Value ‘stripping’: Affordable housing, institutional investment, and the political economy of municipal debt

In this commentary, I examine the role of institutional investors in affordable housing production in England, reflecting and expanding on the papers in this special issue on the governance of residential investment. Drawing on my research on the politics of municipal debt and local authority housebuilding in London, I provide a snapshot of the key regulatory changes that have enabled insurance companies, pension funds, and other institutional investors to extract profits from social and affordable housing. I also explore the politics and relations of power that underpin this transformed environment through a discussion of investors’ lobbying activities, and through an analysis of ‘income strip deals’, long-term leasing agreements between investors and local authorities that have gained popularity in recent years. In line with the authors in this issue, I argue that to grasp the recent wave of institutional investment in public housing, we need to pay attention to the narrative framings through which the promise of patient capital is enacted and legitimised, and to the range of regulatory actions mobilised to support and maintain the flow of value to rentiers.