The Effect of Social Tenure on new Build Property Developments

When the Thatcher government introduced the right to buy scheme for council house tenants, the best of the council house stock was bought up. Some neighbourhoods underwent much improvement as previous tenants became more committed within the communities and new pride in their homes was unleashed, leading to improvements in properties. Although the right to buy scheme is still in place it less successful today, as far more households in council properties live in disadvantaged areas and subsist on low incomes. Social tenure policies were introduced to address this imbalance.

As more council house estates became excluded from the mainstream, policy makers in the UK feared that the country could follow the American example of developing ghettos on one hand, and gated communities on the other. A policy of social tenure was meant to diversify communities and thus produce a more healthy social mix and dynamic, whilst giving greater opportunities to those living in social housing, the term council housing having been dropped.

Studies showed that those in social housing were increasingly marginalized, with fewer opportunities for education and employment, which in turn resulted in more likelihood of anti-social behaviours. The decision to make social housing available within private new build developments became a provision which developers were forced to comply with, with up to 30% of some new build estates being given to social tenants, to be managed by housing associations.

The belief was that social tenure would promote social interaction and common values, thus leading to more social order. However studies into the effects of the policy so far indicates that the policy was misguided, and has not fulfilled its aims. Instead certain developments which clustered the social housing together have only fuelled resentments rather than positive integration, with those in social housing often feeling discriminated against.

Social integration has not occurred naturally through mixed tenure and a report from the Joseph Rowntree foundation found that it has resulted in “segmentation rather than tenure.” The research found that mixed tenure “is creating unbalanced communities and likelihood of social problems in later years.”

Many developers worry about the effect it will have on house prices as consider that the social homes will not be maintained to the same standard as those which are owner occupied: indeed housing associations are already seeing their budgets substantially decreased. If the social homes begin to reflect lack of maintenance as so many do on the social housing estates, it will inevitably reduce house prices in the development and may indeed hinder owners who try to sell their properties.

Owners also perceive that if problems do unfold within the developments that those from social houses will be considered the cause as the stereotypical image remains. Introducing those from social housing has not resulted in the hoped for improvements in job opportunities arising from social integrations, but the better postcodes have helped to remove the stigma of those previously dismissed as coming from a council estate.

Although research is not as yet conclusive into the long term effect of social tenure, early indications are that it may well become a problem for owner occupiers paying mortgages, particularly if the social houses fall into disrepair and reduce the attractiveness of the area for potential buyers and for residents. The very real fear which some may have is that their own properties could devalue into negative equity.

Sources: Joseph Rowntree Foundation