The Smith Institute’s Affordable Housing Commission published a report into the a national housing conversion fund.
The report examines two main ways a ring-fenced National Housing Conversion Fund could be achieved. The first is targeting funds to purchase homes on the secondary (existing) market. It examines which housing markets – in broad terms – the investment might be best aimed at, factoring in how it could help improve housing condition and support jobs and growth. This option could be weighted to support weaker housing markets by providing a floor for the market and helping those struggling and desperately needing to sell. Funding could be made contingent on investing in a property to raise standards. By focusing on low demand housing areas a higher proportion of the investment would target jobs and growth rather than land costs in high demand places, where the economic rationale is weaker.
The second aspect concerns additional funding for social landlords to purchase homes for sale being built by housebuilders and converting them to social and affordable housing. With sites stalled and the prospect of construction workers losing their jobs, this approach would meet the strategic objective of making more housing affordable, as well as the shorter-term goal of supporting the recovery. It would also ensure that capacity and capabilities within the housebuilding industry is not lost due to the downturn but retained for when a recovery materialises.
The overarching case for a National Housing Conversion Fund rests not only on the urgent need to increase social and affordable housing and rebalance the housing system, but also as a quick and cost effective way of supporting the economy as we move forward from – what we hope – is the worst of the pandemic. And, as demonstrated in this report, such a scheme could also improve housing conditions and contribute to the government’s strategic ambitions to level up the economy and reduce carbon emissions.