"There is a toxic trio of abnormally high proportions of rented housing, for that rented housing to be of poor quality, and a lack of job creation"
The study says a new ‘Fair Value Rents regime’ would repair damaged housing markets in coastal communities.
It calls for a three-pronged housing solution to reverse decades of decline in Britain’s seaside towns – and to tackle what it calls a “toxic trio of low home ownership, poor quality rental properties and a lack of job opportunities”.
Alongside new time limited and localised rent controls in the poorest coastal communities, the paper calls for a new ‘one-stop shop’ to make it easier for councils to take action against rogue landlords and drive up housing standards.
It also wants greater financial and skills support from central government for deprivation hotspots that have become ‘house building not-spots’ – places where housebuilders, developers and financiers don’t want to build and invest.
Natalie Elphicke, Chief Executive of The Housing & Finance Institute, commented: “There is a toxic trio of abnormally high proportions of rented housing, for that rented housing to be of poor quality, and a lack of job creation. Dysfunctional housing markets are proving fundamental to the spiral of decline in many of Britain’s coastal communities – and something radical must be done to turn the tide.
The proposals in this paper can help to break up the concentration of housing poverty and attract new high quality building and investment. Housing can be pivotal to securing jobs, growth and reversing entrenched deprivation.
In particularly, a new fair rents regime would significantly speed up the renewal of the most deprived areas, drive a fairer deal for tenants and taxpayers – and kick-start much needed regeneration.”
The Elphicke-House report, the major government housing review co-authored by now HFI chief executive Natalie Elphicke, found that every £1 spent on construction generates a further £2.09 on economic activity.
Figures from Home Group show that the total social benefits from effective regeneration can be greater still – up to £10 for every £1 spent.
The paper highlights Government findings that show nine out of ten of the most deprived smaller areas are by the sea. Rented housing in coastally deprived areas within Blackpool, Margate, Hastings and Jaywick sometimes exceeds 80 per cent of the entire housing market – and it is often expensive and of extremely poor quality.
It’s blueprint for fixing the housing market in these seaside towns, it says, will kick start investment, regeneration and a British coastal renaissance.
The Plan:
1. A Fair Value Rents Regime
Too often tenants and taxpayers alike overpay for housing which just isn’t worth the rent being charged. Too often rents are too high because they are underpinned by benefit rent allowances which are excessive for the location and quality of the property.
It is recommended that:
There is introduced a time limited local application of a fair value rents regime. This would set, by law, a locally assessed fair value rent for the property reflecting the location and quality of the property, within the existing local housing allowance (rent benefit) envelope.
Applying a modern fair value rents regime reflecting quality of condition and management of property could have the same economic effect for taxpayers and tenants of adjusting markets where rent levels are defective, and at the same time reward landlords who invest in better quality properties and appropriate management standards.
The renewal period would create a window to repair the most extreme economically dysfunctional housing markets where rental markets have warped and damaged ordinary capital values for homes.
2. New house building and housing investment to build local economic prosperity
When areas become ‘deprivation hot-spots’, they can become house building ‘not-spots’, places where traditional housebuilders and developers simply don’t want to build and traditional investors and financiers don’t want to invest.
However, there are experienced developers and regeneration experts as well as emerging social property fund investors who want to support house building and who want to improve private rented conditions in order to make the change in deprived areas.
It is recommended that:
There should be greater financial and skills support from central government and Homes England for councils who have communities with small local failed house building markets;
Activating new house building and attracting social property fund investors should itself be an ambition in such areas;
House building should be across all tenures in order to re-balance housing deprived communities;
The economic stimulus that construction can provide to provide apprenticeships, jobs and new business is directed to provide opportunities for deprived communities. This could include the location of new off-site construction factories in order to drive additional skills and local growth.
3. A One-Stop Shop for Housing Renewal Powers
There are a multitude of powers available to councils to take action to renew broken housing markets, to take action against rogue landlords and drive up housing standards. However, each of the powers are contained in different laws and regulations, require different processes and consultation and apply over different periods of time. Some of these powers date back more than four decades – reflecting a very different housing market and a very different type of local authority. The result is a hotchpotch of mismatching powers which are complex, time consuming and expensive for councils to use.
It is recommended that:
A one-stop shop is created by extending housing renewal powers and providing guidance on what is permissible, and what is possible, in order to drive local renewal and growth.
The one-stop shop would provide a single and over-arching administrative process whereby councils can develop, consult on and then implement relevant powers and actions on housing quality, planning, new housing, growth and tenancy management within a specific housing renewal area.
Guidance is extended and updated on disposal of land, investment and borrowing powers.
Renewal councils are provided with greater flexibility to flex tenure, manage planning and hold property outside the Housing Revenue Accounts.
