ls - housing submission to fairness commission
TRANSCRIPT
-
8/9/2019 LS - Housing Submission to Fairness Commission
1/6
Love Southampton - Housing Crisis - a fairness perspective Page 1 of 6
Housing Crisis - a fairness perspectiveSubmission to Fairness Commission by Love Southampton Housing Group
10 January 2015
Introduction
Love Southampton is a networking group formed to facilitate joined up working in two dimensions.
Firstly between the various church-led projects in Southampton that are serving the local community
in similar ways or meeting similar needs. Secondly to facilitate collaboration between the church and
other agencies working in those same similar areas.
One focus within Love Southampton is housing and homelessness. The Housing Group seeks to
communicate to churches the challenges, current provision, gaps and possibilities in this area. The
group produces information and advice for churches.
This paper summarises some of the fairness issues that we see around housing and homelessness.
Note: the Housing Group is a voluntary group. Our members have a broad range of perspectives and
experience, both professional and voluntary, but our work is done in our own time.
Abstract
We are very concerned about welfare reforms and benefit sanctions making many people at
best under extreme financial pressure and at worst actually homeless.
There is a shortage of social housing and therefore many people have no choice but to seek
private rental.
People in private rented accommodation spend higher proportion of their income onhousing than any other housing sector. A young person in private rental has to spend a
minimum of 40% of their income on accommodation.
If your resources are limited to the rates of Local Housing Allowance, you are limited to the
very cheapest accommodation.
Landlords with housing as an investment are making money out of those who can least
afford it.
New developments must prioritise affordable housing. Affordable housing must be defined
with reference to average earnings, not the market.
Housing supplyWe are sure you are aware of the 13,000 households on the social housing waiting list in
Southampton. This is one indication of the demand for housing.
We are concerned that new housing developments are not delivering affordable housing. We would
like to see close scrutiny of each new housing development. Rent needs to be set at affordable levels
with respect to earnings, not as a percentage of market value.
We are concerned that even new social housing is not affordable.
This is a huge and far-reaching issue of fairness and our recommendation is for more scrutiny and
rejection of the current financial and planning systems that favour developers short-term profit over
the long-term housing security of local residents.
-
8/9/2019 LS - Housing Submission to Fairness Commission
2/6
Love Southampton - Housing Crisis - a fairness perspective Page 2 of 6
Shortage of housing - private rented only option
We understand that many people are forced to look for private rented accommodation.
Here is most opportunity for un-fairness, inequality and vulnerability. Our evidence is that in
Southampton it is
in short supply
expensive
insecure (short-term tenure)
likely to be of poor quality
Affordability - % of income spent on rent
Fairness Commission heard evidence of pressures on income in July.
Whether you are rich or poor, if you are a private renter you will spend a greater proportion of your
income on housing than other tenure types.
The poorest fifth spend 55% of their household income on rent.
The middle fifth spend 30%.1
If Southampton is to be a good place to live, what is a fair percentage of income to spend on your
housing? (Shelter suggests 25%)
Our Housing Group did a survey of house prices in Southampton, September 2014:
Type of accommodation Min/week Max/week Min/month Max/month
Room in shared house 62 97 270 420
Studio 81 121 350 525
1 Bed 110 144 475 625
2 Bed 150 196 650 850
3 Bed 185 254 800 1,100
4 Bed 208 323 900 1,400
According to the University of Southampton, the average rent in shared accommodation during
2013/14 was approximately 70-80 per week not including utility bills.2
What is it like for a single person living on a minimum wage and renting the cheapest studio flat.
This is a hypothetical example:
Age Hourly rate Weekly wage (37 hrs) Monthly % of income on rent
Under 18 3.21 137.64 596.44 59%
18-21 5.03 186.11 806.47 43%
21 and over 6.31 233.47 1,011.70 35%
What would you do? If you are 18-21 and you take home 186 each week. Would you spend 80 on
a room in shared house with students3? Or perhaps you want your own space and spend 100 on
tiny studio flat? 86 left over.
This chart shows that for quality accommodation young people have to spend upwards of 60% of
their income and that in reality they will have to limit themselves to shared accommodation.
1
Monitoring Poverty And Social Exclusion 2012, Joseph Rowntree Foundation page 1312 http://www.southampton.ac.uk/accommodation/privaterented/costofliving.html3And then additionally pick up responsibility for Council Tax for the whole house, with only a 25% discount.
