Planning matters

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28 Days Later: mandatory pre-application public consultation in Wales
From the 1 August 2016, applicants for all major planning applications in Wales must have undertaken pre-application consultation with the public, the community and specialist consultees before submitting their applications to the LPA. 

It is exactly four years since the Independent Advisory Group (IAG) made recommendations to the Welsh Government that included making pre-application public consultations compulsory (in certain circumstances) and the question in everyone’s minds is whether or not the requirements will have the desired effect of enhancing consultation and engagement in the planning application process?

The new regulations (summarised below) require applicants to prepare a final suite of documents and then to consult with the local community as well as statutory stakeholders for a minimum period of four weeks, prior to making a planning application.

While there is certainly no zombie apocalypse on the horizon, there are grumblings and some surprise that the Welsh Government did not opt for compulsory engagement before the planning application proposals are fully worked-up. As a result, one suspects the changes will draw criticism from the community that the requirements fail to meet the recommendation of the IAG to deliver “meaningful public engagement at a time when there is an opportunity to influence design decisions”.

The new procedure has two main facets: to involve third parties (including stakeholders) at earlier stages and to seek substantive responses from specialist consultees prior to the submission of the application. The effect should be a more streamlined system in which applications can be determined within the statutory timescales and communities have an opportunity to influence the development before the submission is made.
There is a clear onus upon the applicant to properly consider any material comments and set out its response before the LPA considers the development proposal. There also remains a further opportunity for stakeholders to comment once the application has been submitted. It is indisputable that this is more collaborative for the community than the outgoing approach.

For the applicant, will it also spell improvements to the planning system, in terms of increasing certainty? Theoretically, yes. Issues raised by the community, possibly hitherto unknown, would be considered earlier while specialist consultees are required to make substantive responses. These should result in a shorter, more certain, determination period. However, it remains to be seen whether a reduced overall programme between initial site appraisal and the completion of development (and with it, the achievement of economic and sustainable growth) will materialise.

If it results in more timely decision-making, reduces the overall development timetable and helps sustainable forms of development to come forward, then it should be welcomed as a means by which to address the continuing housing crisis and the need for other forms of development in Wales.

There are ways that NLP can help with the new pre-application statutory consultation and engagement process, in order for applicants to ensure they make best use of the changes in their development programmes:
  1. NLP can provide the full suite of consultation, engagement and planning services for an integrated service to our clients by applying our thought leadership as well as experience and knowledge of the planning system;

  2. NLP’s Smarter Engagement approach provides a focused and active strategy for consultation and engagement. It can be effectively adopted for the minimum requirements or it can be used to create a tailored strategy for any project’s needs and client objectives;

  3. NLP has an in-house, high quality graphic design service to produce bespoke consultation material where wider engagement forms an integral part of the planning strategy. This approach ensures that we can deliver innovative design solutions which help achieve differentiation and market advantage for our clients. Further, these can be combined with our GIS, mapping and data services that transform information and to communicate key messages effectively;

  4. NLP also has an in-house website design and hosting service which has a tiered approach to meeting the individual needs of any project. These range from an elementary yet client-branded display for the minimum requirements (to avoid excessive printing costs), through to fully interactive, dedicated websites updated throughout the development process for continued community engagement; and,

  5. NLP’s bespoke stakeholder toolkit for Wales is designed to take a systematic approach to ensuring the legal requirements of consultation are met, as well as creating efficient documentation of the process ready for preparing the Pre-Application Consultation report.

 

NLP will be closely following the progress of the changes to the planning system over the coming months. We would be pleased to speak with you regarding the new regime, or to tailor a programme for your project.
For further information please contact Helen Ashby-Ridgway at our Cardiff office 02920 435880.

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The Implications of Brexit on Population Projections and Housing Need
The reality of Brexit prompts the question for planning of whether it will impact on the need for housing, and in particular change the housing requirements in emerging Local Plans. An element of the planning effect relates to process issues (e.g. delays in introducing new planning reforms) but we can leave this for another day. This blog focuses on the migration statistics used within the population projections that underpin Local Plan housing figures[1].

