All posts tagged: NPPF
Well it’s here at last. After a few IT glitches, the government’s new streamlined planning guidance was published last week, and it’s potentially good news for housing. The new documents replace thousands of pages of previous guidance and arise from the review carried out by NHF CHair Matthew Taylor.
Back in April last year I commented on a little-noticed clause in the new National Planning Framework that gave cause for optimisim - the requirement for local authorities to look at market signals when casting their local plans. The exact wording reads as follows:“Plans should take account of market signals, such as land prices and housing affordability, and set out a clear strategy for allocating sufficient land which is suitable for development in their area, taking account of the needs of the residential and business communities.”
The new guidance puts meat on these bones and sets out how local authorities should plan for new supply. The starting point is the CLG’s household projections. But beyond, this, planning authorities will now need to look at local house prices and rents, employment growth, land prices and the appetite for self-buiid when they draw up their plans. Two key extracts from the section on future supply are worth quoting at length.
“Prices or rents rising faster than the national/local average may well indicate particular market undersupply relative to demand.”
“In areas where an upward adjustment is required, plan makers should set this adjustment at a level that is reasonable. The more significant the affordability constraints (as reflected in rising prices and rents, and worsening affordability ratio) and the stronger other indicators of high demand (eg the differential between land prices), the larger the improvement in affordability needed and, therefore, the larger the additional supply response should be.”
Simply put, this means that any upward divergence from national or “local” averages will require a boost in supply. It means that local authorities will need to have a clearer understanding of the housing and land markets in their area and plan for additional supply if the market is over-heating. It does not go quite as far as setting a target ratio of house prices to incomes but it is a good step forward. Assessments of housing need will have to be robust and will have to be based on a full understanding of the local housing market and follow the methodolgy set out in the guidance, and this will also give additional muscle to the Planning Inspectorate when bringing recalcitrant local authorities into line.
This will put pressure on local authorities in the south-east in particular. As I see it, local authorities with the largest ratio of house prices to incomes will have to make greater provision for new homes than those with lower ratios. In my Eastern region for instance, the NHF’s latest Home Truths sets out the ratio of median house prices to incomes for each local authority. The four authorities with the worst levels of affordability are Hertsmere (14.9), Three Rivers (14.7), Uttlesford (13.7) and St Albans (13.7) and they will all be expected to plan for more supply in order to redress the house price imbalance in their areas.
Of course, local authorities like these will argue that their areas are popular and that if they built across the entire district it would still not bring prices down. They will also argue the green belt will be put at risk by the new guidance. London boroughs are similarly constrained by a tight green belt. But there will be pressure to identify those areas of green belt land that have the least amenity or aesthetic value for future development and the “duty to co-operate” as set out in the NPPF means that tightly constrined local authorities will have to speak to their less constrained neighbours and plan accordingly. That means that places like North Herts and South Cambridgeshire will have to make cross-border plans with Stevenage and Cambridge respectively. The point is that no single authority should be allowed to evade their duties because they all have a part to play and if a single one opts out then it puts greater pressure on the rest.
A couple of caveats. The guidance is described as being in “test mode for 6 weeks” it’s not clear if this relates to the guidance itself or the new IT system that supports it. The guidance also has the fingerprints of Nick Boles all over it. I’ve written before about the threat to his postion from right-wing Tories and I hope he stays to see it through.
But here’s another thing. Why are we always outflanked by the countryside lobby whenever there are changes to planning or housing policies? The misanthropes at the CPRE rushed out a press release as soon as the guidance appeared and this was widely reported in The Telegraph (“Affordable housing rule threatens green belt”) and printed verbatim in many regional papers. From our sector, silence. Why did the HBF, NHF, the CIH and other housing bodies not issue press releases with headlines like “Planning changes offer hope for first-time buyers”? or “New planning rules provide hope for thousands of homeless people”? Why are we so slow off the mark? The result is that the whole housing supply agenda is dominated by the countryisde lobby. It makes me despair. The housing crisis is a serious business and we should treat it seriously.
Nick Boles is the best planning minister we have had for years, but his position is being threatened by anti-growth Tories and he needs our support.
Boles may be a conservative – by instinct and tradition the natural home of the nimbys - but so was Harold Macmillan and he built more homes than any recent Labour administration. More importantly, Boles understands the key issues in planning and housing, through his background in Policy Exchange. He recognises that we have to build millions of new homes if we are to create a fairer and more civilised society. He also understands that the planning system must release more land in order to boost supply. In a speech last January he talked of our “decades-long failure to build enough houses. And the root cause of that is our decades-long refusal to release enough land for development.”
As Planning Minister, Boles oversees the National Planning Policy Framework and the Planning Inspectorate, which, of late, has been requiring many local authorities to increase their post-Localism Act housing targets. This is because the NPPF contains some key requirements that we, as a sector, should be defending at all costs. For example, it aims to “boost significantly the supply of housing” and says the Government’s key objective is “to increase significantly the delivery of new homes”. It requires local authorities to “prepare a Strategic Housing Market Assessment to assess their full housing requirements, working with neighbouring authorities where housing market areas cross administrative boundaries”.
This is all good stuff, but many traditionalist Shire Tories, including ex-ministers, don’t like it. In a recent Commons debate a gang of them lined up to attack the NPPF and Boles. They spouted the usual scraremongering stuff about “concreting over the countryside” and the imminent threat to the green belt. This comment from ex-prisons minister Crispin Blunt was typical:
“There is greenfield development in the green belt designated for my constituency at the behest of a planning inspector, rather than local people, which is evidence that our system is not working.”
But this is evidence that the system is working. The planning inspector is merely ensuring that local authorities do what is set out in the NPPF – a document created by the government that Blunt and his colleagues allegedly support. Eric Pickles has made it clear that localism is not a one-way street and that every local authority has to play their part in meeting housing needs. National and local politicians cannot assume that localism will allow them to evade their responsibilities to present and future generations, simply because a minority of vocal elderly home owners object to new homes being built, True Tories would understand this - their great philosopher Edmund Burke described society as a contract, “a partnership not only between those who are living, but between those who are living, those who are dead, and those who are to be born”.
Failing to build the number of homes we need represents a breakdown of that partnership and is contemptuous of younger and future generations.
The NPPF needs time to bed down and to work effectively. The last thing that developers need, including housing associations, is yet more change in the planning system .
So my message to the sector is this. We need to defend the NPPF and Nick Boles. If he goes and the forces of reaction triumph it will put our cause back by years. So if you have any political influence at all please speak to your local councillors and MPs and express your support for Boles, Pickles, the NPPF and the critical role of the planning inspector. Say yes to homes.
Edmund Burke is also reputed to have said, “All that is necessary for the triumph of evil is that good men do nothing.” So please do something.
There’s a row going on down in Eastleigh and it’s all about housing, which is good, (it’s about time housing became a major by-election issue), but it also exposes the hypocrisy and double standards of some of our politicians, which is bad.
Let me explain. This week, the Lib Dem-controlled Eastleigh Council gave outline planning approval to a scheme of 1,400 new homes, (including 420 affordable) and community facilities at Boorley Green, a site that is currently occupied by an old golf course and country club. I’ve looked at the plans and it looks like a decent, sustainable scheme with plenty of open space that complements the surrounding landscape. It will bring much-needed jobs and homes to the area. You can read the whole story here and here, and note that 600 local people have been marching against the new homes, claiming it will ‘tear the community apart’. Eastleigh District has a population of 125,000.
