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Boris: 50,000 cheap homes on the way
Pippa Crerar, City Hall Editor20.11.08
BORIS Johnson has announced plans to create 50,000 affordable homes and kickstart the housing market.
The Mayor said he wanted to build the ambitious total, including 30,000 social housing units, within three years.
The £5 billion scheme will attempt to get middle-income families on the property ladder and ditch previous mayor Ken Livingstone's target that all new schemes are 50 per cent affordable.
Mr Johnson said: "These plans aim to put London on a strong footing for the eventual upturn in the housing market."
The scheme will see:
● Stalled developments receiving public money to go ahead, in return for providing affordable homes.
● Unsold new houses being bought and made affordable.
● More flexible schemes for existing social tenants who aspire to own their own home.
● An increase in the number of family-sized homes available to rent or buy.
● £60 million spent on bringing back long-term empty homes into residential use.
● The number in temporary accommodation halved by 2010 and rough sleeping ended by 2012.
The Mayor wants to give a third more Londoners a foot on the property ladder by raising the income threshold for publicly funded ownership schemes.
Households earning up to £72,000 - or a couple paying the basic rate of income tax - will now be able to access help from which they were previously excluded.
Many middle-income families missed out on the housing boom as they were considered too wealthy for government subsidies, but not rich enough to profit from the market themselves.
Mr Johnson's strategy represents a shift from the previous administration's focus on providing more social rented housing towards the Thatcherite dream of greater home ownership.
Funding will be used to develop subsidised rent and rent-to-buy schemes, which could be sold at a profit or turned into permanent affordable homes when the upturn eventually arrives.
Eligibility for schemes will no longer be based on employment in a bid to support workers from all industries, rather than exclusively key workers such as nurses and teachers.
"The strategy focuses not only on the issues facing the housing market in these difficult times but the historic problems of affordability, homelessness and overcrowding," the Mayor said.
"It is designed to meet the needs of Londoners aspiring to get a foot on the housing ladder. By enabling ordinary Londoners to move from being subsidisers to being investors in new homes, we will provide timely support to a struggling development sector."
The Mayor's director of housing, Richard Blakeway, added: "What Londoners overwhelmingly want is to own their own home and it certainly isn't for us to decide what they should do, it's for us to respond.
"If we become a shareholder, rather than a subsidiser, we're getting money back we can then invest in housing in the future."
However, Mr Johnson's First Steps proposals are certain to raise concerns that financially vulnerable families could be encouraged to invest in the housing market when prices are still plummeting.
The London Assembly's housing committee has called on the Mayor to "shift away" from home ownership and instead focus on boosting the rented sector, at least until confidence returns to the market.
Mr Johnson has scrapped Ken Livingstone's 50 per cent affordable housing target and plans to negotiate with the boroughs to provide 50,000 affordable homes during the next three years, of which 30,000 will be social rented.
But housing experts have warned - and Mr Johnson has already conceded - that his ambitious target will be extremely difficult to deliver in the current economic climate. As a result, he plans to support the struggling construction sector by helping developers financially kick-start stalled developments, buying up unsold market homes for affordable housing and providing public sector land - owned by Transport for London, the London Development Agency and councils - for new housing schemes.
The Mayor's draft housing strategy also includes plans to:
●Ensure higher environmental standards, better accessibility and more beautiful design in new homes.
●Support regeneration schemes to "design out" crime by designing footpaths so they don't provide hiding places for attackers, adequate street lighting and clearly defined public and private spaces.
Reader views (30)
To P Staker - I sympathise, but ... there are over 90,000 families living in temporary accommodation in the UK - many of them in London. The social cost of families and children living in this stressful hand to mouth existence is huge - children suffer from ill health, less access to social opportunities and poor educational results. The point is better living conditions for everyone equals a better society for everyone in the long term - do we really want others who aren't as fortunate as us to suffer? Or can we count our blessings and give someone else a hand up?
- Ingrid Rodgers, London N7
There are thousands of empty properties in London.
Use those to house people.
The new 'affordable' developments I have seen,look like they are built from Lego.How long will they last?
- E.Smith, Crawley Sussex
Its all very well Boris talking about extra housing but this wont be much good when because of the way he has ditched vital infrustructure projects like the DLR extension to Dagenham Dock and the Thames Gateway bridge no one will be able to get to work from these areas to pay for the houses. Whether it be Mortgage or rent.
Of course there are many parts of London where the infrustructure exists but the local tory councils operate a "Shirley Porter" agenda where more houses particularly council houses would lead to them Labour or Liberals taking control. Therefore the NIMBYS win aided and abetted by BOJO.
