Over 80% of English local councils are PRIVATE landlords who have set up their own Local Housing Company which by definition is a PRIVATE landlord.
So, let’s begin reviewing the situation ….
The definition of Local Housing Company (LHC) comes from the 2018 Social Housing Green Paper below and this week Inside Housing here reported over 80% of English local councils now have their own Local Housing Company.
The Inside Housing article failed to mention that LHCs are PRIVATE landlord companies who cannot offer secure tenancies and they operate the AST tenure which is often called NO FAULT EVICTION and whose rents are set at FULL MARKET RENT.
The IH article did however mention the huge surge in local councils setting up these PRIVATE landlord companies which have been possible since 2011 but had a huge steer from Government in the 2018 Social Housing Green Paper: –
Researchers at University College London (UCL) have found that 83% of councils in England currently have housing companies, compared with 78% in 2019 and 58% in 2017
In 2019 I wrote a piece here about Liverpool City Council were asserting their Local Housing Company – Liverpool Foundation Homes Limited – was an ethical council housing provider which of course was deceit and propaganda writ large. LFHL was one of the issues mentioned in the Caller Report stating it posted a £700,000 first year loss on its £300,000 turnover as an example of why LCC needed to be taken over and placed in special measures.
Of course the Caller Report did not mentioned that LCC setting up a local housing company saw central government wiped out the billions in debt LCC had with government over its Housing Revenue Account – which was the real reason it was set up in the first place and is evidence of just how desperate the current Tory administration is to bury real council housing;
Ah “council housing” the nostalgic concept of a housing safety net and a key pillar of the 1948 Welfare State that Liverpool and the majority of English local councils no longer have by virtue of giving away their public sector housing for a peppercorn to Private Registered Providers aka housing associations (who also operate the NO FAULT EVICTION AST tenure!)
Perhaps this is part of the Boris Johnson government’s much stated “levelling up” agenda as Local Housing Companies allow councils to operate NO FAULT EVICTION to join private landlords and private registered providers (aka housing associations) whose ‘starter’ tenancies are NO FAULT EVICTION which gets very scant mention in the housing or national media which is still fixated on the private landlord bad / social landlord good narrative … and which fails to report which I am doing here that over 80% of councils are now PRIVATE landlords as they own local housing companies!!
Why oh why oh why?
Intransigent political ideology from the Conservatives who despise (true) council housing as it is public sector housing which purportedly creates more anti-Tory voters. The multi-million former council housing transfer from councils to Private Registered Providers the correct name for housing associations was facilitated and promoted by the 1988 Housing Act although the vast majority and some 1.6million transferred out of the public sector to private sector HAs under the first and second Blair governments.
Housing associations like council owned Local Housing Companies are private sector organisations so their borrowings do NOT count in the PSBR (Public Sector Borrowing Requirement). However, this political circumvention means these landlords borrow from the markets who insist that the maximum return is made on this borrowing hence full market rent being charged and the least possible security of tenure for the tenant – the NO FAULT EVICTION – minimises risk to the return on investment for these financiers eager to get into bed with those who wear the cloak of social purpose.
The Local Housing Company model systemically shafts the tenant with the highest possible rent applied and the minimum possible security of tenure being given and local councils are only too willing to go along with this feodaric capitalist system called landlordism.