But the point is that Eastleigh Council had little option but to approve the scheme, because the national planning policy framework, (overseen, let’s not forget, by Conservatives Eric Pickles and Nick Boles) contains a presumption in favour of sustainable development where local plans are absent, silent or out of date. Eastleigh has no local plan and faces a shortfall in its five-year housing supply, so the presumption in favour of sustainable development applies. According to the officer report to the planning committee: ‘With an inability to demonstrate such a supply, it is appropriate to apply the presumption in favour of sustainable development unless the adverse impacts significantly and demonstrably outweigh the benefits, when assessed against the National Planning Policy Framework policies.’ Had they refused the scheme, Eastleigh would probably have faced an appeal and significant legal costs, and other greenfield sites would then be up for grabs.
But this has not stopped local and national Conservative politicians from attacking the Lib Dems over the Boorley Green scheme, particularly because their candidate Mike Thornton has, in the past, pledged to protect green open spaces. To his credit, Nick Clegg said that some greenfield sites need to be sacrificed for the greater good. ‘Protecting green spaces doesn’t mean you don’t provide homes for people to live in. People need affordable homes to live in,’ he said.
But last week, Grant Shapps, no less, attacked Nick Clegg for ‘planning to concrete over Eastleigh’s countryside’.
Grant Shapps was the housing minister for over five years. He of all people should understand the seriousness of our housing crisis. In the light of the heated debate over the implementation of the NPPF, and the misleading propaganda put out by countryside campaigners his use of the term ‘concrete over the countryside’ is unforgiveable. Just last year he said that 200,000 homes should be built in England every year, which he described as the only way to prevent further rises in rents and meet housing need. Does he see no disconnect between the petty, nimbyism he is espousing in Eastleigh and the wider national picture that he ruled over as housing minister? He and other politicians cannot expect the public to take them seriously if they play politics with such a serious issue, especially when Eastleigh Council has acted properly and is merely implementing the policy of Shapps’ own government. This spat also highlights the split within the Conservative Party between those who understand the key planning and housing issues, like Nick Boles, and the MPs of the counties who are instinctively anti- development.
The scale and complexity of the housing crisis is deep and wide. Few people fully understand its magnitude and its possible remedies. But politicians who have studied the subject have a duty to try to explain it in simple terms to the electorate. They also have a duty to lead and not to follow, to try to mould public opinion and not to cave in to it. If they ditch their knowledge and their principles and seek to woo the nimby vote as soon as an election comes around then we are all in serious trouble.
But this begs the wider question of why so few politicians at a local level take a firm stand against those who oppose new homes. Why will they not face down those who selfishly and routinely oppose new house building (people like these) and instead stand up for the priced-out generation, the homeless, the badly housed? Is it because this group is not so well organised, not so vocal and not so pushy? I fear so. It is always easier to protest against things than in favour of them. But if you have ever read Sherlock Holmes you will understand the story of the dog that barked in the night. Perhaps the people in housing need, who have been unheard at Eastleigh, will bark in the future and be heard above the noise of those who oppose new homes. We need to work with politicians who can help them to find their bark.
Under the new National Planning Policy Framework councils will have to put in place a “sound” local plan in by March next year, otherwise there will be a “presumption in favour of sustainable development” where plans are absent, silent or out of date.
According to Nick Boles, the new Planning Minister, the number of local authorities with a local plan has increased markedly. 219 councils (65% of the total) now have published plans in place and of these 148 are “sound”. This is a big increase from May 2010 when only 60 local authorities had a local plan. Astonishingly, the city of York has not had a local plan for forty years.
This plan-led and “bottom-up” approach will supposedly provide the homes we need. Councils will have to make an objective assessment of housing need based on household projections and co-operate with neighbouring authorities across housing market areas to provide the right mix of market and affordable homes over a 15 year period.
So far so good. But the evidence to date is that many local authorities, particularly in the south-east, are trying to shirk their housing responsibilities by downgrading the housing targets that were set out in the previous Regional Spatial Strategies and ignoring projections for new households. A report for Parliament last June found that although half of all local authorities intended to stick with the target set out in the RSS a significant number were planning to reduce their housing numbers, amounting to a loss of around 31,400 houses each year across England - that’s not much less than a thrid of our actual build figure. Much of this reduction is in the south east where the need is greatest and schemes are the most viable.
As an example of this worrying trend it’s worth considering St Albans, and I’m grateful to planning guru Andrew Lainton for highlighting this case. According to the NHF, St Albans has the highest average house price in the Eastern region - £420,396 - and the second highest ratio of house prices to incomes – 14.2.
Now, the NPPF states that local authorities should take account of local house prices when they draw up their local plan. “Plans should take account of market signals, such as land prices and housing affordability, and set out a clear strategy for allocating sufficient land which is suitable for development in their area, taking account of the needs of the residential and business communities.” (para 17 - Core Planning Principles”.)
On this basis, you would think that the good burghers of St Albans would be straining at the leash to ensure that they built a shedload of new homes over the next 15 years in order to make housing more affordable for their local citizens. Not a bit of it. This NIMBY-driven Council has just agreed a new target of 250 homes each year compared to the 360 set out in the RSS, even though CLG estimates that there will be a growth of 11,700 new households in the district between 2010 and 2028 – i.e. 688 new households per annum.
The report to the Council’s cabinet is an absolute masterpiece, and deserves to be read by anyone interested in the gestation of planning policy. In brief, St Albans Council views its green belt as sacroscant, so the report assiduously cherry picks from the NPPF and ministerial statements to find the words that will support their position, and uses a medley of tenuous arguments to justify the new housing target, ignoring all the requirements in favour of a higher build figure. For example, the report suggests that local infrastructure could not cope with new homes, but given that the M1/M25 interchange (one of the busiest in the country) falls within the district this is like arguing that a few gallons of added water will cause the Thames to overflow. Yet the St Albans’ green belt comprises 80 percent (121 sq km ) of the district’s area. Do the maths and you realise that even building on just 1 percent of it would provide around 3,750 homes – double what they aim to build.
We can only hope that the Planning Inspectorate will come down hard on authorities like St Albans, find their draft plan unsound and make the Council face up to its housing responsibilities. If St Albans and other like-minded authorities are allowed to evade their housing duties then the cumulative impact will be catastrophic for the nation’s housing situation.
Will the new National Planning Policy Framework be a developers’ charter or a NIMBY wet dream? I think the answer to that question depends very much upon how we as a sector respond to it. Back in February former housing Minister John Healey described us as the most introverted sector he had ever come across. I think he is absolutely right. But the new planning framework gives us a fantastic opportunity to put our heads above the parapet and make the case for housing. It could represent the best chance in a generation to build significant numbers of new homes, but this will only happen if the housing and development industry engages fully with the planning process.
There are three key aspects of the NPPF which give me grounds for optimism.
Firstly, the plan’s the thing. The new framework is plan-led and local plans must make an objective assessment of future development needs, including housing. Where plans are silent, absent or out of date then the presumption in favour of sustainable development takes effect. Local authorities will have twelve months to get their plans in order. If we fail to engage with the local planning process then we deserve to fail.
