England’s Hidden Housing Subsidy

With all the fuss on (my) Twitter about social housing in London, I thought it’d be worth trying to understand things using public data. It turns out, England’s social housing system delivers a £21 billion annual subsidy that I’ve never seen on a manifesto or in a spending review, and is overwhelmingly concentrated in the wealthiest part of the country. Here, we’re going to quantify that subsidy for every local authority in England. TL;DR: to London. The mechanism I’m going to argue that social housing (and social rents) allow people to live in a location at below market rate. The gap between what a tenant would pay on the open market and what they actually do pay is a Governmentally funded economic transfer - it’s basically the same as housing benefit payment but through exclusive use of a public asset, rather than direct expenditure. Because of this, it doesn’t appear in any budget. But it’s a real cost all the same (suppression of returns on publicly held assets). Add that gap up…