This may come as a shock, but it seems Johnson's campaign rhetoric on housing was, er, bollocks.
The Government’s ‘affordable rent’ programme allows landlords to charge rents at up to 80% of the market rate. They say that the homes will be let to the same people who previously would have been offered homes for social rent, and that they will receive full housing benefit if entitled (robbing Peter (CLG grant towards new homes) to pay Paul (increased HB cost on substantially higher rents)).http://redbrickblog.wordpress.com/2012/ ... nt-a-clue/
The ‘affordable rent’ scheme is costing hundreds of millions of pounds and an untold amount of additional housing benefit. It is a dramatic shift in policy as Government subsidy for social rented housing has virtually ended. Rent levels are a crucial factor in the scheme. You would therefore be forgiven for thinking that there would be some careful monitoring of the rents being charged by providers.
In the run up to the election the Mayor of London tried to take the sting out of the housing debate by claiming that most ‘affordable rent’ rents would be similar to the old social rent levels and that the average across the programme as a whole in London would be 65% of market rates. He made great play of his efforts to keep rents reasonable.
Last week’s National Audit Office report on the ‘affordable rent’ scheme didn’t pay much attention to the implications for tenants, but it did note that the annual average rent would be £6,552 compared to £4,698 under the previous National Affordable Housing Programme, that the average rent across the whole programme would be 75% of market rents, and it confirmed that ‘in London providers typically planned for rent levels at approximately 65 per cent’. I have taken ‘typically’ to mean average. It strikes me as a statistical oddity that London, which will get more than a quarter of the programme’s homes, will charge 65% of market rent but the national average, including London, is 75%. What does that imply for rents outside London?