Catherine West
Main Page: Catherine West (Labour - Hornsey and Friern Barnet)Housing and Planning Bill
Catherine West Excerpts
Brandon Lewis
We have worked across the sector, and it is clear that our starter home proposals are very popular. As Conservative Members have pointed out today, those in many areas are keen for us to get on with delivering more properties affordable to people who want to buy their own homes. There has been no such product in this country before.
Catherine West (Hornsey and Wood Green) (Lab)
The Minister speaks of affordability. Is he aware that the average deposit paid on properties in London is now £91,000?
Brandon Lewis
That is why we have extended and changed the arrangements. We now have the London Help to Buy scheme and we have starter homes coming in with a 20% discount. Shared ownership is also an important product, and we are determined to deliver 135,000 more shared ownership homes. The prospectus went out just a couple of weeks ago and the plan is to spend £4.7 billion in that area. Even in London, the deposit for such properties is closer to £4,000, which completely changes the affordability for people wanting to get into ownership.
Dr Blackman-Woods
My hon. Friend makes an excellent point. If the Minister has those figures, we will give him an opportunity now to share them with us, as that would be extremely helpful in allowing us to know exactly what we are going to be voting on this evening.
Although more information is important, we need to remind ourselves that the whole policy of selling off higher value council housing to fund the right to buy is considered by almost everyone to be a very bad thing to do, and that replacement is absolutely essential.
Lords amendment 47, tabled by Lords Beecham, Kerslake and Kennedy, addresses the issue of replacement, and would require the Government to enter into an agreement with a local authority under clause 72 whereby a local authority could show the need for a type of social housing and the Secretary of State would then agree a hold-back sum, so that homes sold could be replaced by houses of the same tenure, type and rent. If the Government do not accept this one-for-one, like-for-like replacement, they need to explain why. The reason this amendment is so important is that few details are in the public domain about how the Government will meet their own commitment for one-for-one or two-for-one replacement in London.
It appears that Ministers could force the sale of a council house in Camden and count two other new homes built for open market sale in Croydon as meeting the so-called commitment to replace. Therefore, the like-for-like replacement in amendment 47 is vital to ensure that housing need is met across the range and that homes for social rent are not simply replaced by starter homes or homes at higher rents, which, as the Public Accounts Committee outlined in its statement, is a real risk.
Furthermore, figures from Shelter this morning outline a truly alarming picture of the impact of the sale of higher value council homes on local authority stock, and I will come on to that in a moment or two.
Catherine West
Does my hon. Friend agree that this also punishes good councils that try to build social homes?
Dr Blackman-Woods
Indeed, but I suspect that that is part of the Government’s rationale.
Labour will be supporting the Lords in their amendment 47.
Bob Blackman
It is quite clear that we want a more democratic system in which people have the opportunity to buy their own homes. The principle introduced in the Bill of encouraging home ownership through that process must be right. Equally, it is quite clear that an unfinished piece of business from the Thatcher revolution of the sale of council homes under the right to buy was that housing association tenants did not have the same opportunity, so I am delighted that the Government are putting that right.
It is right to ensure that people who exercise the right to buy continue to live in their properties as owner-occupiers. It is not right that people should suddenly have a windfall because, having been in social rented accommodation, they are offered a discount on a property that they can either immediately resell or re-let. There should be a taper, and I am glad that the Government have seen sense in accepting that such a taper should apply. There is an argument—or a discussion—about where the taper should start, but the reality is that the vast majority of people see that as the right way forward. People buying a property under the buy-to-let process should also have the opportunity to ensure that they get a discount under the Help to Buy arrangements but, equally, they should not be allowed suddenly to get a windfall and then move on.
Catherine West
What does the hon. Gentleman think of the suggestion recently made by one of my constituents that the right to buy should also apply to private sector tenancies? Should there be a public subsidy so that somebody has the right to purchase a private tenancy?
Bob Blackman
It is quite clear there should be an opportunity for everyone to exercise the right to buy. In London, people who use buy-to-let arrangements are getting a return of probably about 3% to 4% on their capital. They are not necessarily getting a huge rate of return, so they are providing facilities for people to live in accommodation when those people cannot possibly afford to buy their own home, or choose not to do so. There are people who choose to rent rather than buy because that suits their lifestyle better.
I want to move on to an issue that seems to have been forgotten in all this. The reality is that someone who demonstrates that their housing need is sufficient—in other words, they are homeless—has a chance of winning the lottery prize of getting social rented accommodation. If they currently get such a prize, they can live in the property for the rest of their life, regardless of their income. That has to be wrong; it should not happen. People come to me every day and say, “I can’t get a council property. I can’t afford to rent a property in the constituency. All the local authority is offering is, with respect, a place in Bradford, Wolverhampton or somewhere in Birmingham, but nowhere near London.” The reality is that people are being priced out of the market because we are building too few homes and, equally, we are allowing people to live in social rented accommodation for far too long after their incomes have risen considerably. That cannot be right. Social rented accommodation should be for people who need it.
Catherine West
It is a pleasure to follow the hon. Member for Thirsk and Malton (Kevin Hollinrake).
