When will the Tories accept that, to end homelessness, you need homes?

Sleeping rough in London. Image: Getty.

A Labour councillor writes...

When it comes to housing, the Conservatives’ 2019 manifesto is scant on detail. But buried deep within there is a clear pledge to “end the blight of rough sleeping by the end of the next Parliament by expanding successful pilots and programmes such as the Rough Sleeping Initiative and Housing First, and working to bring together local services to meet the health and housing needs of people sleeping on the streets”. What’s more, there is a plan to fund all this by “bringing in a stamp duty surcharge on non-UK resident buyers.”

This gives the government 1,535 days to end street homelessness. It is without doubt a worthy ambition. But it’s one that does not acknowledge that government policy over the past decade has caused the number of people bedding down on the streets each night to rocket: in England it spiralled from 1,768 people in Autumn 2010 to 4,677 people in Autumn 2018, according to the government’s own figures

A benefits system that’s becoming impossible to navigate, particularly the cap on local housing allowance that means some areas have quite literally no privately rented homes available to those claiming housing benefit, is causing street homelessness. The fact that so many are denied the help they need because of the callous No Recourse to Public Funds policy also plays its part. 

Amidst all this turmoil, local authorities have tried their best. In Islington we have appointed an in-house Rough Sleeping Coordinator who oversees all of our work, and our outreach team do joint shifts with a range of brilliant partner groups in the borough, including those specialising in help with substance abuse, medical support, and assisting with the specific issues that female rough sleepers face. We were also proud to support local groups in setting up the Hornsey Road Solidarity Homeless Shelter. Local businesses from Hornsey Road Traders Association also provided some money for the initiative. 

We also piloted a Housing First programme with five of our own council homes. Born in New York in the 1990s and rolled out nationally in Finland, Housing First offers an unconditional home to vulnerable rough sleepers together with a package of wrap around support. Most recently, we are proud to be part of the new homeless shelter now operating at the former Holloway Prison Visitors’ Centre. 

But none of this is easy at a time when councils like Islington are dealing with a 70 per cent cut in their core government funding over a decade. So let’s assume just for a moment that in the forthcoming Autumn budget and in budget days to come, that the tap is turned on so that all local authorities have ample funds to spend on homeless outreach and particularly on Housing First programmes. With Housing First the clue is in the name – in order to work it requires a supply of housing. Put simply, the government’s plan does not acknowledge the primary reason for homelessness: a lack of genuinely affordable homes. 

To solve that, we need to build lots more genuinely affordable homes for social rent. Government spending on building new homes actually fell from £11.4bn in 2009 to £5.3bn in 2015 – from 0.7 per cent to 0.2 per cent of GDP. The grant that councils can obtain to build new homes generally doesn’t cover any more than a third of the build costs. There is just one mention of council housing in the Conservative manifesto, and it refers to a pledge to maintain the right to buy policy, which continues to decimate the number of council homes available. There is no lack of political will in local authorities to build council homes – but the government needs to stop stacking the system against us.

Without a change in government attitude and policy towards council and social housing, homelessness will continue to rise. But even more concerning is that the government actually seems intent on building even fewer social rent homes. The new flagship First Homes policy suggests that homes for sale discounted by up to £100k will be built through s106 planning agreements. In Islington we have some of the toughest planning policies in the country, requiring all developments of over ten homes to be 50 per cent genuinely affordable, including 35 per cent homes for social rent. 

It’s a policy that we are not afraid to enforce and on the Parkhurst Road case, where a developer tried to argue that they couldn’t comply because they had paid too much for their site, we took it all the way to the High Court and won. A postscript to the judgment sets out that future guidance from the Royal Institution of Chartered Surveyors (RICS) should make clear that developers shouldn’t seek to mitigate high purchase prices by reducing social housing numbers.

So any forthcoming legislation that requires planning agreements to focus on discounted homes for sale will mean that fewer homes for social rent are built and, ultimately, lead to more homelessness. 

On the available evidence, it would appear that the promise to end rough sleeping is doomed to failure without a fundamental change in the direction of government policy. I am happy to be proved wrong in the next 1,535 days. But it’s time to get a move on. 

Diarmaid Ward is a Labour councillor and the executive member for housing & development at the London Borough of Islington. 


A new wave of remote workers could bring lasting change to pricey rental markets

There’s a wide world of speculation about the long-lasting changes to real estate caused by the coronavirus. (Valery Hache/AFP via Getty Images)

When the coronavirus spread around the world this spring, government-issued stay-at-home orders essentially forced a global social experiment on remote work.

Perhaps not surprisingly, people who are able to work from home generally like doing so. A recent survey from iOmetrics and Global Workplace Analytics on the work-from-home experience found that 68% of the 2,865 responses said they were “very successful working from home”, 76% want to continue working from home at least one day a week, and 16% don’t want to return to the office at all.

It’s not just employees who’ve gained this appreciation for remote work – several companies are acknowledging benefits from it as well. On 11 June, the workplace chat company Slack joined the growing number of companies that will allow employees to work from home even after the pandemic. “Most employees will have the option to work remotely on a permanent basis if they choose,” Slack said in a public statement, “and we will begin to increasingly hire employees who are permanently remote.”

