Paragon brands social housing changes as "dangerous"

The Paragon Group has called the government’s changes to social housing as “dangerous”.

George Osborne, chancellor of the exchequer, revealed a £4.4bn reduction to the social housing budget in his speech to the House of Commons on the Comprehensive Spending Review.

Nigel Terrington, chief executive of The Paragon Group of Companies, says the decision to move social housing rents in line with private sector will strain the private sector.

He says: “The trend in housing tenures over the past 10 years has been away from social housing and towards the private rented sector, and these measures will inevitably accelerate this shift.

“The number of properties in the social housing sector has fallen by one million since 1991, and the private rented sector has largely picked up the slack, increasing by 1.3 million properties.

He adds that the private rented sector stock is under strain as more people look to rent than buy, and this surge in tenant demand is causing rental inflation.

He adds: “Whilst we recognise the positive regulatory changes already made by the government, it has to be careful not to shift the role of housing people on low incomes onto the private rented sector without ensuring it has appropriate levels of support at both an economic and regulatory level.

“Failure to do so could be dangerous because it could lead to a shortage of rental property at a time of unprecedented levels of tenant demand.”