Planning matters

Our award winning blog gives a fresh perspective on the latest trends in planning and development.

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.  

CONTINUE READING

Is the romantic dream of self-build dead or alive?
Is there anything more romantic than building your own home? DCLG certainly didn’t miss the opportunity to promote this concept on Valentine’s Day, by reminding aspiring self and custom housebuilders of new rules coming into force and recently published draft planning guidance taking effect on 1 April 2016, which will see the launch of various measures (including new registers) to support prospective self-builders looking for plots – supposedly making it easier for them to get their dream home underway.I’m currently working on a scheme in County Durham for 14 self-build plots. Shortly after distributing invitations to a consultation event we received four enquiries from local residents who were determined to buy a plot. It’s clear to me that there is a strong demand for self-build.The statutory duties under the Self-build and Custom Housebuilding Act 2015 require local planning authorities (LPAs) to keep a register of self and custom-builders for their area from 1 April 2016. Local people will be able to add their names to the register to make it clear they are seeking to acquire a serviced plot of land in order to build their own home.The draft guidance (that will be added to the national Planning Practice Guidance – ‘the PPG’ – on 1 April) states that, "registers that relate to their [LPA] area may be a material consideration in decision-taking" and that LPAs with plan-making functions, "should use their evidence on demand for this form of housing from the registers that relate to their area in developing their local plan and associated documents”.In light of recent research showing that more than half the population would like to build their own home at some stage in their lives[1] and that 1 million people are currently taking action to build their home in the next 12 months[2], Housing Minister Brandon Lewis’ ambitious target to build 20,000 self and custom-built homes a year by 2020 appears all the more achievable. But how will this demand translate into delivery on the ground, especially when viewed in the context of easing the country's housing shortage?Paragraph 159 of the National Planning Policy Framework (NPPF) requires LPAs to prepare a Strategic Housing Market Assessment (SHMA) to assess their full housing needs, including inter alia, catering for housing demand and the scale of housing supply necessary to meet this demand. The new draft guidance encourages LPAs to feed the demand data from the self-build and custom housebuilding registers in their area into their SHMA and consider future need for these types of housing when developing their local plans.However, it could be argued that the registers will create a false impression of demand because theoretically, anyone could apply to be on a register even if they have no realistic means to build their own home. In response, the draft guidance encourages relevant authorities to request additional information from applicants to support a better and more accurate understanding of the nature of demand in their areas, but applicants have no obligation to provide this information. As long as the applicant meets the eligibility criteria – any European Economic Area citizen aged over 18 seeking to acquire a serviced plot of land for a house that would be their sole or main residence – they have to be accounted for on the register, even if they have no interest in providing additional information to facilitate the LPA’s understanding of demand.In addition, some have called for a small application fee to be required, for entry onto the register to help cover the administration costs incurred by LPAs and as a means of ‘filtering out’ those not committed to building their own home. However, this measure has not been included in the Act. NLP thoughts... In light of the above, we are expecting to see large numbers of local people adding their names to registers up and down the country. This could illustrate huge demand for self-build and custom housebuilding influencing both plan-making and the decision-taking functions of LPAs. However, due to the relatively relaxed eligibility criteria and the absence of any test to determine whether people actually have the means to build their home, it will be difficult to accurately quantify the nature of demand and future potential for self-build and custom housebuilding.In principle, the inclusion of registers will be a useful mechanism for gauging local demand for self-build and custom housebuilding. However, on the basis of the above coupled with the lack of measures to prevent people from signing up to registers in numerous authorities – invariably inflating demand further – LPAs should err on the side of caution when using the demand data to inform their SHMAs.Ultimately, it will be interesting to see whether the registers capture ‘new’ demand which was previously unaccounted for or will they largely represent alternative demand which already exists for housebuilder products?... [1] Planning Portal[2] Ipsos Mori 

CONTINUE READING