Council pays tenants to downsize

Council tenants are being offered £2,500 a room to downsize to a smaller property to help ease London’s chronic shortage of social housing.

A couple whose children have left home who agree to move from a four-bedroom house to a two-bedroom property will get £5,000, plus £2,500 to help with moving costs. The “sponsored moves” scheme is being pioneered by Richmond council, which this week agreed to spend £150,000 this year on the project.

The council currently has around 6,000 people on its housing waiting list, of whom around 3,000 are looking for family homes. Over the last four years Richmond has persuaded more than 200 households to move into smaller accommodation, thus freeing up desperately needed larger units. It hopes another 25 people will move into smaller properties under the proposals this year.

Councillor Nicola Urquhart, Richmond’s housing chief, said: “It really is a win-win formula. People who need to downsize after their children have left home or are left with more space than they need receive £2,500 per room - and assistance from the council in finding a property that better suits their needs. This then frees up valuable space for families and goes towards cutting overcrowding issues.”

Richmond is one of London’s most expensive boroughs to buy property. According to research by Shelter, average house prices in the area currently stand at £391,000 - so buyers need an annual salary of £83,000. Yet the average gross income of residents is £35,000.

Kay Boycott, director of communications, policy and campaigns at Shelter, pointed out that the “sponsored moves” strategy only represents a drop in the ocean when it comes to London’s housing shortage. It calculates that at its current rate, Richmond will take 24 years to clear its housing waiting list.

She said: "We welcome positive steps to help people downsize to somewhere more appropriate for them which then frees up homes for overcrowded families. However we must not forget that the fundamental issue is our desperate shortage of new affordable housing, which is making it increasingly difficult for more and more people to find and keep a home with a reasonable rent or mortgage."

The shortage of council homes in the capital is forcing councils to adopt increasingly drastic measures. Some 14 boroughs are rehousing families in cheaper areas outside London, including Waltham Forest which is sending them to Luton.