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Why we must focus on housing need

Why we must focus on housing need Copyright: RHM/Tim Crocker

Need and demand: attempting to draw a distinction between these two terms can lead you down a slippery semantic slope. When it comes to housing, the importance of a clear distinction – between what we mean by housing need and housing demand – is especially important.

CPRE’s latest housing foresight paper – Needless Demand – attempts to provide clarity on what we mean by these two terms, explain why the difference is so important, and provide suggestions as to how planning policy could incorporate a clear understanding of what the differences are.

The situation is not helped by the fact that both the National Planning Policy Framework (NPPF) and the National Planning Policy Guidance (NPPG) conflate the two terms. As Needless Demand demonstrates, this confusion is perpetuating the housing crisis. By treating market demand as the same as genuine social need, developers are able to bring forward the housing schemes that are most agreeable to their profit margins rather than the needs of the local community. This problem is compounded by a lack of social housing and the Government’s insistence that affordable housing provision should be met through private development.

However, as our new paper sets out, housing need and housing demand aren’t the same thing. Rather, we set outobjective criteria that should underpin any real concept of housing need:

• Is the housing affordable to the people who need it?
• Is it located where it is needed?
• Is it of an appropriate quality?
• What is the balance between existing and emerging housing need and what might the duration of housing need be?

Demand, on the other hand, can be defined as the ‘quantity and quality of housing which households will choose to occupy given their preferences and ability to pay’. While housing demand reflects households’ financial circumstances, housing need is the baseline required for everyone to live in appropriate conditions.

As well as making clear this distinction, Needless Demand suggests how it can be applied to improve planning policy. Based on these definitions of need and demand, local planning authorities should make estimates and alter their plans for the amount and type of housing. Crucial to this, the ‘objectively-assessed need’ figure that authorities are required to produce should not be a single numerical target, but rather outline the range of different housing needed. More widely, we also call on the Government to revise the NPPF to clarify the distinction in national policy.

We hope that Needless Demand will make a timely contribution to the housing debate, especially given the Government’s new consultation, Planning for the right homes in the right places, launched just last week. It is vital that the debate on housing shifts from a dogmatic obsession with sheer numbers to a broader discussion about how we can deliver against genuine housing need. Needless Demand attempts to bridge this divide.

It is vital that the debate on housing shifts ... to how we can deliver against genuine housing need

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