Net international migration to the UK in 2014/15 was 336,000 (636,000 in, 300,000 out). The split between EU/Non-EU is around 50:50 (latest figures show 49:51) so on that basis each component (EU and non-EU) would represent net flow of c.168,000 p.a.

The Office for National Statistics (ONS) 2014-based Population Projections which Government guidance says Local Plans must use to underpin Objective Assessments of Need for housing in Local Plans were released in 2015. They already assume that net in-migration will reduce from current levels to 185,000 p.a. by 2021; a 45% reduction on the 2015 net level. It is assumed to decline as follows:

The 2021 levels are then projected forward as a constant until 2037.

Although a reduction in net migration to the “tens of thousands” was an aspiration of David Cameron, it seems unlikely that net in-migration would fall below the long term figure assumed by ONS with or without Brexit; if anything, the figure of 185,000 p.a. is still likely to under-estimate future levels.
Given the share of net inflows from non-EU countries (168,000 p.a.) is already capable of being controlled by UK Government migration policy (which since 2010 has been seeking to reduce it) it is reasonable to assume no reduction due to Brexit. Therefore, hypothetically, and all things being equal, in order for the ONS Projections long term migration estimate (185,000 net p.a.) to be achieved, net flows from within the EU would have to fall to just 17,000 p.a. (ie reduce by 90%).

All this supports the idea that the ONS projections were, in any event, adopting very cautious estimates of net in-migration for the long term, and thus cautious estimates of population and household growth for planning purposes. Although the ONS did not explicitly take account of Brexit, there is no evidence available to support the notion that leaving the EU will see a reduction in migration of a scale that would be necessary for population estimates to fall below projected levels.
What does this all mean for housing numbers?
The effect of Brexit is impossible to gauge at present because the UK will most likely remain a member of the EU for at least the next two years whilst the terms of exit are negotiated. There is currently no evidence base for arriving at an alternative set of assumptions about future expected migration until the terms of withdrawal are settled, and indeed, it might even be that Brexit simply results in an agreement that links UK access to the Single Market with continuation of the free movement of labour.  Equally, were the UK to have a controlled migration relationship with Europe, this might prove just as incapable of reducing EU-migration as it has proved with non-EU flows. Further, if emigration flows out to the EU reduce as part of controls, any changes might simply cancel each other out.

There is simply no way of knowing at this stage, and no coherent basis for Local Planning Authorities, developers or Inspectors to settle upon a different set of migration figures than those currently available from ONS in planning. The next set of ONS projections to be produced (2016-based) will be required to get to grips with the appropriate relevant long term assumptions to adopt.

In summary, the current basis for UK estimates of housing need are already predicated on a 45% drop to total net-in-migration by 2021, so for Brexit to have any downward pressure on planned housing targets in Local Plans, it would need to be assumed that Brexit resulted in European net-migration to the UK falling to virtually zero over the medium to long term. This seems unlikely.

There are other factors driving household growth, including natural change in the population, and age structure (an increasingly elderly population means a greater number of single person households), so migration is only part of the story. Further, many local plans set housing requirements based on factors such as employment growth, the need to improve housing affordability, and the need for affordable housing. All of these can put upward pressure on estimates of housing need drawn solely from population projections.
The data in summary:



*Approximately half of inflows to the UK are from outside of the EU. For the purposes of this analysis we have assumed this is also applicable to the net figure.

Figures may not sum due to rounding.

[1] Housing requirements in Local Plans are based on Objectively Assessed Need which is calculated using demographically-based projections that apply household formation rates to estimates of population change in order to arrive at the number of households in a given local area. Other factors such as employment, market signals and affordable housing need are also considered.

 

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So where do people actually want to live?

So where do people actually want to live?

