Council demands freedom to build Hackney homes...but government hits back over housing crisis
PUBLISHED: 17:12 07 February 2017 | UPDATED: 15:28 09 February 2017
In the final part of our special Hidden Homeless investigation, EMMA YOULE asks what radical new ideas are necessary to solve the housing crisis in Hackney. The answer, time and again, is: ‘We need to build more homes’
A decade ago the King’s Crescent Estate in Hackney was a pin-up for stalled regeneration in the borough.
Work to overhaul ageing council blocks on the border of Clissold Park had run aground with “a big pile of rubble in the middle of the estate and residents wondering when new homes would be built”, says Mayor of Hackney Philip Glanville.
Today it is a huge construction site at the forefront of Hackney Council’s ambitious plans to build 3,000 new homes in the borough by 2024 – more than any other local authority in the capital, the council says.
But the homes are a fraction of what’s needed when compared to the 12,000 currently on the council’s housing list and the rising numbers being priced out of the private market by sky high rents.
Today the government acknowledged the issues as it announced a raft of measures to tackle a “broken housing market” through its long-awaited Housing White Paper.
It set out measures such as ordering councils to build more homes with an emphasis on high-rise blocks, relaxing planning rules so councils can provide “build to rent” homes, and ensuring longer-term tenancies in the private rented sector.
The Mayor of Hackney visited the King’s Crescent Estate with the Gazette this week, which he described as a “fantastic project that has unlocked the regeneration and delivery of new homes”.
Work began afresh on King’s Crescent in March 2015 and by next month there will be 765 new homes on the site including 376 for private sale, 115 for shared ownership and 275 council flats – 80 more than previously.
But, given the huge scale of housing need locally, the Gazette asked the mayor whether controversial measures, such as building taller tower blocks on council sites or developing green land, were now necessary to tackle the shortage head on.
Cllr Glanville said Hackney is being creative in delivering new homes but must also build developments people actually want to live in or next to.
“It’s not about cramming in housing everywhere you can,” he said. “It’s about creating a really high quality liveable space. If you don’t make them liveable places and you don’t allow residents to shape schemes, then they don’t want them to happen and we’d never get anything built.”
Green spaces were categorically out of bounds, he said.
“We don’t want net loss of green spaces on our estates and if we’re talking about parks and public spaces, I’m very proud that we’re not looking to build on those.”
The council is considering the use of “back-land” and depot sites for development and the Housing Supply Programme has identified a range of council sites that can “quite easily” deliver housing.
“We’re looking at what we own as a council, what we own within housing land, what we no longer use, and there have been several big pieces of work on that,” said Cllr Glanville.
He admitted the council was not meeting the Mayor of London’s target for achieving 50 per cent affordable homes in new developments, but said the planning team had “got better” at challenging viability assessments from developers.
“The real challenge is a lot of sites in Hackney are very complex and they’re not just trying to deliver housing,” said Cllr Glanville.
“If they’re in our town centres they have to provide retail, office and commercial space to preserve jobs; if they are delivering new social infrastructure like schools or leisure centres that comes in before affordable housing.”
Solving the housing crisis will take on increased political prominence following the government’s white paper announcement, which has placed councils firmly on notice that they need to build more homes.
But questions have been raised about how cash-strapped local authorities will finance the new dawn of development.
Sir Steve Bullock, executive member for housing at London Councils, which represents the capital’s 33 local authorities, said: “Simply putting pressure on councils to build more is not acceptable, particularly as many have clear ambitions to build.
“Authorities must be given the powers, support and resources to realise these ambitions – which means cutting red tape around planning regulations and providing adequate funding to support major housing projects.”
Cllr Glanville, who was the council’s housing policy boss before becoming mayor, branded the white paper “classic style over substance” - saying government inflexibility on housing finance was actively preventing councils from building.
Local authorities have only two sources of funding to finance new homes.
One is borrowing through their housing revenue accounts, which is capped at £160million - a figure the mayor described as “arbitrary”.
“It doesn’t matter whether you can prove that there’s a cash flow through rents or incomes to borrow more,” said Cllr Glanville. “So something like King’s Crescent, you need a lot of money up front to start development, to invest in getting the site ready, in some cases to acquire leaseholder interests.
“You know that will pay back in three years’ time when homes are sold, but if that pushes you over the £160million you can’t borrow the money.
“If you can show you’ve got a strong business case, a strong need, a sensible record of delivery, then we should be able to go over that limit.”
The second source is funding from the sale of Right to Buy council properties, which must be spent within three years or repaid to government with interest.
Cllr Glanville said this was an unrealistic time frame to get new development programmes off the ground and called for the time limit to be upped to five years.
