Greenwich to spend £48.5 million acquiring homes
Greenwich Council are set to spend £48.5 million on acquiring homes rather than building new according to a decision made by the authority.
A decision posted on the council website this week council report noted a “Deed of Variation to the Greater London Authority 2021 – 2026 Affordable Housing Contract…to deliver the Council Homes Acquisition Programme” with a total of 150 homes are proposed.
They’ll also use borrowing with £17,301,582 from Housing Revenue Account Borrowing adding to GLA’s £31,218,418 from the Council Homes Acquisition Programme Grant.
The acquisition of homes rather than building new is likely to further place pressure on private renters already battling high rents, with ONS data yesterday showing rents in London rising 9.7 per cent.
This program, which on the one hand does help some of the almost 2,000 in temporary or emergency accommodation, is also likely in turn reducing stock of existing housing and see more private renters require emergency and temporary housing. Ultimately, it’s no solution when demand is so high.
Emergency
The usual line is “it’s an emergency”. Well it is of course, but the solution does little mid to long term. Every year the same excuse is given for buying and not building and yet the emergency gets bigger. Failing to build new homes and in turn reducing availability of privately rented homes – and in turn pushing up already sharply rising rents – will not make that the problem any lesser next year.
It also shows just how dysfunctional housing is when Greenwich Council have sold land or entered into joint agreements on public land that see very few social homes. See Riverside House in Woolwich which is now set to be converted into a hotel and student rooms, or the Woolwich leisure centre project with just five per cent of almost 500 homes planned being new council housing.
London Mayor Sadiq Khan is likely to hail the move as part of his “Right to Buy Back” policy where homes formerly sold under right to buy are bought back – but at current market prices and not the deeply discounted level they were sold.
A level of cost that is often more expensive per unit than building new.
As we know, many former right to buy homes are now let privately and some of the cheapest homes to privately rent in London which the most vulnerable and/or poorest live in. Acquisition programs hit them hard.
So when he and Greenwich proclaim how great this is ask them who was kicked out or in turn became homeless due to it. It’s a revolving door.
Further damage
The downsides of buying instead of building are numerous. Another issue is it doesn’t help a construction industry in a dire situation. Housebuilding is around record lows and employment in construction at the lowest level for 25 years.
Companies entering administration are 33 per cent higher than 2019.
The new Labour government may hope for 1.5 million but if many are losing their jobs – and skills being lost as people seek other careers – there’s little hope of that. Building new homes retains and supports employment levels until reforms take hold.
And on a basic level building new homes adds to the overall housing supply in a city still growing quickly and now above 10 million people and seeing large levels of overcrowding.
Yet housing starts in London are down a 90 per cent on last year.
Additional new social housing on a substantial scale would also compete with private rent levels, as opposed to “Buy Back” which sends private rents up.
Some homes bought will also be owner-occupied -with councils out-competing first time buyers who are in turn left renting – with ensuing additional impacts upon private rented stock levels.
Of course this policy helps some – but it also hurts many others. In the crises we have, it’s simply not going to move the dial a great extent towards anything like what’s needed.
A mass new housebuilding program is the solution. Endless tinkering that hurts almost as many as it helps – at vast public expense – is not going to solve this problem no matter how many times it’s repeated year after year after year.
What’s wrong with these people?
I’d be interested to hear Mr Pennycook’s response to this article
What, £48.5 million on acquiring ONLY 150 homes? That is some voodoo economics.
Geeenwich is one of the highest providers of social housing. For every build, 20% – 30% of “affordable rent” tenants are housed in million pound flats. A lot of them cause chaos because they have no incentive to take care. Unless you live with them – you don’t know how much trouble this causes. I don’t want to hear from people who don’t have lived experience living with social tenants . We do not need to build more flats just to house people who won’t take care of them.
Save your tired stereotypes and nonsense. I grew up on an estate and have since lived in various later on as a private renter with social tenant neighbours. The vast majority (and me) were fine. There have been the odd idiots and they should face repercussions. If someone acts up, act on that. Don’t punish everyone for it.
You also seem ignorant of the fact that councils have a legal responsibility to house people. If there isn’t council/social homes they are still housed but in places that cost the council and taxpayers far more money. And often places that are inadequate or shunted around. If people are treated as rubbish then often they’re hardly going to be model citizens are they or be a part of settled, strong communities.
Your other points are factually incorrect too. Very few flats in the borough cost £1m+. The level of housing at social level is rarely if ever at 30 per cent.
There’s also clearly not enough homes if 2k households are now in temporary and very expensive accomodation and Greenwich are procuring hotels such is the shortage.