The Smith Institute: Affordable Housing Commission

Funding at a glance

Programme: Nurturing Ideas to Change the Housing System
Amount: £306,080 grant
Approved: 2018
Timescale: 20 months
Status: Funding in progress

The Affordable Housing Commission brought together a group of 15 key players from across the housing world and was chaired by Lord Best. Its reports look at how the housing system works in England and proposes changes which would eradicate unaffordable housing by 2045. 


Why we funded this project

The current model of affordable housing in England is unfit for purpose. We know that the housing people want, in the places they need to live, is becoming more and more unaffordable, with ordinary, in-work households struggling with housing costs. The Commission was formed to take an in-depth look at the housing system, diagnose the problems which have led to a severe lack of affordable housing and propose solutions to make things better for the people who need it most.

Strategic purpose

To improve understanding of the ideas that have potential to create change in the housing system.

Project description

Across the life of the Commission, various research techniques were used to truly understand both the workings of the housing system, and the experiences of people whose lives are affected by it.

The Commission conducted polling and spoke with focus groups, as well as using financial modelling so that it could suggest solutions from a background of real knowledge and experience.

In June 2019, the Affordable Housing Commission launched a report, Defining and measuring housing affordability – an alternative approach, which proposed a new measure of affordability. This measure looks at affordability alongside household incomes and what people can afford, be it to rent or to buy, rather than the market model which focusses on market rents and house prices. This alternative approach would replace the current Affordable Rent model, which the report claims fails to support the provision of new affordable homes.

The Commission concluded that when rents or purchase costs exceed a third (33%) of household income for those in work, it can lead to financial difficulties, arrears, debts and consequently, personal problems. These difficulties become critical where housing costs are 40% or more of household income.

In March 2020, the Commission launched its final report, Making Housing Affordable Again: Rebalancing the Nation’s Housing System. The Commission concluded that a wholescale rebalancing of England’s housing system needed to take place, with a group of private renters needing help to become home-owners, and a far larger group needing affordable rented accommodation from social landlords. The Commission stated that none of us should be living in unaffordable housing by 2045, and that the government should use new ways of measuring affordability, alongside targets to achieve this. The final report also included a raft of measures, which, if taken on board by the government, have the power to transform the housing system entirely.

The recommendations of the report included:

  • Calling for a large increase in building of social rented housing – returning funding for this type of housing to pre-2010 levels.
  • Reforming Right to Buy, so that councils can determine discount levels locally and keep money from sales to build new affordable housing.
  • Limiting rent increases, so that tenants aren’t met with exorbitant cost increases at the end of every contract term.
  • Pushing to improve the quality of new housing, including more control for local councils and more money for social housing providers to improve homes.
  • Recognising that older people have varying needs that are currently not being met by our housing system, and that they should be supported to adapt their homes or move into specialised retirement properties.

Following the publication of the final report, consideration is now being given to how the detailed work of the Commission might be given further life. The Nationwide Foundation is leading efforts to bring organisations from across the housing sector together, to achieve truly affordable housing once and for all.

Affordable Housing Commission
The Smith Institute

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