Stephanie Irvine 23 Jun 2016
With an additional 9.7 million people expected to be living in England by 2039[1], this is a key question for developers and policy-makers alike. In planning for new housing, it is important to identify who these homes are for and whether they are suited to the needs and aspirations of people in different age groups. Will the properties built today be the dream homes of the future, or will we just have to “make do” with those available?

A Centre for Cities report “Urban Demographics – why people live where they do” analyses the results of two YouGov surveys which asked respondents why they chose to live where they did and for their least favourite aspects of their neighbourhood. The cost of housing was the most commonly selected factor in deciding where to live (28%), with proximity to friends and family a close second (28%). The size and type of housing was also a significant reason (22%), along with living close to the workplace (21%).

Figure 1: Most commonly selected reasons why residents chose to live in their neighbourhood

Source: Centre for Cities, Urban demographics: why people live where they do, November 2015

It should come as no surprise that people’s priorities in deciding where to live change over the course of their lives. According to the Centre for Cities research, younger age groups tend to value proximity to the workplace and being near leisure or cultural facilities, whereas those of middle age are more interested in the safety and security of their neighbourhood, as well as the quality of schools. Meanwhile, older people prioritise living close to the countryside and green spaces, and the size or type of housing.

The different priorities of these age groups broadly reflect the geography of cities, with younger people valuing the convenience and amenities of city centres, middle-aged groups opting for family-friendly suburbs and older people following their dreams in escaping to the rural hinterlands of cities for their retirement. According to the Centre for Cities research, this pattern is most prominent in larger cities, where city centres have recently seen huge growth in population, a large proportion of which has consisted of students and young professionals. The question is, whether the market is offering (a sufficient number of) homes in the locations where people want to live? Also, what are the implications of these preferences?

Research shows that, either by choice or necessity, a growing proportion of young people are living in private rented accommodation. The proportion of households in England aged 25 to 34 in private rented homes increased from 24% to 46% over the last 10 years. For households aged 16 to 24, the proportion increased from 43% to 71% during this period[2].


Figure 2:     Proportion of households (by age of household reference person) in private rented accommodation

Source:       English Housing Survey 2014-15

This increasing demand indicates significant opportunities for the Private Rented Sector and Build to Rent – although it is important that these types of homes are provided in the right places.

Meanwhile, almost half of the projected population growth by 2039 is expected to consist of people aged 75 and over[3]. Therefore, it is essential that the housing needs and preferences of older people are taken into account in planning for new homes. The national Planning Practice Guidance (PPG) states that plan-makers should identify the need for both general housing and specialist accommodation for older people, broken down by type and tenure. This guidance is intended to help older people live independently and safely, thereby reducing the costs to health and social services, and also free up houses that are under-occupied[4].

While the Centre for Cities research applies a wide age bracket of 55 and over, housing needs for people in this category are diverse, reflecting the changing push and pull factors affecting priorities as people get older, including health, mobility and the desire to be close to family. The fact that people are continuing to work until later in life may also have an impact on housing decisions.

Although the Centre for Cities research indicates that people aged 55 and over value countryside living, the limited availability of public transport and distance from friends and family were cited as the main drawbacks of the areas where older people currently reside. Therefore, in planning for specialist accommodation for this age group, it is important to take into account factors such as proximity to public transport, amenities and health care facilities, which can increase in importance as people grow older. It may be that the provision of high quality landscaping and gardens could help to attract and retain older residents in city and town centres, suburbs and other areas that offer a variety of amenities and good access to public transport, thereby reflecting the desire for “countryside living”. Certainly, the more housing choice that can be provided for older people, the better.

While the planning system should continue to encourage and enable mixed communities, it is important to provide homes that reflect both the needs and priorities of different age groups. It is likely that city centres will continue to attract young people, and suitable rented accommodation should be provided there to accommodate them – indicating an increasing role for the Private Rented Sector and Build to Rent. Meanwhile, the needs and aspirations of older people should be better understood in order to enable independent living for as long a time period as possible. New development should take these preferences into account, providing an appropriate mix of housing types and tenures in the right locations to cater for all sections of the population. Otherwise, some of us may just be forced to settle for a home that is “not quite what we had in mind”.

