In this article, we look at the innovative solutions which community-led housing offers for young people having difficulties securing their own home.
A recent report by the Resolution Foundation claims that one in three so-called millennials will never own their own home. The report calls for a radical overhaul of the private rented sector, to ensure that it provides a fair, secure alternative to home ownership.
Some of the suggestions in the report include improved security of tenure and rent stabilisation. However, it is worth highlighting some of the solutions which local communities have already come up with. At Wrigleys, we work with several community-led housing groups across England and Wales, which are developing innovative solutions to deal with the housing crisis facing young people. We have highlighted some of these below.
Community Land Trusts
The purpose of a community land trust is for a local community to come together and develop homes and other assets for the benefit of the community in the long term. They provide a mechanism through which a local community can take control of its area, in order to determine what homes should be built, where and whose needs they should meet.
Homes built by a CLT may be available for rent, to purchase or they may be a hybrid model such as shared ownership. CLTs will usually want to keep the homes as affordable as possible, for as long as possible. This means that, where homes are made available for purchase, they will generally have some cap on their resale value. This may be achieved by including a covenant which limits the price at which a house can be sold to a percentage of its market value. In other cases, the price may be linked to local salaries, such as in the ground-breaking St Clements development by London CLT.
The number of CLTs in the UK has grown significantly over the last two years and they are making a real difference to the communities in which they operate. For example, in Leeds, Leeds Community Homes has undertaken a community share offer, which raised £360,000 in order to build 16 affordable homes in the city. At the other end of the country, Brighton and Hove Community Land Trust are working with several community-led housing projects in order to develop affordable housing for those in need.
CLTs offer a solution for young people through the development of affordable homes, for rent or buy, where the intention is to keep the homes as affordable as possible in the long term.
Cohousing describes a mode of living where people live in their own, private homes, but there is also a large amount of shared space and facilities. For example, there would usually be a common house, in which you would typically find a communal eating area, a communal kitchen, guest rooms, a laundry, workshop space and post boxes. Houses may be owned or, if the financial model permits, rented.
The key point about cohousing is that residents control the space in which they live. They have responsibility for managing it, so are not subject to the whims of a third party landlord or developer.
Cohousing could be an attractive option for young people who want to live in an intentional community, where they have control over their own living environment. Where a financial model permits, cohousing could also include affordable options for young people, as being developed by Yorspace in York.
Housing co-operatives have been around for a long time. The co-operative society buys the property, in which tenants live together. Tenants pay rent to the co-operative in return for the right to live there.
Young people may be attracted to the housing co-operative model, driven by a wish or a financial need to share living costs among a group of like-minded people. As with cohousing, it also means that responsibility for managing your home is in your own hands, instead of being subject to the vagaries of the private rental market.
Mutual Home Ownership Societies
The basic premise of a mutual home ownership society ("MHOS") is that a group of homes are owned collectively by a cooperative. Residents of the homes are members of the cooperative and so have responsibility for managing the space in which they live.
The key difference to a standard housing co-operative is that tenants accrue equity shares, in return for the rent which they pay. When a resident moves out, they can cash in these equity shares, taking the capital built up through the payment of rent with them.
The level of rent paid by a tenant may also be linked to income, for example with residents paying a percentage of their monthly income to the society instead of rent being linked to the value of the property. This could be of particular interest to young people, who are more likely to be on lower incomes with fewer savings, and so more vulnerable to fluctuations in local socio-economic conditions.
LILAC in Leeds is the only MHOS which is currently up and running, but we are working with several other aspiring groups who are looking at this model.