Secondly, the NPPF calls for a significant boost to housing supply. Local authorities must plan to meet “the full, objectively assessed needs for market and affordable housing in the housing market area” and to provide an annually updated list of developable sites that provide the required housing for the first five years, with an additional buffer of 5 percent (20 percent for poor performers). They must also identity a supply of sites for years six to fifteen. Local authorities will be required to draw up a housing delivery plan and they must take account of migration and demographic change. The plan must include details of the size, type and tenure of homes to be provided in each location. Affordable housing must be provided on site “unless off-site provision or a financial contribution of broadly equivalent value.” This provides plenty of ammunition to ensure that housing needs are properly accounted for in Local Plans. Every housing provider should be keeping a close watch on their key local authority partners and they should prepared to challenge backward-looking authorities who fail to make proper provision. The “duty to co-operate” in the Localism Act also makes it essential that local authorities consider needs over a wider area, so decisions like those in the Stevenage/North Hertfordshire dispute should be robustly challenged. The fact that England is set to grow by 232,000 households every year for the next twenty years means that every local authority has a part to play in new provision. Local opposition cannot compete against the objective fact of population growth and rising demand, but as a sector we need to ensure this message is being heard.
The third significant element of the NPPF is the economic message about market signals, first raised by Kate Barker. The NPPF states that: “Plans should take account of market signals, such as land prices and housing affordability, and set out a clear strategy for allocating sufficient land which is suitable for development in their area, taking account of the needs of the residential and business communities.” I see this as a great opportunity for national bodies like the NHF and the CIH, as well as local authorities, to set out a proper definition of affordability. Imagine a world where planning policy dictated that an affordable average home should aim to be no more than three times the average salary in an area. This would push local authorities to release more land for housebuilding in order to restore balance to local housing markets.
Paragraphs 47 to 55 and 159 of the NPPF set out the key requirements for housing provision. I would urge everyone involved in housing strategy and supply to learn these by heart. Now is the time to make the case for housing.
Last week’s publication of the National Planning Policy Framework left both sides in the debate claiming victory, which means either that the document was brilliantly drafted, or one side was either putting on an act or had misread the document - or both. I certainly think the final NPPF is a triumph of drafting – it seems to have pleased both sides and may end up pleasing neither - yet it seems to me that the bodies who opposed the draft NPPF, including the National Trust, the CPRE and the Daily Telegraph could hardly afford to lose face in public, given the amount of time and effort they had spent in attacking the government.
On the day that the NPPF was published I could not see a great deal of difference between the draft and the final versions. Of course there were changes of emphasis and the default yes to development had been removed but it seems to me that the final NPPF is overwhelmingly about growth, albeit sustainable growth, and that the repeated references to economic growth trump almost every other element of the policy framework, as Andy Boddington from the CPRE has manfully pointed out. I also predicted that the countryside lobby would seek to save face by claiming victory and I was right. Articles like this and this appeared over the next few days. The Daily Telegraph, (whose laughable “Hands off our Land” campaign failed to garner the support of their sceptical readers) even had the chutzpah to claim that six changes to the final NPPF had been their doing, (it was their “It’s The Sun Wot Won It” moment). It was therefore rather strange to see Simon Heffer in The Mail simultaneously taking the polar opposite view. Is the countryisde about to be concreted over or have the evil developers been sent packing? You can buy your paper and take your choice it seems.
This deliberate or unintended misreading of the new framework may come back to haunt some of these commentators. I hope it does. The NPPF’s emphasis upon economic growth is borne out by a brilliant word count of the 50-page document carried out by Mike Galloway, a Lib Dem councillor for Wolverton in Milton Keynes, who has looked at both the draft and the final document. His analysis reveals that the most frequently used words in the final NPPF are as follows:
- Plan/Plans/Planned/Planning - 689
- Development - 385
- Local - 349
- Site/Sites - 146
- Home/Homes/House/Housing - 110
- Sustainable/ Sustainability - 113
- Environment/Environmental - 96
The word ‘countryside’ appears only seven times. Overwhelmingly, these most frequently used words relate to growth, development, planning and localism. Encouragingly, the word “housing” appears almost three times more in the final document over the draft. These words speak for themselves and I truly hope that they will count for something in the future.
So after eight months of intense and often heated debate between pro-growth and anti-growth factions the revised National Planning Policy Framework was finally published this afternoon. We now have a working document that will set the tone and shape of planning policy for the foreseeable future.
It’s 47 pages plus appendices, 5 fewer than the draft, and replaces over 1,000 pages of previous planning policy including Planning Policy Guidance documents 1 – 20. As predicted, the document places a very heavy emphasis upon economic growth (a victory for George Osborne and the Treasury), balanced against social and environmental issues.
The key requirements on housing are retained. Local plans should “deliver a wide choice of high quality homes, widen opportunities for home ownership and create sustainable, inclusive and mixed communities.” Councils will have to carry out an objective strategic housing needs assessment, in partnership with other local authorities where housing markets cross boundaries, and provide the housing that is required. This includes providing for the size, type range and tenure of new homes, and proposals must take account of migration and other demographic change. Local plans will have to allocate, and update annually, a list of deliverable sites for new housing for the first five years of the plan, plus a 5 percent buffer (down from 20 percent in the draft). Authorities who have consistently failed to deliver new homes in the past will be put on the naughty step and forced to stick with the 20 percent buffer. Additional sites for years 6-10 and “where possible” for years 11-15 will also have to be identfied.
The key issues that upset some of the countryside lobby, like the National Trust and the CPRE (it must be remembered that the NFU and the Countryside Alliance supported the proposals) have been only slightly watered down, even though they are trying to spin the NPPF as a victory for their cause. The presumption in favour of sustainable development where plans are absent, silent or out of date is retained. In other words development will be presumed to be approved unless the “adverse impacts of doing so would significantly and demonstrably outweigh the benefits, when assessed against the policies in this Framework taken as a whole”.
The NPPF also effectively ends the previous national brownfield-first policy, and local authorities will now be free to set their own targets, so there will longer be a national target for new homes being provided on brownfield land, something which pleases me greatly. This means that cities like Cambridge, which have been subject to unacceptable cramming on garden and brownfield land, can take a more balanced view about the future of previously developed land in the future.It is disappointing that the NPPF does not review the purpose and shape of the green belts, which do so much to cram us into the existing urban footprint at ever greater densities. But although green belts will retain their protection no new ones should be created unless there are “exceptional circumstances”. The NPPF also opens up the possibility of a new generation of Garden Cities to be built on greenfield land, including urban extensions that meet Garden City principles. This is one of Grant Shapps’s pet projects, via the Policy Exchange, and has to be welcomed by the housing sector.
Local authorities will be required to “take account” of the intrinsic value of the countryside, but I’m not sure how meaningful this is, when so many other clauses within the NPPF allow for greennfireld development. The feeling I’m getting from the Twittersphere this afternoon is that the countryside lobby is disappointed with the final document.
However, the NPPF places a huge emphasis upon localism and the local plan. In the absence of national and regional targets I’m still worried that the local planning process could end up being a NIMBY charter. If it is only the well-heeled and the well-housed who engage with their local planning authorities we could end up with plans that do not meet the needs of all the people, the housed and unhoused, the poor and the rich. That is why it is important for our local councils to engage effectively and constructively with their communities and for housing providers to get stuck into their local planning process. The ball is in our court now.
Like kids waiting for Christmas, the main protagonists in the NPPF debate are displaying a mix of anxiety, excitement and apprehension as they await the publication of the final version of the document, due to be published on Budget day. The twittersphere is erupting in spasmodic bursts of bad temper between the pro and anti factions. After a long and sustained campaign for and against, the final NPPF is bound to cause upset on one side and exhiliration on the other, unless it turns out to be a classic English fudge that pleases no one.
