1.27 million homes for those in greatest housing need – homeless households (79,900), those living with a disability or long-term illness (194,000), living in hazardous conditions (631,000), in overcrowded accomodation (240,00) or rough sleeping (128,000).
1.17 million homes for ‘trapped renters’ – younger families who cannot afford to buy and face a lifetime in expensive and insecure private renting
690,000 homes for older private renters – people over 55 struggling with high housing costs and insecurity beyond retirement
We estimate that public expenditure on housing in England was £26.8 billion pounds in 2016-17.
Public spending on housing has lagged behind expenditure on other public services over the past twenty years and the focus of spending has increasingly been on housing benefits rather than investment in new social or affordable housing.
Real terms housing benefits payments in England have been on a long-term upwards trend, more than doubling since the start of the 1990s. The increase is mainly due to rising housing benefit payments per caseload as real terms rents for all tenures have increased. However, an increased reliance on private rented sector tenures has also raised the housing benefit bill and the cost in rents to tenants.
Reduced investment has lowered the number of additional social rent homes being delivered each year. Social rent housing additions have fallen by 79 per cent since the first half of the 1990s.
Grant funding for social housing has been limited since 2011. Instead, the focus has predominantly been on making funds available for affordable rent homes or the Help to Buy equity loan scheme. This appears to be changing though with the government recently making £1.7 billion of grant funding available, which will be available for social rent homes. The government envisages that this will provide £72,600 of funding per social rent home built.
Meanwhile, “Help to Buy” appears to have delivered a relatively small number of additional, relatively expensive private sector homes to buyers on relatively high incomes. Funding per additional home has averaged between £123,000 and £380,000, compared to grant funding per affordable rent home of £26,000.
There is a strong investment rationale for the government funding new social rent housing. Building these homes would deliver savings in welfare expenditure generated by moving families receiving housing benefit from private rented accommodation into social rent tenure.
Building new homes requires up-front expenditure. Our calculations suggest that building 3.1 million social rent homes over the next twenty years, entirely funded by the government, would add 6.5 percentage points to the ratio of public sector net debt to gross domestic product by 2039. The welfare savings accumulate however and government debt would be lower over a longer time horizon."
In England, just under a fifth (18% or 4,202,791) of households are in relative poverty after housing costs, including 1,599,197 households who are in poverty as a result of their housing costs.
The difference between poverty before housing costs and after housing costs is particularly marked in the private rented sector. Over half (53%, 775,773 households) of those in poverty in the private rented sector were not in poverty before paying their rent.
Households with children experience higher rates of poverty after housing costs across all tenures. 1,834,837 (28%) of households with one or more children, and 3,585,528 children (31%), are in poverty after housing costs are paid.
Over the past decade the number of households with children living in the private rented sector has also grown disproportionately, rising from less than a million households in 2008/9 to 1,618,075 (2,840,681 children) by 2015/16.
In the private rented sector, 44% of households with one or more children are in poverty after their rent is paid. A quarter (26%) of households are in poverty as a direct result of their housing costs. A third (33%) of households with children are living in poverty even though one or more adults in the household work full time.