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Planning matters

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The social impact of the undersupply of housing
The appeal of owning a house remains strong. According to research more than three quarters of under-25s still aspire to own their own home. Yet there exists a massive shortage of houses for us young people to buy.  A shortage of houses means sky high house prices, and a generation of people who feel locked out of the market.The economic benefits of housebuilding are clear - for instance, NLP research demonstrated that the UK housebuilding industry employs over 600,000 people and generates at least £1.4bn in tax revenue. Yet less is made of the more subtle, harder-to-capture social benefits of owning your own home – something which seems increasingly out of reach for my generation.It almost seems too simple to explain the root cause of the housing crisis as simply a case of supply and demand – but in truth it really is. A mixture of increased demand has been combined with a lack of supply to mean that housebuilding has simply not kept pace with demographic and social trends. These forces have combined to drive house prices sky high (over just the ten years between 2001 and 2011 the average price of a home increased from 7.4 times the average salary to 11.1 times).  As a consequence, more and more young people have to enter into the private rental market, and for most owning their own house is an all too distant possibility. Research by the think tank IPPR shows that half of all those renting privately think it will be at least 10 years before they can even think of buying their own home.Some might ask why my generation should even want to buy their own house? Germany is often cited as an example of a well-functioning economy with low rates of home-ownership. Two main reasons exist - first is the economic one. By paying rent to a landlord instead of mortgage repayments, one is essentially losing out on owning a valuable asset. Yet the aspiration to own one’s own house is more than about money. Young people, just as their parents’ generation did, want somewhere that feels like home - a place that we can put our own stamp on, to feel safe and secure in, or a place to start a family. It should come as no surprise that home ownership has been associated with increased life satisfaction, whereas not owning a home has been found to make young people delay achieving major life ambitions – polling shows one in five of those who have never had children said they’re delayed starting a family because they didn’t own their own home.Homeowners are more likely to become more involved in neighborhood groups as a way to establish ties with others and integrate in a new community. Renters who move, however, are less likely to turn to civic participation as a way to build new social network ties. A locked-out generation of young people means an unsettled generation, and an unsettled generation will lead to unsettled communities. IPPR analysis finds that owning a home increases someone's sense of belonging to a neighbourhood as much as simply living there without owning for fourteen years. For example, when controlling for all other variables, an individual who has lived in the same home for 20 years yet does not own it is likely to feel only the same sense of neighbourhood belonging as someone who owns their home but has lived in it for just 6 years.Whilst renting may make sense for those in their early 20s, the UK rental sector is not as secure for those who want a long-term home (in Germany, leases are generally indefinite, and landlords can only evict for specified reasons, whereas in the UK, landlords are generally able to evict tenants with two months’ notice).  Many students, having graduated, are priced out of renting independently (especially in London) so have been forced to live with their parents in order to save even to be able to afford to rent – but this has been shown to arrest development and affect relationships (such as the ability to find a partner)One way the Government is trying to increase the number of young people entering the housing market is through the provision of ‘starter homes’ - sold at 80% of the full market value to first time buyers for the most part under the age of 40 (and as currently proposed, over 23).  Whilst the technical details are yet to be fixed, developers will be able to provide starter homes as part of meeting their overall affordable housing requirement - which some critics have suggested would lead to the continued decline in the overall number of affordable housing units being built.What makes this so frustrating is that the simplest solution to fix the housing crisis – building many more houses in as many tenures as possible – is severely restricted by the political hot potato of protecting the Green Belt. The Green Belt - whilst conjuring up images of pleasant English rolling hills and scenic landscapes - includes land which is covered by airports, quarries, railway embankments and sewage works (oh and golf courses – more land in Surrey is covered by golf courses than housing). It has been claimed that the release of just 3.7% of London’s Green Belt would provide land to build up to a million homes.This crisis will not be solved until politicians not only accept the scale of the crisis but the obvious solution lying under their noses.It should now be obvious that Britain needs to build many more homes. Housebuiliding provide a massive boost to Treasury coffers - housebuilding creates jobs and tax revenues not just directly through construction, but also indirectly through fitting them out them with kitchens, curtains and carpets. Yet even more importantly it is necessary for my generation, which has exactly the same aspirations that my parents had. Building enough houses which people can call home - a place they feel safe in and feel happy to raise a family in - will in turn be good for society as a whole.  