Meanwhile, the rumours are flying. This began with Newsnight’s report on the 6th March claiming that the NPPF would be published unchanged and that Pickles had received a grilling from the pro-growth Chancellor. Osborne’s sense of urgency reminds me of Labour’s slogan from the 1945 election: “Let’s Build the Houses, Quick”. The story of an unchanged NPPF was confirmed by Inside Housing on the 8th March. But then up pops The Telegraph with a worrying story that the NPPF would be significantly modified including a re-affirmation of the brownfield-first policy and the scrapping of the requirement to identify 20 percent additional land for housebuilding in years one to five.
If so, that is a worrying development. Brownfield first has distorted land prices and caused city cramming on a dangerous scale. We need to take a more objective look at brownfield land rather than building on every scrap of it. Yesterday I took the train from Brighton to St Pancras and London is looking increasingly dense. Historic monuments like St Pauls and the Tower of London are being swallowed up in a sea of huge new buildings. The same thing is in happening in Liverpool where the UNESCO world heritage status of the Three Graces is threatened. Do we really want to destroy the heritage of our cities so that Lord Rogers and his urban task force friends can have the satisfaction of surveying the “dense polycentric city” from their country retreats?
Either way, when the final NPPF is issued you can expect an almighty row. If it really is published unchanged, the National Trust and the CPRE will no doubt be mobilising their members across the shires in ways that are as yet unthought of and the Trust’s Director General will retreat with her tail between her legs to the Master’s Lodge at Emmanuel College (worryingly close to where I live). But if the document is altered in the way that The Telegraph suggests you can expect the opponents of the NPPF to be jubilant. Toad Hall and its precious countryside will have been protected once more from the nasty urban stoats and weasels who seek to destroy its sanctity. Watch this space.
My last blog “Crying Wolf in the Countryside” obviously hit a raw nerve with the National Trust, because one of their Directors, Ben Cowell, has written a piece for their website objecting to my description of the Trust as “pretty clueless on housing.”
Describing me as “One of the National Trust’s fiercest critics in the debate over the NPPF” (I can live with that!) Ben argues that the Trust has a long and proud record of involvement in housing. He points out that Octavia Hill, the patron saint of housing management, was one of the National Trust’s founders and that the Trust has 2,000 tenants and is a housing developer in its own right.
I fully accept these points, although Ben omits to mention that the Trust has also built homes against fierce local opposition, notably when they developed an exclusive gated development of 200 homes at Cliveden in the green belt. What I should have said, of course, is that the Trust is “pretty clueless about housing numbers.”
Ben accepts that some homes will have to be built on greenfield land but as usual is evasive about how many should be built and where they should be built. The National Trust will not or cannot accept the fact that we will need to build at least 3 million homes on greenfield land over the next twenty years and it is this lack of honesty on the part of countryside campaigners that is the real problem with the NPPF debate.
Ben’s final point that building on only 1.3 percent of the unprotected countryside is too high a price to pay for meeting the country’s housing needs is where we part company. I think it’s a small price to pay, and well-planned developments would help us to protect and enhance the best landscapes.
His strange calculation that 3 million new homes in the countryside would require half as many roads as we have already makes no logical sense and rather proves my point about the Trust’s cluelessness. Given that we already have 22 million homes how would 3 million new homes increase the amount of land required for roads by 50 per cent?
Ben makes the valid point that Octavia Hill campaigned for open space to go alongside housing. That is why I believe a blanket brownfield-first policy is so misguided. When brownfield land becomes available in our towns and cities we need to analyse the costs and benefits of developing it. In some cases it may make more sense to return brownfield land to open space or to urban food production rather than cramming new homes onto every inch of our already dense cities. I’m sure Octavia Hill would approve of such an approach.
Steve Hilditch at the respected Red Brick blog has also joined the debate, pointing out that the NPPF contains no housing targets at regional and national level. I completely agree, and that is the greatest defect in the NPPF, but it is still a step in the right direction towards releasing the land that we need to address our housing crisis. He also makes the salient point that the National Trust is too close to the CPRE (“an organisation that does not in my view have progressive leanings”) and it is interesting to note that the NT and the CPRE have worked almost hand in glove on the anti-NPPF campaign, Of course the Trust’s Director General is a former head of the CPRE and I understand several senior CPRE staff came with her. But the Trust may come to regret this lack of independence as I sense a growing unease among some Trust members about the elitism and politicisation of their anti-NPPF campaign, as indicated by the comment from disillusioned Trust member Lorna underneath Ben’s blog.
In the meantime, we await the publication of the revised NPPF, due out very shortly. You can expect the debate to heat up considerably from publication day onwards.
It seems the National Trust and the Campaign to Protect Rural England are becoming desperate. Over the past six months they’ve run a brilliant scaremongering campaign against the draft National Planning Policy Framework, claiming that the government is putting the entire countryside at risk of development. But on Monday they issued a report claiming that, in fact, the opposite is true and that the NPPF will have very little impact upon growth and new development. Confused? Read on.
The draft NPPF was launched last July and was met with a barrage of opposition from groups like the National Trust and the CPRE - although it’s interesting that the people who actually live and work in the countryside, like the NFU and the Countryside Alliance, support the NPPF. They know that the countryside has to be a living, working place where development is essential for its long-term prosperity.
The re-drafted NPPF is out shortly, and everyone in the housing world should be hoping that three of its core principles are retained. First, a plan-led approach – where local authorities set out the housing and other needs of their district and allocate the land to meet them, whilst preserving the best landscapes. Second, a presumption in favour of sustainable development where land is allocated for a specific purpose, or where plans are silent. Third, no return to a blanket brownfield-first policy, which did so much damage to some of our urban areas.
The government, to their credit, believes that the planning system acts a brake on growth and fails to deliver the homes we need at a price we can afford. That is certainly the view of most credible commentators on land use and planning.
But this latest report commissioned by the National Trust/CPRE (and written by an economics outfit called Vivid), takes the opposite view. As an exercise in evasion, dissembling and obfuscation it’s hard to beat and makes for an hilarious read, since both organisations appear to have moved from a position where the entire countryside is at risk of being “concreted over” to a position where none of it is now at risk! Or at least in the “short term”. The report aims to prove its point by bringing in all manner of non-economic issues, but its basic headline is that planning reform won’t boost growth. I can only guess that this bizarre volte face is based on their view that the NPPF is a Treasury-led document and that if the economic arguments are undermined then the whole document will fall.
Yet the National Trust/CPRE have always put forward the firm view that planning controls do not act as a barrier to economic growth, so it is axiomatic, by their lights, that any change to the planning rules won’t affect growth. This report is therefore internally incoherent and a pointless commission! Not only that, but its conclusions are refuted by a plethora of more credible reports, notably Kate Barker’s 2004 and 2006 reports on housing affordability and land use, and a series of reports from the LSE’s Spatial Economics Research Centre, which all show that our planning system hinders economic growth, raises house prices and increases market volatility. Who would you rather believe in this debate?
So this really is desperate stuff on the part of the National Trust and CPRE. The problem with scaremongering is that it can come back to hit you in the face. Like the boy who cried wolf, people stop believing you after a while. I’ve consistently argued in these blogs (and the CPRE, at least, seem to accept this), that we need to build at least 5 million homes over the next 20 years to cope with population grown. No more than 2 million can be built on brownfield sites (and I think the CPRE accepts that as well), which leaves 3 million to be built beyond the existing urban footprint, either on well-planned urban extensions or new settlements. But this is where the National Trust and the CPRE fall silent (actually the Trust is pretty clueless on housing issues). Rather than engaging in a rational grown-up debate about how and where we should build these new homes, and protect the best countryside into the bargain, they rely on scaremongering or emotive terms like “sprawl” and “concreting over the countryside” to make their arguments. It’s like a child sticking its fingers in its ears and screaming. No sensible local authority, with a sensible local plan in place, is planning to create sprawl or “concrete over the countryside”. What’s more even if three million homes were built on greenfield land this would take up only about two thirds of one percent of the existing countryside, or just 1.3 percent of the unprotected countryside.
