A sector that is as safe as houses
Health and community cohesion are spin-off benefits of a well-planned social housing
The provision of housing will mean different things to different people. For developers, it is their raison d’être; private landlords will see buy to let as an essential component of pension provision, while local authorities and enterprise companies view housing as a way of influencing labour markets and attracting inward investment.
Directors of building societies would be well advised to stay in their beds if the provision of quality housing for all does not feature as the principal catalyst which ignites the business and sustains it on a simmer even in quiet markets.
But clearly housing takes on a more fundamental role for the individual. Following the numbers game that dominated post war housing policy when the agenda was clearly to build as many houses as possible, expensive lessons have been learned.
The perceived wisdom is no longer to tackle the shortfall of provision solely by volume, and neither is housing seen solely as the basic entitlement of an individual to a home.
In the owner-occupied sector provision has often been speculative with the developer taking the risk. Elsewhere, intervention by government has featured, where public subsidy is either directly linked to the increased provision of housing stock or indirectly to improve inward investment.
However it is in the social housing sector where the real benefits of investing both public and private funds are more apparent. It is strange that this should be so, given that most surveys predict it to be a declining market.
We do not even call it housing provision any more: community regeneration is the preferred term.
Social landlords, quite rightly, have to demonstrate their ability to adopt a wider responsibility for the real and sustainable regeneration of our communities rather than simply building houses if they expect to receive grant backing from their regulator, Communities Scotland.
We have heard the old argument that any sector requiring public subsidy is, by definition, a commercial failure.
However, Scotland’s near-200 registered social landlords have not only shown that they are capable of providing good quality housing and an excellent service to tenants, they are also providing substantially more.Surely public subsidy is a worthwhile investment if the overall social and economic benefits it then generates repays that investment.
In addition, there is a clear co-location between quality social housing provision and the new realisation that housing tenure may not be as important as it used to be.
Tenure mix in planning itself delivers community integration and reduces social and f inancial exclusion of the type that gated private developments threatened to generate.
Evidence suggests that this approach, linked with the key prerequisite of tenant participation helps reduce crime and assists with the retention of the general appearance, and therefore popularity of new build social housing developments.
This type of environmental improvement is another reason why both public and private investment in the sector is so important and so readily available.
Private finance providers will not only view social rented housing as nice to look at, and located in safer communities but also sustainable and therefore capable of servicing long-term debt. The macro benefits continue. Improved housing and community spirit has additionally been shown to improve health.
So why particularly do banks and building societies compete so fiercely to provide the necessary top up finance required over and above the grant?
The sector is perceived as safe, delivers efficiency in housing provision and an “after sales” service that not only meets the immediate need to increase the supply of housing but the wider benefits are there for all to see. Safe as houses, as we would say.
Content supplied by Gordon Campbell, head of regeneration, Dunfermline Building Society.