model
The true extent of the problem in delivering new social housing was laid bare when L&Q publicly declared that the current development model of providing cross subsidies from outright sales was broken and failing to deliver new rented homes in the numbers needed.
If an association with the size and ambition of L&Q is having difficulty delivering new homes at affordable rents, then you can bet the rest of the HA sector is as well.
But it is not just problems with declining grant rates and difficulties in shifting recently completed properties in a market full of nervous would-be buyers, that is making social landlords seriously re-think their spending plans.
Many social landlords are facing the prospect of having to spend huge sums on ensuring their housing stock is properly safeguarded from the risk of fire. Balancing the two is hugely problemmatic. The G15 group of developing HAs in the capital recently estimated they are having to earmark £6.87 billion for fire safety works to their high-rise blocks.
This eye-watering sum is reducing the amount they can spend on building new affordable homes. And this is where the contribution of local councils will be so important in picking up the slack and replacing HAs as the main providers of new social homes for rent.
But the Local Government Association has warned that the one per cent increase in PWLB borrowing rates could see council housebuilding projects cancelled, postponed or pared back in size.
One person who hopes that will not happen at his council is Michael Jones, the head of housing at York City Council. He visited Goldsmith Street in Norwich back in July and he plans to build three similar estates in York to the same Passivhaus energy-efficient standards. He said: “The site visit gave us the confidence to do it. I remember getting goosebumps walking around.”