If housing associations and councils were to sell their high value social housing when it becomes vacant they could raise enough money to fund up to a further 170,000 homes a year, according to a report from think tank, Policy Exchange
The National Housing Federation, NHF, has described the findings ‘fundamentally flawed’ and have warned the idea could ‘cleanse’ some high-value areas of working people who cannot afford to live there.
The report, “Ending expensive social tenancies”, claimed that more than a fifth of England’s social housing stock was worth more than its area’s average house price, with a total value of £159 billion.
3.5% of these high value properties become vacant each year. The sale of these would generate around £4.5 billion, which is equivalent to the £4.4 billion capital expenditure on social housing earmarked for the 2011/15 comprehensive spending review period.
Alex Morton, the author of the report, said: “Expensive social housing is costly, unpopular and unfair. That is why almost everybody rejects it. Social housing tenants deserve a roof over their heads – but not one better than most people can afford, particularly as expensive social housing means less social housing and so longer waiting lists for most people in need.’
Housing minister Grant Shapps was supportive of the idea, whilst the NHF opposes it.
David Orr, Chief Executive of the NHF said: “The Policy Exchange’s report rightly recognises that we have a huge shortage of homes and urgently need to start building more, and part of that solution is that housing associations should be able to take advantage of the value of their properties in different ways. However, the idea of selling off social housing in “high value” areas to build more in cheaper areas is fundamentally flawed. It could effectively cleanse many towns of hard working people who simply can’t afford the high prices of buying or renting privately. The report also ignores the fact that there is not the mortgage availability or market for people to buy these homes.”