That we should have some system of enabling poor people to have a roof over their heads seems sensible enough. That we should have the one we do have seems a little less certain. For the way we’re defining what is affordable, and thus worthy of subsidy to produce, is a method which insists that a city entirely full of wondrously affordable housing doesn’t have any affordable housing.

We’re not just being picky when we suggest that this isn’t a sensible manner of deciding how to spend the wealth of the nation.

Some of the UK’s biggest cities are allowing developers to plan huge new residential developments containing little or no affordable housing, a Guardian Cities investigation has found.

In Manchester, none of the 14,667 homes in big developments granted planning permission in the last two years are set to be “affordable”, planning documents show – in direct contravention of its own rules, and leading to worries that London’s affordable housing crisis is spreading.

There’s no reason at all why any specific development should contain affordable housing. Only that all are able to afford housing. So, what’s the definition being used?

….met the government’s affordable definition. That says homes must either be offered for social rent (often known as council housing), or rented at no more than 80% of the local market rate.

But that’s absurd. If housing is £1 a week and there’s nothing at 80 pence then there’s no affordable housing. Quite putridly stupid in fact.

Looking around a 2 bed costs £525 a month in Manchester.

Two bedroom properties were the most common type surveyed by the Valuation Office Agency, and across the 10,780 two-beds in Greater Manchester they were found to have an average rental price of £525.

It’s rents to local wages that matter of course:

At an average of £29,900, annual pay in the north west is more than £3,000 lower than the UK average of £33,500.

Note that’s not household income. Nor is it income after any welfare benefits. That’s purely market income per working person. Rents on a 2 bed therefore seem to be around 20% of gross wages. Entirely affordable.

And thus we see the problem with a relative definition of affordable rent, the one we’re using. In a city with entirely affordable rents we’re insistent that there’s no affordable housing. Proving that we’re using the wrong measure of affordable housing, no?

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Rhoda Klapp
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Rhoda Klapp

Is Greater Manchester the North-West? I mean is it the same thing. If not the comparison is invalid.

I’m watching a great deal of nonsense about relative wealth on Sky ‘News’ right now. Turns out poor people live in shitholes a lot. And inequality is rife in London. Best to move out, if you are poor.

Jim
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Jim

I’d compare housing costs to median income, not average. I severely doubt there are more people in the NW with wages above £30k as there are below.

Tommydog
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Tommydog

Affordable housing inclusionary requirements lower the financial viability of potential projects. This is well understood by planners and politicians who then cynically demand such housing be included in projects as a means of limiting the amount of housing that will be built.

jgh
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jgh

The only housing that is unaffordable is housing that lies empty and unsold. If somebody has paid for it then by definition somebody can afford it. If they couldn’t afford it they wouldn’t have bought it.

My personal definition of “affordable” housing is a three-bed house with garden that a family of three or four on half median income for the area can afford. As Alderman Sydney Dyson told Roy Hattersley: “workmen’s cottages with a bit of garden round them”. Using the standard 3.5 times income method that comes to something like £45,000 in Sheffield, or about £250pm rent.

Bongo
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Bongo

We don’t need a definition of affordability at all, any more than one for fuel poverty, or minimum floor space requirements for HMOs. Anyway this affordability malarkey is an example of Bastiat’s unseen. If the market is permitted to build housing at any price level it wants and as a result only the wealthy move up the ladder into the new builds and the newly converteds, then the properties they vacate have suddenly become a little bit cheaper for those lower down the ladder.

James in NZ
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James in NZ

Why does it matter anyway? Let’s assume that the houses can only be bought by Manchester United and City soccer players. They then vacate (either through sale or renting) their current properties, which the very rich move into. To do so they have vacated their properties and the rich move into them. Likewise the middle-classes all the way down to the poor.

It is the increase in housing stock that drives affordability; not the direct increase in “affordable” housing stock.