Housing and Planning Bill

Written evidence submitted by One Housing (HPB 16)

Housing and Planning Bill

One Housing helps people to ‘live better’ by providing high quality homes and care. We manage over 15,000 homes across 27 London boroughs and surrounding counties, and care for over 11,500 people to help them live independently.

In the last few years we have delivered more than 1,500 new affordable homes and we plan to build a further 3,600 by 2019 to help meet the housing shortage. We offer a wide range of housing options including homes for affordable rent, shared ownership, private rent and private sale. We also make a positive difference to our residents’ lives by promoting aspiration, independence and well-being through a range of training and support services.

The briefing sets out our position on the provisions within the Bill which could affect One Housing. We are broadly supportive of the Bill but we have a number of specific concerns and issues we would like the public committee to scrutinise.

We’ve given evidence in four key areas:

1. Starter Homes

2. Right to Buy for housing association tenants

3. Pay to Stay – higher rents for high income social tenants

4. Speeding up the planning system

1. Starter Homes

The Bill introduces ‘starter homes’ and puts requirements on local authorities to monitor and promote them. The exact details of these requirements will be set out in Secondary Legislation, but could include requiring a portion of a Section 106 Agreement to be for ‘starter homes’.

· We agree that a wide range of affordable homes needs to be taken into consideration when local authorities are reviewing planning applications. We agree that S106 should not just include a provision for social homes, but affordable homes for young professionals and the ‘squeezed middle’.

· If this policy had been in place since 2010, allowing us to create a mixture of affordable tenures, with a mixture of rental income, and to set the rents based on income and the local area, we would have collected an additional £6 million in rents, which would have been reinvested back into building more affordable homes.

2. Right to Buy for housing association tenants

Part 4 covers the implementation of the Right to Buy for housing association tenants. This follows the voluntary agreement made between the Government and the National Housing Federation.

Clause 56 states that the Secretary of State may make grants to private registered providers to fund the discounts offered to tenants. These grants may be made "on any terms and conditions the Secretary of State considers appropriate". We are concerned that the Bill makes no mention of full market value reimbursement for the discount.

· One Housing, along with many of our sector partners, signed the voluntary Right to Buy deal. We signed up to it as we were given assurances that we would be reimbursed for the full market value for homes sold under the policy.

· We are concerned that without further detail, there is a risk that a future Secretary of State will not honour this agreement.

· If there is uncertainty in the amount reimbursed for the sale of homes, we will not be able to deliver the Government’s promise of a one for one replacement. Additionally we borrow based on the value of our assets, so there is potential for the sector’s development pipeline to be put at risk, undermining our ability to build affordable homes.

· As a London based housing association we are particularly keen to ensure that the money raised from the sale of high value properties in London is used to fund the building of more homes in London and not used to fund building in other, cheaper, areas. We would like a guarantee from the Secretary of State that money raised in London as part of measures in the Bill, will be ring-fenced for London development.

· We are largely supportive of Zac Goldsmith’s amendment for a guarantee that in addition to the replaced housing association homes, London will see at least two low-cost homes built for every single "high value" home sold. However, if housing associations do not receive the full market value reimbursement for the discounts, building replacement homes in London will be impossible.

· In order to fund the Right to Buy, the Bill states local authorities will be required to sell off their "high value" properties in order to fund the policy. However, the Government has not clarified what "high value" means and defined "high value" in different areas.

· The Explanatory Notes state that the Government is open to housing associations meeting the criteria "in other ways" if they would create "an equal or greater level of support" to tenants to help them into homeownership. At One Housing, we offer a wide range of homeownership options including: shared ownership, shared equity, help to buy, rent to buy and right to acquire. We feel that a policy which supports a diverse range of homeownership options is much more conducive to increase the number of homeowners, rather than focusing on one policy. It would be helpful if the Bill defined what "other ways" housing associations could meet this criteria.

· We want to work with the Government and support them in their initiative in giving people a chance to own their own home. However, we need guarantees in return so that we can reassure our lenders and continue to deliver more affordable homes so that not only current residents of housing associations can buy, but people in private rented accommodation too.

3. Pay to Stay - higher rents for high income social tenants

The Bill requires housing associations to charge tenants on higher incomes higher rents.

· We are broadly supportive of this measure but we would like to see it phased in over time so that tenants gradually increase their rents in line with their income. One of our immediate concerns is that for some residents, there is a stark difference between their current rents and what they would pay on full market. If this was staggered, tenants would be able to budget more effectively and thus there is less chance of them falling behind on their rent and entering into arrears.

· We would also like to see rents set at a local level and for housing associations to have more control over rents. While we welcomed the changes in the Localism Act, which permitted local authorities and registered providers six new options on the length of tenancies, and local authorities new options on access t o allocation of social housing, we ask that the G overnment go further and allow housing associations to set their tenants’ rent. We thi nk this would be beneficial for the following reasons:

1) Allow mixed communities to thrive: housing associations know from experience that when communities have a mixture of people with various socio-economic backgrounds, lifestyles and cultures, communities flourish. By allowing housing association to set the rents, we will ensure that our developments include private, affordable and general needs, fostering a balanced community.

2) Opportunities for the excluded middle: The huge changes in the housing market in recent years have created a new category of people who can’t afford to buy their own home. At the moment, the HCA controls who we house, and the rents that we charge, restricting our ability to cater for the squeezed middle and, in the process, making it more difficult to create and maintain more sustainable communities.

· We would also like to see more detail about how the HMRC will be disseminating information regarding tenants’ income.

4. Speeding up the planning system

The Bill will mean that planning permission will be granted automatically in principle on brownfield sites. Councils will be required to keep a register of all brownfield land.

· We agree that the Government should have oversight when it comes to defining "affordable housing" within local authorities. Different definitions of affordable from one council to another means that the planning process is costly and inefficient, increasing the likelihood of delays.

· The Government has not yet stipulated any limit to the size or location of housing schemes that would be given permission in principle, so we would welcome more detail.

· While changes in brownfield sites are a step in the right direction, we would also ask the Government to consider a review of the existing greenbelt. The popular view of the greenbelt is highly inaccurate. Many areas of existing greenbelt around London are neglected and poorly used. A review of all existing greenbelt land would identify which areas are currently not community amenities, and could be used to build more homes.

· For example, research by London Councils suggested that if the land around 11 tube and railway stations in the greenbelt were developed to a ten hectare area, more than 7,875 new homes could be developed with existing infrastructure links. However, we recognise the impact that development can have on communities, sometimes affecting infrastructure and local services like schools and doctor’s surgeries. This is why we support discrete development trials on specific sites to evaluate their impact on the community and environment.

Summary

We support the Government’s commitment to build more homes and we are committed to helping more people to realise their dream of buying their own home.

However, we are concerned that some of the measures contained in the Bill, may have an adverse effect on the number of new homes built. In particular, we are concerned that housing associations may not be fully reimbursed for the Right to Buy discount, which will impact on our ability to build. Without full compensation, housing associations will not be able to fund the development of replacement homes.

We are also concerned that the Bill increases the regulatory powers of the HCA. Now more than ever, housing associations with a strong track record of building need to use our full balance sheets to borrow more so that we can build more. We also need the HCA to rethink their grading system, as housing associations need to diversify their stock with private sale to subsidise our social homes, we need our regulator to grow with us, not work against us.

November 2015

Prepared 10th November 2015