Gerard LemosLemos&Crane

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

Mortgage

Cash UVs

Rent

What buyers can buy with

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

Your questions