Government should build 75,000 "Living Rent" homes a year for low income workers, says think tank
The Government should build 75,000 homes a year aimed at low paid workers, a think tank has argued.
Renewal, which works to broaden the appeal of the Conservative Party, said the Rent to Buy model unveiled in the Comprehensive Spending Review should be scaled up and rents reduced to allow people to save for a deposit.
Living Rents would be set at no more than one-third of the average low income in an area. Properties would have a five to 10-year tenancy as a minimum to provide "security and stability" not available in the private rented sector, while still encouraging mobility and efficiency in the use of stock, the think tank said.
After two years, tenants would have the option of buying their home at a discount similar to those offered under Right to Buy. This would be facilitated through an extension of Help to Buy-style equity loans.
The report states that this would generate revenue to replace properties sold off.
In addition, allocation policy would allow local authorities and housing associations to use the homes for working people on low incomes.
David Skelton, director of Renewal, said: "Hardworking people on low incomes across Britain are seeing their wages disappear as private rents increase year-on-year.
"A Conservative Living Rent, which gives people on low incomes a change to put enough money away to save for a deposit to buy their own home, should be put at the heart of the Prime Minister's social justice agenda."
The paper comes after the Local Government Association called for a "national renaissance" in council housebuilding, saying the last time the country was building more than the 250,000 homes a year needed to meet current demand was 1977-78, when councils built 44 per cent of new properties.
Statistics from DCLG show there were 139,880 new homes completed in 2015-16.