Nathaniel Lichfield & Partners' CAREpacity toolkit aims to provide a helping hand to developers of housing for older people. It provides a specific package of tools aimed at helping developers assess the potential for specialist housing for older people and present a case for such development.

[1] ONS 2014-based National Population Projections

[2] English Housing Survey 2014-15

[3] ONS 2014-based National Population Projections

[4] Planning Practice Guidance, Reference ID: 2a-021-20160401

 

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Build to Rent: How can we support Build to Rent?
In the first two blog posts in this series I set out the benefits of and barriers to Build to Rent developments. This last post will explore ideas on how we can support the sector to a greater degree in order to maximise its impact and cement its role as a key contributor to solving the housing crisis.

In a recent letter to Housing and Planning Minister Brandon Lewis, The Better Renting Campaign has suggested three priority areas which could further help to support the sector:
  1. A set proportion of sizable public land sites suitable for more than 100 units, be designed for long term BTR, with a presumption in favour of planning
  2. Not to levy the stamp duty surcharge for second homes on professional BTR investors, as promised by the Chancellor in December 2015, to help make these developments more viable and attractive to investors.
  3. Provide recognition of Discounted Market Rent (DMR) as a form of affordable housing for BTR schemes.
I agree that the release of some public sector land for BTR housing would significantly help the sector and reduce the competition with build-to–sell housing. I advocate the use of BTR quotas in Local Plans, if based on an objectively assessed need and resulting housing requirement, or as part of a brief for the development of public sector land. All of these measures would help to ensure that BTR housing is reflected in land prices and as such, would help to reduce the viability gap.

An exemption in relation to the stamp duty surcharge would help the sector and encourage investment and ultimately housing delivery. However, with investment in the sector reaching £50 billion over the next five years it is no surprise that the Chancellor wants some of this value to be captured, to help fill Government coffers. Whilst the stamp duty surcharge will no doubt impact on viability, it is generally considered that this in itself will not undermine growth in the sector. This was explained by Philip Nell, Fund Director of Vista UK Real Estate Fund, the residential property fund established by Hermes Investment Management and Countryside plc:
Through adept negotiations with developers, we believe that the impact of higher stamp duty on rental properties can be mitigated. This, combined with continuing policy support for PRS property development, greater pressure on smaller-scale landlords and the persistent demand and supply imbalance in the UK rental market, should ensure that investment opportunities in this sector remain compelling.
The call for greater recognition that DMR should qualify as ‘affordable housing’ for BTR developments is critical, as providing traditional social rented accommodation within BTR developments, managed by a Registered Provider, is not a realistic proposition. The BTR model works because the developer is responsible for the management of the entire building: a proportion of units being managed by another organisation is not seen as an acceptable proposition. On the BTR schemes that I am currently involved with, there is acceptance that DMR is a means to ensure that a BTR scheme can offer an ‘affordable housing’ contribution. This is an approach which has been applied on a number of schemes across London, for example M&G/HUB Residential in Ealing, Dolphin Living’s scheme in Westminster and Essential Living’s scheme in Swiss Cottage - it appears already to be the accepted approach in London.

Whilst DMR housing will not necessarily provide homes for those residents on a Council’s or social housing provider’s waiting lists, the discount offered will make those units more affordable for those on lower incomes. In some schemes across London, innovative approaches are being taken forward where the discount is linked with income, creating ‘Living Rents’. It is important that the BTR sector is encouraged to explore such models, in the interests of helping to house those on lower incomes and thereby help to retain the capital’s workforce.

There is clearly a range of mechanisms which could help overcome the viability issues faced by BTR developers – some which can be done today, some which need greater government support. With the sector set to triple in size by 2020 and the industry knocking on the Government’s door with suggestions of how to unlock its potential, there seems to be a real prospect that BTR could help to ease the housing crisis – but to what degree? Only time will tell but the future is looking very promising indeed for the BTR sector.
 

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