Consultation on Affordable Rented Housing: Analysis of Consultation Responses

4 Proposal 3: Property Ownership

Proposal 3: Create the flexibility for social landlords to consider whether an applicant owns property when deciding their priority for housing

4.1 Current housing legislation does not allow social landlords to consider whether an applicant or their immediate family own property when considering the applicant's need for housing. Consequently, this generates public concern about the fairness of allocating housing to people with access to alternative accommodation. The Scottish Government has therefore proposed changes to the current law, which are set out below:

THE SCOTTISH GOVERNMENT'S PROPOSALS - PROPOSAL 3
(Source: Consultation Document Page 14)

Remove the current ban on social landlords taking into account whether, or to what value, the applicant or any of their family owns or has owned property in the United Kingdom.

And instead:

Allow social landlords to take into account whether, or to what value, the applicant or any of their family owns property in the United Kingdom, unless it would not be reasonable for them to occupy it. That is, if they own property but:

• cannot secure entry to it (except where it has been rented out);
• occupying it is likely to lead to abuse;
• it is a moveable structure, vehicle or vessel and there is no place where the owner is entitled or permitted to place it and live in it;
• it is overcrowded and may endanger the occupants' health.

This is based on the definition of homelessness where people have accommodation, as set out in section 24(3) of the Housing (Scotland) Act 1987.

4.2 An analysis of the responses provided to proposal 3 is set out below.

Views on the Proposal (Q10)

4.3 The majority of respondents who answered this question, 66%, were in agreement with the proposal, whilst 12% disagreed with these proposals and 21% were unsure. The proportion who were unsure was higher at the regional events, and subsequently the proportion who agreed with the proposals were lower at the events.

Proposal 3 - Do you think social landlords should have the flexibility to consider whether an applicant or their family owns property when deciding their priority for affordable rented housing?
Respondent Source	Yes		No		Not sure
	Number	%	Number	%	Number	%
Written (n=207)	156	75	24	12	27	13
Events/Facebook (n=143)	76	53	19	13	48	34
Total (n=350)	232	66	43	12	75	21

4.4 The table below breaks down the 207 responses to this question via written questionnaires by respondent type.

Proposal 3 - Do you think social landlords should have the flexibility to consider whether an applicant or their family owns property when deciding their priority for affordable rented housing?
Respondent Source	Yes		No		Not sure
	Number	%	Number	%	Number	%
Individuals (n=31)	17	55	7	23	7	23
Landlord Representative Groups (n=4)	4	100	0	0	0	0
Landlords (n=80)	68	85	6	8	6	8
Other Groups (n=26)	19	73	2	8	5	19
Tenants Groups (n=66)	48	73	9	14	9	14
Total (n=207)	156	75	24	12	27	13

4.5 For all respondent types, the majority of respondents who answered this question were in agreement with the proposals. Support was however greatest for landlords and landlord representative groups, whilst 14% of tenants groups and 23% of individuals disagreed with the proposals.

Other situations (Q11)

4.6 The consultation document sets out a number of examples where it may be inappropriate for a social landlord to take into account whether the applicant or any of their family owns a property in the United Kingdom. The consultation asked whether there are any other situations where an applicant owns property but is genuinely unable to access it. A series of situations were referenced by respondents based largely around four themes. These are as follows, with the percentages referring to the proportion of the 237 written responses:

• Where the other property is unsuitable for the applicant due to health or disability reasons (suggested by about 35% of respondents);
• Where there are cases of abuse, violence or mistreatment at the owner's other property (about 27% of respondents). This is similar to one of the situations set out in the proposal document;
• Where there are relationship or family issues or break-ups resulting in one or more member of the family needing to access another home (about 19% of respondents);
• Where there are financial reasons, for instance the owner did not have the finance to update the property to an acceptable standard (about 18% of respondents).

4.7 A series of other reasons were also given by a much smaller number of respondents. These include: where people need to move for employment reasons; where there are unmovable tenants or squatters at the applicant's property; where the additional property is owned overseas; where they have experienced a trauma (e.g. crime or bereavement) in the previous house; or where there may be negative impacts on the community. Approximately 21% of respondents did not provide an answer, 7% did not know and 3% felt that there were no other situations.

