Shapps Targets Housing Fraud

Housing minister Grant Shapps has been in the news this week with regard to a number of issues affecting the housing market and he has vowed to ‘build the homes that the country needs’ during his tenure.

Shapps also hinted at a crackdown on social housing fraud and pointed at the abuse of the system by some buy to let landlords. The MP for Welwyn and Hatfield underlined the problems faced as suggestions have emerged that the subletting of council properties could soon be a criminal offence. With no restrictions currently in place, some social housing tenants are simply moving out and subletting their homes.

“For too long this country has turned a blind eye on the multibillion-pound problem of housing tenancy fraud and abuse,” Shapps said in the Sunday Telegraph.

“Why is it so easy to get away with subletting your council house at market rent and simply pocketing up to £1,000 a week at taxpayers’ expense?”

Shapps promised an end to the abuse and went on to claim that high earners will soon be forced out of their council homes and on to the open market.

“This year the coalition is determined to end that scandal. Why should someone on a six-figure income enjoy a fantastically subsidised council rent, whilst those in real need languish on the waiting list?”

Pushing those high earners out in to the housing market may be seen as a logical move but with new builds and mortgages becoming increasingly hard to find, how does Shapps intend to address that particular issue?

Writing in his column for 24housing magazine, the minister announced several measures that he hopes will get Britain building again while offering hope for those that are struggling to secure the lending that will get them into home ownership in the first place.

“At the heart of the Strategy is a new-build indemnity scheme, which will offer a useful alternative to the Bank of Mum and Dad for those people struggling to get deposits together and take a step on the housing ladder,” Shapps wrote.

“Due to be launched this Spring, under this new industry-led scheme house builders and we in Government will provide security for the loan, enabling homebuyers to secure mortgages on newly-built homes with just a five per cent deposit”

Shapps also announced right to buy measures which could tempt those would be sub-letters to buy their home in the first instance.

“Shortly I’ll also publish plans to increase the average Right to Buy discount to up to half the value of the home, bringing home ownership more within reach of social housing tenants,” he added.

It’s clear from Grant Shapps’ comments that the social housing sector could have more impact on the overall market than many might think and these measures should help those with higher incomes who face the prospect of being forced out of their property.