Reform use of public land
Using public land to build desperately needed affordable homes can help level up the country, especially in the South West of England
GROWTH
Image: Istock
Victor da Cunha
Chief Executive, Curo Group, and Chair, Homes for the South West
We were all reminded of the importance of home during the pandemic. Now, as the cost of living continues to soar, we’re reminded that access to an affordable home – in its broadest sense – is equally important.
As a nation, we need effective policy measures to facilitate the delivery of more affordable housing, and it seems to me that among the strongest measures missing is reforming the use of public land so it places greater priority on public housing.
Delivery deficit
As we’re all aware, housing delivery in the UK continues to fall short of demand. Estimates vary, but the Bramley Study’s assessment that 340,000 new homes need to be built in England each year is the most comprehensive. Despite this, and the government’s own annual target of 300,000, last year just 126,000 net dwellings were added to our national stock
Homes for the South West (H4SW), a coalition of 11 of the largest housing associations in the region, knows that if housing targets aren’t met there are real impacts on people’s lives. In educational attainment. In health outcomes. In the prospects for work. In the simple enjoyment of life
The same research found that, in our region, we need to build 42,000 new homes each year, of which 15,000 need to be affordable. Yet National Housing Federation data shows that the annual shortfall in new homes in the region stands at 22,000. In a potentially recessionary environment, it’s unlikely that this shortfall will be delivered by the market, even if the latest Land Registry figures show that house prices in the South West shot up 16.9% over the 12 months to June 2022.
126,000
new homes built in the UK against a government target of 300,000 (and an estimated need of 340,000)
22,000
annual shortfall in new homes in the South West region of England
16.9%
rise in house prices in the South West region of England in the 12 months to June 2022
Market difference
We all know that there is not one housing market. There are regional and even sub-regional variations. In the South West, we have a number of challenges which affect the speed and volume of new affordable supply. H4SW has commissioned the University of the West of England to research the regional marketplace and we hope to have their findings available in September.
For now, however, what we know is that 27% of all second homes are here. We also know that we have some of the lowest average salaries, yet some of the highest house prices. This has led to some of the highest pricing multiples with homes in some areas now costing 17 times the average salary.
This is compounded by our region having high levels of holiday lets, Airbnb usage and a rapidly diminishing private rental sector. It is nearly impossible for local people to find a place to call home.
Public land solution
To address this worsening housing crisis, it is surely right for the government to review the use of public sector land and prioritise the delivery of affordable homes.
The fact that the current model of public land disposal focused entirely on best value, means that decisions tend to settle on the highest cash receipt, rather than the highest overall value to the country. This approach allows developers to then row back from the affordable housing numbers set out in local planning policies because of viability concerns. If you do this enough, you end up where we are now – with virtually no region achieving its affordable homes targets.
Of course, we know that public land reform will not be enough. Other measures are important too, including long-awaited planning reforms (which must protect and enhance affordable housing supply), the continuation of affordable housing grant and long-term certainty over social housing rents. But land supply appears to be a crucial and missing component in policy terms.
It is promising to see that the government has indicated plans to review public land disposal to support homebuilding. It has also committed to reviewing control of the short-term use of homes so more are made available for families. Indeed the Levelling Up, Housing and Communities Select Committee of MPs has recommended that we need to fund the regeneration of estates that have come to the end of their useful life.
I hope these ambitions, matched with a focus on affordability, are not lost as we transition to the leadership of a new prime minister in September. Building new housing is a powerful way to level up in the South West. It creates jobs, raises skills, stimulates economic activity, drives supply chains and allows people to remain connected to their communities and lead successful lives. A counter to the cost-of-living crisis in every way.
“The fact that the current model of public land disposal focused entirely on best value, means that decisions tend to settle on the highest cash receipt, rather than the highest overall value to the country.”
