In 1979, more than 4 in 10 British people lived in a council house, yet today that figure is just 1 in 12 whilst, according to Shelter, 65% of families on the Council House waiting lists have been on those lists for more than a year and 27% for over five years.
One solution to the housing crisis has always been for the local authority to build more homes, yet should the state provide people with secure and dependable places to live? Or is that an out-dated point of view? To look at this objectively, let’s take a step back:
After WW2, both Tory and Labour governments built council houses in massive numbers, yet it might surprise you to know that between 1945 and 1970more Council houses were built per year under Tory Governments than Labour ones.
However, everything changed in 1979, when Margaret Thatcher delivered the right for Council tenants to buy their Council House (called the Right To Buy Scheme). Interestingly, Right To Buy was a Labour Party idea from one of Labour’s Manifestos of the late 1950’s (although they then lost to the Tories). Mrs Thatcher’s idea was based on overly-generous discounts and 100% mortgages for those buying … but, and this is the real issue that has come back to bite us all these years later: Half the proceeds of the property sales went to Westminster and the other half to the local authority – but the Councils’ half could only be spent on reducing their debt – not spent on building more Council houses.. hence why we now have a shortage of council houses.
In 2011, Central Government gave local authorities the power to limit people’s entitlement for social (Council) housing, hence removing those people that did not have an association or link to the locality.
Today, in Ashford, the Council House Waiting List has dropped by 22.1% since 2011, meaning
1,129 families are waiting for a Council House in Ashford
Interestingly though, if our local Council House Waiting List had dropped by the same degree as nationally, the waiting list figure would be 885 instead because, overall in the UK, Council House waiting lists are 38.6% lower than 2011.
So where are these Ashford families living and what does this mean for Ashford homeowners and Ashford Landlords?
Quite simply, private landlords have taken up the slack and housed all those people that were on the waiting list. This is important as more and more tenants are stopping longer in the Private Rented Sector – the average length of time of a tenant stays in the same property is now 4 years. Renting is becoming a choice for many, as the 21st Century rolls on. So much so, that it might surprise you to know that renting a house can be more expensive than buying it with ultra-low mortgage rates and 95% loan-to value mortgages freely available.
Rents in the Rental Sector in Ashford will increase steadily during the next five to ten years. Even though the Council House Waiting List has decreased, the number of new council and housing association properties being built is at a 75-year low. The government campaign against buy to let landlords together with increased taxation and the banning of tenant charges will act to restrict the supply of private rental property, which in turn using simple supply and demand economics, will mean rents will rise – meaning buy to let investment will continue to be an attractive investment vehicle (irrespective of the increased fees and taxation laid at the door of landlords).
..and for Ashford property owners, values will remain strong and stable over the medium term, as the number of people moving to a new house (and selling their old property) will continue to remain limited, meaning that due to lack of choice and supply Ashford buyers will have to pay decent money for any property they wish to buy – especially ones in nice locations and presented well.
Interesting times still ahead for the Ashford Property Market!