I really must respond to Dean Kimber’s and Gerald Vernon-Jackson’s recent assertions that somehow building sub-market housing is profitable.
Social housing is subsidised housing and someone has to pay the subsidy: you can’t get away from that.
Even if delivered via housing associations, where the Right-to-Buy does not apply, the general recognised figure for the minimum level of subsidy required is £60,000 – and that figure in turn ignores the recent rent reductions imposed by government that have had the effect of increasing the losses made.
It is possible to borrow for build housing, but not to cover the subsidy element.
That has to be paid upfront, the point being that it will never be repaid from the rent. It is false to say that can be borrowed. Debts have to repaid; loans are not reserves.
Radian Homes is a not-for-profit Housing Association that manages more than 20,000 properties.
If they cannot break even developing a site in Tipner including only 30 per cent social housing, it is wishful thinking to imagine that the council could somehow do so with a much higher proportion.
That the former Liberal Democrat administration built just 52 council homes in total during 11 years in control suggests that they know that.
Seeking more social housing is a legitimate goal, but if that is your priority you have to explain what you will cut to fund it or how you will persuade people to support a large council tax rise in a referendum.
There are no easy options.
Cllr Luke Stubbs
(Cons, Portsmouth City Council)
South Parade, Southsea