HA’s abandon all social ethos – to their FINANCIAL cost!!

We will house who we want and there is bugger all you can do about it may as well be the mission statement of Severn Vale Housing Association as they have banned all those under 36 from the council housing properties they inherited in 1998.

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Make no mistake this policy reveals what housing associations actually are – private landlords – and it is a seminal moment for the death of the social housing model created in the 1948 Welfare State.

Yet what is truly bizarre about this decision is that it makes no financial sense whatsoever for those housing associations who are hell bent on being private landlords.  They are losing out on a good 40% increase in income by banning those under 36 and this, dear reader, is Housing Think in all its ignominious glory and ineptitude – the closed and inept mindset of the social (sic) landlord!

Private Registered Providers, the correct name for housing associations, have 63% of all social housing with just 37% being council housing of one form or another and the housing association movement is very aggressively commercially focused.

What semblance of social mission or ethos housing associations could have claimed they had has now gone with this Severn Vale policy of casting aside those in housing need.

Expect the usual bullshit and deflection from other HA’s and from the Chief Executive of the National Housing Federation David Orr who will say this is a consequence of yet another disastrous ill-conceived government policy.  Expect the usual suspects within housing to support the policy by the same excuse and assert that housing associations should be free to house who they want.

Yet the banning of those under 36 is still a deliberate choice taken by this Private Registered Provider.  This is a choice that means no job no house if you are aged under 36 in and around Tewkesbury where Severn Vale operate.

Born after 1980 no house is what this means too and whether or not you have a job (a damning indictment on zero hours contracts and job insecurity generally) and so has huge consequence for the local economy and extends way beyond being just a housing issue.

The local councils in this areas have been well and truly fucked over (I’m trying not to be profane but nothing else cuts it) as they all still have mandatory housing and homeless duties that now sees them with both hands tied behind their backs. When, note not if, the massive increases in homelessness emerge late this year from the reduction in the overall benefit cap and other reforms then Forest of Dean, Gloucester, Stroud as well as Tewkesbury council are fucked (again no other word cuts it) and fucked well and truly by the private landlord who took over the council housing stock in Tewkesbury.

The children and grandchildren of those now living in and around Tewkesbury are well and truly fucked too as by the time they embark on a working life they will not be able to afford to rent from a private landlord, will not be able to afford a mortgage and they will be banned from what this charlatan landlord will still try to say is social housing.

There is nothing whatsoever social in the ethos, mission or actions of Severn Vale Housing.

I genuinely fear that other housing associations will adopt this same policy.

If they did they like Severn Vale would be stupid and inept as the Shared Accommodation Rate or SAR policy which limits single and childless under 35 year old’s to a lower rate of housing benefit, is much more an opportunity than a threat.

Tomorrow sees the first meeting of a number of social landlords taking place in the Midlands over the ‘under 35s’ issue and one of a number planned.  The attendance list is impressive in the seniority as most are Housing Directors which reveals,somewhat unusually for housing,  a timely and proactive and serious strategy will be adopted.  So it should as the under 35s issue is a catalyst for a serious look at the huge number of shared provision models that are common in the private rented sector and also in supported (social) housing.

Hugely significant increases in rental income can be made from the same social housing property when for example two tenants share a 3 bed property rather than a family.  I am talking about 40% to 70% more from ‘sweating the same asset’ in the ever more commercially focused world of (social) housing.

There are a huge number of models of shared provision that I have worked in and managed and developed and which work and hold little if any risk and are sustainable financially and operationally and, critically, they are mutually beneficial to landlord AND tenant!

Just keeping this to the benefit tenant shared provision model ask yourself would a single tenant under 35 choose a social housing shared property with all the benefits it has over the private sector alternative for the same price or even cheaper?  It’s a no brainer and of course they would.

In Tewkesbury it would see Severn Vale receive £150 per week (£75 each from two tenants) for a 3 bed property they usually receive £101.65 per week for according to official figures – a 48% increase in income from the same asset and an extra £2500 per year per property.

