THIS REPORT RELATES TO COUNCIL ITEM 30 ON THE AGENDA

STIRLING COUNCIL ENVIRONMENT SERVICES

13 MARCH 2008 NOT EXEMPT

PRESSURED AREA STATUS

1. SUMMARY

1.1 Demand for social rented housing across Stirling significantly outstrips supply. This is, in part, the result of the impact of the right to buy. There is a strong case for the Council to consider making an application to the Scottish Government for “pressured area status” to suspend the modernised right to buy for some communities.

1.2 This will not, however, resolve the housing crisis that many people now face. There is pressing need to take early action to increase the number of new properties available to let. This can only be achieved by increasing the number of new social rented properties being built. The current rate of new construction is 62 properties per annum.

1.3 The paper sets out the options for making an application for “pressured area status”.

2 RECOMMENDATION(S)

2.1 To agree that the Council should make an application for pressured areas status covering the whole of the rural area west of the M9/A9 including Cambusbarron.

2.2 To agree that the Council should make three further applications covering the following high pressure urban areas:-

• , and Causewayhead/Logie

• Stirling town, Riverside, Broomridge, Braehead and the Newhouse/lower St. Ninians area

• , Whins and Hillpark/Firs

2.3 To agree the strategic priorities set out in the report and instruct the Director of Environment to ensure that they are reflected in the Council’s Strategic Housing Investment Plan.

N:\DEMSUPP\NEWDECISIONS\SCOUNCIL\REPORTS\SC20080313ITEM30PRESSURISEDAREA.DOC 2.4 To agree that the strategic priorities set out in the report should be reflected in reviewing the Council's Structure Plan and Local Plan policies and Supplementary Planning Guidance on Affordable Housing. .

3 CONSIDERATIONS

Housing demand and need

3.1 In December 2006 the Council in consultation with its partners, commissioned a comprehensive analysis of housing need to provide an up-to-date and robust picture of existing and projected housing need in the Stirling Council area. The outputs of the study will be used to inform strategic planning, in particular, in updating the Local Housing Strategy and to inform housing requirements for the preparation of the Structure Plan, National Park Local Plan and the Local Plan.

3.2 The study included a survey of 1,096 households and a detailed analysis of supply and demand information up to 2011. The final report was published in September 2007. Two copies have been left in the Members’ lounge.

3.3 The study was carried out using a Scottish Government approved analytical framework. The consultant was also instructed to include in the calculation of need an assessment of the impact of the abolition of the housing legislation’s priority need test by 2012 on the demand for affordable housing.

3.4 The results have been broken down to three geographical areas corresponding to those used in the Structure Plan. Overall the report concludes that there is a backlog of unmet housing need at present. Based on current supply projections this will increase significantly over the next five years in all areas and for all housing types except in the very broadly drawn category of “supported housing”. The following tables illustrate the disaggregated results for the three Structure Plan areas at year five:-

Table 1 - Cumulative Shortfall Summary, Core Area at Year 5 Year 5 Net Shortfall/Surplus of Affordable Housing Core Size 1 Size 2 Size 3 Size 4 Size 5 General Needs -1,622 -217 -55 -121 -80 Special Needs Accommodation - Wheelchair -46 -47 -33 -28 -12 Accommodation - Without Stairs -88 -84 -55 -45 -16 Sheltered 1900000 Supported 75 56 0 0 0 Total Special Needs 131 -74 -88 -73 -28 Total -1,490 -291 -142 -194 -107 Table 2 - Cumulative Shortfall Summary, Rural Area at Year 5

Year 5 Net Shortfall/Surplus of Affordable Housing Rural Size 1 Size 2 Size 3 Size 4 Size 5 General Needs -326 -154 -53 -86 -31 Special Needs Accommodation - Wheelchair -4 -5 14 -2 -1 Accommodation - Without Stairs -23 -36 -9 -19 -9 Sheltered 0 0 0 0 0 Supported 26 15 -1 -2 -1 Total Special Needs -0 -26 3 -24 -10 Total -326 -181 -50 -110 -41

