Economic downturn, credit crunch - pick your jargon there's a lot of discussion about it on the news etc. I am particularly interested in this issue from local and housing perspectives. Lib Dem Shadow Chancellor, Vince Cable warned today of a "deep crisis in the housing market" during PMQs and it certainly is an issue which concerns me both as a ward councillor, and as the Lib Dem housing spokesperson in Reading.
At last week's meeting of the Housing, Health and Community Care Scrutiny Panel (which I now Chair), I asked the Director of Housing and Community Care to give a short presentation on 'challenges facing Reading' in relation to her area of responsibility: housing and community care. Her presentation did not include reference to challenges caused by a 'lack of affordable housing'. When I pressed on this she admitted that this was an ongoing challenge for RBC.
I would argue it's a national challenge, and not one that's got any easier under Labour. The sad fact is that Council housing lists have increased by 60% under Labour, with 1 in 4 Council houses being sold off under the Right to Buy legislation brought in by the Tories.
Affordable housing is a major issue in Reading where we are facing high house prices, a similar cost of living to those living in London, and a considerable waiting list for Council properties.
The reason I raise this subject today is that I am reading more and more articles which point to a renewed threat to the supply of affordable housing, as house builders cut back the number of new homes they build.
Figures released last month suggested that the rate at which new houses are being built had fallen to its lowest level since 1945. The Construction Products Association calculated 147,700 new homes would be built this year compared to 203,900 in 2007. This clearly has a very serious knock on effect on the number of new affordable homes that will be built this year in Reading. Given the amount that local Councils rely on funding via 'planning gain' from new developments, any reduction in housebuilding in the town could have a negative effect on spending on local facilities.
Now that Councils can no longer build houses themselves, housing associations play a key role in ensuring that affordable homes are available for sale or rent in our towns and cities.
Worrying news then that housing associations ability to provide new homes is seriously threatened in the current economic climate according to senior figures in the industry. Banks and Building Societies are cutting back on the amount of money they are a willing to invest in housing associations and to quote David Orr, Chief Executive of the National Housing Federation:
"We face a three-way stand-off between lenders who won't lend, buyers who won't buy and builders who won't build"
Coupled with the slow-down in the number of new housing being built, we are faced potentially with a rise in the number of empty homes in the Borough, including new-build properties such as executive flats which housebuilders are unable to sell .
I have been campaigning for many months to get RBC to refresh it's approach to dealing with empty homes which it turns out is very timely, as in May it was revealed that the number of empty homes in the UK had risen for the first time in 10 years as a result of reposessions etc. Ironically, the Council's original empty homes policy was introduced on the back of the recession in the 1990s.
Any reduction in the supply of affordable housing supply will clearly also impact on the private rented sector in Reading, which accounts for a large percentage of the housing stock and on the number of families living in overcrowded and poor standard accomodation.
The impact that another recession will have on Reading's homeless population also needs to be considered - an issue my colleague Patrick Murray, Lib Dem Prospective Parliamentary Candidate for Reading West wrote about in an excellent article at the start of the year. As confirmed by RBC officers earlier in the year, Reading currently has the highest rough sleeper population outside London.
In my role as Chair of HHCC I am trying to organise a one off scrutiny event to be held to debate issues surrounding Reading's large private rented sector with landlords, tenants and those affected. I will post more information on this subject here when I have it. I also hope to get a review of progress on empty homes, affordable housing and another look at rough sleeper debate on the agenda this year.
I pressed the Director of Housing and Community Care last week about what plans Reading Borough Council has in place to deal with the fall-out of the credit crunch and was pretty reassured by the response given. A new draft housing strategy is currently being drawn up by officers and will go to consulation soon.
Clearly no one knows what is around the corner, but the Lib Dems in Reading will continue to scrutinise these plans carefully to ensure that as much as possible, the Council is prepared.