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Planning for Housing Demand in the UK

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Planning for Housing Demand in the UK Planning for housing demand in the U.K.: Just a question of space? Jill Morgan and Mark Stallworthy Norwich Law School, UEA Introduction It has been observed that ‘discussions on housing policy generally either ignore …[the] law or regard it as a passive instrument for policy implementation.’1 Our paper concerns the serious shortage of housing accommodation in the United Kingdom, with particular focus on England and Wales. There are two ways in which lawyers can engage with such issues. The first, which at the moment is particularly prevalent in the United Kingdom, is from a human rights perspective. Thus, a number of challenges to substantive housing provisions on the basis of the European Convention on Human Rights have been made in the English courts - albeit to rather limited effect2 - since the Human Rights Act 1998 came into force in October 2000. The second, more traditional, approach - which this paper will take – is to consider the capacity of law and policy-making structures and processes to deliver appropriate (and just) outcomes. The housing shortage: causes and consequences Although there is, in crude terms, a surplus of housing, in England,3 much of it is situated in areas where there is no work, and many properties stand empty because they are either dilapidated or in serious disrepair. Others await incoming tenants or purchasers, or are second homes. However, despite this housing surplus, there is nevertheless a serious housing shortage which is particularly pronounced in London and the south east of England. Problems of weak supply have been exacerbated by the effective withdrawal of the municipalities from new housing provision, with social housing new build generally at a non- viable level. Yet housing needs cannot all be met by the market. Not only is home ownership 1 Goodchild, B, ‘Applying theories of social communication to housing law: towards a workable framework’ (2001) 16 Housing Studies 75 -95, 75. 2 A notable exception is Mendoza v Ghaidan [2002] 4 All ER 1162, in which the Court of Appeal held that the succession provisions of the Rent Act 1977 were discriminatory (thereby falling foul of Article 14 of the Convention) and should be read therefore so as to include a same sex partner as someone who had ‘been living with the tenant as his or her wife or husband.’ This had previously been taken to mean only heterosexual partners (Fitzpatrick v Sterling Housing Association (2001) AC 27). 3 According to the 2001 Census, the total number of empty homes (or ‘vacant dwellings’) in all tenures in England stood at 977,000 (3.7% of the total stock). Even in the economically powerful London and south east sub-region, there are estimated to be 70,000 private empty houses: see Kennedy, M, Guardian, 27 November 2003. not necessarily appropriate for the whole community, but there is also a rising proportion of the population which cannot engage in the market. The government accepts that since the 1980s, the UK ‘has seen a rise in income inequality almost unique among developed countries’.4 Further pressures arise from the severe backlog in social housing provision, such that some commentators argue that government figures for household needs should be increased from the figure in excess of 4 million referred to below to around 5 million.5 Indeed, housing problems are exacerbated by the growing residualisation of social housing. Following the introduction of the right to buy, around 30 per cent of council housing stock was sold off between 1979 and 1997. New building mostly ceased following restrictions from 1980 on housing allocations and freezing of sale receipts (though the latter was lifted in 1997). Remaining council housing provision stands at around 19 per cent of the total stock in England and Wales, and contains severe pockets of social deprivation for those trapped in ‘sink’ estates.6 Social housing needs are increasingly met by registered social landlords, especially housing associations, themselves increasingly reliant upon private funding. For all the improvements in building and estate design, reliance on private capital has also contributed to higher, low-subsidy rent levels. This brings familiar problems, and ‘new entrants to housing association properties are increasingly likely to be dependent on welfare benefits: those in work would find the rent commitment an impossible burden. So ultimately, large areas of residential properties are occupied only by those who are economically inactive: unemployment becomes a norm for that area’.7 The Barker Report has concluded that a lower real trend in house prices is desirable so as to improve macroeconomic stability and deliver greater affordability for individuals.8 In order to bring the real price trend in line with the EU average of 1.1 percent, it is thought that an extra 120,000 private sector houses per annum might be required, as well as between 17,000 and 23,000 additional social houses per annum to improve access to housing for those who cannot afford market rates.9 The approximately 250,000 per annum new build is would serve to address growing needs and to reduce the backlog, enabling around one third (15,000) of new households to be priced back into the market by 2021. The realignment in housing tenure (which is considered further below), has occurred in the context of important social trends and it has become clear that reliance on market-oriented policies is seriously limited in the face of ‘the pattern of housing needs, general income levels and demographic factors - notably the rate at which new households are being formed’.10 In England, household formation has been estimated at 179,000 per annum, yet in 2002 only 134,000 extra homes were built.11 The number of households in Great Britain has increased significantly over recent decades, partly because households now contain fewer people. The average household size fell from 2.9 in 1971 to 2.4 in 2003 and there has been a particularly large increase in the number of people living alone (29 per cent in 2003, compared with 18 4 UK Government, A Better Quality of Life: a Strategy for Sustainable Development for the UK, Cm 4345 (London: Stationery Office, 1999), para. 7.13. 5 Jones, C & Watkins, C, ‘Planning and the housing system’, in Allmendinger, P & Chapman, M, Planning Beyond 2000 (Chichester: Wiley, 1999), 103. 6 Lee, P, Murie, A & Marsh, A, The Price of Social Exclusion (London: National Federation of Housing Associations, 1995). 7 Kettle, J & Moran, C, ‘Social housing and exclusion’, in Allmendinger and Chapman, note 5 above, 235 8 Barker, K, Delivering Stability: Securing our Future Housing Needs, 2004, Treasury/Office of Deputy Prime Minister (ODPM) (the ‘Barker Report’), 11. 9 ibid. 10 Greve, J, Homelessness in Britain (York: Joseph Rowntree Foundation, 1991), 21. 11 See Barker Report, note 8 above, paras. 1.16-17. 2 per cent in 1971). While, over the same period, the population has increased by six per cent, the number of households has increased by 31 per cent.12 These changes in the size and number of households can be attributed to a number of factors. They include increased longevity, together with a desire among older people to continue to live independently rather than with relations or in institutions, a decline in the birth rate, and a move on the part of many younger people to establish separate households either as single people or with other unrelated adults (the decision to marry being made later in life - or not at all).13 The picture is further complicated by the rise in divorce rates and an increased incidence of relationship breakdown among cohabiting couples. There has been a decrease however in the proportion of households containing the traditional family unit and an increase in the proportion of one-parent families. Today, fewer than 40 per cent of households fit the model of the conventional nuclear family and yet it is arguable that housing policy has only just begun to come to terms with the shift in the foundations of British family life which these figures represent. In sum, Government projections for England for a 20-year period to 2016 suggest expectation of an increase of in excess of 4 million households requiring to be housed. This represents an increase of around 23%.14 The main reason for the increase is a demographic one, not accounted for by population alone. An increase in population of around 7 per cent, or 3.4 million, is expected for the quarter-century 1996-2021, whilst over that same period the growth in the number of households is anticipated from a figure of around 20 million to over 24 million.15 Despite the growing number of new households the supply of new housing has fallen, therefore, with house building for all tenures at its lowest peacetime level for decades.16 There are two primary reasons for this: first, council housing is not being built and building by housing associations is not making up for the deficit; and, secondly, private sector building is producing a supply side shortfall, which it is argued is largely a consequence on development planning controls imposed by the state. The geographically uneven pattern of economic growth means that a greater proportion of the additional households are to be found in the south than in the north. Between 1996 and 2001 the average annual increase in households in England was almost 200,000 but this comprised a growth of 136,000 households in London, the south east, the east of England and the south west, compared to only 64,000 in all the other six regions together.17 However, more new homes have been built in the north of England than extra households formed.
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