Table 3 - Cumulative Shortfall Summary, National Park Area at Year 5 Year 5 Net Shortfall/Surplus of National Affordable Housing Park Size 1 Size 2 Size 3 Size 4 Size 5 General Needs -191 -60 -53 -22 -16 Special Needs Accommodation - Wheelchair -26 -32 -13 -9 -5 Accommodation - Without Stairs -20 -28 -10 -7 -4 Sheltered -2 -3 -1 -1 -0 Supported 6-6-2-1-1 Total Special Needs -42 -69 -27 -18 -10 Total -234 -130 -80 -40 -26

3.5 The total cumulative shortfall reported by the study at year five is:-

Table 4 - Cumulative shortfall by year 5 Core Area 2,224 Rural 708 National Park 510 Total 3,442

3.6 The consultant has estimated that this cumulative shortfall will continue to rise and reach 4,996 by year 10.

3.7 In order to better understand the detail of the spread of demand for affordable housing the Council also commissioned the consultant to carry out an analysis of areas of pressure on the existing social rented stock. This is expressed as a ratio of the number of applicants for each let available. 3.8 The research shows that the overall ratio of lets to applicants for Stirling as a whole is 1:8. This includes Stirling Council and housing association waiting lists and lets. However this varies widely across allocations areas. Thirty-six of the Council’s 47 allocation areas have a lets to applicants ratio of over 1:6. Thirteen areas have a ratio of over 1:20 six of which are in the urban area and 7 in the rural area. The full results can be seen in the housing needs study which is available in the Members' lounge.

3.9 The evidence from both the housing needs study and the pressured area assessment clearly demonstrates significant levels of housing shortage at present and growing demand for new affordable housing over the next ten years.

Responding to the growing demand for affordable housing

3.10 As the strategic housing authority the Council has a number of options for responding to this situation. These include both operational and strategic planning tools. The main ones are:-

• strengthening provision for affordable housing in local planning policies;

• applying for pressured area status to limit the number of right to buy sales from the existing social rented stock;

• reflecting the need for new affordable housing in its Strategic Housing Investment Plan including:

¾ working with local housing associations and the Scottish Government to deliver new affordable housing; and

¾ building and managing new houses directly through the Housing Service.

3.11 The remainder of this report sets out the issues and options for each of the above and makes specific recommendations for action by the Council.

Affordable housing policies

3.12 Currently, affordable housing can be delivered through the Structure Plan and the Local Plan in a number of ways.

• Local Plan sites - affordable housing generally contributes to 25% of the development, regardless of the number of dwellings to be provided (although higher % are identified for some sites). Most of the local plan sites are now almost all developed and have provided some levels of affordable housing. However, until a review of the Structure and Local Plans is brought forward, and further land is identified, few local plan opportunities will be available in the short-term. • Windfall sites (non-Local Plan sites) - affordable housing generally contributes to 25% of the development where the development is 20 dwellings or more. Windfall sites have historically and will continue to make up a significant amount of the available land supply and will therefore be relied upon to contribute a considerable amount of affordable housing in the future. The location of future windfall sites are however not always known and the timescales for coming forward uncertain. It can be difficult therefore to predict the levels of affordable housing that may be provided.

• Rural village sites - affordable housing contributes to 100% of the development where the development is 4 dwellings or more. It is increasingly becoming more difficult to achieve affordable housing through rural village sites as few sites are coming forward.

3.13 The delivery of affordable housing can be secured by the use of Section 75 Agreements with developers. However, this in itself can cause delays as the developer can choose to build the affordable housing at any stage of the development and this is rarely at the start. It can also take up to 5 years from planning agreement to the provision of houses on the site. In an attempt to deliver affordable housing through Section 75 Agreements regular meetings are held with all appropriate stakeholders to discuss issues such as site availability/viability, funding packages, location of affordable housing within the site and deliverability of affordable housing.