Benefits (Q12)

4.8 The consultation asked what the benefits are to these proposals. A series of benefits were given, mainly by those in support of this proposal, although some of those not in support also gave some benefits. These were based largely around four themes. These are as follows, with the percentages referring to the proportion of the 237 written responses:

• This proposal would provide housing for those with genuinely no other options as a result of financial or other reasons. It would make available the limited stock of affordable housing for those who were unable to afford to purchase a property or rent from the private sector (suggested by about 19% of respondents);
• It would stop the system being abused, for instance by preventing individuals from making a profit from renting their own home for profit which they could access whilst living in affordable housing (about 16% of respondents);
• It would reduce the unfairness or perceptions of unfairness held by the general public in relation to current allocations policy, particularly by those individuals who have been on a waiting list for a long period of time (about 12% of respondents);
• It would make better use of the existing housing stock in terms of freeing up scarce social housing for those most in need or increase the number of homes for sale (about 10% of respondents).

4.9 A series of other responses were also given. These included the potential benefits in terms of enabling social landlords to consider housing someone in this situation who could provide benefits to the local economy or community or who needs to move for employment reasons. It could also enable social landlords to have the flexibility to take account of all factors in their allocation decision. These include taking account of an individual's access to a home they own in deciding their priority for housing, whilst safeguarding those unable to access their property for reasons such as abuse, having a sitting tenant or for financial reasons.

4.10 About 20% of respondents did not provide an answer, 2% did not know what the benefits were, whilst approximately 5% of respondents felt that there were no benefits. In response to both question 13 and 14, a number of respondents stated that it was rare for individuals who own housing that they can reasonably live in to rent this out for financial gain whilst living in affordable housing.

Problems (Q13)

4.11 The consultation asked about the problems with this proposal. A series of potential problems were raised. These are as follows, with the percentages referring to the proportion of the 237 written responses:

• Elements of the proposal needed clarifying, in particular:
  • Clarity on the definition of 'family' e.g. whether the proposal includes considering if all, or just some, of the family members own a property and whether 'household' is a better definition;
  • How landlords will apply this flexibility and whether individuals will have a right to challenge a landlord's decision;
  • Whether it would consider homes owned abroad e.g. for holiday purposes (it is suggested that the definition be consistent with homelessness legislation by referring to 'in the UK and elsewhere'; and
  • Whether it would consider caravan or boat owners.
• This proposal may lead to a situation whereby some social landlords do not take individual circumstances and needs into account. This could result in genuine cases where homeowners who cannot access their home are prevented from accessing social housing (about 26% of respondents);
• The proposal may lead to time and resource constraints for social landlords. It may be difficult, time consuming and/or expensive to keep track of money and ownership issues not only at the application stage but on an ongoing basis (about 19% of respondents);
• The proposal may impact on the wider housing market, for instance limiting choice, limiting the potential for mixed communities and giving the social rented sector the reputation as being the sector of last resort (about 5% of respondents).

4.12 Other responses included the current financial situation which is making it increasingly difficult for homeowners to sell their property; enforcing this policy on an ongoing basis may require legislation with regards to terminating tenancies once it is discovered that someone owns a property; and people may abuse the system by buying a council house, sell at a profit and then return to social rented housing.

4.13 Approximately 21% of respondents did not provide an answer, 2% did not know what problems this would cause, whilst about 9% stated that it would not cause any problems.

Actions to overcome problems (Q14)

4.14 The consultation asked about what can be done to overcome these problems. A series of actions were suggested. These are as follows, with the percentages referring to the proportion of the 237 written responses:

• There is a need to provide tighter guidelines and clarification in relation to issues such as geographical location of the home and the definition of family as detailed in question 13 of the consultation questionnaire (about 15% of respondents);
• Ensuring landlords have the flexibility and apply it to take individual circumstances into account when determining tenancies (about 14% of respondents);
• Provide detailed guidance to homeowners and landlords to help them understand the criteria and give clarity on what would be expected of a prospective tenant in terms of disposing of their existing property. This is particularly important for those tenants that are 'asset rich but cash poor' and those that have particular difficult circumstances at their owned property (about 8% of respondents);
• Have various safeguards in place including checking people carefully; forcing tenants of social housing who do own homes to make these available at a reasonable and affordable rent; ensuring that right to buy is not provided to those tenants of social housing who own other property; providing tenants who do own a home and want to sell with a Short SST whilst waiting for the sale to go through; and ensuring strong legal recourse in areas where the system is exploited (about 8% of respondents);
• There is a need for rigorous and regular reviews of individual circumstances regarding home ownership to overcome the issue of needing to track home ownership (about 4% of respondents).

4.15 Other responses included providing lower points in the allocation system for those owning homes; work with other agencies to discover information about tenants; have a clear policy for what to do if an applicant does not provide the necessary information at the time of application; greater communication between landlords and tenants; require tenants to prove that they are unable to dispose of their property; and increase good quality housing options for older people across the housing market.

4.16 A large proportion of respondents (35%) did not provide an answer, 5% were unsure about the actions required to overcome these problems, whilst 3% stated that there were no ways to overcome the problems.