The National Trust and the CPRE really should re-think their tactics. After all, we all know what happened to the boy who cried wolf.
Do you fancy a one-bed apartment in Berlin for £35,000 or a four- bed detached house in the Rhineland for £51,000?
In many parts of Germany house prices are a fraction of their UK equivalents – in fact, German house prices have decreased in real terms by 10 percent over the past thirty years, whereas UK house prices have increased by a staggering 233 percent in real terms over the same period. Yet German salaries are equal to or higher than ours. As a consequence Germans have more cash to spend on consumer goods and a higher standard of living, and they save twice as much as us, which means more capital for industry and commerce. Is it any surprise that the German economy is consistently out-performing ours?
There are a number of reasons for the disparity between the German and UK housing markets. Firstly, German home ownership is just over 40 percent compared to our 65 percent (there are stark regional variations – in Berlin 90 percent of all homes are privately rented) and the Germans do not worship ownership in the way we do. Not only is it more difficult to get mortgage finance (20 percent deposits are a typical requirement) but the private rented sector offers high quality, secure, affordable and plentiful accommodation so there are fewer incentives to buy. You can rent an 85 square metre property for less than £500 per month in Berlin or for around £360 per month in Leipzig. There is also tight rent control and unlimited contracts are common, so that tenants, if they give notice, can stay put for the long-term. Deposits must be repaid with interest on moving out.
In addition, Germany’s tax regime is not very favourable for property owners. There is a property transfer tax and an annual land tax. But the German housebuilding industry is also more diverse than ours with more prefabraction and more self-builders. The German constitution includes an explicit “right-to-build’’ clause, so that owners can build on their property or land without permission so long as it conforms with local codes.
But the biggest advantage of the German system is that they actively encourage new housing supply and release about twice as much land for housing as we do. German local authorities receive grants based on an accurate assessment of residents, so there is an incentive to develop new homes. The Cologne Institute for Economic Research calculated that in 2010 there were 50 hectares of new housing development land per 100,000 population in Germany but only 15 hectares in the UK. That means the Germans are building three times as many new homes as us pro-rata even though our population growth is greater than theirs. This means that German housing supply is elastic and can respond quickly to rising demand - hence their stable house prices, whereas in the UK our restrictive planning laws and tight green belts do not allow developers to respond to increased demand, so our supply is inelastic. More demand combined with a fixed supply of homes means steep price rises, volatility, and boom and bust.
For me, in the ongoing debate over our deepening housing crisis and the National Planning Policy Framework there are two stand-out lessons from the German experience. One, we are failing to release enough land for housing and this is causing volatility and unsustainable bubbles within our housing market that cause damage to our people and our economy. Two, a high quality, affordable, private rented sector benefits from regulation and rent control.
(Thanks to Andreas SchulzeBäing and ImmobilienScout for assistance with this article)
Countryside campaigners were delighted when the House of Commons’ Local Government Select Committee released its report on the National Planning Policy Framework late last year. After months of impressive campaigning by the National Trust and other groups, the Committee’s call for a re-write of the draft document was seen as a partial victory for the anti-development lobby.
But one aspect of the committee’s findings made me almost fall off my chair and raises questions about the competence of the Committee to reach an objective view on planning reform.
Paragraph 12 of the report reads: “We received much anecdotal evidence as to whether the planning system is currently an obstacle to growth or whether other factors are more important in slowing the economy and curtailing the level of house building… We found no conclusive research, however, that planning policy or guidance is a particular constraint on economic development.”
Now, either the witnesses who attended on behalf of the housing industry were stunningly poor at getting the economic arguments across, or the Committee is guilty of an egregious level of ignorance about planning, housing and the wider economy. Or both.
Let’s start with Kate Barker’s original report on housing supply from 2004 which contains stacks of evidence to explain that our dysfunctional housing market causes economic instability. Here are just three quotes: 1) “A weak supply of housing contributes to macroeconomic instability and hinders labour market flexibility, constraining economic growth.” 2) “Weak responsiveness of housing supply and the volatile behaviour of our housing market poses risks to economic stability and overall economic welfare.” 3) “Better housing supply could also play a part in reducing economic volatility. Most major cycles in the UK economy over the past 30 years have been associated with instability in the housing market.”
Kate Barker’s follow-up report on the planning system (2006) is even more explicit: “…further action needs to be taken to deliver an efficient planning system, by reducing delays, addressing unnecessary complexity and increasing certainty. Unnecessary delays have a number of hidden economic costs in addition to direct financial costs… In economic terms, 69 per cent of firms are dissatisfied with progress made by local planning authorities in improving their planning system…”
Given that both reports were commissioned by Gordon Brown I find it impossible to believe that the Select Committee was not made aware of their contents.
Then there is the work carried out by the LSE’s Spatial and Economnc Research Centre. Two quotes: 1)“SERC research also shows that planning restrictions increase housing market volatility.” 2) “There is evidence that planning negatively affects productivity”
Or the Centre for Cities: “The UK’s housing problem has become an economic problem (and) prevents our most successful cities from expanding, shuts people out from job opportunities and stifles national economic growth.”
More recently Savills revealed a widening gap between the housing haves and have-nots, with the under 35s owning just 5% of the nation’s housing equity and a growing gulf between the regions. If that is not a recipe for social unrest and economic malaise I don’t know what is.
I could go on. The point is there have been dozens of reports over the past twenty years setting out how our dysfunctional housing market, which is the spawn of a dysfunctional planning system, harms economic and social wellbeing.
If the esteemed members of the Local Government Select committee have been unable to discover or recognise these simple truths, and to join up the dots between the housing market, economic malaise and the planning system then heaven help our parliamentary system.
‘We shape our buildings, and afterwards our buildings shape us,’ wrote Winston Churchill in 1943. I don’t think anyone would disagree that our built environment can influence behaviour and the quality of life, as theorists from Oscar Newman to the great Jane Jacobs have shown. But a recent report from RIBA, that received less attention than it deserved, should worry everyone involved in housing provision.
The Case for Space - The size of England’s new homes revealed that England is now building the smallest new homes in western Europe, and apart from being too small to swing a cat they are literally cramping our style, having a detrimental impact upon family life and harming the educational prospects of children who grow up in them.
The average floor space of homes in the UK is 85 square metres but for new homes this falls to 76 square metres. This compares to 88 square metres for new homes in Ireland (15 per cent bigger), 116 square metres in Holland (53 per cent bigger) and a staggering 137 square metres in Denmark (80 per cent bigger). According to RIBA’s survey, the top three things people look for when moving home are outside space (49 per cent), the size of the rooms (42 per cent), and closeness of local services (42 per cent). Almost a third of those questioned would not consider buying a home built in the last ten years, or would only consider it as a last resort. Of these, 60 per cent said it was because the rooms are too small. This is quite an indictment of planners and our house building industry.
Holland is twice as developed as England (20 per cent of its land area is built upon) yet their new homes are much larger. Why is this? The RIBA report sadly fails to analyse the culprits responsible for England’s tiny new homes, but in my view it is a clear consequence of our dysfunctional planning system and our failure to release enough land for housing.
