Boosting the supply of affordable housing

The Housing Authority Board has now approved the conditions of a scheme by which it hopes to boost the supply of affordable housing we can offer.

This will be launched by the end of this month.

Basically we have allocated Lm3 million to buy up existing older housing in urban cores as well as blocks of apartments that are already built in shell form or finished (which we can then either sell on under shared ownership) or rent out to our many needy clients.

There is no doubt that there is a shortage of supply for the demand out there, and although our average output of 200 units per year is sorely needed and very much sought after, we in fact cannot reach current levels of demand with the current output.

It is primarily for this reason that the Housing Authority has decided to ring-fence its surpluses for us to try and boost the supply of affordable housing in the coming years. Three million liri is not a fortune when you are trying to purchase property, but anything additional to our current output will be welcomed by our clients with very different needs, the hundreds if not thousands of older people who need a safe, accessible and easy to manage one-bedroom apartment, the young and not so young hardworking couples who want to get a foot on the ownership ladder, those young people with disabilities and their families who are keen to  secure an independent future for  their children, and single people who have particular affordability problems if they need to pay for housing with one income.

We are in fact doing three things to boost supply and accessibility to that supply, which are being met with varying degrees of success. Firstly this summer we introduced the concept of shared ownership which allows people to buy that stake of ownership they can afford, but doesn't give away too much for free at the expense of all the hardworking taxpayers in this country.

The demand and interest has been overwhelming, because affordability is usually the only handicap which prevents people from wanting to be owners or part owners of their property.

I was amazed to see AD chairman Harry Vassallo on Xarabank recently claim that cheap rents would boost supply. On the one hand he's asking for rent law reform to give justice to landlords; on the other he's encouraging another generation of landlords to get a little return for their investment!

Secondly, we have also tried to encourage landlords to rent their property to us so we could then rent then out to clients of the Department of Social Housing. It was a high-profile campaign with slots before the eight o'clock news on PBS, Super 1 and Net TV and the response was limited.

Landlords clearly prefer to leave their properties empty rather than rent them out to us. I didn't expect our beat housing to be offered to us, but I'm surprised owners of very basic units still prefer to leave them empty. Cultural changes and financial necessity may change the picture, but we are leaving this call for applications open in the hope that some more landlords will consider renting their property to us.

Lastly, we are concentrating on trying to boost supply in our urban cores and there are many reasons for this. Our clients are concentrated in areas where there is a terrible shortage of supply, such as Valletta, Hamrun, Msida and Cottonera.

These areas are crying out for smaller projects of urban renewal, and small projects like our sheltered housing project in Floriana have simply lit up the street and were greatly appreciated.

And we need to boost ownership in these areas too as places with an oversupply of rental and not enough balance between owning and rental become ghettoes of dependency, which is not beneficial to the wider community.

We will be using three main criteria to assess applications when the scheme is launched: value for  money, the regeneration of our urban cores, and the specific needs of our core clients.

It will not be an easy process. I fully anticipate problems, not least because anyone who sells to us has to declare the full price and that is something we are not very used to. Others will try to palm off properties with problems or to sell at unreasonable prices.

This is not just a one-off. It is the start of a process by which we hope to spearhead cultural change in the property sector and focus just as much on existing stock as on building new.

Ms Micallef is chairman of the Housing Authority