3.14 Our target for the provision of affordable housing is 62 per year. However, due to issues outlined above it is increasingly becoming more difficult to achieve this. During the years 2006/07 and 2007/08 the number of new affordable rented houses built was 2 and 170 respectively. The latter were mainly a result of regeneration at Cultenhove.

3.15 It is recognised that the need for affordable housing in Stirling is complex. It is not simply a matter of the number of houses required, but more of the distribution and quality of supply of house types and sizes to suit demand.

3.16 Supplementary Planning Guidance on the Local Plan defines affordable housing as "that part of the housing delivery system in which the primary aim is to provide housing to people unable to afford adequate housing at market prices". In the current circumstances there is a need to review this definition to focus planning guidance on increasing the output of affordable rented housing particularly in the most pressured areas including those covered by the proposed application for “Pressured Area Status”.

3.17 Affordable housing can be provided in a number of ways:-

• social rented housing with affordable rent levels provided by the Council or by Registered Social Landlords.

• low cost home ownership such as Homestake provided by Registered Social Landlords.

• private ownership where the property is purchased on the open market at an affordable price. 3.18 Provision must also be made for affordable housing for residents with special needs. Housing Services are currently liaising with Community Services, Corporate Asset Management and Planning to ensure such provision is forthcoming.

3.19 It has been recognised that the current methods for the provision of affordable housing require to be reviewed. Discussions are currently taking place between Planning and stakeholders to determine the best way forward. The Local Plan specifies the extent of affordable housing within local housing areas as a percentage of the full development. This ranges from 15% - 50 % and applies to sites in the urban area where the development exceeds 20 dwellings. It is critical to the future of affordable housing that the requirements for varying these percentages in certain areas are fully justified and formalised to ensure that all developers are fully aware of their obligations prior to the submission of planning applications.

3.20 Any amendment to the affordable housing policy and specific site requirements, will require to be developed in full consultation with stakeholders, including the development industry and take into account land values and site circumstances and have regard to other financial obligations linked to particular developments, including any expectation that developers will contribute to infrastructure and supporting development such as schools or roads.

Pressured area status

3.21 Pressured area status was first introduced in the Housing () Act 2001 as part of the Modernised Right to Buy legislation. Section 45 of the Act defines ‘pressured areas’ as localities where:-

• there is a clear excess of demand for social housing over the supply of such accommodation; and • it can be demonstrated that the operation of the RTB is exacerbating the situation.

3.22 Guidance issued by the Scottish Government indicates that areas with a let to applicants ratio of 1:6 or above are likely to be eligible for consideration for pressured area status.

3.23 Pressured area designation allows a local authority to apply to Scottish Ministers for the consideration of suspending the right to buy, for a period of up to five years, in the designated area to help tackle a shortage of affordable housing. If approved, the suspension would apply to all social rented housing tenants with the right to buy, if the tenancy commenced on or after 30 September 2002. This is known as the modernised Right to Buy. At the end of the five years it is possible to apply for the period to be extended if appropriate. The designation of such areas is in the gift of Scottish Ministers.

3.24 The consultant has estimated that the number of sales that would be prevented over a five year period by pressured area status at structure plan level is as follows:-

• Core urban area 126 units • National Park 12 Units • Rural Stirling 17 units 3.25 The legislation does not allow for pressured area status to be obtained for an entire council area. In any case, the main arguments against an application for the whole of the Council area are:-

• the detrimental impact on the Council’s ability to promote mixed tenure communities in relevant settlements which have an over supply of social rented housing, particularly those in regeneration areas; and

• the impact of the loss of right to buy sales on the Council’s HRA capital programme and the ability of the Council to meet the requirements of the Scottish Housing Quality Standard by 2015.

3.26 On the basis of the evidence available the consultant has recommended that the Council should proceed to make an application for pressured area status for the whole of the rural area including the national park area. This is reflected in the recommendations set out in 2.1 above.