Because of England’s restrictive planning regime we are already the most hemmed-in nation in Europe, with 90 per cent of us living in just 10 per cent of England’s area. European countries release far more land for development than we do. The Centre for Cities reports that Germany releases twice as much land for development pro-rata as the UK. As a consequence German house prices are 10 per cent lower in real terms than 30 years ago. By contrast, UK house prices have inflated in real terms (i.e. after inflation) by 273 per cent since 1959. If eggs had inflated at the same rate we would now be paying £18 for a dozen. This should be a cause for national debate and soul searching.
Land really is the solution to almost all the housing problems you can think of. By taking only a tiny proportion of additional greenfield land, just over 1 per cent of unprotected countryside, it would allow land values to fall and for the correct quantity and quality of new homes to be built, whether for sale or rent. This would help to eliminate our ludicrous £22 billion housing benefit bill and reduce significantly the demand for and the need for social housing.
This is why the argument about the National Planning Policy Framework is so critical and why it is so important that reactionary countryside campaigners do not dominate the debate. The transitional arrangements for the NPPF are due to be published this week and the revised document is promised shortly. I am keeping my fingers crossed that the government does not water down the original document.
The HCA has announced a £47 million funding package for 600 new Gypsy and Traveller pitches in England, to be delivered by thirty three housing associations and local authorities. The 71 “projects”, will include new and refurbished sites - that’s £78,333 for each pitch, more than double the grant being made available to conventional housing.
In the past, local authorities and housing associations have been very reluctant to meet their legal and moral obligations to provide pitches, despite strong encouragement from people like Naisha Polaine at the HCA. You can see why: public opposition to new sites can be both fierce and racist, and many housing associations are reluctant to risk their reputations by getting involved, although some associations have built and run very successful sites – Luminus and Broadland in the Eastern region are two examples.
But if housing associations exist to meet housing needs can there be a group of people with greater needs than Gypsies and Travellers? All the research shows that the health and life outcomes of this community are shocking. They have the lowest life expectancy of any ethnic group - 50 per cent die before their 39th birthday and 70 per cent fail to reach the age of 70 - and educational achievement is poor. They struggle to get access to decent healthcare and are prone to diseases such as anxiety, asthma, bronchitis, depression, and long-term illness. A recent Radio 4 programme highlighted how amateur boxing at junior level is dominated by Gypsy and Traveller kids, but very few manage to make the grade as adults, mainly because their diet is often bad, reliant upon takeaways that are high in at and salt and low in roughage.
The HCA’s £47 million programme sounds generous, but when you set it against the £18 million it cost to deal with the disastrous Dale Farm evictions, and the fact that there are around 18,000 Gypsy/Traveller caravans, of which 4,000 are on unauthorized encampments it is a relatively modest, albeit worthwhile, investment. But I can see trouble ahead. The HCA has not published details of the location of sites but the provisions within the draft National Planning Policy Framwork for local and neighbourhood planning may make it easier for nimby-motivated campaigns to prevent Traveller sites being set up. As always, it could be the pleasant, middle class areas that are more successful in preventing new development, so the danger is that new sites end up where they have traditionally been sited - next to motorways and sewage farms, not very healthy spots by any measure. I would urge any housing association or local authority involved in site selection to make sure that they do not provide sites in unhealthy and remote locations. They also need to stand firm in the face of local opposition and work hard to get the message across that the Gypsy and Traveller community needs support and encouragement, not suspicion and isolation.
Planning and housing go together like turkey and stuffing, so what happens in the planning world should be of fundamental interest to housing professionals. But planning has had a funny old year, dominated by the furore over the draft National Planning Policy Framework, which was supported by, among others, the CIH, NHF and the housebuilders but violently opposed by the National Trust and other countryside campaigners. This week the Local Government Select Committee published its rather depressing report calling on the coalition to amend some fundamental aspects of the NPPF. I won’t dwell on the report’s implications because Jules Birch has covered it in his excellent blog.
Instead, I want to focus on the politics of this planning debate. I have a confession to make: I have been a member of the Labour Party for over thirty years and stayed loyal through thick and thin: the disastrous leadership of Michael Foot; the achievements of the Blair years; the traumas of Iraq; the election of the wrong Miliband brother - but I don’t think anything has depressed me more than Labour’s current opposition to the NPPF.
Think about it: here we have a government led by the Conservatives, supposedly the party of conservation and the countryside, proposing some brave and radical changes that could simplify and democratise our planning system and release the land that is required to meet the nation’s housing needs. In the process they have alienated some of their core supporters – the middle Englanders who read The Daily Telegraph and the 4 million members of the National Trust and the CPRE. Labour, by supporting the NPPF, could have driven a wedge into the heart of the coalition government, splitting the government from its supporters. After all, isn’t Labour supposed to be the party that supports affordable housing and progressive politics? Instead, Her Majesty’s loyal opposition seems to have taken the Pavlovian view that it is duty bound to oppose everything the government proposes. As a result of this kneejerk, unthinking response we had the grotesque spectacle of Hilary Benn, Pickles’ shadow, writing this, in The Daily Telegraph of all places:
“George Osborne and Eric Pickles seem to think that it is the planning system which is holding back economic recovery, by not producing the homes that we desperately need. In fact, they should be looking at some vested interests. Under the current system, councils have granted planning permission for 300,000 new homes that haven’t yet been built. Why not? And why isn’t George Osborne on the phone to these developers every day to get them building?”
Where to begin with this nonsense? Firstly, as a sector we have to take responsibility for our utter failure to get across the simple message that our defective housing market, which is itself the spawn of a defective planning system, is doing untold damage to our economy. Has Hilary Benn never read Kate Barker? (“the volatility of the housing market has exacerbated problems of macroeconomic instability and has had an adverse effect on economic growth.”) or this, or this? There may well be 300,000 extant planning permissions but that represents little more than a year’s proper supply of housing and the notion that a Chancellor could cajole builders into building when there is no demand and no mortgage finance is so naïve it beggars belief. It’s also worth pointing out that the Select Committee says almost nothing about the economic damage caused by the planning system.
At a time when housing is so unaffordable, when the housing market is causing untold damage to people and the economy, when the average age of first time buyers is 37 and millions of people are spending half of their incomes on rent, wouldn’t you expect the Labour Party to come up with some radical solutions to our growing housing crisis? As shadow minister, Benn should be setting out a long-term vision that accepts the need to build 5 million homes over the next twenty years. He should recognise the fact that no more than 2 million of those homes can be built on brownfield and that the remaining 3 million will have to be built in new settlements or urban extensions, in other words on greenfield land and that, as a consequence, the country is going to have to face down the countryside campaigners sooner rather than later. As I’ve said before, we are the most hemmed-in nation in Europe, with 90 percent of us living on just 9 percent of England’s area. As a consequence we are building the smallest homes in Western Europe. If the planning system is not to blame for this state of affairs I don’t know what is.
So a radical vision is required from the Labour Party. But instead, Hilary Benn finds himself in bed with the reactionaries of the National Trust (who have absolutely no answers to this country’s housing problems) opposing some sensible and much needed planning reforms. It’s as if the political world had turned upside down.
This is my final diatribe of 2011. Can I wish all readers of this blog a Happy Christmas and all the best for 2012.
If you’re at a loose end this Christmas can I recommend that you load up Google Earth and take a flight over southern and eastern England? What you see may surprise you. The myth says that we live in a built up and overcrowded island. The reality, especially in the east of England, is a vista of thousands of square miles of prairie-like fields with barely a settlement to be seen. The reason that England may sometimes feel overcrowded is because we are one of the most hemmed-in nations on earth, with 90 percent of us living on just 9 percent of England’s land area.
