Published on 23 Nov 2011

Housing plans ignore astonishing numbers

It’s rare that the government serves up a truly astonishing statistic.

The housing strategy was released on Monday and debated in parliament that afternoon. On that same day the DCLG received statistics from the Homes And Communites Agency (HCA) about the number of affordable houses under construction. On Tuesday, the numbers were released to all of us.

Opposition housing minister Jack Dromey spotted that this represented a 99 per cent decline in HCA funded affordable homes from the last fiscal year to the first half of this year. If you dig a little deeper and go to the sub-regional stats, there’s some incredible numbers.

This is the impact of the huge cut to the housing budget capital programme announced by the coalition government’s spending review in 2010.

In east and south east England, 10,865 affordable housing starts over the fiscal year ending in April. Since April this year, 37 ( in total).

In the north east and Yorkshire and the Humber, 3,843 affordable housing starts last fiscal year. Since April this year, less than one per week. In south and south west England, last fiscal year there were 7,219 affordable housing starts. Since 1 April this year, less than one a week.

Last financial year (pre-spending review) there were 16,331 total affordable housing starts in London. In the first half of this financial year: 56. That’s two a week.

Between April 2010 and March 2011: there were 3,766 affordable housing starts in north west England. Guess how many since? Zero. Not one single affordable house, under the government definition, across the north west of England.

As an aside, I can’t find comparable up to date statistics for Scotland yet. But similar stats seem to suggest that there were more houses like this built in Scotland in Q2 than in England so far this fiscal year. As Scotland’s population is a tiny proportion of England’s, and its issues with affordability are small compared to particularly south east England, that does seem remarkable.

So what’s going on? Are there government housing gurus running around the DCLG shouting: “We are the 99 per cent reduction in affordable housing”?

No, I don’t think so.

These numbers were running at about 54,000 per year. Since April its been 454. In this parliament that number will go back up to a few thousand, as the new government affordable homes programme kicks in.  These programmes are predominantly about renting. So we are at the bottom of a one year “funding valley” for affordable housing, though it should be pointed out that the other side of the valley will be far, far less high. Something similar happened with university funding.

But the government’s decision to hit the affordable housing budget by 60 per cent, and to go for front-loaded cuts to capital budgets (which tends to be spending with a bigger knock-on effect, or multiplier, in the rest of the economy) may clearly have had a wider impact across a weak economy. The apparent wish to communicate mass homebuilding and affordability on Monday, when Tuesday’s figures were a direct result of their previous decisions, should give pause for thought.

I should point out that the numbers above are from the Homes and Communities Agency. They were responsible for 91 per cent of affordable housing starts last year, but there are other sources, such as local authorities, so-called section 106 agreements.

I should also point out that in the Housing Strategy document on page 21 is the line: “there is a real need for more affordable housing”. Just a few hours later the HCA reported falls of 95-99 per cent.

Follow Faisal Islam on Twitter: @faisalislam

18 reader comments

  1. Philip Edwards says:

    Faisal,

    That’s Manchester in deep doo-doo, then……:-)

  2. e says:

    Pause for thought! Time for action will be…..? When £40,000 income might get you a rented roof over your head?

    Has supply and demand been removed from the lexicon to make room for the squeezed middle?

  3. Gary says:

    Why? Do the government want us all to be “Travellers”? Do they want us all to live in tents beside the crumbling roads?

    We need a revolution in this country, the elitist, upper class, bigotted poilticains have had it too good for too long!

    1. e says:

      I fear we’re 10 a penny hence our forebears fight to establish the Labour party – unfortunately they’re suffering an identity crisis – I don’t think we should doubt this governments ability to ignore urban slums developing. They want a workforce fit to compete with china’s and alike. That would be living on a pittance under a makeshift roof. The Tories housing policy suggests this is exactly what they expect to get.

  4. muggwhump says:

    It is obvious that all taxpayer funding that used to go into building social housing has been diverted into underwriting mortgages and funding shared equity schemes to prop up house prices.
    Is this fair?
    Shouldn’t any public subsidy be spent first and foremost on the poorest?

    Notice how there is no political pressure from any party questioning this, so year by year it gets worse and worse! In fact Labour criticized the government for not going far enough when it came to guaranteeing mortgages.

    The banks are the only things that matter to our political class.