This subject was discussed on the politics show today (Sunday) with a spokesman for the mayor and then when they went onto a different subject another spokesman was wheeled out talk about waste at City Hall. At least Ken knew what he was doing I suppose Boris was busy writing a newspaper column.
- Melvyn Windebank, Canvey Island, Essex
"Why should those of us that have worked very very hard to buy a property have to live near social housing, which we have been excluded from. - P Staker, London"
Who your neighbours are is none of your business unless they choose to tell you. This is called living in a free society.
- Alan Griffiths, Forest Gate, LONDON. UK
Does this mean that I, a 52 year old single charity worker earning £23k, will finally be able to get on the property ladder? I do not think so - but maybe in 2-3 years time when property prices have hit rock bottom...
- Terry Murtagh, London, UK
I wonder who would be getting the building contracts... But it's necessary to get more affordable accommodation for everyone. Do not forget students.
- Munro, London
There are some weasel words being used here: 'subsidised rent' can mean state underwriting of slum landlords; 'affordable' homes can just mean a one-off state subsidy to the first lucky buyer, who then cashes in, like so many Council house purchasers in the last 25 years. 'Shared ownership' can give you all the duties and none of the powers of ownership: a month or two back the ES covered the case of a young man I know who was completely tied from moving by the inertia of his landlord/share owner. He had the mortgage and repair bills, they had all the cards.
Another one is 'key workers', who all seem to be in the public sector, funnily enough: not bakers, delivery drivers or scaffolders. I read recently of a chap very happy in his keyworker housing, who mentioned almost by the way that if he happened to get a job in the private sector, he would have to move! In other words, he was living in a tied cottage.
- Mdj, Leyton, e10 london
Because of the total lack of decent mortgages for shared ownership properties and the total lack of flexibility of shared ownership mortgages, once you are in one you are trapped. Doesn't matter how much equity you hold or how good your payment record is Nationwide, who are the best of the two options available, just treat you like a criminal.
- Thalia, london UK
Don't add to the inventory of homes, it's simple economics. This won't help
- Joel, Phoenix, AZ
This won't help much. The banks need kicking first. I am currently trying to buy an affordable home and I have a 10% deposit on a mortgage. The trouble is that with my 10% (if I could afford more i wouldn't need an affordable house) on a shared ownership scheme there are currently only TWO mortgages available to me. I have a good credit rating and earn a fair amount. The banks need to start offering more shared ownership mortgages and at lower deposit amounts. They see affordable housing as a bigger risk to them than 'normal' housing.
Tackle this and you go some way to solving the problem, of course Boris not having financial difficulties would not realise this.
- Rebecca Whitehead, Battersea
Easy win for Boris. All he has to do, is fold his arms and wait 2 years. Hey-Presto homes will be affordable again.
Busts follow booms as day follows night. Please remember that for the next one in 15 to 20 years time.
- Dave Davies, Basingstoke, Hants
"affordable" LOL Send in the sub prime loans!
- Trunk, US
Boris's conversion to socialism continues apace, I though the, 'market' solved everything.
Are these homes going to be built on an island in the Thames estuary.
- David, London UK
It sounds cynical but the homes, like the jobs created over the past ten years, will go to incoming immigrants. They usually arrive with very little so will always get the necessary points to get the best of the the cheap or free things.
- Norma, London
While Boris does his bit to stimulate the British economy all the Labour Government can do is to arrange for Lord Mandy to appear on Strictly Come Dancing while ensuring all the headlines cover all and any topic except boom & bust Brown's mis-handling of the economy. With personal debt at 170% of GDP and Public sector debt including all off-book items also reaches 170% of GDP. Undoubtedly we currently have the worst Government in British history.
- Joe, London, UK
Can we please keep this so called "affordable" housing away from private developments please.
Why should those of us that have worked very very hard to buy a property have to live near social housing, which we have been excluded from.
- P Staker, London
Our strategy focuses on the issues facing the housing market in these difficult times and is designed to meet the needs of, first time buyers aspiring to get a foot on the housing ladder, those that currently own a home and wish to move up the ladder in fact the scheme has been designed to include and not exclude.
Unlike some of the current government schemes which exclude those that have a joint income of over £60,000 the new MPH Scheme will not, it will not dictate on what or where you can buy as a lot of the current schemes do.
If you are a couple and you want to buy a three bedroom house and you can afford to pay a mortgage that covers between 50 & 85% then you can buy it.
What people want is to own their own home and that’s what we intend to help them do by launching our MPH Scheme.
- Eugene Dunkley, Hitchin, Hertfordshire
who gets to decide what is affordable ? the properties will still be priced in a way that is not affordable by the average familly, also the properties that are to be rented will all probrably go to immigrants and single female teenagers with 3 kids to 3 different fathers !
