The Housing Sector; This years predictions?

  • Affordable Homes Programme; There are still tens of thousands of homes to be built under the 2011/2015 Affordable Homes Programme. Development will therefore continue at speed to meet the March deadline. Alongside these programmes, Provider’s development plans will increasingly include a large number of homes built for outright sale and for the private rented market.
  • Financial Pressure; In 2014, 14 Social Housing Providers were reprimanded for failing to meet the value for standard money by the Homes and Communities Agency. This year Providers will be scrutinised even more to demonstrate they are not just saving money but are also utilising their assets to maximum benefit, providing quality services and delivering high tenant satisfaction at the appropriate cost. Business plans will be scrutinised and due to the amount of public subsidy Providers receive, any new Government in May will be keeping a close eye on the performance of Providers.
  • Welfare Reform; There were plenty of predictions in 2014 about the impact of ‘direct payment’ to landlords under the universal credit policy. 2015 could be the year that the policy falls apart if Labour is voted back into Government in May. The ‘Bedroom tax’ is also likely to be abandoned under any Labour Government whereas a Conservative Government will seek to cut welfare reform payments further as the pressure to make further cuts remains. Further, the Supreme Court will hear from disabled tenants who were granted permission to challenge the ‘bedroom tax’ on the basis of discrimination.
  • Temporary accommodation; the use of temporary accommodation by Local Authorities is likely to increase this year as a result of the increases in rent. More people are likely to be evicted due to being unable to pay their rent, especially as discretionary housing payment funds available to Local Authorities begin to shrink rendering Local Authorities unable to support families to maintain their tenancies. Many families and the homeless will become displaced from one area of London to another or to other parts of the Country. Recent figures show large numbers of households have been living in temporary accommodation for more than 5 years. London makes up 75% of those living in temporary accommodation in England. The statutory homelessness figures released by the Department for Communities and Local Government (DCLG) in December 2014, showed that there were 60,940 households in temporary accommodation on the 30th September 2014. 45,810 households were in temporary accommodation in London which an increase of 8% from 2013. This figure is likely to increase in 2015.
  • New Legislation:
  • Care Act 2014 comes into force later this year. The Act aims to improve quality of care provided to vulnerable adults by bringing a range of social care regulation and guidance under one legislative framework. Providers of Social Housing are now explicitly listed as one of the partners a local authority must co-operate with when considering and planning a person’s need for care.
  • Deregulation Bill. An amendment in the Deregulation is expected to clear the somewhat murky waters in respect of ‘tenancy deposits’ in the private rented sector. If the amendment passes, landlords will not need to re-register the deposit or re-issue to tenants the Prescribed Information about the deposit protection when a fixed term tenancy becomes a periodic tenancy or is renewed.
  • Tenancies (Reform) Billl; MP Sarah Teather’s derailed Bill to prevent ‘revenge evictions’ which was resurrected by the Liberal Democrats peers on the 4th December 2014. Its proposal has been added as a new amendment to the Deregulation Bill. Ms Teather’s Bill had proposed to prevent ‘revenge evictions’ where a tenant has complained about the poor condition of a property and a landlord in response has subsequently served a S21 notice to evict the tenant. The Tenancies (Reform) Bill had cross party support as well as support from Boris Johnson, Shelter Crisis, Citizens Advice, Barnado’s, the Children’s Society. The amendment to the Deregulation Bill provides that a Notice under Section 21 will be invalid if before the Notice was given, the tenant has made a “relevant complaint” in relation to the state of the property or to the relevant Local Authority and the Local Authority has served a Notice.

2015 is certain to bring many challenges and much scrutiny to the Social Housing sector regardless of which Government is voted in. There is likely to be a change of Housing Minister, either through a new Government or a Cabinet reshuffle. If Labour or the Liberal Democrats take power, there is likely to be a ‘Mansion Tax’ on properties over £2million. Although Labour says the money will be used for the NHS and not for Social housing!
For any further information please contact Aisha Akhtar, Assistant Solicitor, Housing Management Team at Prince Evans Solicitors LLP on 020 8567 3477.