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Developers renege on affordable homes as countryside faces housing crisis

6 June 2017

Developers renege on affordable homes as countryside faces housing crisis Credit: Roo Reynolds via Flickr Creative Commons

Council targets to meet local need missed in many areas

New research from the Campaign to Protect Rural England (CPRE), released today, shows a growing crisis of affordable housing provision in many rural areas. 

Using Government data, the research indicates that the proportion of affordable homes being provided by non-metropolitan local authorities has halved in five years [1]. In 2011-12, 35% of new dwellings in shire districts and unitary authorities were affordable; in 2015-16, this had decreased to just 16%. Other than a small recovery in 2014-15, those years showed continued decline. 

CPRE’s research also shows that just five of the 15 most unaffordable districts outside London have met their most recent lowest affordable housing target. In Epping Forest, the tenth most expensive borough outside of London, just 14% of new housing over the past five years has been affordable. The borough’s target is 40%. 

The Government data also shows which councils have provided the lowest proportions of affordable housing. Over the past five years, an average of just 6% of the new housing in Oadby & Wigston, Leicestershire, has been affordable. In Poole, which aims for 40% affordable housing, just 7.7% of completed homes have fulfilled the criteria. 

As councils no longer receive direct funding for affordable housing, and, until recently, very few councils have been building homes (just 1,890 across the entire country in 2015-16 [2]), the main way affordable homes are currently provided is through conditions on developers being granted planning permission. 

A pattern has emerged, however, where developers claim through a viability assessment that it is not or no longer possible to build the requisite proportion of affordable homes as part of a development [3]. In Horsham, Sussex, an American real estate investment trust recently told the council that a viability study demonstrated its development could not provide more than half the council’s 35% affordable housing target. Faced with the prospect of an appeal, or seeing the development cancelled, the council waved through the 2,750-home and business park development, accepting the developer’s assessment [4].

Recent research from the Town and Country Planning Association (TCPA) shows that councils are increasingly concerned about affordable housing and the effect that viability assessments have on providing it. In the TCPA’s study, over 60% of councils surveyed agreed that the viability test set out in the National Planning Policy Framework has hindered their ability to secure sufficient social and affordable housing to meet local needs [5].

 

Paul Miner, planning campaign manager at the Campaign to Protect Rural England (CPRE), said:

“Many councils are falling woefully short of their targets to provide affordable homes. Yet you also have to look at those developers who continually use shady tactics to renege on promises to build affordable homes and new community infrastructure. These are often the promises that win them permission in the first place. 

“Developers have councils in a bind. It’s either fewer affordable homes or missed housing targets. And either way it’s young people and local people in need who lose out. 

“As just 8% of rural housing is affordable, much of the countryside is already out of reach to those on average incomes. If we don’t change things this will just get worse. The next Government must reduce the power of these viability studies, stop highly profitable developers gaming the system and give councils the hard cash to start building houses again.”

 

ENDS

 

Table 1: Proportion of affordable housing built 2011/12 - 2015/16  

Affordable housing completions in Unitary Authorities and Shire Districts

2011-12

2012-13

2013-14

2014-15

2015-16

Shire

     20,760

     16,960

     15,880

     24,090

     13,580

UA

     11,470

       9,890

       9,590

     14,500

       7,470

Total

     32,230

     26,850

     25,470

     38,590

     21,050

Net additional dwellings in UA and Shire Districts

Shire

     58,800

     52,970

     58,960

     74,610

     84,320

UA

     32,430

     31,150

     32,400

     41,790

     43,970

Total

     91,230

     84,120

     91,360

    116,400

    128,290

Proportion affordable (%)

Total

         35.3

         31.9

         27.9

         33.2

         16.4



 

Table 2: The proportion of affordable homes built in the 15 least affordable* local authorities outside London and comparison with the most recent housing target in a local plan

Council

Local plan affordable housing target

5-yr ave: % affordable homes

Proportion of target being met**

South Bucks

20-28% ***

15.6

78

St Albans

40%

27.4

68

Waverley

30%

33.1

110

Tandridge

40%

27.4

69

Epsom and Ewell

35%

41.4

118

Elmbridge

20-50%

31.9

160

Chiltern

15-28% ***

24.7

165

Epping Forest

40%

14.0

35

Hertsmere

35-40%

22.5

64

Woking

35%

24.7

70

Horsham

35%

23.1

66

Sevenoaks

20-40%

18.8

94

Windsor and Maidenhead UA

30%

21.2

71

Chichester

30%

17.2

57

East Dorset

40-50%

41.0

103

 * The unaffordability ranking is based on the ratio of lower quartile house price to workplace-based earnings (Source - Office for National Statistics)

** Where a range has been given the lowest target has been used to calculate the proportion of the affordable housing target that has been met. This is likely to overestimate the proportion of the target that has been met as many local authorities set lower targets for small sites and higher targets for larger sites. 