- Peter Ex Londoner, Hartlepool
Oh Den from London, stop moaning. Just because some people work hard and think harder to enable them to buy the odd house or two, why do you have to have such a chip on your shoulder about it. Stop moaning and do something about it!!!
- Steve, Barnet
The way to make housing affordable is to let the market crash to the historic norms of 3.5 - 4 x average income.
I am a middle income graduate living in social hosuing because I can't afford to buy (and got social housing due to a serious medical condition). I won't be tempted buy into a 'part-ownership' scheme. Even if the prices were ramped upwards again (which I doubt will happen for at least 5 years), part-ownership would leave me mortgaged to the hilt on my share of the property (which would probably equate to one row of bricks) and I would have to pay rent on the remainder.
I am saving feverishly at present and I calculate that when the crash is through, I will be able to buy a 3-bedroom semi in suburbia or buy my current housing association flat under 'right to buy' with a 35% deposit and a sensible mortgage which is less than 3 x my salary.
If not, you will never dislodge me from my current flat.
I suggest the Mayor takes heed and boosts the rental sector giving assured tenancies and low rent in a 'rent-now/ buy later(ie in 3-5 years, when the market's bottomed-out)' scheme.
He also needs to ensure that middle class people are entitled to socially rented units by removing the allocation from the hands of the Councils and allowing the Housing Associations themselves to process applications and allocate to a balanced and mixed group of tenants.
- Maria, Southwark, London
cheap homes! the way the ecomony is going just wait another year or so and all our home will be cheap
- Mike, london
Am i the only one perplexed at logic that says 'house prices are declining so....let's expand supply'? The problem is not that there are too few homes for sale - there are too many relative to demand. Building thousands more will make the house price reduction/decline in middle income wealth even more sharply felt.
- Freddie, London, UK
Boris, I think that you will have to build at least 237,000 this year and more next year. Its called mass uncontrolled immigration + children
- Grim Reaper, Hell
One of the positive outcomes of the 50% affordable housing targets was that there were a greater mix of people on different incomes in each housing development. This is surely a benefit to avoid areas of the city being dominated by affordable and social housing, which inevitably leads to poorer levels of education and opportunities. There's a proven correlation between household income and levels of service received in London boroughs. How will local authorities approach this new target? Will they start building housing developments entirely for affordable and social housing? Coming soon to an area near you!
- Nicola, London
Surely you mean Social Problem Housing. Cheap housing equates with cheap people and creation of mono social ghettos. Social Problem Housing is usually hideous, dull, unimaginative, rabbit hutch type buildings in inappropriate locations. The importation of large numbers of people with no connection to the area and nothing to contribute except consunption of already stretched local resources and more cars just using their new dwelling as cheap state sponsored housing. Who needs a 2 bed flat anyway? These developments are blighting London. I live near the evidence of these attempts at social engineering and its remarkably depressing. Welcome to the Stalinisation of the UK.
- Nellie, East London
Any rushed decisions on new sites will be similar to new estates getting Civic Trust Awards in the 1970s, and turning into slums within ten years.
The highest design standards are vital, to minimise carbon dioxide production, and avoiding car use to get about.
- Jon, London
This is Boris laudable vision for London and not Conservatives'. Let's get that clear...
- Olusegun Opanuga, Norwood & Dulwich, UK
The rationale behind the former 50% target was that each local authority had an equal obligation to provide affordable and social housing.
However by assigning separate boroughs separate targets, this means that some boroughs obligations to provide affordable and social housing have been significantly diminished.
I understand that the revised targets place an increased burden of responsibility to provide social and affordable housing on those boroughs which already have high proportions of such properties, typically those in the inner city and east end.
In effect, all this move really does is reinforce the 'ghettoisation' of some areas of London and place further strain on these local authorities, who will have a greater proportion of low income residents who require support.
Social housing, built in equal proportion to private housing, ensures that all boroughs make equal impact and no borough is more adversely affected than the other. Why should boroughs such as K&C and Westminster be released of their obligations whereas Lambeth and Southwark are left to struggle on?
- Mark Lee, Vauxhall
Easy, if the "already own a property brigade" don't buy them to let out we may just may have a chance of actually owning a property and this pledge may work. Like we all know this won't be the case and the greedy buy to let investors will clear up as usual and the banks will carry on leading to this low risk bracket only...You will also notice the developments splattered as usual in "to let" signs. Please just let the housing market re-adjust (crash) and brought back to reality....
- Den, London
I don't think we need more building!
- Georgie, Islington, London
