Affordable Housing (London)

Rupa Huq Excerpts

Wednesday 9th September 2015 Westminster Hall

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

In the four minutes or so I have available, I want to acknowledge the comments made by my hon. Friend the Member for Southwark—[Interruption.] Sorry, my hon. Friend the Member for Dulwich and West Norwood (Helen Hayes), who represents the borough of Southwark, because she painted exactly the picture in my constituency. She laid out very comprehensively the financial challenges of building homes for social housing providers. I find myself, perhaps not for the first time actually, in total agreement with the right hon. Member for Cities of London and Westminster (Mark Field), because there is a real issue in my constituency too about overseas developers, and I will touch on that.

I want to cut to the issues that I want to raise with the Minister, but I need to add that my surgeries, too, are full of people in great distress. When I started out in politics about 20 years ago, housing was a huge issue. It was a case of having to visit people in bed and breakfasts; there were all those sorts of problems. Things got a bit better, but they are now worse, I think, than they have ever been. People are so distressed. They are living in overcrowded conditions, and there is no way out. They are put in temporary accommodation a long way from home and have to remove their children from school. They are unable to get a foot on the housing ladder, find it a struggle to pay the rent and have no security of tenure in the private sector.

I should just alert Members to my entry in the Register of Members’ Financial Interests, Mr Owen. I let a property, so I understand the technical side for landlords. There is a lot of bleating, frankly, from some of the landlords’ associations about the challenges of keeping rents at a rent escalator level, so that when someone goes into a tenancy, they know how long they will be there and what the rent will be. I do not think that there is a problem for any landlord, big or small, in managing a business model along those lines.

Let me cut to the issues that I would like the Minister to address. I agree with the right hon. Member for Cities of London and Westminster that we need to tax the overseas investors. I am not an expert in how that should happen, although the Select Committee that I chair may well end up pursuing that issue. It is a real issue. I commend to the Minister the map that Private Eye did. It simply looked at properties that were sold and whom they were sold to. The situation is shocking. Let me just mention my area. There are flats down the road from me. As my hon. Friend the Member for Mitcham and Morden (Siobhain McDonagh) said, small properties that should be going to local first-time buyers are being bought by overseas companies. They are somehow getting a tax break for doing that. That is not the sort of investment that we need. I recognise that huge sites, such as Battersea power station, may need to attract overseas investment, but this is taking away from local people, so the Minister and the Government need to look at that.

The Government need to go back to the drawing board on the right to buy. As I said in my intervention, taking family-sized properties away from Hackney council to backfill for the sale of housing association properties is double-hitting the affordable housing stock in my area, where it is increasingly unaffordable for someone on the minimum wage even to rent a property, certainly without housing benefit. I recently heard of a nurse moving into a new housing association development who was reliant on housing benefit from day one. That is my other point: the Government must grasp the nettle of housing benefit. Subsequent Governments of differing hues have not done that. When Sir George Young, who was formerly in this place, was a Housing Minister more than 20 years ago, he said, “Let housing benefit take the strain.” Housing benefit is now taking the strain to a ridiculous extent. If that money were better invested, we would make a dent in the problem.

This is something the Minister could easily do. Certainly my party had discussions with the Council of Mortgage Lenders before the last election about allowing longer tenancies in the private sector. It is the mortgage lenders that, ridiculously, suggest that a year’s contract is more secure. Frankly, a tenanted property in London often represents a more secure income for the mortgage lender than that from someone in a precarious job. That is something the Minister could quickly act on, and I urge him to do so.

[Dr Rupa Huq (Ealing Central and Acton) (Lab)]

We are hearing a list of questions for the Minister, and I just want to throw in a few of my own, because although I am new here, even I am getting a sense of déjà vu. I led a similar debate almost exactly two months ago, and we did not have any answers then, so I just want to throw in three questions from then.

[Albert Owen (in the Chair)]

Order. I will do my best to fit the hon. Lady in at the end, but she must follow procedures. Make an intervention by all means, but do not ask a list of questions.

[Dr Huq]

It was just the mention of Sir George Young that reminded me, because he is a predecessor of mine.

[Meg Hillier]

In the 30 seconds remaining to me, I will rattle through my points. Shared ownership needs to be reviewed. Recently on the market in my constituency was a £1 million shared ownership property. One would need to earn £77,000 a year to get a quarter share in that property. That is not computing; it is not working, and it needs to be reconsidered in London.

The Government could and should consider co-operative ownership. The garden suburbs were on that model. As my hon. Friend the Member for Mitcham and Morden said, there is an opportunity to think more broadly and innovatively. Perhaps there could be a competition for housing solutions, and that could be one of them.

We need to give London much more autonomy. We need to devolve more property tax, so that the London Mayor, whatever party they are from, has the control to be able to grapple with this issue in the London market. We need to have a much better strategy for public land. Hon. Members have already talked about this in the debate. Her Majesty’s Treasury is demanding the highest pound return for the taxpayer. That sounds admirable, but the better dividend locally for communities would be to have affordable housing for local purchasers and local renters on the sites. It is common sense to look at the way land is dealt with, so the London Land Commission is a step in the right direction.

The Minister, I hope, will recognise that housing is a huge problem for our constituents. That has to be grappled with now or it will remain a problem for the next 20 years. It is going to take a long time to solve as it is, and if he does not tackle it now, it will become worse. We will see London hollowed out, with key workers and people on low incomes unable to live in the areas in which they work and which they serve. That will be devastating for the social capital of London.

--- Later in debate ---

[Dr Rupa Huq (Ealing Central and Acton) (Lab)]

I want to raise some questions that remained unanswered when we debated the subject in July, and I wonder whether we will have better luck with this Minister than we did with the previous one. I congratulate the hon. Member for Croydon South (Chris Philp) on securing this vital debate.

The average age of an unaided first-time buyer in London is now 37, and at the debate in July I asked what the Minister predicted that would be by the end of this Government’s term in office. I also raised the question of affordability. The hon. Member for Croydon South talked about Old Oak Common, where 24,000 dwellings are coming on stream. The Mayor of London’s definition of affordable is 80% of market rent, but is that realistic or desirable? Can we change it? I had no reply to that question.

The right hon. Member for Cities of London and Westminster (Mark Field) made some interesting comments about overseas matters. I remember asking in the previous debate whether we would soon be “turning Japanese”. In that country, people bequeath a mortgage from generation to generation. Do we foresee that happening? Regarding overseas investors, I asked the Minister who responded to the debate in July whether he would consider including a provision in his next housing Bill banning overseas and off-plan investors from buying future new builds, so that local London first-time buyers would at least have a chance. That was the No. 1 thing for me as a candidate, and it is the No. 1 thing in my postbag and inbox as an MP.

Recently, I posted a picture when I was door-knocking in Stephenson Street, NW10—a cobbled road of terraced housing that is often used in period dramas, and that was in the video for “Our House” by Madness. I posted it to say what a fantastic cultural heritage we have in East Acton ward, and somebody posted underneath asking, “Have you looked at what these are going for? The last one sold went for half a million.” Those houses were not meant to be for rich people. I fear that London will experience a brain drain, and that in time it will be only for the oligarchs and the super-rich.

[Albert Owen (in the Chair)]

Order.