As a consequence, as Martin Durkin says, we “are stuffed into towns and cities like battery-farmed chickens.” The consequence of this stuffing is unaffordable property prices and a deepening housing crisis. If I had one cure for the housing crisis it would be, “It’s all about Land, stupid.”
One of the principal obstacles to sustainable housing growth are the 14 green belts that surround many of our towns and cities and comprise 13% of England’s area. They were set up with the best of intentions, to prevent sprawl, but in some places they are strangling the very cities they were designed to protect, leading to a massive imbalance between homes and jobs and causing thousands of people to “jump” the green belt every day, at huge cost to their nerves and the environment. In Cambridge where I live, 45 000 people have to commute across the green belt every day because they cannot afford to live in the city. Last week a house in my road, a modest Victorian terrace with a loft extension sold for almost half a million pounds. The consequence of this level of unaffordability is that many Cambridge colleges and high-tech firms are unable to recruit the right people, causing immense harm to the national economy. The green belts restrict development, push up land prices and have contributed to the UK having the smallest homes in Western Europe.
One of the aims of the green belts was to open up the countryside to recreation. In fact less than 2% of the green belt comprises accessible country parks. Much of the green belt is devoted to intensive farming with no amenity value or public access. As an example, take a drive along the M25 clockwise from Heathrow to Dartford. Is there any reason why London should not expand up to the M25 along much of this stretch of motorway, with green lungs to allow access beyond the city? But the green belts have also caused the loss of amenity land within the cities they were meant to protect. The brownfield first policy means that derelict sites within the city are almost always built upon rather than turned into parks and open spaces. The Borough of Islington, for example, contains almost no open space. If the green belts in London, Oxford and Cambridge were rolled back, perhaps replaced pro-rata with land beyond their present boundaries, it would allow more open spaces to be created within the cities and for sustainable development to take place.
The green belt is a 1930s concept that is no longer fit for purpose. Interestingly, one of the planners behind the green belt concept was Sir Patrick Abercrombie who also founded the CPRE in 1926, now, along with the National Trust, one of the most virulent campaigners against the much-needed planning reforms set out in the National Planning Policy Framework. As Martin Durkin argues, the green belts were essentially an act of class war, a conspiracy of the intellectuals and land owning aristocracy to prevent the stinking lower orders from spreading beyond the confines of the city. The countryside campaigners who oppose the NPPF are essentially part of this same tradition. It’s time for a re-think on the green belt.
Well, it’s not really a strategy, to begin with. A strategy is a master plan that identifies a problem, sets goals and marshalls the resources that will be needed to meet them. Within the strategy there will be a series of plans and tactics that contribute to the overall strategy.
A proper housing strategy for England would be a radical long-term vision, setting out how we restore balance to the failing housing market, how we green our homes and create sustainable and prosperous neighbourhoods, how we meet the needs of a growing population, how we reform the housebuilding and mortgage industries and how we provide housing to the most vulnerable. Today’s “housing strategy” does none of these things – it is merely a jamboree bag of short-term tactics that fail to address the big structural issues in housing. The strategy rightly identifies some of the problems with housing supply and it is great to see a Conservative-led government highlighting the economic benefits of housebuilding, but this is primarily a Treasury document that sees housing growth as a way to stimulate the economy. The strategy aims to “unlock the housing market” and get Britain building again, which rather ignores the fact that it was the housing market that got us into our present mess in the first place! Reviving a failing housing market is going to lead to the same old boom and bust.
The strategy says, “To kick start housebuilding we need demand from first time buyers and others.” No we don’t! Demand without supply merely creates inflation. Supply first, then demand.
But the proposals for increasing supply are mostly a re-hash of what has gone before with a dash of half-baked optimism. Underwriting 95% mortgages (Barclays already offers a 95% mortgage) will allow “up to” 100,000 households to buy. (That doesn’t build any new homes on its own.) The First Buy scheme will help “almost” 10,500 first time buyers into the market. (Ditto.) Releasing public sector land will provide capacity for “up to” 100,000 new homes (who will build them?) Cutting right to buy discounts is unlikely to produce 100,000 new affordable homes. It’s not clear how the Growing Places fund and the Get Britain Building Fund will increase housing supply. Is this public money? The strategy isn’t clear. Community right to build and neighbourhood plans are all covered in the Localism Act and the draft National Planning Policy Framework. One of the few new initiatives in the strategy is the proposal that developers should be able to re-negotiate section 106 agreements that were put in place during the boom years. That certainly won’t increase the supply of affordable homes!
The strategy points out that households are likely to grow by 232,000 per annum for the next twenty years. That means we should really be building 250,000 new homes every year to recover past under-supply and meet future demand. I don’t see anything in this strategy that will boost supply to those levels. The NPPF is our only hope, but that really needs to be backed up with regional or national housebuilding targets that are rigorously enforced by planning inspectors.
The strategy also says nothing about the principal problem of our housing system – the fact that we see housing as an investment, rather than as a commodity. In our hearts we know that house prices and rents need to experience a long-term decline so that we can start to invest our surplus cash in things that that actually help the economy to grow, rather than in meaningless bricks and mortar. I realise of course that no serious politician could ever propose such a long-term plan!
Moreover, the strategy says nothing about the monolithic housebuilding industry, which bears some responsibility for the current crisis. Mergers and acquisitions have created an industry that cares more about margins and profits than meeting demand. The number of smaller housebuilders has fallen significantly and the industry needs to be broken up and re-formed with assistance for smaller firms. The same applies to the mortgage industry, which needs to be broken up so that smaller lenders and greater competition are encouraged.
More analysis will follow in the coming days and months, but these are my initial thoughts.
For years our sector has been extolling the economic, as well as the social benefits of house building. It’s estimated that every house produces 1.5 permanent jobs and that investment in housing has a greater multiplier impact than any other form of investment because people who move house buy new carpets, furniture and white goods.
Well it seems that ministers have finally got the message. Yesterday’s Sunday Times says that housing will be the “prime target” of a £50 billion plan for growth that will be announced within the next two months. But the programme will not be funded from the public purse but by pension funds and future revenue streams, such as tolls on upgraded roads, like the notorious A14. The Treasury has clearly factored in housing as a major component of UK growth and as a way of avoiding a double dip recession. The “presumption in favour of sustainable development” in the draft NPPF is further evidence that housing is a principal element in the recovery programme.
So is this a matter for rejoicing? Well, up to a point Lord Copper. It may be too little too late. At this stage it’s not clear how the housebuilding measures will pan out but if there is no public funding involved it’s unlikely that we will see any social or even “affordable” homes being proposed as part of the programme. It’s clearly a good thing that a Conservative-led government sees the economic merits of housebuilding (although Stanley Baldwin and Harold Macmillan both presided over much larger housing programmes). But the problem is that the housing market is a fickle beast that rarely responds in the right way to stimuli. House prices continue to fall – by 2.7 per cent outside London over the past year according to LSL Property Services. Another survey from the Halifax says that 30 per cent of those surveyed predicted prices would fall next year compared to 28 per cent who said they would rise. A gradual fall in house prices is also a good thing, but although there are continuing signs that the mortgage market is reviving - last week, for example, Barclays offered a 90 per cent fixed term mortgage - who in their right mind is going to buy a property if they think that house prices will continue to fall, especially at a time when the Eurozone crisis is still unfolding? So even though there are 300,000 extant planning permissions few housebuilders are likely to start building new homes if there is no demand.
