The LGC article reflects perhaps the nature of general elections and the slightly strange promises made.
On the surface this seems like a Damascene conversion for the Conservatives to the merits of councils building, well, council houses. ? As LGC points out, although Manchester and Birmingham clearly have their own challenges, the homelessness crisis and the shortage of homes is clearly more acute in London and the South-East.
More importantly I would challenge the economics behind this. In effect it looks like councils will be given permission to borrow more (presumably via some HRA device) and they can then build the homes. However, it looks like an unspecified proportion will be subject to RTB discounts. The questions is why would a council ever do this? How would it make a rate of return on an asset with a 60-100 year lifespan which they would need to sell after 10-15 years for a knock down price? Where’s the incentive? More debt, pressure on revenue, some relief on housing the homeless for 10-15 years and then nothing. The devil may be in the detail but this seems like an investment opportunity councils may want to avoid.
The Tories’ weekend promise to “build a new generation of social housing” certainly had shock value. There’s an election on and the Conservatives are seeking to reach out beyond their perennial supporters’ quest for the small state into political territory which is already occupied. So the Tories are being supportive, in rhetoric at least, of council housing – that of it that survives nearly four decades of Margaret Thatcher’s right-to-buy. The more natural enthusiasts for social housing remain enthusiasts, and far more so than in the recent past. In the past few days the leaked Labour manifesto pledged a minimum of 100,000 council and housing association homes would be built for “genuinely affordable rent or sale” by the end of the next parliament.