3.27 There are a further six areas with a lets to applicants ratio of over 1:20. These are:-

• St. Ninians Newpark

• Riverside

• Broomridge

• Bridge of Allan

• Bannockburn

• Causewayhead/Logie

3.28 Whilst each of these areas show very high levels of demand for each let they are all part of a small number of identifiable housing and community areas within the core urban area. Rather than considering each one as an option for pressured area status it may be more appropriate to see them in the context of their immediate area. As follows:-

Stirling town:

Newpark, Lower St. Ninians and Newhouse

Riverside

Braehead

Broomridge

Stirling South:

Bannockburn

Whins of Milton

Hillpark/Firs Stirling North:

Bridge of Allan

Causewayhead/Logie

Dunblane

Rylands/Whitecross

The following table details the number of properties sold under the Right to Buy since its introduction and the pressure ratio for the area.

Area Preserved Right Modernised Total Right to Pressure Ratio to Buy Right to Buy Buy @ 2007

Stirling Town

Newpark 7 0 7 27:1

Newhouse 36 0 36 16:1

Lower St. 300 1 301 12:1 Ninians

Riverside 123 0 123 100:1

Braehead 499 0 499 12:1

Broomridge 64 1 65 23:1

Totals 1029 2 1031

Stirling South

Bannockburn 435 0 435 20:1

Whins of Milton 454 0 454 6:1

Hillpark / Firs 217 1 218 5:1

Totals 1106 1 1107 Stirling North

Bridge of Allan 318 1 319 44:1

Causewayhead 56 0 56 51:1 / Logie

Dunblane 254 1 255 12:1

Rylands/ 134 0 134 10:1 Whitecross

Totals 762 2 764

3.29 On the basis of this analysis it is further recommended that the Council make three separate applications for pressured area status for each of these areas. This is reflected in the recommendation at 2.2 above.

The Local Housing Strategy and strategic investment plan

3.30 The Council produced its first Local Housing Strategy (LHS) in 2004. This covered the period 2004–2009. The Council will be required to submit a new LHS during 2009. One of the strategic objectives of the LHS is 'addressing housing needs'. However, on the basis of current planned investment and without the ability to apply "pressured area status" and suspend the modernised right to buy, the Council is unlikely to meet the total shortfall in affordable housing as set out in 3.5 above.

4 POLICY/RESOURCE IMPLICATIONS AND CONSULATIONS

Policy Implications Diversity (age, disability, gender, race, religion, sexual orientation) No Sustainability (community, economic, environmental) Yes Corporate/Service Plan Yes Existing Policy or Strategy Yes Risk No Resource Implications Financial No People No Land and Property or IT Systems No Consultations Internal or External Consultations Yes

4.1 Policy Implications

4.1 This is consistent with the Council's Corporate aims and with the aims of the Local Housing strategy. This paper will influence the Strategic Planning Framework. 4.2 Resource Implications

4.2 The proposals are consistent with current estimates of resources available from Communities Scotland. Provision has been made within the Housing Revenue Account and investment programme to support the work outlined here.

4.3 Consultations

4.3 A draft of this paper was taken to the Housing Advisory Group on 7 December 2007. Planning has been consulted in the preparation of this report.

5 BACKGROUND PAPERS

5.1 Stirling Council, Local Housing Strategy 2004-09.

5.2 Communities Scotland, Strategic Housing Investment Plan Guidance (2007).

5.3 Housing Pressure Area Status, final report, Arneil Johnston, September (2007).

5.4 The Modernised Right to Buy, Scottish Government, (2002).

5.5 Applications for Right to Buy pressured area designations, supplementary guidance, Scottish Government, (2006).

5.6 Firm Foundations: the future of housing in Scotland, the Scottish Government (2007).

5.7 Stirling Council Local Plan (as Altered 2007).

5.8 Stirling Council Supplementary Planning Guidance - ‘Planning to Meet Stirling’s Housing Needs’ (2003).

Author(s) Name Designation Telephone Number/E-mail

Patricia Peat Service Manager, Strategy and 01786 442931 Development

Tony Cain 01786 443018 Head of Housing Services

Name Designation Signature

Brian Devlin Director, Environment Services

Date 3 March 2008 Reference REP856SC(TC)