It is clear that, ten years post ‘credit crunch’, we are still facing significant challenges in the housing sector. This underlines the importance of collating data and evidence across the UK to understand this picture fully. This is difficult, particularly in a context where government spend on statistics and research is a lesser priority, a challenge that Terri Alafat (CIH) addressed at the launch of the 2017 UKHR last month. For me, the irony is the fundamental need for independent evidence to make better decisions in a cost-effective way. This is one reason the HSA chose to join those financially supporting the UKHR this year.
At the launch event, Mark Stephens (co-author of the UKHR) took us through the economic context. While employment growth has been surprising, it is evident that the quality of this employment and consistent depleting average earnings mean that there is a lack of consumer confidence and associated decline in spending (including on the purchase of homes). At the same time, monetary policy continues to protect house prices, and the impact of an increase in interest rates could be critical for borrowers. ‘Brexit’, of course, adds considerably uncertainty to forecasting efforts.
One of the key themes of the launch was the availability of ‘affordable homes’ and what this means for landlords (social and private), as well as tenants. John Perry (co-author, UKHR) presented an overview of current government investment in housing. Perhaps surprisingly, he highlighted data showing that 79% of this investment is in the form of government initiatives to support and ‘prop up’ the private sector, with only 21% spent on ‘affordable’ supply – a statistic that made headlines Furthermore, the government has prioritised ‘affordable’ homes over ‘social’ homes, leading to a sharp decline in the number of new social homes from 37,000 in 2010/11 to only 1,000 in 2016/17, while the label of ‘affordable’ is at best contestable.
Steve Wilcox (co-author, UKHR) continued on the affordability theme, demonstrating the evidence that this private sector investment continues to support those older home owners who gained from low deposit mortgages and tax relief, whereas first time buyers (particularly the under 35 category) are excluded from reaping the ‘benefits’ of this investment, forcing younger households towards the private rented sector. It was agreed that a potential solution for this conundrum is re-directing £1.5bn from the private investment fund to build much needed socially rented homes. I am convinced that regions and devolved nations should work together, sharing knowledge and ideas as well as multi-departmental analysis on the impacts of poor housing and who picks up the associated costs in terms of health, well-being and life chances.
Another major theme of the day concerned the challenges of welfare reform across Great Britain. This was of particular interest to me, from a Northern Ireland perspective, where a range of mitigation measures have been put in place until 2020, giving some limited time to prepare both landlords and tenants for the full implementation of these highly controversial measures, and learn from the rest of the UK in managing the impacts.
Unfortunately, the wide-ranging evidence presented at this event did nothing to allay my concerns about welfare reform, particularly for those in the private rented sector (tenants and landlords). Tom Dacey (Southern Housing Group) opened the launch with a warning that ‘the worst is yet to come’, explaining how Universal Credit had resulted in a 70% increase in arrears and an average growth of £900 in individual debt levels, with the six-week waiting period incredibly problematic for both tenants and landlords. However, it was encouraging to hear that social landlords remain committed to their mission of housing the most vulnerable households and those on low incomes, and – in the absence of the support of public funding – have responded to these new challenges in innovative, creative ways, for example by developing shared housing schemes for single under-35s.
This year’s UKHR further illustrated the importance of understanding social housing tenants experiences and needs, particularly in the apparent absence of housing policies that do so. One technique that could be explored is to target communications and advice and tailor initiatives effectively by utilising segmentation techniques. This means we need to collect good quality information complimented by strategic research to continue to build an evidence base to monitor and manage the impacts of policy change on the housing market as a whole.
It is also vital that we present information using language that tenants and consumers understand, enabling people to engage sooner, for example, when advice is required and before they face the potentially life-changing difficulties associated with mounting arrears or the threat of repossession.
Lord Richard Best concluded by emphasising the importance of the UKHR – a ‘Housing Bible’ – as an evidence base for understanding which policies are working and which are failing, and posed the critical question: who will house the poorest in our society? If Housing Associations struggle to meet the mission of housing people on low incomes and the private sector isn’t compelled to do so, the very likely outcome is further increases in homelessness. This point was echoed in the Q and A session by Francesca Albanese (Crisis) who called for innovative ideas on how we can work together to tackle homelessness. It will be crucial to work with the voluntary sector and ensure that together, with a joined up approach, we can further develop solutions using data and research to tackle the multiple, inter-linked issues that emerge from the analysis in the UKHR and that were so clearly articulated at this informative and thought-provoking launch event.