AMT Public

In understanding how you can influence the provision of affordable housing within your community it is essential to have a good understanding of what constitutes ‘affordable housing’.

Not everyone is able to find a suitable home that they can afford on the open market, whether to buy or to rent, so the Government has a policy to provide subsidy for rents (housing benefit) as well as providing subsidised housing, called ‘affordable housing’.  Affordable housing is only available for households whose means (incomes and savings) are not sufficient to buy or rent a home on the open market.

Affordable housing should meet the needs of eligible households at a cost low enough for them to afford.  This is determined with regard to local incomes and local house price, either via social rented or intermediate affordable housing.

• Social rented housing – is rented housing owned and managed by local authorities and registered social landlords (Housing Associations).
• Intermediate affordable housing – is housing at prices above those of social rents, but below market house price or rents. There are a range of schemes available to help people buy their home and they include shared equity products and low cost home ownership products.

What is an affordable price?

Affordable housing has to be provided at a price that households can afford.  This is usually determined by local incomes and local house prices.

• A property is deemed unaffordable if it costs more than 3.5x a single or 2.9x a joint gross household income.  Households entering owner-occupation are also assumed to have at least a 5% deposit.
• A rented property is deemed unaffordable if it costs more than 25% of gross household income.

What are Housing Associations?

Over the last 20 years, Housing Associations have been the unassailable market leaders of new affordable housing provision in the UK.  Housing Associations also referred to as Registered Social Landlords (RSLs), are non-profit making charitable organisations that exist to provide good quality affordable homes for people in housing need.  They own, let and manage rental and intermediate affordable housing. With their status as not-for-profit organisations, revenue acquired through rent is ploughed back into the acquisition and maintenance of property.

Beyond this definition there is very wide variation. Housing associations may or may not be registered charities, and they may or may not be geared towards assisting particular social groups with accommodation – for instance, older or disabled people. Rent may or may not be subsidised to varying degrees.

They are run by committees or boards made up from unpaid members of the public, councillors or tenants who give time to the Association and monitor its activities to ensure a good quality services are provided to the Association’s tenants.  They are accountable to the Tenant Services Authority and receive funding from the Homes and Communities Agency.

How is affordable housing allocated?

Choice-Based Lettings (CBL)

In January 2005, Communities and Local Government’s five year housing plan, ‘Sustainable Communities: Homes for All’ was published.  It set out the Government’s plans for taking forward its Choice-Based Lettings (CBL) policy. In effect, all English local authorities are required to adopt CBL by 2010.  This includes not only local authority and RSL properties, but also low cost home ownership and properties to rent from private landlords.

CBL replaces the traditional way of allocating housing under which housing officers seek to match applicants who have priority on the waiting list to available vacancies.  CBL allows applicants for social housing (and existing tenants seeking a move) to apply for available vacancies which are advertised widely by landlords (e.g. in the local newspaper or on a website).  Applicants can see the full range of available properties and can bid (i.e. apply) for any home to which they are matched (e.g. a single person would not be eligible for a three-bedroom house). The successful bidder is the one with the highest priority under the scheme. Authorities provide feedback that helps applicants to assess their chances of success in subsequent applications.

The Housing Register

Although the push is for all local authorities to have a CBL policy by 2010, this may not as yet be the case everywhere.  There are traditionally two routes that could be taken to be registered for housing association accommodation.   Households could apply directly to the relevant housing association or to the local authority and be ‘nominated’ for properties. In both cases, households joined a waiting list or Housing Register, which, depending on where they live, could be long. Some housing associations would not consider households unless they met certain criteria, for example, age, length of residency within an area or income details, may not have suited their nomination procedure to offer housing.

Go to Part IV: The new ‘place shaping agenda’