On Sunday there was an alarming report in The Observer which said:
Three-bedroom homes are being condemned to demolition by housing associations because the coalition’s bedroom tax has made them too expensive for tenants to live in, the Observer can reveal.
Despite a national property shortage, providers of affordable homes are unable to find people who can meet the cost of living in a home with an extra bedroom and are, in some cases, planning demolitions.
In Liverpool, one housing provider, Magenta Living, has admitted that “with changes to welfare benefits there is very little prospect of letting upper three-bedroom maisonettes in the current climate”.
The report added that Coast and Country Housing, a housing association in north-east England, and Wigan and Leigh Housing were also proposing to demolish their homes.
The Labour Party probably placed the story. One source was a letter to the Labour MP, Alison McGovern. Certainly Labour was keen to trumpet the story – the Shadow Work and Pensions Secretary, Rachel Reeves, told the BBC:
Councils in Wigan and Liverpool are looking to demolish larger properties because people can’t afford to live in them.
The problem is that it is not true.
I contacted the three housing associations concerned and none of them have any such plans.
Magenta Living said there was a particular block that was unpopular and they are looking at replacing it with better homes:
Like many other Registered Housing Providers, Magenta Living is experiencing reduced demand for three bedroom properties. However, this particular block is unusual in that it consists of 9 shops of which two are occupied. Above these are a mix of flats and maisonettes and the block is proving to be unpopular and unsuitable.
We are therefore considering its future in discussion with residents and whether we are able to demolish and replace with more appropriate accommodation as part of our development programme.
The Coast and Country spokesman says:
There are no plans in place to demolish any properties due to the impact of the spare room subsidy reduction.
Home Exchange events to help under-occupying tenants to find exchanges to smaller properties resulting in a 50% increase in the number of exchanges (24 in April to June this year compared to 12 in the same period last year). We intend to hold further similar events.
Other measures they are taking to adjust to the changes include:
Where there are no bids on properties through the Choice Based Lettings (CBL) scheme, we are advertising properties through Right Move and other web sites. So far this has resulted in letting 6 properties to people who were not registered on CBL and were not aware that they could apply to Coast & Country. The new tenants include working couples with family connections in the area.
Promoting joint applications for people who would not previously have been considered for a joint tenancy for example friends or family members not part of a couple.
Reviewing our stock profile in view of the mismatch between supply and demand and considering the viability of re-designing some larger properties.
In the case of the Wigan and Leigh Housing Association I got a long statement giving the political views of its chief executive Ashley Crumbley. But when I pressed for clarification it confirmed it had “no plans to demolish homes.” It was all bluster.
In any case, any social housing provider wanting to demolish homes would have to persuade the Homes and Communities Agency that such a decision represented value for money.
Wigan Council has 170 of its tenants in overcrowded properties. That is down from 185 in April when the spare room subsidy cut came in. Can there really be a great surplus of larger properties?
But let us suppose that there really is no demand for the larger properties – despite the rents being subsidised and lower than the private sector. Perhaps, for example, people might prefer to stay in an overcrowded street property rather than a flat in a tower block with more space. In any circumstances it would not make sense to demolish the homes leaving nothing but waste land. It might make sense to sell them and use the proceeds for new building. It might make sense to convert a three bedroom house into two one bedroom flats. It might make sense to redevelop a site, replacing a tower block with mansion flats or terraced housing.
What would not make sense is what The Observer and the Labour Party suggested will happen. It will not happen. The housing associations do not propose to do it, and if they did, the HCA would not allow it.