Meanwhile, the private rented sector has grown by about 1 million homes over the past five years. The cuts in benefits that came in this year were meant to suppress rents. Many letting agents are now refusing to take benefit claimants. Yet rents continue to rise – by around by 4.3% in the past 12 months, with tenants paying an average £29 a month more than they were a year ago. The reason for this is clear - all the young people who would normally have bought a place by now are still in the rented sector or living with parents. This unmet demand is building like water behind a dam and at some point will be unleashed on the housing market. My hunch is that we will then face another panic as these punters rush to get on the housing ladder, leading to yet another boom in house prices.
So we are in a bit of a pickle, if you’ll excuse the pun, and a stimulus to private housebuilding won’t necessarily have the desired effect, at least in the short term. Perhaps the answer is an FDR-style New Deal – a massive increase in affordable housebuilding that avoids the market turbulence of the past few years, creates jobs and provides much-needed homes for those who need them. “You have nothing to fear but fear itself.” Not likely, but stranger things have happened.
I have to hand it to the National Trust for running an exemplary campaign against the draft National Planning Policy Framework. They wrote to every one of their 4 million members and issued hundreds of daily appeals and tweets during the three months of the consultation period. They effectively hijacked the debate on planning and their backers in the right-wing press, mainly the Mail and the Telegraph, banged the drum on their behalf. By contrast, supporters of the NPPF like the Home Builders Federation, the CIH, the NFU, the CLA and the NHF were relatively silent. Yet at the end of it all the Trust obtained the signatures of just 4 per cent of their members, a paltry 200,000 signatures, for their oxymoronic “Planning for People” petition.
So lots of sound and fury but not signifying very much. Government ministers have not backed down on the broad thrust of the NPPF and although the NPPF only applies to England David Cameron has pledged to protect the “beautiful British landscape” from development (which presumably means that the less than beautiful parts of the landscape will not be protected!)
So far so good for developers and those in housing need.
But the failure of the Trust’s tub-thumping shows that the planning process remains a remote and alien concept for most people. It is because the planning system is hard to understand (it is something that is done to us rather than by us) that the National Trust had to resort to scaremongering tactics to agitate their members. They repeatedly used images of ancient woodland and rolling countryside in their propaganda as if these areas were at risk from development, when clearly they are not. They know very well that if they had instead told the truth and said: “We need to build 5 million homes over the next twenty years and this may mean building on about 1% of the unprotected, and therefore not particularly attractive scrubland that surrounds our towns and cities” they would have garnered even less support.
This view of planning being the preserve of an elite is reflected in a recent poll of 416 local government councillors, carried out by ComRes. 64 per cent of them felt there was a lack of robust evidence of public opinion in planning discussions, and 75 per cent of councillors believe that the “silent majority” is excluded from debate about planning issues. The silent majority was defined as those who are “perhaps likely to benefit from new homes or use the facilities provided by development, but are less likely to participate in the planning process than the more vocal minority, who can object vigorously to proposals”.
The real tragedy of the NPPF consultation process is that the countryside has dominated the debate. Why has this been allowed to happen? Planning is overwhelmingly about cities. 90% of us live in towns and cities and the future of our planet depends upon the sustainability and success of city living. For the vast majority of people the issues that pre-occupy them are urban issues – the quality of life in their neighbourhoods, the trains and roads that will get them to work, the quality and affordability of their housing, the quality of local services like schools, healthcare, parks and open spaces. Most people have little interest in the countryside, and as the National Trust has itself said, many people are wary of venturing too far into the countryside for fear of encountering a “No Trespassers” sign or an angry farmer. The Withnail and I view of the countryside resonates with many urban dwellers.
The NPPF’s presumption in favour of sustainable development was the issue that engendered such a knicker-twisting frenzy within the National Trust. Yet amidst all this hysteria the many positive aspects of the NPPF have been ignored. These include: the clear structure of local and neighbourhood plans; the potential for planning to become a genuinely participative and democratic process; the potential for neighbourhood development orders to give communities real power and influence over planning decisions and to capture the benefits of development for their own area; the chance to build the number of new homes we need, at last; the opportunities to green our cities, to make them more vibrant and provide sustainable transport systems.
All of this has been lost in what I consider to be a selfish and self-obsessed countryside campaign. It is interesting that bodies who really understand the countryside, like the NFU and the CLA, support the NPPF. They know that the countryside has to change and develop if it is not to stagnate.
I think it is time for the National Trust and their supporters to pipe down for a while and allow the silent majority, the town and city dwellers who have the most to gain from the NPPF, to have their say.
Two days ago the BBC published “Eight radical solutions to the housing crisis”. They were:
1. Encourage the elderly out of big houses
2. Freestyle planning
3. Contain population growth
4. Force landlords to sell or let empty properties
5. Ban second homes
6. Guarantee mortgage payments (i.e. force the banks to lend)
7. Live with extended family
8. Build more council homes
It’s an interesting list, although the suggestion that “building more council homes” is seen as radical will have Harold Macmillan and Aneurin Bevan spinning in their graves!
Here is my quick take on the rest of it.
Number 1 is Stalinist and would upset middle England.
Short of re-negotiating the Treaty of Rome or introducing compulsory euthanasia Number 3 is a non-starter. Much of the projected growth in population is down to people living longer. The rest (about 44%) is due to in-migration, mostly from the European Union, which we are powerless to stop. This is the issue that most excites letter writers to the Daily Mail and Telegraph: in fact most of the comments in their pages during the NPPF debate focussed on immigration control as a way of solving all our problems, not just the housing crisis. Don’t go there.
Number 4 – fine, but local authorities already have powers to deal with long-term empty properties.
Number 5 is a non starter- most peers and MPs have second homes and they are hardly likely to vote for a ban. Introducing fiscal disincentives to second-home ownership is one option, but it could penalise the poor – what about families who’ve owned a chalet in Clacton for decades?
Number 7 is happening already (the average age of a first time buyer is 37) and is bound to get worse. It’s market-driven and not something you can legislate for.
That leaves numbers 2 and 6, which are to some extent two sides of the same coin. “Freestyle planning” is a clumsy description of the draft National Planning Policy Framework, and reflects the largely successful scaremongering anti-campaign run by the National Trust and others.
As I’ve argued before, we need to build at least 5 million homes over the next twenty years to catch up with under-supply and population growth, but this means building on little more than one per cent of the unprotected countryside of England (and remember that 45 percent of England’s land area is protected).
The price of land is a significant element in the price of any house – up to 50% or more in some areas. More land means lower land prices, means lower house prices. It’s a simple equation isn’t it?
Lower house prices will lead to a more balanced mortgage market which will allow more first-time buyers to borrow. One of the key arguments made against the NPPF has been the outstanding number of planning permissions - about 300,000.
Apart from the fact that this is not much more than a year’s supply of homes, the mortgage drought is a short-term phenomenon. Banks are building up their balance sheets after the crash and housebuilders won’t build if there is no demand, but they will start lending and building again before too long and if house prices are lower relative to incomes it means they will be able to build for and lend to more people.
That is why the NPPF is a once-in-a-generation opportunity to restore some of the balance in the housing market and, subject to some tweaking, it opens up the possibility of providing the much-needed affordable homes that we need.
So numbers 2 and 8 in the BBC list are the answer. Forget the rest. All the recent fluffy initiatives on right to buy, buy to let and under-occupation are just so much smoke and mirrors, designed to conceal the fabled elephant in the room - the fact that housebuilding is at its lowest level since 1923.