Housing Supply and Homelessness

Lord Best Excerpts

Thursday 5th December 2024 Lords Chamber

[Lord Best (CB)]

My Lords, I am grateful to the noble Baroness, Lady Warwick of Undercliffe, for introducing this debate so brilliantly. I am also looking forward to hearing from the most reverend Primate the Archbishop of Canterbury, who has been a consistent champion on behalf of the homeless and the badly housed.

There is likely to be almost universal agreement in this debate on the need for a huge increase in genuinely affordable, secure accommodation. I am only the fourth speaker, but I find that I will be repeating what has already been said. Perhaps that shows a unanimity of view on the urgency of the situation.

We have heard the figures for homelessness and temporary accommodation; I give special thanks to Crisis for its comprehensive briefing. We know of the impossibly long waiting lists for social rented housing. The Government want the housing associations and councils to build far more new homes, but there is an urgent need for investment in the existing social housing stock. The Grenfell tragedy has highlighted the necessity to spend billions on remediating unsafe buildings. We now have the Social Housing (Regulation) Act, with Awaab’s law, which requires cold and mouldy properties to be treated quickly. It is backed up by an enlarged role for the Housing Ombudsman, so the social housing sector has turned its attention to the need to address its backlog of maintenance and major repairs.

Meanwhile, we see the impact of inflation on building costs, land costs and interest rates. All this means that we are unlikely to build nearly enough new homes to meet the pressing demands. A quick calculation of the proportion of the 1.5 million homes the Government hope to see built during this Parliament suggests that less than 10% of those new homes will be affordable for those on average incomes or below.

So what can be done to dramatically and rapidly increase output of social rented accommodation, at a time when public funds are so scarce? I will suggest three potential ways forward. There has been no pre-discussion of this, but I find that space for two of my three has already been taken by the noble Lord, Lord Young of Cookham. I will expound my three.

First, it seems quite possible that the huge expense of the land for development may, in future, be reduced where the uplift in value can be captured for the public good; if necessary, backed by compulsory purchase powers. Where land is bought by local authority arm’s-length development corporations—not least those established for the new generation of new towns and urban extensions—a comprehensive master plan can parcel out sites to a range of private and social developers, achieving quality place-making as well as higher levels of social renting.

Secondly, we have failed nationally to recognise the opportunities as well as the obligations from demographic change. By building specifically for older people, as noted in last week’s Older People’s Housing Taskforce report, significant financial benefits can be achieved. On the one hand, more suitable accommodation for older people pays its way in postponing or preventing hospital admissions, delayed hospital discharges, home-care costs and moves into residential care; on the other hand, each new home for an older person is likely to achieve two for one by releasing a family home for the next generation. This secures the precious asset of a social rented family home at no cost, while better serving the needs of an older person.

Thirdly, a shortcut is needed to secure accommodation for those forced to accept highly unsatisfactory temporary accommodation, and to address the crippling costs of this temporary accommodation for local authorities. An answer lies in channelling funds to the acquisition and modernisation of the private rented properties where landlords want to exit the market, not least under new pressure from the Renters’ Rights Bill coming down the track. The Government could incentivise the outgoing landlords to sell to a social landlord through exemption of capital gains tax. Stamp duty does not work so well because it is paid by the purchaser, and the social landlords will not be paying stamp duty, but capital gains tax presents a real opportunity. This approach, as advocated by the Affordable Housing Commission, represents “Back to the Future” for housing associations, whose main output in the 1960s and 1970s was in buying and improving street properties. It means investing in property rather than paying private landlords exorbitant rents for low-quality, short-term use: bricks, not benefits.

I hope the Minister can comment on these three ways of getting a bigger bang for the public buck: capturing land value; addressing unsuitable, underoccupied housing for older people; and, once again, purchasing and upgrading unsatisfactory private rented housing. Now I am honoured to hand over to the most reverend Primate the Archbishop of Canterbury, and I pay tribute to the leadership and inspiration he has demonstrated in relation to the housing crisis.