*** Based on recent needs assessment

 

Table 3: The 10 local authorities who have built the lowest proportion of affordable homes 2011/12 - 2015/16

Council

Local plan affordable housing target

5-yr ave: % affordable homes

Proportion of target being met*

Unaffordability ranking (outside London)**

% affordable homes in 2015/16

Additional comments

Oadby and Wigston

10-30%

5.8

58.3

122

8.3

No affordable homes built in 2 of last 5 years

Bournemouth UA

40%

7.4

18.4

128

2.8

Bassetlaw

15-35%

7.6

50.8

245

14.7

Poole UA

40%

7.7

19.1

66

5.9

No affordable homes built in 2 of last 5 years

Brentwood

35%

10.1

28.9

24

0.0

No affordable homes built in 3 of last 5 years

Ashfield

20-45%

10.7

53.5

246

0.0

No affordable homes built in 1 of last 5 years

East Riding of Yorkshire UA

No numbers given

12.2

 n/a

201

17.9

Worthing

10-30%

13.1

131.0

89

2.1

Surrey Heath

20-40%

13.6

16.4

37

0.0

No affordable homes built in 3 of last 5 years

Epping Forest

40%

14.0

26.0

8

3.7

No affordable homes built in 1 of last 5 years

* Where a range has been given the lowest target has been used to calculate the proportion of the affordable housing target that has been met. This is likely to overestimate the proportion of the target that has been met as many local authorities set lower targets for small sites and higher targets for larger sites.
** The unaffordability ranking is based on the ratio of lower quartile house price to workplace-based earnings (Source - Office for National Statistics)

 

[1] CPRE compared data from Government live tables on additional affordable dwellings (Table 1008C) and net additional dwellings by district (Table 122). Affordable homes are defined in the National Planning Policy Framework, published 27 March 2012, as housing provided to specified eligible households whose needs are not met by the market. The statistics include affordable rent, social rent, intermediate rent, shared ownership and affordable home ownership schemes. In some cases, homes classed as affordable are still out of reach of those on average incomes: for example, affordable rent is set at up to 80% of local market rent, which in some areas may still be a very high proportion of a household’s income.

[2] Government live tables on permanent dwellings completed by tenure (Table 209)

[3] In most cases, developers are required to invest in local services and affordable housing to offset the impact of the development on the local community. A viability assessment may be used to negotiate down the developers’ contribution, by claiming that the contribution will have an impact on the overall financial viability of the project.

[4] West Sussex County Times, ‘Unpopular but necessary’ North Horsham scheme approved, May 2017.
This follows other examples of developers using viability assessments to lower affordable housing contributions in rural areas.

In 2014, David Wilson Homes informed Bedfordshire council that it could no longer provide the full affordable housing allocation for its development in Kempston, despite already having built 1,000 of the planned 2,760 houses. The council assented to the move.

In the same deal, the council also assented to reductions in energy efficiency standards and new infrastructure. Promised public facilities, such as a library and sports facilities, were cancelled. Most recently, the developer sold land originally earmarked for a medical centre and community centre to a supermarket chain. Some buyers were not informed of these changes until after the purchase had been completed.

[5] Town and Country Planning Association, Building Homes, Creating Communities, May 2017

The Campaign to Protect Rural England (CPRE) fights for a better future for the English countryside. We work locally and nationally to protect, shape and enhance a beautiful, living countryside for everyone to value and enjoy. Our members are united in their love for England’s landscapes and rural communities, and stand up for the countryside, so it can continue to sustain, enchant and inspire future generations. Founded in 1926, President: Emma Bridgewater, Patron: Her Majesty The Queen. www.cpre.org.uk

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