Mayoral Election - (Affordable) housing will tear us apart
On 5 May 2016, Londoners will vote for new members of the London Assembly and, most importantly, the next Mayor of London, to succeed Boris Johnson. Unsurprisingly, housing, planning and, broadly speaking, the built environment have been the main topics of discussion during mayoral hustings and in the press in the last few months, with all the mayoral contenders focusing on setting out various strategies and plans to tackle the current housing crisis.The Labour Party’s mayoral candidate is Sadiq Khan, MP for Tooting since 2005 and former Minister of State, Department for Transport (2009-2010). In his 82-page long electoral Manifesto (A Manifesto for all Londoners), housing is clearly identified as his top priority:‘We need to build more homes (more than 50,000 new homes a year), including more genuinely affordable homes for Londoners, and fewer gold bricks for overseas investors.’ Genuinely affordable homes for Londoners To effectively tackle the housing crisis, Khan pledges to ‘building thousands more homes for Londoners each year, setting an ambitious target of 50% of new homes being genuinely affordable, and getting a better deal for renters’. The backbone of his housing strategy is the setting up of Homes for Londoners, a new City Hall team that will be in charge of building ‘the genuinely affordable homes London needs’, including: Homes for social rent, supporting councils and housing associations in delivery; Homes for London Living Rent, where rent is to be based on one-third of average local wages; Homes for first-time buyers to ‘part-buy part-rent’, to be developed on mayoral and other public land, giving Londoners (who have rented for over 5 years) ‘first dibs’; Homes to buy, building on brownfield public land and once again, giving Londoners ‘first dibs’. This rather ambitious housing plan, while interesting in the way it uses different housing tenures for different needs, stands in sharp contrast to the government definition of affordable housing (and the intention to include starter homes in the National Planning Policy Framework’s affordable housing definition), as set out in Khan’s Manifesto itself. In case of election, this is likely to be a point of sharp debate between the Greater London Authority and national government. Devolution powers and local alliances Another pledge that is likely to create some friction between the Greater London Authority and national government relates to Khan’s intention to call for more devolution powers, including: powers for councils to invest in new homes for Londoners; prudential borrowing powers for councils to invest in new affordable housing, and the major taking the lead in developing public land; ‘use it or lose it’ powers to avoid land-bank on sites where planning permission has been granted. The release of mayoral, TfL and other public sector land is seen as the keystone to addressing genuinely affordable housing needs. This goes hand in hand with the intention of creating an alliance with ‘all of those with a stake in building new homes for Londoners’, meaning councils, housing associations, developers, home-builders, investors, businesses, residents organisations; this housing partnership would be in charge of developing a unified voice to make requests to Central Government to ease the difficulties of building enough new homes in London. The role of businesses and transport for housing Interestingly, the first housing measure mentioned in Khan’s Manifesto (in the 1st chapter ‘business, prosperity and opportunity’) refers to the involvement of businesses in solving the housing crisis, by ‘exploring incentives for businesses to provide investment in new homes which could benefit their workforce’. The accent on creating mixed communities, able to combine housing and working needs, is stressed in other parts of the Manifesto, promising to: ‘promote the provision of small businesses and start-up premises in housing and commercial development through the London Plan’ ‘provide live-work units as part of the Mayor’s affordable housing programme’ ‘set up Creative Enterprise Zones, providing dedicated small workspace with live in space so that creative industries, artists and the fashion industry are given extra support to flourish’ Building on his previous experience (as he highlights in the document) as UK Transport Minister, Sadiq Khan acknowledges the importance of taking a long term view on future transport needs by ‘making sure that the plans deliver the highest possible gains in terms of new homes for Londoners.’ He pledges to secure Crossrail 2, the Bakerloo line extension (to Lewisham and beyond) and London Overground extensions, as well as new river crossings in the East; he also pledges to ‘plan the next major infrastructure projects’ such a potential Crossrail 3, new orbital links for outer London, DLR and tram extensions.However, there are very few measures that relate transport improvements to the potential for delivering additional housing; this point stands in sharp contrast to his main contender, Conservative candidate Zac Goldsmith - his housing strategy is largely based on securing ‘the transport links we need to make private sector land more accessible’. The not-so-risky planning choices and the role of local authorities On other headline matters, such as airport expansion and the Green Belt, Sadiq Khan’s position is not surprising; he opposes a third runway at Heathrow and supports Gatwick as ‘a more viable, cheaper and easier-to-build alternative’ (he has also said he will review Boris Johnson’s decision on London City Airport). On the Green Belt, his position is to oppose building on it (as do all the other mayoral contenders), since it ‘is even more important today than it was when it was created’.Working with councils, as a way of dealing with an array of matters, is underlined in several parts of Khan’s Manifesto. This collaboration will stop ‘the excessive conversion of commercial space under permitted development rights’, will guarantee ‘greater transparency around viability assessments’ and will bring ‘empty homes back into use, using compulsory purchase orders where necessary’. On the other hand, the labour candidate aims to set clear guidelines for the mayoral ‘call-in’ power, including where planning has stalled and/or where opportunities to deliver more new or affordable homes are being missed. An extensive (and conflictual) housing programme In conclusion, Khan’s intentions on election are surely ambitious in trying to tackle the housing crisis through different strategies (some more convincing than others). If he is voted in as Mayor, the success or otherwise of his Manifesto pledges will be dependent on: the ability to raise funds, both from central government and from private investors, to guarantee the viability of some of the above-mentioned proposals; effectively dealing with a national government that is not on the same page on some of the core pledges of his Manifesto (not least, the definition of affordable housing); gathering different stakeholders around the same table, to work collectively in addressing a crisis that is beyond each stakeholder’s control; the capacity to give certainty to the housebuilding industry; and, on top of everything else the effectiveness of the proposed measures in doubling the current house building rate  (roughly 25,000 homes per annum). The questions and uncertainties arising from Khan’s Manifesto promises are neither few nor easy to answer; if he were to be elected, early implementation of as many as possible would make all the difference between eye-catching political announcements and effective policy measures.