-
8/9/2019 LS - Housing Submission to Fairness Commission
3/6
-
8/9/2019 LS - Housing Submission to Fairness Commission
4/6
Love Southampton - Housing Crisis - a fairness perspective Page 4 of 6
This chart serves to emphasise that if your resources are limited to the rates of Local Housing
Allowance, you are limited to the very cheapest accommodation. You cannot afford a studio flat on
LHA. You can barely afford a 3-bedroom house.
NOTE: Discretionary Housing Payments can be made, to provide help with housing costs on top of
Housing Allowance. It can be used if the Housing Allowance does not cover full rent, deposit, rent in
advance or removal costs. There is no limit to the amount that can be awarded, a one off payment
or long term weekly payments. We have anecdotal evidence that these discretionary payments are
rarely made, nor are they a long-term solution6.
Barriers to entry
Agents Fees - agents are now charging for everything, even just searching for a house fo r
you. Fees for setting up a letting are at least 250.
Deposit - up by 50% since 2007, yet earnings up only 31%7
Rent in advance - as well as deposit Guarantor - who will be guarantor for someone who has little prospect of earning enough?
6From a refugee support worker: in my experience the discretionary HB top up is now very hard to get, is only
for a limited period 3-6 mths e.g. to give a person subject to bedroom tax a few months to look for a cheaper
property. I think the city council has a specific budget for it so once used up they can not offer any more in a
particular financial year.7Deposit now calculated as 6 weeks rent instead of 4. See http://www.moneyexpert.com/news/housing-rent-
deposits-rise-50-since-2007-says-data-protection-service/800582876
-
50
100
150
200
250
300
350
Shared Studio 1 Bed 2 Bed 3 Bed 4 Bed
Local Housing Allowance
vs min/max weekly rent(Southampton, Sept 2014)
LHA/week Min/week Max/week
-
8/9/2019 LS - Housing Submission to Fairness Commission
5/6
Love Southampton - Housing Crisis - a fairness perspective Page 5 of 6
Dont take benefits. Again we have anecdotal evidence that being on benefits is a real
barrier to gaining private rented accommodation. 89
Quality
Members of the group report that much of the housing stock is poorly maintained and frequently
damp. If you are vulnerable through pressures already mentioned, then you are more likely to onlyhave the choice of the lowest quality accommodation.
damp
overcrowded
in bad repair
Location
Is accommodation available where I want to live? Near my childrens schools?
e.g. Rightmove.co.uk Search shows accommodation is not evenly distributed.
Security of tenure
And if you have navigated the maze, found a place that you can afford, is well kept, you still dont
have the security of a long-term tenure. You could be out in a month
Summary
Private rental sector is the focus of the crisis for many people and it is
in short supply
expensive
insecure (short-term tenure)
questionable quality
There is a huge need for young peoples accommodation at below market rates.
Vision for the future
Currently, private renting provides a good investment vehicle for landlords and an expensive,
stressful place to live for many.
We have a vision for a different quality of private rented accommodation. In a similar fashion to the
Fair Trade mark, wed like to see Fair Housing:
Affordablewithin local Housing Allowance rates
Good Qualityregular repairs/ maintenance
Security of Tenurelong term lets
Things to consider
There are some actions that Love Southampton is hoping to promote. Could the City Council
consider them?
1. Firstly, address the supply issue by proper scrutiny on every new development and reduce the
profit-taking from accommodation. Ensure that affordable housing is not a token, but is real, with
8Housing support officer: The number of landlords that take people on benefits has reduced a lot. We now
have only have three or four landlords who will take our clients. Two Saints private rented service have a few
more but not many.9Refugee support worker: For people I deal with on local housing allowance, it is almost impossible to find
landlords prepared to accept benefits. And as you mention, deposits and fees out of reach for many.
-
8/9/2019 LS - Housing Submission to Fairness Commission
6/6
Love Southampton - Housing Crisis - a fairness perspective Page 6 of 6
respect to earnings, not market value. And make sure the new housing remains affordable
throughout its life-time.
2. We would like to see good practice identified and promoted in the private sector.
Promote social letting agencies that have been certified as Fair Housing.
Promote bond scheme (instead of deposits)
Promote credit union - as helping people manage their money better.
Regulate - could the City
o influence rental amounts?
o inspect properties?
Reward good landlords. Can the City
o reward for low rent?
o reward for long tenure?
o reward for accepting bonds?
Create a landlords consortium for fair housing
Promote supported lodgings schemes - use spare rooms. This could be very effective for the
young people who need below-market rate accommodation.