He said: “It’s particularly disappointing that it (the white paper) didn’t move at all to lift the borrowing cap so councils like Hackney can directly fund and build homes for their communities, nor is there any new money for the existing fund to help councils and housing associations build homes for social rent or shared ownership.”
The Gazette asked the Department for Communities and Local Government (DCLG) for a response on these points but did not receive a reply.
The human cost of declining house building over the last three decades has been rising homelessness.
Our investigation has shown more than 2,700 households in Hackney are now living in temporary accommodation, 700 in homeless hostels.
Nationally, the number of new homes built annually has fallen from just over 350,000 in 1970 to slightly less than 150,000 in 2012, according to figures from the Department for Communities and Local Government (DCLG).
The data shows a steep drop in building by local authorities.
Hackney Council, and charities such as Shelter, say steeply rising rents in the private sector have priced many out of the market and council housing is no longer available as a backstop.
The average weekly rent on a one-bed council flat in Hackney is £89 compared with £216 in the private sector, and this rises to £130 a week for a four-bed council home compared with £417 market rent.
But DCLG, which has responsibility for housing policy, said Hackney Council should be doing more.
A spokesman said: “Time spent in temporary accommodation ensures people have a roof over their head and nationally the number of households is well below the 2004 peak.
“However, there are councils who are successfully reducing the number and length of time families are spending in B&B accommodation – we expect areas in similar situations to follow their example.
“We are also investing over £550 million and backing Bob Blackman’s Homelessness Reduction Bill to provide vital support and prevent more people from becoming homeless in the first place.”
The Mayor of Hackney says government policy, such as the controversial Housing and Planning Act, has fuelled problems locally.
The act could lead to the sale of “higher value” council houses as they become vacant, which on current estimates will lead to the loss of a further 700 council properties in Hackney.
“We could get to the ridiculous situation where you’ll have a family in temporary accommodation that needs a home and rather than being able to give it to somebody you’ll have to sell it,” said Cllr Glanville.
“I think that’s a shameful position to be in all in the name of supposedly improving supply of homes for sale. We are seeing homes that are so badly needed in Hackney sold off.”
This story is part of our Hidden Homeless campaign to shine a light on the issue of temporary accommodation in Hackney. Read more news, stats and opinion at our Hidden Homeless microsite – and find out how you can tell us your story or add your name to our manifesto.
BUILDING HOMES ALSO CREATES JOBS
Jill Walker-Murrain has lived on the King’s Crescent Estate for 33 years and is now working as site administrator on the construction.
She backed the council’s calls for more powers to build new homes.
“There are a lot of people out there who are in the bracket who rely on council housing,” she said. “I grew up in council properties and the fact is my own children, and many other people who are on low incomes, they just can’t afford to live in Hackney. There are families who you read about in the newspapers who help their children get on the property ladder, but what about those who aren’t able to do that? This has been a hard slog but it will be worth it. We need to build more social housing.”
Jill, who was secretary of the King’s Crescent Tenants’ Association for many years, is now overseeing the transformation of her estate working for the council’s development partner Higgins Plc.
A new street on the estate will also be named Murrain Road after her late husband Vince, who was chair of the tenants’ association for many years before his death in 2012.
YOUR VIEWS: WHAT ACTION IS NEEDED TO COMBAT THE HOUSING CRISIS?
Glyn Robbins, housing worker and campaigner
It’s perfectly simple. We have to restore investment in council housing, both new-build and investing in existing stock. We have to restore council housing back to main stream policy and there needs to be significant central government investment over a long period.
Meg Hillier, MP for Hackney South and Shoreditch
The council needs to keep building housing. They’ve got 3,000 in the pipeline but it’s a drop in the ocean compared to what’s needed. And for any public land sold, where appropriate, housing should be considered. The government has to give London a different deal on housing policies.
Connie Cullen, London support services manager at Shelter
We need to have a real commitment to building new homes that people on lower incomes can afford, also longer tenancies in the private rented sector so people can put down roots in their community. Five years would be a decent amount of time to settle.
Diane Abbott, MP for Hackney North and Stoke Newington
Councils should be allowed to borrow to build and I’d bring in rent controls – none of this actually costs money. We also need better provision of facilities for homeless people and a drive against sub-standard conditions in private sector hostels.
Samir Jeraj, of Hackney Green Party
Hackney Council has to take risks in actually turning down planning applications that have lots of unaffordable housing. It sends a warning to developers. And to what extent is the council prepared to borrow to build new social homes? Those are big issues.
* Do you have a story for our Investigations Unit? Contact Emma Youle on email@example.com or 020 7433 0122.