This type of declaration has been echoing through workspaces since Twitter made its announcement on 12 May, particularly in the tech sector. Since then, companies including Coinbase, Square, Shopify, and Upwork have taken the same steps.

Remote work is much more accessible to white and higher-wage workers in tech, finance, and business services sectors, according to the Economic Policy Institute, and the concentration of these jobs in some major cities has contributed to ballooning housing costs in those markets. Much of the workforce that can work remotely is also more able to afford moving than those on lower incomes working in the hospitality or retail sectors. If they choose not to report back to HQ in San Francisco or New York City, for example, that could potentially have an effect on the white-hot rental and real estate markets in those and other cities.

Data from Zumper, an online apartment rental platform, suggests that some of the priciest rental markets in the US have already started to soften. In June, rent prices for San Francisco’s one- and two-bedroom apartments dropped more than 9% compared to one year before, according to the company’s monthly rent report. The figures were similar in nearby Silicon Valley hotspots of San Jose, Mountain View, Palo Alto.

Six of the 10 highest-rent cities in the US posted year-over-year declines, including New York City, Los Angeles, and Seattle. At the same time, rents increased in some cheaper cities that aren’t far from expensive ones: “In our top markets, while Boston and San Francisco rents were on the decline, Providence and Sacramento prices were both up around 5% last month,” Zumper reports.

In San Francisco, some property owners have begun offering a month or more of free rent to attract new tenants, KQED reports, and an April survey from the San Francisco Apartment Association showed 16% of rental housing providers had residents break a lease or unexpectedly give a 30-day notice to vacate.

It’s still too early to say how much of this movement can be attributed to remote work, layoffs or pay cuts, but some who see this time as an opportunity to move are taking it.

Jay Streets, who owns a two-unit house in San Francisco, says he recently had tenants give notice and move to Kentucky this spring.

“He worked for Google, she worked for another tech company,” Streets says. “When Covid happened, they were on vacation in Palm Springs and they didn’t come back.”

The couple kept the lease on their $4,500 two-bedroom apartment until Google announced its employees would be working from home for the rest of the year, at which point they officially moved out. “They couldn’t justify paying rent on an apartment they didn’t need,” Streets says.

When he re-listed the apartment in May for the same price, the requests poured in. “Overwhelmingly, everyone that came to look at it were all in the situation where they were now working from home,” he says. “They were all in one-bedrooms and they all wanted an extra bedroom because they were all working from home.”

In early June, Yessika Patapoff and her husband moved from San Francisco’s Lower Haight neighbourhood to Tiburon, a charming town north of the city. Patapoff is an attorney who’s been unemployed since before Covid-19 hit, and her husband is working from home. She says her husband’s employer has been flexible about working from home, but it is not currently a permanent situation. While they’re paying a similar price for housing, they now have more space, and no plans to move back.

“My husband and I were already growing tired of the city before Covid,” Patapoff says.

Similar stories emerged in the UK, where real estate markets almost completely stopped for 50 days during lockdown, causing a rush of demand when it reopened. “Enquiry activity has been extraordinary,” Damian Gray, head of Knight Frank’s Oxford office told World Property Journal. “I've never been contacted by so many people that want to live outside London."

Several estate agencies in London have reported a rush for properties since the market opened back up, particularly for more spacious properties with outdoor space. However, Mansion Global noted this is likely due to pent up demand from 50 days of almost complete real estate shutdown, so it’s hard to tell whether that trend will continue.

There’s a wide world of speculation about the long-lasting changes to real estate caused by the coronavirus, but many industry experts say there will indeed be change.

In May, The New York Times reported that three of New York City’s largest commercial tenants — Barclays, JP Morgan Chase and Morgan Stanley — have hinted that many of their employees likely won’t be returning to the office at the level they were pre-Covid.

Until workers are able to safely return to offices, it’s impossible to tell exactly how much office space will stay vacant post-pandemic. On one hand, businesses could require more space to account for physical distancing; on the other hand, they could embrace remote working permanently, or find some middle ground that brings fewer people into the office on a daily basis.

“It’s tough to say anything to the office market because most people are not back working in their office yet,” says Robert Knakal, chairman of JLL Capital Markets. “There will be changes in the office market and there will likely be changes in the residential market as well in terms of how buildings are maintained, constructed, [and] designed.”

Those who do return to the office may find a reversal of recent design trends that favoured open, airy layouts with desks clustered tightly together. “The space per employee likely to go up would counterbalance the folks who are no longer coming into the office,” Knakal says.

There has been some discussion of using newly vacant office space for residential needs, and while that’s appealing to housing advocates in cities that sorely need more housing, Bill Rudin, CEO of Rudin Management Company, recently told Spectrum News that the conversion process may be too difficult to be practical.

"I don’t know the amount of buildings out there that could be adapted," he said. "It’s very complicated and expensive.

While there’s been tumult in San Francisco’s rental scene, housing developers appear to still be moving forward with their plans, says Dan Sider, director of executive programs at the SF Planning Department.

“Despite the doom and gloom that we all read about daily, our office continues to see interest from the development community – particularly larger, more established developers – in both moving ahead with existing applications and in submitting new applications for large projects,” he says.

How demand for those projects might change and what it might do to improve affordable housing is still unknown, though “demand will recover,” Sider predicts.

Johanna Flashman is a freelance writer based in Oakland, California.