Council houses owning brand new cars?

[TheCluelessMum]

I’m writing this post with the hopes of being educated, not slandered

however I completely appreciate I may be just completely shot down for asking this.

i live on a new build estate, 12 houses at the start of the estate are council houses. I don’t know this because I’m a snob, I know this because it’s clearly marked on plans when you buy those houses.

i see so much stuff online about how the UK benefits system is failing people, the higher rise of food banks. It’s absolutely abhorrent people are in this situation.

however, when entering my estate today I noticed that each and every single council house had a car newer that a 20 plate. Mercedes, Audi’s, BMW’s even range rovers.. there was not a single house out of the 12 which had an older than 20 plate car.

I am now confused as to why this is the case? Everyone I know (including those receiving benefits) continually speaks about how hard the cost of living is.

so could someone please answer how/why those in what we would presume lower income families, are able to afford such lavish cars.

People get PIP to meet the expenses of being disabled, so we are told. So the fact that someone gets PIP has no effect on their disposable income.

Let’s try again and you might understand it. Open market rent of a property (what it would get on the private rental market) is £1000.

Person A is on high benefits. They get housing benefit that meets the cost of housing, £1,000.

Person B gets some benefits. Their housing benefit is £500, their rent is £500.

Person C gets no benefits. Their rent is £1,000.

The overall effect on the state is that they get an open market rent out of person C who needs no subsidy, and the extra money raised can go back investing in expanding the UK’s social housing provision which is an excellent thing. the country is skint. If you can afford to pay a fair price for social housing, I can’t see why you shouldn’t.

The rent for social housing covers the actual cost. Open market rent is based on profit. A subsidy is when someone else is covering part of the cost which isn’t the case with social housing. HAs and council housing accounts have to wash their own faces.

But that is basically what happens.
Only the rent is more like £500 / £600 to start with.

Some people get all the rent paid on benefits, some get part of it paid and others pay full rent.

The taxpayer. If the person was paying open market value then the housing association would have more money to invest in more housing, getting people out of b&bs, giving them better lives and saving the government vast amounts of money. Temporary housing is one of the four costs that take up 75% of council budgets (along with adult social care, child social care and SEN educational provision). If we spend less on temporary housing we would have much better public services.

@Freeasa Many council tenants pay tax.

Two people. Both accountants, both on £60k a year. One lives in social housing (for historical reasons) and pays £500 a month, one lives in private rented, same property, pays £1,500 a month. In what way is not charging the social housing dweller the full £1,500 good for public finances?

I don't believe you should patronise people when you have no idea of their knowledge and background.
(A) I was responding to the overly simplistic idea that people on benefits should be charged less rent than those on no benefits. As I have said twice now, that plan was previously proposed and councils didn't take it up because it's unworkable, non cost effective and does not make sense in the scheme of building settled and mixed communities. So we can put that one to bed.

(B) You said social housing is subsidised. It isn't. Here's an example in the form of a FOI to Cambridge council (as good as any).

If the tenant pays their own rent in full, as a tenant of a local
authority, they are paying the full rent charged by the local authority
for the occupation of the dwelling. Social housing rents are well below
market rents, but are not subsidised rents. The Housing Revenue Account
(HRA), which is where all of the properties are accounted for if they are
owned by a local authority, is what is known as 'ring fenced', which means
all of the costs of providing the social housing need to be met from the
rental income received from them. The housing fund cannot be subsidised
from other areas of Council activity i.e.; Council Tax, planning fees,
parking income etc. Under the same rules, the HRA cannot use its funds to
subsidise the rest of the Council's services.

I hope this now makes sense.

A lot of the new builds that go to housing associations are rent to buy properties and only people who work can rent them.

Very confused argument I'm afraid. That just isn't how council budgets work.

In offering accommodation at less than full open market value the taxpayer is paying an opportunity cost. This is the cost of missing out on the opportunity of getting the full value for the property.

it is exactly arguments like yours which is why public finances are in such a bad way. You are not looking at the cost to the taxpayer of offering sub market value rent. This is money that could be fairly charged to improve others lives.

Which is why councils are skint. My goodness I give up!!!

What’s that got to do with social housing being subsidised? It was never intended to make a profit.

Actually, they can spend their money on what they like….same as you do!

it’s nobodies business….and allowed by whom?

Tell that to the multiple CCJs and house repossession, a 10k car, a 5k bank loan and multiple smaller debts that are on my credit history after 18 years, even despite evidence I did not take out the debts.

Make your mind up. You said it was "All kinds of wrong" that two people who work full time can live in social housing. Which is it?

If the one not living in social housing had to go through whatever the other one had to go through to get that social housing (usually homelessness, severe deprivation, domestic violence, disability, care leavers etc) to save a few hundred quid a month, do you think they'd choose to?

But it isn't all their money, is it? By living in council housing they are allowing themselves to be partly subsidised by the state.

Council housing should be there for those who are most in need.

Are you suggesting we are giving people cheap rents to compensate people for having had tough lives? Nice idea but in doing so we take money away from other things.

If the state wants to do something - get more people out of B&Bs and other temporary housing for instance - it first has to work out where the money is coming from to do that. There is no magic money tree. I suggest asking people who can afford it to pay a full market rent. I can’t see that it’s an unfair thing to do.

I am not letting the state partly subsidise the cost of my home, thereby freeing up a chunk of my salary to pay an expensive car loan.

The state doesn’t subsidise social housing - for the umpteenth time. 🙄

Or, how about they live like millions of other people, who pay such a large percentage of their salaries on their (unsubsidized) private rent/mortgage that they cannot afford any holidays at all, or to run a car, or own a pet?

That’s the property being subsidized. Rented for less than market rent to someone who could afford more. Losing money for the public purse.

Yes it does. The state pays billions every year in grants to local authorities and housing associations to build housing. That’s taxpayer money. Yet many benefitting from these subsidized properties are not in need.

Well they could buy the property?

they are in need….in need of secure housing. Money doesn’t come into it. It’s the security that’s of value. As they approach pension age they will need security more than ever..

Once again - because it obviously didn’t sink in the previous numerous times this has been explained - HA and council housing accounts are separate from general expenditure and don’t cross pollinate. These accounts have to cover all the costs of the housing.

There is NO subsidy.

Define ‘need’