‘Council housing is losing its purpose’: Regeneration schemes increase social housing rents, new report finds

Regeneration schemes on major estates are pushing up social housing rents for low-income Londoners, a new report from the Public Interest Law Centre (PILC) claims.

The study of six estate renewal schemes across London – by academic Dr Joe Penny from UCL – says that once redevelopment of the Aylesbury estate, in Thurlow Street, Walworth, is complete, the cost of social housing is expected to be higher than average council rents in the borough. 

Weekly rent for a two-bed housing association flat on the regenerated Aylesbury estate is estimated to be £212.90, compared to £125.32 for the average two-bed Southwark council flat, the report said.

Aysen Dennis, 66, recently moved to a new home in Bradenham Court – part of the wider regeneration of the Aylesbury estate, where she previously lived for 30 years.

Since moving into the refurbished block, her rent has increased from £120 to £210, including service charge.

Ms Dennis said: “It is another way of attacking council tenants.

“My rent has gone up but the quality has gone down. The internal housing is very cheaply done and I keep having electrical issues.”

Ms Dennis is also concerned about fire hazards in the new block.

She said: “No one has an extractor fan in their kitchen and there is only one very narrow staircase – we haven’t had a fire drill yet but it will be hard for us all to get out quickly.”

Social homes in Elephant Park, where the former Heygate estate in Walworth used to stand, are also significantly more expensive than average council homes in the borough, according to the report. 

It says the average social rent for a three-bed housing association flat on Elephant Park is £186.62 per week, compared to £137.32 for the average council flat in Southwark. 

Ms Dennis, who receives housing benefit, said: “Council housing is losing its purpose.

“Some people in social housing are on housing benefit – this has a rent cap. When rent increases too much they will have to top this up themselves.

“This is something many low-income people, especially with families, can’t do. They will be evicted.

“Council housing is becoming unaffordable, so what’s the point?”

The study, which also looked at Lambeth, said social homes created by the council’s now abandoned ’s Homes for Lambeth’s estate renewal scheme are “consistently more expensive” than the social housing they replace.

A Lambeth council spokesman said: “The rents for Homes for Lambeth and council properties are set in the same way as rents for social housing across the country, following the Government formula used for all council homes. This formula takes account of the value of a home, based on its quality and location, which means that the rents for brand-new homes built for our tenants are inevitably higher than for the homes they replaced.  This is true for all newly-built social rent homes.”

Existing tenants who move to a new HFL or Council home as a result of regeneration, are offered a discount for a period of years as part of the Council’s Key Guarantees.

All of the schemes studied, apart from one in Camden, were found to have a reduction of social and affordable housing.

Dr Joe Penny, the report’s author, said his findings showed the need for a “fundamental rethink” of estate regeneration in the capital.

He said: “The current model is badly failing council and social housing tenants, as well as those on housing waiting lists. 

“Social and affordable rents are increasing beyond what those on the lowest incomes can afford. And structurally sound buildings are being wasted amid a deepening housing emergency.”

Councillor Helen Dennis, cabinet member for new homes and sustainable development, said Southwark is “committed” to building “truly affordable homes”.

She said: “To effectively replace older housing at a large scale, councils sometimes work in partnership with housing associations to build modern, safe and high quality homes for our residents.

“The council sets rents in line with Government policy and the formula local authorities must use. Council rents and housing association rents may be set differently for a number of reasons.

“The average rent of our new build council properties is generally higher than our older properties, because of the way they are valued.”

Lambeth council have been approached for comment.

Pictured top: The Aylesbury estate in Southwark is due to be demolished and rebuilt (Picture: Robert Firth)