If you’re under 25 (30, 35, or even 40) the idea of buying a house in London becomes more remote and fantastical with each passing year.
All the while wages are stagnating, the cost of education is rising, and more people are working irregular hours, are self-employed or on zero-hours contracts.
The outlook is getting bleaker and bleaker for aspirational younger people and the goal of owning your own home feels like it was never going to become a reality.
Social housing provided by the state through local authorities used to insure that even the most vulnerable were provided with affordable housing.
But schemes such as Right to Buy and the proliferation of private housing (subsidised by the taxpayer) has created a dearth in social housing, and the £400,000 threshold for ‘affordable housing’ here in London set by the government is still far too high for most people to see as attainable.
There is, however, another way.
In the 1980s the now-defunct GLC (Greater London Council) concocted a series of social housing experiments across the city, testing oddball models and living situations trying to find something more effective. Over time, most of these experiments were swallowed up by Right to Buy and the homes trickled into the private sector, the GLC was disbanded and the fact they had even taken place was all but forgotten. Except for one.
In Langdon Park, Poplar exists possibly the only experiment that turned out successfully.
Glenkerry House is a tower block where people can buy two-bedroom homes for as little as £115,000, more than three times cheaper than a similar flat just across the road.
Gerry Cornelius, a musician by trade who has lived in the block for the last 18 years and is a member of the management committee, talked to EastLondonLines about his experience and the future of social housing in London.
“It’s essentially social housing, but here you don’t buy the fabric of the building, you buy the under-lease,” he explains. “You buy the right to live here and you become a shareholder of the association. Everybody has a £1 share in half of everyone’s else’s flat,” he explains.
But how does that make it any cheaper?”
‘You buy you flat at half price of the structural value, not the market value. You buy it at half of that and you make a covenant with the association to sell it for half of the structural value, the same amount you bought it for.’
Essentially, this block artificially keeps the prices of the homes within them low by not allowing people to profit much if and when they sell. Buy cheap, sell cheap.
How have things changed as house prices in London have become more and more expensive?
Cornelius replies: “In the 18 years I’ve been here the value of decent social housing like this has increased because it’s truly affordable. That is really rare now in London, I can’t think of another enterprise that’s like it in the south of England.
“If you look at new homes, even the ones the council are doing, a single key worker wouldn’t be able to afford half the value. It’s a colossal amount of money we’re talking about.”
So just how did Glenkerry House come into being?
“The initiative came as one of, I think, a dozen experiments set up by the Greater London Secondary Housing Association in the early 80s and its the only one that survived the model,” Cornelius explains.
“This is now essentially unique because we are self-governing and self-managing. Tower Hamlets are now the superior landlord here, but the idea is that we work in partnership with them. We manage the affairs of the building, the residents, and the selection of residents – which is the important part.
“Why is that so important? I think it’s fair to say most people in London aren’t close with their neighbours.”
“Because we are a co-op and we try at least to get people involved in the running of the building, you need to meet your neighbours.
“I didn’t really know anyone until I got involved with the running of it but now I know practically everyone. Ha, not everybody partakes but I think that’s because of a lag in the selection process. When you apply you have to commit to the co-operative spirit, actually being part of it and having a vested interest in sharing something.
“You take on the financial gain of it, the fact that you are in a building that’s not governed by the housing market. You’re not going to make an astronomical amount of money living here, but with that gain there’s a balance of fairness in your mind.
“I think people who want to join that are going to be co-operatively minded, they’re going to want to be a part of the community.”
So what’s stopping more councils and more blocks taking on this kind of model? Would it really be that expensive?
Cornelius pauses before replying.
“I don’t think it would be about the true cost of doing it, it would be about the loss of what they could make from it if they sold it to a developer and walked away. That’s the problem. The financial culture of society means that councils are obliged to get the maximum fiscal value out of anything.
“If I had the lottery, I’d work towards setting up another one of these. It’s not altruism, but you have to balance the right to have somewhere to live with the fact that it’s not the objective of housing to make money. You build communities that way.”