I shall be brief, because I know that the hour of the vote is upon us, but I could not resist speaking. Since I was elected a year ago, 1,300 people have come to my advice surgery or have contacted me, and 60% of complaints have been about housing. People have wanted to get on to the housing ladder, have been party to unsatisfactory private rental agreements, or have desperately needed a social home.
It is great that so many London Members have spoken today. Many of us look forward to a wonderful result on Thursday and a more positive approach to housing in London. I am sorry to say that, when it comes to housing for people on ordinary incomes, the record of the current Mayor of London has been pathetic. As a council leader—I must declare an interest as a vice-president of the Local Government Association—I was involved in a number of rows with him. When the council said, “This must be 50% genuinely affordable,” he changed the definition of affordable homes to 80% of the market rate which, in inner London, is utterly unaffordable for the average worker. He also called in applications proactively. When we had agreed with developers about 50% affordability, he turned the application on its head and gave in to the developers. We need a Mayor who will stand up for Londoners and hold developers’ feet to the fire. We need a Mayor who will do the opposite of what was done then and call in developments when councils are not providing enough affordable property.
Let me say a little about the private rented sector. This is not just a London issue, because 4 million families in the country are now renting private property. This is not just a minority interest for London Members; the problem exists across the board. The insecurity that families in the private rented sector feel must be taken much more seriously. It is a crying shame that, notwithstanding all the parliamentary time that we have had in which to debate this matter, and despite all the thinking that has been done in the House of Lords and here in the House of Commons, we have come up with no more than paltry recommendations for an unfair housing sector in which rents go up at the drop of a hat, agents can charge ridiculous fees just to photocopy a rental agreement, and people regularly have to change schools and GPs, which involves a massive cost. In the previous Parliament, housing benefit cost us £60 billion, which could have been spent on building more affordable homes. Why do we think that housing is such a wonderful investment for the private sector? Because of the returns. An investment of £100,000 returns that money after 10 years. It is an excellent investment, which is why housing is so expensive.
I see that you are restless for the vote, Madam Deputy Speaker, so let me end by saying that we must have some leadership from the Government on social housing. There are virtually no proposals, apart from that on starter homes, for the active promotion of high-quality communities with a mix of social homes, private homes, starter homes and key worker homes. We need to be able to take an active interest in how we shape our communities and neighbourhoods so that they are genuinely mixed, rather than being the ghettoes that proposals of this kind could potentially create.
Chris Philp
I draw colleagues’ attention to my entry in the Register of Members’ Financial Interests.
Let me start by responding to a point made by the hon. Member for City of Durham (Dr Blackman-Woods). She referred to the Government’s house building record; let me tell the House that it is a fine one. In the last year of the previous Labour Government, only 125,000 units were started. Last year, that figure had increased to 165,000 units, so this Government have a record they can be proud of when it comes to building new homes.
The hon. Lady and the Chair of the Select Committee, the hon. Member for Sheffield South East (Mr Betts), also talked about the need to increase supply more generally, and we on this side of the House wholeheartedly agree with that. There is much in the Bill with which their lordships have thankfully chosen not to disagree that will increase supply, including local development orders, the requirement to have local plans in place by 2017 and the work of the London Land Commission. There is a huge amount in the Bill that will increase supply, which Opposition Members have asked for.
I want to say a word in support of starter homes. We know that 86% of the citizens of this country aspire to own their own home, and starter homes will help them to do that. By owning their own home, they will benefit economically as house values go up and they pay down their mortgages, and social benefits will accrue as well. We have heard a lot from Opposition Members about the importance of settled and rooted communities. What better way is there of having a settled and well-established community than by ensuring that it is a community of people who own their own homes?
Opposition Members also talked about affordability, speaking about the ceiling of £450,000 in London and £250,000 outside the capital. That is a ceiling; it is a maximum. My borough, the London Borough of Croydon, is the largest borough by population. The average starter home there will cost £190,000. That means that, with Help to Buy, a deposit of £10,000 will secure a home, and a couple earning £22,500 each will be able to afford to service the mortgage on it. In the London Borough of Croydon, starter homes will work.
On the point about increasing the supply of council houses, I must respectfully point out that in the past five years of a Conservative Government, we have built more than were built in 13 years under Labour. I would further point out that under the rules governing the disposal of high-value council houses, one such house will replace every one that is sold outside London, and it will be two for one in London. These measures will actually increase the supply of council housing across London as a whole, so they should be welcomed.
The problem with the amendment relating to the 20 years’ discount is that if someone wants to move from their starter home, they will need to realise its full market value in order to move up the property ladder to their second and then their third home. I believe that we might see regulations that would allow for a sliding scale, perhaps between five and 10 years. Given that the average length of time spent in a property is about seven years, that would make sense.
On the amendment about local authorities being able to circumvent starter home provisions, I must point out that our proposals were part of a national manifesto commitment that was approved by the electorate at the general election, so it is quite right that they should now be implemented nationally. Local issues will be fully accounted for via the 20% discount on the open market value, which will reflect local housing need.
There is more that I could say, but I am sure that we all want to hear from the Minister. I support the Government’s position on the amendments and look forward to supporting them in the Lobby.