Affordable Housing in Rural Communities

Lord Best Excerpts

Thursday 15th October 2015 Lords Chamber

[Lord Best (CB)]

My Lords, I thank the right reverend Prelate the Bishop of St Albans for initiating this debate and for his very helpful opening speech. In essence, the national problem for the next generation in obtaining a decent home people can afford is appreciably worse in most rural areas. Average house prices are significantly higher; average wages are markedly lower. There is only half as much council and housing association accommodation, not least because of the high levels of sales of council housing in villages over past years.

I declare my interest as chair of the Rural Housing Policy Review, sponsored by Hastoe housing association, a leading rural housing provider. Our review involved some of the nation's greatest experts on rural housing matters, including the noble Lords, Lord Cameron of Dillington and Lord Taylor of Goss Moor, along with Jo Lavis as our incredibly helpful secretary. Our report is available on the Hastoe website and I strongly commend it to all those interested in these matters.

Since our report was published in February, three issues have risen to the top of this agenda. With the noble Lords, Lords Cameron and Lord Taylor, I was very glad, yesterday, to discuss these issues with the Secretary of State, Greg Clark, the Housing Minister, Brandon Lewis, and the noble Baroness, the Minister.

First, there is serious concern over the Government’s plan to remove the opportunity for local authorities to require affordable homes on sites of fewer than 10 properties. This measure has been subject to action in the courts and is not yet resolved, as the noble Lord, Lord Taylor, said. Because around 80% of sites in rural areas are small and because the affordable housing obligations on housebuilders have produced two-thirds of all the new affordable homes in rural areas, this measure—however helpful in urban areas—would be disastrous for local people requiring a home in their village. Without any homes for local people, the opposition to new development in rural areas is likely to be much intensified, meaning fewer homes overall.

Secondly, the Government’s intention to allow housebuilders to substitute starter homes—properties for sale with a 20% discount—in place of shared ownership or rented accommodation would, again, be problematic in rural areas. In most of these localities the 20% discount would not be enough to help those on average incomes and below. The opportunity for purchasers to sell on the open market after five years would mean that, in time, all the properties would be beyond the reach of those for whom previously affordable housing had been provided and kept available.

Thirdly, there has been much anxiety about the extension of the right to buy to housing association tenants. Thanks to the good judgment of the Secretary of State, plans for a statutory right for these tenants will not be pursued and a much more flexible voluntary scheme will be introduced. This will mean that housing associations operating in rural areas will be able—and will be strongly advised—to reject requests to buy and instead to offer the opportunity for the same discount to be applied to the purchase of another property elsewhere. Although some rural housing associations remain very anxious, this is a much improved outcome from the negotiations between the Government and the National Housing Federation.

Nevertheless, some aspects of the right-to-buy deal continue to be particularly problematic for rural communities. In particular, local authorities that have retained their council housing will be required to raise the money to pay for the right-to-buy discounts, and will have to do so by selling on the open market the most valuable council homes when they fall vacant. Although the details are yet to be hammered out, in some rural areas—including in North Yorkshire, where I am based—it seems likely that a high proportion of the remaining rural council homes will need to be sold when they become vacant to pay for the housing association discounts.

There are now three potentially serious new obstacles to creating and retaining affordable homes for those not able to buy, even with a 20% discount under the starter homes initiative. There is a real danger that people in rural communities on average and below-average incomes will face an even worse housing future in the months and years ahead. I get the feeling that Ministers are willing to consider ways of addressing these difficulties and I hope that the Minister will work with all of us in standing up for the needs of local people in all our rural communities.