Affordable Housing - What it is and why protest?

I have been sent the graphic below and asked to circulate this protest against the affordable housing awards.  I do so as it gives opportunity to say what the claimed ‘affordable’ housing actually is - the direct opposite of the dictionary meaning of the word affordable

The term ‘affordable housing’ was invented with the 2011 Affordable Homes Programme which spawned the chronic misnomer of ‘affordable rent’ or AR and which on average is a 37% higher rent level set by councils and housing associations than their traditional rent level called social rent or SR. 

Essentially, AR is the government sweetener to SRS landlords for government cutting capital subsidy by 60% in 2010.  The notion is the difference between the 37% higher AR level and the traditional SR level should be top-sliced and recycled from revenue subsidy into capital subsidy for new housing development by the social landlord.  

In short, this is government telling SRS landlords get the capital subsidy to develop new housing by charging tenants more in rent.  Sweat the tenant not the government!

How do those tenants paying the affordable (sic) rent level feel about being overcharged and paying more than they need to in order to subsidise future tenants? 

I leave that as rhetorical and first turn to the actual rent levels. The official rent data of SRS landlords is by each local authority area and below I present for ease of illustration for each of the nine English regions with the average social rent (SR) amount and the average affordable rent (AR) level amount. This is for the current financial year 2023/24.

On the regional basis we see a range of so-called ‘affordable’ rent being between 26% and 71% higher than the traditional rented housing of council and HA landlords.  

The ‘affordable (sic) rent’ level is – supposedly – no more than 80% of the local gross market rent level (GMR) and this is hugely problematic for many reasons. 

Firstly, what is the local GMR level?  The discrepancies between what SRS Landlord A says it is and what SRS Landlord B assesses it are wide and stark and there appears no scrutiny by any external regulator of these very different assessments by SRS landlords.  I will spare you the details, which are numerous, but read my discussion of the 3-bed AR level in Reading below

Secondly, the overwhelming majority of new developments are set at the much higher AR level and the SR and traditional level for any new housing has all but vanished.  Whether this is financiers dictating to SRS landlords for a greater return on their investment or whether this is SRS landlord commercial greed is a moot issue.

Thirdly, there is a public purse issue, as ALL of the AR rent can be paid by the taxpayer in housing benefit because AR is deemed a social housing tenure.  This means that wherever the Local Housing Allowance (LHA) – the private renter version of housing benefit – is 79% or less of the local gross market rent (GMR) then more housing benefit is paid to the SRS landlord than is paid to the PRS landlord.  

In very simple terms imagine the full GMR weekly rent is £100 and the LHA rate is £75pw which means £75 per week is paid by the public purse in housing benefit to the PRS landlord.  The affordable rent charged by the SRS landlord is set at 80% of GMR and £80 per week and so £80 per week is paid out in housing benefit.

In 2017 I did a ‘deep-dive’ into the Statistical Data Return for 2016/17 which is the actual rents charged by property size and by AR and SR which all SRS landlords return each year to government. 

I posted about it on numerous occasions and one occasion was here which detailed that Clarion Housing Group were charging £442.88 per week for a 3-bed general needs property in Reading.  

As AR is deemed social housing all of the £442.88pw of 7 years ago was and still is payable in housing benefit and by the public purse.  Yet today in FY2324 the maximum in housing benefit (LHA) payable for a 3-bed in Reading is £264.66 per week.

The SDR for that year revealed other SRS landlords in Reading setting a rent of  £245 - £319 per week for a 3-bed AR property

Fourth – and most heinous – there is the SR to AR conversion with the policy having a built-in incentive for SRS landlords to evict existing tenants.  

To explain, once an existing tenant paying the traditional social rent (SR) level leaves and for whatever reason, the exact same property can be re-let to the replacement tenant on the affordable (sic) rent AR level. 

Looking at the table above this means the London SRS landlord can get rid of the tenant paying £584 per month and replace with a new tenant the very next day who is charged over £1001 per month.  

That is one hell of an incentive for SRS landlord to find ways to evict all current tenants paying the traditional social rent level of rent. 

Did you know official government data reveals more SRS properties have been ‘converted’ from the social rent to affordable (sic) rent than SRS properties sold under the Right To Buy (RTB) between 2012 and 2019?  

 

When a social housing property is ‘converted’ from the traditional social rent level to the misnomer of the affordable (sic) rent level such properties no longer are affordable in the dictionary definition of the word.  

All of these 116,243 SR to AR conversions mean an overnight rent increase averaging between 26% and 71% as my first table above reveals.

Imagine a private landlord evicts a tenant to replace them with a higher paying replacement tenant.  

The private landlord is rightly condemned as a money-grabbing heartless b*stard … 

... yet this has been done more than 116,000 times in 7 years by the so-called good guys of the social landlords who have been incentivised to do precisely that by government!

Now these so-called ‘good guys’ who also state and restate that they are ‘social’ landlords who have social purpose coursing through their veins and who will always house those most in housing need (blah, blah, fucking blah) are having an ‘affordable housing’ awards event celebrating that they are greedier bastards than the proverbial greedy bastard private landlords they howl outrage towards at every turn!

Summary

The above are just a few reasons why I am more than willing to publicise a rightful protest against these ‘good guys’ for an awards ceremony on the charade that is affordable (sic) housing and an awards ceremony which is also paid for out of SRS tenant rents.