Review could relax requirements for social housing
Published by 24publishing for 24dash.com in Housing and also in Central Government, Communities, Local Government
Review to relax requirements for social housing
The Government is considering lending publicly owned land to developers and relaxing council requirements for social housing in a bid to entice institutional investment in the private rented sector, according to the Guardian.
The details are expected to be published in Adrian Montague's review of the barriers to investment in private rented homes.
Mr Montague - the non-executive chair of private equity firm 3i – was asked to lead the review by housing minister Grant Shapps last year. The review is expected to be published in the next few weeks.
Under the plans, the Government and councils would loan developers and housing associations land they own with the state repaid once developments were sold to institutional investors such as pension funds.
Social housing requirements – through section 106s – would also be relaxed. Instead, an agreement would be in place that the rented homes could not be sold privately for a minimum period.
Through the Government's Affordable Rent programme - which charges higher rents for social housing - the Coalition has moved away from a higher capital grant regime in favour of supporting people through personal subsidy i.e. housing benefit.
However, it has been warned that cutting both the capital grant to build new homes and capping personal subsidy i.e. housing benefit risks exporting the vulnerable and least capable families to the poorest areas with the lowest rents.
Last year influential think-tank, the Resolution Foundation, produced a report calling on councils to open up their social housing allocations to include low-income working people and start accepting private sector housing as meeting section 106 agreements.
It formed part of a package of measures to attract institutional investment in the private rented sector to help those currently falling between the gap of homeownership and social housing.
In another report it published last week, the Foundation said housing associations could kick start build-to-let developments by building new units which could then be sold onto an investment fund enabling providers to build more new homes.
It's currently working with a group of five registered providers to model the returns that would be generated from this approach - the details of which will be published this autumn.