You may have heard the term ‘affordable housing’ being used more often in recent years, but what exactly is it, and how does it affect landlords and tenants? If you need answers, look no further. Here are the most important things you need to know about affordable housing.
What is affordable housing?
According to the government’s definition (updated in 2014), affordable housing is “social rented, affordable rented and intermediate housing, provided to specified eligible households whose needs are not met by the market”. Currently, the UK has a shortage of homes for the country’s growing population, and the costs of available homes have risen dramatically in recent years. As a result, the government has been encouraging private owners to build and develop more affordable homes.
What makes a house ‘affordable’?
When it comes to renting, a property is considered to be affordable when it costs no more than 80% of the average local rent. As for buying a property, mortgage payments on an affordable home should be greater than the rent for a council house, but still below the market average, and they must remain affordable for future generations. Another type of affordable housing is the ‘starter home’, typically a new build which will be sold at 20% below market value, and will only be available to first-time buyers under 40.
How many affordable homes are there?
Over the past few years, the government has set ambitious targets for creating more affordable housing. In 2016 then Prime Minister David Cameron pledged £1.2 billion over five years for building these homes, and between April 2015 and March 2016, over 32,000 affordable homes were delivered in England. However, government targets are not always met by local councils, and many argue that enough is being done to resolve the affordable housing crisis.
Bristol’s affordable housing
In Bristol, a collection of local councils, housing associations and private developers are working together as a team, known as HomesWest, to create more affordable housing in the city. All of these new homes can be found on the HomeChoice Bristol website, where tenants are able to submit an application for affordable housing and find out if they are eligible. There are also schemes in place to encourage custom houses and self-building in Bristol, in order to stimulate the city’s property market. Currently, affordable housing is being developed in areas including Hotwells, Brislington and on the outskirts of Bristol near the Long Ashton bypass.
Landlords and affordable housing
A lack of affordable housing can affect landlords, especially when a tenant falls behind with their rent. If you’re a landlord who has this problem, your tenant may be entitled to Housing Benefit – another government scheme that helps people to afford their homes – which will in turn help them to pay you. If you are considering taking on tenants on Housing Benefit, or if your current tenants are having problems with their rent, check out Rentify’s comprehensive guide to Housing Benefit to find out what assistance you and your tenants could be entitled to. Alternatively, if you have concerns about managing rent yourself, you could choose a property company with a portfolio management option, such as Gough Quarters, to deal with rent collection for you.
Are you looking to let in Bristol? Contact Gough Quarters today to find out more.
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