An article in the UK’s The Guardian highlights a change to England’s regulatory laws with the potential to have wide-reaching consequences.  According to the article’s author, Rebecca Bennett-Casserly, section 115 of the Housing and Regeneration Act, which came into effect in April 2009 “opened the door to profit distributing organizations to register as affordable housing providers, hitherto a status reserved for non-profit distributing bodies.”

She goes on to explain how this can be an interesting change by writing that there is a “general perception that the existing sector is inefficient, with few, if any, commercial incentives to drive efficiency”.  However, “if the private sector can be tempted to enter the market aggressively they will ensure that the image of the product is aligned with their corporate image. They will ensure that the quality of homes and services is commensurate with their position in the market.”  As a result, for-profit organizations entering the affordable housing could result in an overall improvement to the quality of those properties.  She adds that other recent changes to regulations can make the affordable housing market even more attractive to for-profit companies: “rents for affordable homes can [now] be increased to 80% of local market rents; security of tenure for life with extensive succession rights will no longer be a given, with providers being able to offer fixed term leases, thus opening the door to asset sales to take advantage of capital appreciation; and providers will no longer be tied by rules prescribed by central government determining to whom they offer tenancies. All in all a much more attractive market to potential new entrants.”

Take a few minutes to read Ms. Bennett-Casserly’s article. Can this be a true model for affordable housing? Can this model be effectively adapted to meet the needs of ageing populations? Share your thoughts with IAHSA.

For More Information:

The Guardian

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