    Lets have that honest debate about housing shall we Faisal?
    The housing market is no longer a free fair market, literally, market forces no longer apply. Nor will they ever again because we have house prices that require most people to take on a 7x salary mortgage underwritten by the taxpayer.
    So how do we move forward in a world where those at the bottom are paying taxes so those above them can get housed?

  5. Andrew Dundas says:

    Thatcher has returned!

  6. byrdele says:

    This is so sad – sad for the people affected, but even more sad that people do not realize that there is an alternative to the expensive housing. No, this one organization, Habitat for Humanity cannot solve all the housing problems. It might even end up being what seems to be a drop in the bucket. However, to the people affected there is no drop in the bucket, just a nice, affordable, safe home. Link: http://www.habitatforhumanity.org.uk/page.aspx?pid=273 for the UK. I’ll leave my msg at that – I am certain the website will say it all. Thank you.

    1. e says:

      A great organisation, definitely one to be supported, brilliant work overseas as well…..

  7. Philip says:

    Spin this one, Dave, Georgie & Big Eric! Housing Minister = Grant shacks?

  8. Jide says:

    Finding this a difficult one….up until social housing policy is fully reformed it is difficult to stand whole heartedly behind a build more brigade. There must be room for self determination and self responsibility for citizens. Current Social Housing Policy allows people to shreak responsibility for their decisions. Whilst this happens I am not sure I will be a supporter of more social housing

    1. muggwhump says:

      But a majority of the millions on waiting lists plus countless others stuck living in over-priced rented accommodation are taxpayers who are having their money spent on policies designed to keep house prices inflated far above what they would be otherwise. For many this will mean that they’ll never be able to live anywhere!

    2. e says:

      The new social housing policy is going to nudge people into spending their declining disposable income more generously in “the right” direction is it?

  9. Dan Cookson says:

    Faisal

    The picture in Scotland is less dramatic but still worrying.

    eg 33% fall in housing association starts

    Nice summary of Scottish housing market here:

    http://www.scotland.gov.uk/Topics/Built-Environment/Housing/supply-demand/chma/statistics/MarketReviewOct2011

    Private Rented Sector (PRS) picking up the strain in Scotland.
    Citylets report of Scottish Rental Market Q3 2011 is here: http://www.citylets.co.uk/reports/

  10. sue_m says:

    “The apparent wish to communicate mass housebuilding and affordability..”
    I am sure the govt do want mass housebuilding as their paymasters in the building firms are pushing for and they are willing to make those homes saleable by underwriting mortgages for short-term affordabilty. BUT ..they are not willing to provide proper affordable social housing within the reach of the majority on lower incomes as this doesn’t generate huge profits for the corporates funding the party.
    It is obvious this govt is not concerned with anything that doesn’t generate profit for large private companies. For those who cannot afford or obtain a mortgage it’s an attitude of tough luck – go rent privately. Which has the added advantage of further enriching the Tory sympathising private landlords.
    The basic needs of human beings for shelter, warmth, food and decent healthcare no longer matter in the UK nor does the greenbelt or heritage of this country. We must worship the god of money and profit only and put up with whatever crumbs the greedy 1% decide to scatter to the rest of us. Shocking how quickly these privileged fools are destroying so much the people of the UK fought for and were…

  11. ResistoryX says:

    “10,865 affordable housing starts over the fiscal year ending in April. Since April this year, 37 ( in total)”
    This figure is so obviously a nonsense that I’m surprised no one picked up on it…wait hang on some one did http://www.estatesgazette.com/blogs/london-residential-research/2011/11/homes-communities-agency-figur.html

    1. e says:

      He [Grant Shapps] said the HCA figures did not usually attract media attention – and were “very internal”, usually only of interest to the housing press and denied claims that he had pulled out of a Today programme interview on Thursday http://www.bbc.co.uk/news/uk-politics-15888991
      He continues along the lines that the government is very impressive because having cut investment in social housing 150,000 “affordable” homes can now be built.
      Affordable for whom?

  12. Rob says:

    This story is simply wrong, I work for a housing association in the south east and we alone have started more homes than the figures quoted this financial year. I think you will find that the Homes and Communities Agency has not yet updated it’s online system since a new funding regime came in place which the new government introduced(which admittedly is not C4News fault). The story is well off the mark and disapointing for a normally top rate programme.

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