Recognising intergenerational inequality
- The number of households in the private rented sector in the UK increased from 2.8 million in 2007 to 4.5 million in 2017, representing an increase of 1.7 million (63%) households.
- Younger households are more likely to rent privately than older households; in 2017 those in the 25 to 34 years age group represented the largest group (35%).
- The latest data published by the Ministry of Housing, Communities and Local Government shows an overall increase of 22% in the number of affordable homes delivered across England in 2018/19 to a total of 57,485. However, only 66% were for rental use, compared to the 78% delivered five years ago and the 84% delivered in 2010/11.
Home ownership challenges include
- Inability to save for a deposit due to low incomes and expensive private rental market.
- Demand significantly exceeds supply.
- 6-month ASTs prevent tenants putting down roots in the community.
- Significant reduction in the delivery of affordable housing and routes to home ownership.
- Younger generation and in particular those in higher education or working in social care have low incomes and no ability to access housing market.
- Only 2% of UK housing stock consists of retirement/downsizing dwellings.
- Over the next 15-years the number of over 65s will increase by 50% to 17 million.
- The majority of new housing for the over 55s is currently located in urban areas and comprise predominantly of apartment schemes (McCarthy & Stone, etc.).
Elderly & isolated persons
- A large number of elderly people are living alone in unsuitable accommodation.
- Isolation and loneliness are growing issues and they create significant implications for health and social care services.
- Many elderly are asset “rich” but cash “poor” and would benefit from releasing equity through downsizing.
What is Traditional Affordable Housing?
The more traditional affordable housing tenures of social rent, affordable rent and shared ownership are typically delivered by developers alongside their open market homes as part of local authority section.106 planning contributions in line with the National Planning Policy Framework.
Registered providers and local authorities then access funding to purchase the properties and let the homes at affordable rents to applicants who are eligible.
In recent years changes to the Government’s affordable housing programme and the subsequent move away from the provision of social rented homes to affordable rented homes has seen a substantial decline in the amount of social rented homes housing providers are able to deliver. To enable social rents to be achieved some level of subsidy from the local authority or registered providers is also usually needed.
Alongside The Different Approach tenures there may be an identified local need within any community for one of the more traditional forms of affordable housing.
Social rented houses
Social rented homes are owned by either local authorities or registered providers of affordable housing (RP’s). These
organisations charge a rent which is set by government guidelines through the national rent regime. These rents are
typically low (approximately 50-60% of local rents) and are generally affordable to the majority of people.
Most local authorities are part of a ‘choice based letting’ scheme in their area. These schemes allow households to join a register with other people wanting housing in the area and to access the list of properties which become available to rent. Applicants then choose whether they wish to bid for the opportunity to rent the property and are allocated according to eligibility criteria such as need and local connection etc.
The law states who is eligible for social rented housing and they should get preference on the waiting list, however councils also have flexibility on who qualifies locally.
Affordable rented housing
Affordable rent housing is similar to social rented housing, however is subject to rent controls that require a rent of no more than 80% of the local market rent (including service charges, where applicable). As local market rents vary from place to place, these are measured by the amount of local housing allowance administered in a particular area.
The same eligibility criteria requirements apply to affordable rented housing and they are allocated in the same way as social rented homes.
Shared ownership gives those who can’t afford to buy a home outright, the opportunity to buy a share of it if they are able to
save for a deposit. This can be between 25%-75% of the home’s value. Rent on the remaining share is paid to the owner (usually a registered provider or local authority).
Over time more shares may be purchased, however in some rural areas no more than 80% may be purchased. Most new shared ownership properties are advertised through the Government’s Help to Buy agents. Eligibility is based on household earnings (£80,000 a year or less outside of London) and any of the following apply:
- you’re a first-time buyer
- you used to own a home, but cannot afford to buy one now
- you’re an existing shared owner
In some rural areas there are also local connection criteria which apply.
Any restrictions placed on the purchase of shared ownership dwellings can affect the mortgagability and affordability of the property for purchasers.
Shared ownership purchasers are responsible for repairs and maintenance on 100% of the property they own a share of
Delivering purpose-built homes for older people at a social rent and homes for younger people within the same community to encourage transgenerational support, reducing loneliness and isolation, and promoting integration.
Meeting the needs of the ‘right-sizing generation’ by offering the over 55s a pathway to community based downsizing (enabling them to remain close to those people they feel comfortable with and committed to).
Many adults with learning and/or physical disabilities are unable to access the housing and support they need. We recognise that the right support at the right time can have a significant positive impact on quality of life, outcomes and value for money.
Saving for a deposit continues to be the single biggest barrier to home ownership in this country. Rentplus is an affordable rent to buy model which offers an accessible route to home ownership for those who are currently excluded from the market, with the opportunity to rent, save and own through a combination of affordable rents and a 10% gifted deposit.
A form of housing which combines private living spaces with shared communal facilities – such as shared kitchen, dining and relaxation areas – creating a community-centred environment that not only gives privacy in living arrangements but also promotes social contact by providing the type of social spaces valued by younger people.
Fully serviced affordable self-build plots providing a route to home ownership for those with the necessary skills to build their own home. Plots are provided at a 20% discount on market value complete with the required
infrastructure. We also envisage a range of ‘add-ons’ which the developer can deliver at a fixed price for those needing additional support.
Enabling families to live all together more economically, combatting (i) expensive childcare, and (ii) generational or circumstantial loneliness and isolation.
A new affordable way of enabling local business owners to purchase a business unit on a shared ownership basis. The purchase agreement allows the owner to staircase and increase their share as and when they have
adequate funds in their pension. Once they staircase to 100% they will own the unit outright and 100% of the asset in their pension.