gerard lemos lemos&crane. access for homeless and priority need low rent lifelong tenure choice...
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Access for homeless and priority need
Low rent
Lifelong tenure
Choice
Mobility
Mixed neighbourhoods
Security Aspirations
Social rented housing trade-offs
Access for homeless and priority need
Low rent
Lifelong tenure
Choice
Mobility
Mixed neighbourhoods
Security
Aspirations
Social rented housing trade-offs
• This doesn’t work for:– Homeless people – Priority need – People in temporary housing– Existing tenants who want to move– First time buyers on low incomes in high cost
areas
Social rented housing trade-offsSocial rented housing trade-offs
• More choice for homeless and priority need
• Access to home ownership for homeless and priority need
• More opportunities for existing tenants to move
• Access to affordable home ownership for first time buyers
What do we need to achieve?Choice and assets
• A new online auction for affordable housing to rent and buy
• Levelling the playing field through a virtual currency (UVs) for homeless, priority need and existing tenants
• UVs will only be used for housing; can’t be cashed in; equity always held by RSL
• On-line auction restricted to – homeless – priority need – existing tenants– first time buyers on low incomes in high cost areas
A possible solution: Think e-bay
Open
ing
Doors
For
You
Sellers
Existing tenants
Social housingproviders
Buyers
People in priority need
Existing tenants whowant to move
First-time buyers
Social housing providers
Proposed Solution: Opening Doors For You
Needs assessment UV allocation
Band A Homeless or top priority need 100,000
Band B Priority transfer 60,000
Band C Current tenant 30,000
Band D First time buyers None
How UVs are allocated
Buyer Seller
Tony (Band A)Tony is homeless and needs a place to live
Muhammad (Band B)Owns a 10% stake in his property
Errol (Band B)Errol and his family need to move urgently
Fred (Band C)Owns a 20% stake in his property
Sarah (Band D)Sarah and her boyfriend are first-time buyers
Betty (Band C)
Owns a 50% stake in her property
For simplicity, the winning bid in all the auctions is deemed to be £200,000
Three example auctions
Seller: Muhammad and his familyare tenants and own a 10% stake.
Buyer: Tony and his family are homeless
£200,000
Rent
Mortgage
UVs
£80,000
£20,000
100,000(Band A)
Rent on £80,000 90%
equity
Sociallandlord
£20,000
Buyer typesPriority need
Seller: Fred lives on his own in a 2-bed. He owns a 20% share
£40,000
Buyer: Errol is a priority transfer
£200,000
£40,000
£20,000
60,000(Band B)
Rent
Cash
Mortgage
UVs
£80,000
Sociallandlord
£60,000 cashRent on £40,000
50% equity
Buyer typesExisting tenants
Seller: Betty lives on her own in a 2-bed. She owns a 50% share
£100,000
Buyer: Sarah is a first-time buyer
£200,000
£80,000
£20,000
£100,000
Cash
Mortgage
Rent
Sociallandlord
£20,000 cashRent on £80,000
40% equity
Buyer typesFirst-time buyers
New residentPriority need
New residentExisting tenant
New residentFirst-time buyer
Existing residentBuys a stake
Rented property
Key:Rented shareOwned share
10%
10%
50%
30%
0%
Equity share over time
• Unsecured credit from banks and credit unions
• Lower cost mortgages and secured credit
• Debt management and advice if things go wrong
• Insurance
Financial inclusion (1)Access to responsible credit and insurance
• Low cost savings products
• Low cost, low risk investments
• Equity shares and home ownership
• Pensions
Financial inclusion (2)Acquiring assets
Sociallandlord
Local authority
Mortgage lenders Banks
Independent Financial
Advisor (IFA)
Debt Adviso
rTenan
t
Citizen perspective
Sociallandlord
Tenant
Local authority
Mortgage lenders
Banks
Advises and facilitates
Independent Financial Advisor (IFA)
Debt Advisor
Citizen perspective
1. New purpose for RSLs: promoting social mobility including financial inclusion
2. Social landlords should be encouraged to become financial inclusion agencies
3. All social rented tenancies to be made flexible tenure
4. Access to home ownership starting from 10% equity
8 steps to social mobility (1)
5. First time buyers allowed to buy low cost home ownership
6. National on-line auction for all affordable housing vacancies; homeless people, priority need, existing tenants and first time buyers on low incomes
7. Financial incentives for tenants to leave social housing
8. Economic rents with housing benefit
8 steps to social mobility (2)
• Comment and vote on the
Opening Doors for You manifesto• www.openingdoorsforyou.org.uk• Housing White Paper• New publication• Action seminars for housing practitioners
– Supporting tenants towards financial inclusion (11.10.07)
– Maximising choice and mobility for tenants (20.11.07)
Taking the work forward