This simple model is sustainable if the two tenants work or don’t work and is a far better option for such tenants than the private rented sector alternative.  Most if not all of the perceived higher tenancy risks can be developed out from the start and there will be huge demand for such products and social landlords can cherry pick tenants.

There is no nee to limit shared models to those on housing benefit or indeed to those under 35 years of age.  What about two nurses sharing such a property or two factory workers or even the ever increasing number of tenants on zero hour contracts in and out of employment?

Shared provision has always been anathema to social landlords.  It is not what we do or what we want they say with the all too typical closed minds that comes with the Housing Think which is so endemic to the sector.  We can see all too readily how this closed mindset has played a key part in this inept and offensive Severn Vale decision.

There is no need to swamp problem properties that all social landlords have and ghettoise areas that will quickly lead to community blight.  Shared provision is a choice but a very good one for all general needs social landlords as a great deal of models work and are sustainable and the excess income they generate can be used to ameliorate the ravages of the 1% imposed rent cut and the reduced overall benefit cap to come from October that can and will equate to a 2% – 3% cut for all social landlords outside of London.

Many will perhaps be surprised that I see the SAR issue as much more an opportunity than a threat yet it is and most importantly it is far better for tenants than the often dangerous shitholes they are crammed into in the PRS.

I caused huge consternation back in 2011 when I said the way government policy was drafted that the SAR could be imposed on social housing. I went on to say it was inevitable in any case and even after receiving a letter from the then Housing Minister Grant Shapps to say the government had no plans whatsoever to impose the SAR on social housing.

The argument then as now was from 1 January 2012 the Government increased the age of the shared accommodation rate from all those under 25 to those under 35 on the basis that it was common even for professionals such as lawyers to share provision up to the age of 35.  That may well be the case in London and other high rent areas, yet that aside, the shared provision models do stack up financially and operationally for the social landlord AND are a much better option for the tenant.

Many years ago I commissioned hundreds of properties when leading for a council on the dispersed asylum seeker programme.  This was 100% with PRS landlords who not only bit my hand off at the thought of guaranteed rent and despite a very rigorous selection process of making all properties HMO compliant and of a very high standard, but they were cheaper than the SRS alternative.

Hundreds of 2 and 3 bed properties available for families or for shared use for singles and the programme not only worked very well, it saw the PRS stock quality in that LA rise dramatically and benefited the area for many years to come.

There was no ghettoisation and no complaints from local residents at all and the contract price which was the same for all councils in the consortium area saw the council make a very nice profit indeed given the lower costs negotiated.

The asylum seekers also had the best accommodation of all the LAs in the consortium area and they were the tenants.  The same better provision can be had now by tenants and at a cheaper cost and the social landlords see far more income from the same assets as they have ever seen before.

In short Severn Vale’s decision is not only offensive it is naive and inept in business terms – and that explains the pervasive closed mindset called Housing Think of social landlords better than anything.

Note well I said 2 sharing a 3 bed property not 3 sharing as the battery hen approach most definitely does not work.  There are many other caveats and no-no’s in developing shared housing provision and many other truly social benefits to tenants.  Given UC conditionality and social landlords EET pretensions then two benefit tenants sharing a 3 bed can be varied to include free wifi in the property to better help such tenants gain employment!

Yes its all beginning to make sense once social landlords get out of the closed mindset of Housing Think that sees shared provision as anathema.  Every landlord has difficult to let properties and the well known issue of Northern landlords seeing DTL 3 beds become impossible to lets when the bedroom tax started now sees a viable and sustainable alternative than the often much greater costs employed in persuading single households to rent and indeed provide a much greater income from these ‘problem’ properties and with no need to adopt the drastic measures of knocking down walls to convert to a 2 bed that truly perversely sees one Liverpool landlord being nominated for a good practice award for doing just that!

That’s another example of Housing Think right there!

Yet the major element of Housing Think is that purported social landlords never see the social – they never see housing from a what would be good for the tenant perspective and as the above proves shared housing provision is much much better for the social tenant than the PRS alternative and the ever only commercially focused and blinkered (social) landlords get a much greater return by sweating their assets!

Now that truly reveals the inept Housing Think that is so pervasive in so-called social landlords!

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