Stoke shows why selling homes for £1 gives councils the power to revive deprived communities

Derelict houses up for auction in Stoke-on-Trent, 2013. Also, a cat. Image: Getty.

In the city of Stoke-on-Trent, England, the council is offering 25 homes for sale for just £1 each. The houses are mainly two-bedroom Victorian terraces, in a deprived area of the city where there are a large number of empty properties, and which has a reputation locally for high levels of disorder and antisocial behaviour. Clearly, the city council hopes the “Reviving Communities Scheme” will do just that.

This doesn’t mean a bonanza for private landlords or property developers in Stoke. These properties must be renovated and lived in, rather than demolished or rented out, and there are strict criteria which applicants need to meet.

Would-be £1 home owners must have a local connection and earn no more than £27,000 each year if they’re a single person (up to £60,000 if they’ve got a family with children). This scheme includes a loan of up to £60,000 – repayable over 15 years – which funds renovations carried out by the council before new owners move in. This way, new owners can avoid the stressful process of organising the renovations themselves.

The big issues

Faced with ongoing austerity measures, Stoke-on-Trent City Council has had to make £172m in savings since 2010 and will need to find a further £34m by 2020. So one might wonder why the council doesn’t simply renovate the properties to rent them out and generate much-needed income in the process. The answer is that – rather than being a money-maker – this scheme sets out to address some of the deepest social issues facing Britain today.

It is estimated that there are more than 589,000 empty homes in England and Wales – more than 200,000 of which have been empty for six months or more. Against the backdrop of severe housing shortages across the UK – and an anticipated need to build over 210,000 homes per year – the £1 scheme can put disused homes back into use, providing short-term relief from some of the pressure on the housing market and freeing up extra rental spaces in the city.

The scheme has been introduced at a time when many young people are struggling to buy a home. Incomes are stagnating and, on average, house prices are 7.6 times the average UK salary, up from 3.6 times earnings in 1997. The Council of Mortgage Lenders recently revealed that less than 50% per centof people under 35 believe they are likely to buy a home within 10 years.

While there have been calls for young people to spend less and save for a deposit, the reality is often that young people – who are far more likely to live in private or social rented housing – routinely pay more in rent than they would for a mortgage.

The uncertainties of living in rented housing – exacerbated by short-term lets – have recently spread to council tenants and other social renters. The £1 homes scheme offers residents, and especially younger people, an affordable way to buy their own homes and escape these uncertainties.

Small but successful

Schemes like this have been tried before – in Stoke back in 2014, and in cities as far afield as Liverpool in the UK, Roubaix in France and Abruzzo in Italy. The previous scheme in Stoke proved remarkably popular, attracting hundreds of applications for just 35 homes.

There is evidence that they work, too – Stoke’s first £1 homes scheme led to reductions in disorder and anti-social behaviour, as well as improvements in local health outcomes and housing conditions in the local area. Meanwhile, The Portland Inn Project has encouraged local organisations to work together to turn the former Portland Inn into a community centre. In working to breathe new life into the former pub, they have helped local residents develop a stake in the community.

Schemes such as this can work in tandem with other initiatives to deliver real benefits for local people. For example, Stoke was (unsuccessfully) shortlisted for the UK City of Culture 2021 contest. The ambition to revive declining communities and support local cultural and heritage industries formed a key part of the bid.

In this sense, the £1 scheme can be seen as part of the broader plan to encourage and sustain the city’s long-term cultural revival. It has given the council a means to encourage and maintain stable inner-city communities, while delivering benefits for residents by creating a sense of safety, belonging and ownership. It can also encourage younger residents to make a long-term commitment to the local area, helping places to become communities that survive and thrive long into the future.

The ConversationOn their own, small projects such as £1 houses won’t give all residents a chance to own their own home – nor can they alleviate the insecurities of renting or make up for the nation’s housing shortages. Only the national government has the power to solve problems of this scale. But they do give local authorities the means to encourage a sense of ownership in their local communities. And for Stoke – and many other post-industrial centres across the UK and Europe – that commitment from residents is what helps cities thrive.

Ian Mahoney, Lecturer in Criminology, Liverpool Hope University and Tony Kearon, Senior Lecturer in Criminology, Co-Director of the Keele Policing Academic Collaboration (KPAC), Keele University

This article was originally published on The Conversation. Read the original article.


What's actually in the UK government’s bailout package for Transport for London?

Wood Green Underground station, north London. Image: Getty.

On 14 May, hours before London’s transport authority ran out of money, the British government agreed to a financial rescue package. Many details of that bailout – its size, the fact it was roughly two-thirds cash and one-third loan, many conditions attached – have been known about for weeks. 

But the information was filtered through spokespeople, because the exact terms of the deal had not been published. This was clearly a source of frustration for London’s mayor Sadiq Khan, who stood to take the political heat for some of the ensuing cuts (to free travel for the old or young, say), but had no way of backing up his contention that the British government made him do it.

That changed Tuesday when Transport for London published this month's board papers, which include a copy of the letter in which transport secretary Grant Shapps sets out the exact terms of the bailout deal. You can read the whole thing here, if you’re so minded, but here are the three big things revealed in the new disclosure.

Firstly, there’s some flexibility in the size of the deal. The bailout was reported to be worth £1.6 billion, significantly less than the £1.9 billion that TfL wanted. In his letter, Shapps spells it out: “To the extent that the actual funding shortfall is greater or lesser than £1.6bn then the amount of Extraordinary Grant and TfL borrowing will increase pro rata, up to a maximum of £1.9bn in aggregate or reduce pro rata accordingly”. 

To put that in English, London’s transport network will not be grinding to a halt because the government didn’t believe TfL about how much money it would need. Up to a point, the money will be available without further negotiations.

The second big takeaway from these board papers is that negotiations will be going on anyway. This bail out is meant to keep TfL rolling until 17 October; but because the agency gets around three-quarters of its revenues from fares, and because the pandemic means fares are likely to be depressed for the foreseeable future, it’s not clear what is meant to happen after that. Social distancing, the board papers note, means that the network will only be able to handle 13 to 20% of normal passenger numbers, even when every service is running.

Shapps’ letter doesn’t answer this question, but it does at least give a sense of when an answer may be forthcoming. It promises “an immediate and broad ranging government-led review of TfL’s future financial position and future financial structure”, which will publish detailed recommendations by the end of August. That will take in fares, operating efficiencies, capital expenditure, “the current fiscal devolution arrangements” – basically, everything. 

The third thing we leaned from that letter is that, to the first approximation, every change to London’s transport policy that is now being rushed through was an explicit condition of this deal. Segregated cycle lanes, pavement extensions and road closures? All in there. So are the suspension of free travel for people under 18, or free peak-hours travel for those over 60. So are increases in the level of the congestion charge.

Many of these changes may be unpopular, but we now know they are not being embraced by London’s mayor entirely on their own merit: They’re being pushed by the Department of Transport as a condition of receiving the bailout. No wonder Khan was miffed that the latter hadn’t been published.

Jonn Elledge was founding editor of CityMetric. He is on Twitter as @jonnelledge and on Facebook as JonnElledgeWrites.