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The Housing White Paper: what next for the ‘broken’ housing market?
13 June 2017

 

The long awaited Housing White Paper was published by the Government earlier this year; now six months on we look back on the paper and the future (or otherwise) of its key recommendations.  

The weeks immediately following its publication saw much discussion around its potential implications but little agreement on exactly how it will fix what the document itself proclaims to be a ‘broken’ housing market. Many measures are sought to be tackled at the highest level within the Paper but will be reliant on changes to national policy or secondary legislation dealing with their root to turn them into reality.

The Paper is introspective around the headline topics relating to the stumbling housing market discussed ad nauseam since the coalition Government was formed in 2010. These include the need to get spades in the ground, the drive towards greater levels of home ownership moving away from a market bolstered by the rental sector and the untangling of planning red tape.

The Paper generally plays a numbers game, seeking mechanisms to secure permissions for the reported 225,000 to 275,000 homes a year that the country needs and then to ensure that they are built promptly.

What the Paper struggles to grapple with most significantly is what many consider to be the root cause of the housing crisis – the lack of social housing provision and upward mobility in the marketplace. The removal of the requirement for 20% of housing on new sites to be Starter Homes provides a reprieve for more traditional forms of social housing. But the lack of additional funding to be made available to social housing providers will only maintain the status quo at best in terms of delivery.

Time will tell as to whether the recent tragic events at Grenfell Tower will result in a wholesale review of the way in which social housing is both funded and provided. There is a chance that any reaction to this catastrophe may see significant elements of the Paper superseded already.

The Paper’s apparent absence of joined up thinking around upping housing delivery whilst sidestepping additional subsidy for affordable housing will have its pros and cons for developers. The potential will exist for a loosening of certain planning controls on the location of new housing – additional development opportunities will slowly present themselves. Conversely, the thrust of the Paper leads us to envisage that the cost burden of affordable housing delivery may fall on housebuilders, perhaps more than ever. Issues around viability are therefore going to be central to every new scheme.

The main concern around the substance of the Paper is, well, lack of substance. As mentioned above we will have to wait to see what mechanisms will be used to aid general delivery. Land registers, Green Belt reviews, market diversification in the housebuilding sector, both punitive and supportive measures for local planning authorities, training in construction and a standardised approach to calculating housing need are all mentioned. But the Paper is simply a blueprint.

Generally we consider that the Paper is broadly positive towards landowners and developers. It does, however, present a far more balanced list of opportunities and threats to town halls. An area that will inevitably need further review in light of recent events is how it will ensure enhanced access to suitable social or low-cost housing for those who need it most. One thing that is clear across the board is that the Government is intent on ensuring that the burden of growth is assumed on a proportionate basis by both urban and rural areas.

In the event that the Paper serves to be something more than a coffee-table book then the subsequent amendments to policy would see the planning system remain in flux for a while yet – a state of affairs that in itself can often harm its efficiency. This will only be exacerbated by the added uncertainty caused by the recent General Election and potentially the Brexit negotiations that are now underway. There is the possibility that any future Government may have its policy approach to housing tempered by a stronger socialist element within any fresh coalition.

The Paper promised a second half of 2017 that brought with it new legislation and a long awaited review of the National Planning Policy Framework. Much has happened since its publication, however recent events may trigger a further review of the way in which the housing market operates. To this end it remains to be seen how much the direction of the Paper may change and whether it will simply fall as yet another set of unimplemented recommendations.

For further information please contact Alex Munro.

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