Thursday, February 22, 2007

Housing crisis: Exploitation! Exploitation! Exploitation..!

We have seen various attacks on the welfare state under the guise of welfare reform. It seems like now that social housing is next on the agenda for attack. The post written by Martin Wicks illustrates the myths written about social housing by the likes of Will Hutton.

But what also troubles me is the fact that private rented accommodation is kinda left out of the equation by the Left. Council housing is much more homogenous, more collective and better organised (Defend Council Housing) unlike the private rented sector which is much more diverse, varied and has less rights. You can be booted out on a whim by an unscrupulous landlord! It is of course, the buy-to-let brigade along with the banks that are pricing young workers out of owner-occupiership and into the grasping embrace of the private landlords.

The rented sector is the smallest in the western world and accounting for 10% of the housing stock. And it contains some of the worst housing conditions in Britain with 10% of households living in unfit homes. Around 43% are in serious disrepair. It also exposes security of tenure, homelessness, tenancy agreements, deposits, restrictions on housing benefits, fair rents and conditions at worst end of the sector. Lone parents with children, for example, are more likely to rent their property than own it, 50% are rented from the public sector and 15% rented privately. In 2003/2004 owner occupation was highest in the South East (75%) and lowest in London (58%). London had by far the highest proportion rented from the private sector (17 per cent).

But by far the biggest scandal is the “buy- to -let” scam and what an unhealthy scam it is! The Council of Mortgage Lenders released figures for 2006 estimating that 330,000 mortgages were for buy to let properties and therefore £38.4billion was taken in 2006.

“With evidence from other sources of strong tenant demand, rising rents and falling void periods, buy-to-let looks set to continue to remain popular and successful."

The solution (short of revolution)? Must be in the extention of council housing. This could be funded out of right to buy receipts and loans based on the rental income that would be coming through. The advantage of this would be high quality affordable homes with good security of tenure. The “disadvantage” is that no one would be getting rich on the backs of ordinary people (which is what would make such a scheme affordable).

What seems to be on offer for young workers is renting from a buy-to-let landlord. Buy-to-let is the most extreme form of the parasitic “something for nothing” ideology that surrounds and distorts the property market. What new housing do buy-to-let landlords provide? None. How much value do owner-occupiers provide for the increase in the value of there homes? Same answer. What protection is there for ordinary people if the market crashes? Same answer. How much extra housing will Ruth Kelly’s proposals provide for the vulnerable in society? Same answer.


AN said...

Tis is a agood and infoemative article. Asa question - how do feel the registered Social Landlords (housing associations) fit into this picture.

I have come round to a sort of non-ideological view on this, that council housing is better, but an expansion of social housing that came via the RSLs would still be progress.

Louisefeminista said...

I think housing associations are a mixed bunch. Some are very good while some act as if they are privatised and project that corporate image.

Unfortunately, security of tenure is different now as well and like any other housing, housing associations reflect this and so they get more leverage over the tenant compared to security of tenure before Housing Act 1988. They became assured tenants as opposed to Rent Act protected tenants.

Yes, I don't have a problem with expanding social housing via housing associations but what needs to happen (and including council housing) is that housing associations need to be democraticised and made accountable and responsible to the tenants.