Signs of the home-owner’s apocalypse, number 17: Planning Delivery Grant August 10, 2006
Posted by Brickonomist in Media, NIMBYs, Planning.add a comment
Here’s a wonderfully hysterical story from Monday’s Telegraph about how
The Government intends to reward councils with cash if they give planning permission for hundreds of thousands of new homes to be built in attractive parts of England where property prices are high.
(Funny how the Telegraph only cares about areas with high house prices, isn’t it?)
Let’s see how many things they managed to mislead their readers about in a single story, shall we?
No environmental conditions are placed on the scheme
There doesn’t need to be. The housing targets are set as a result of a regional planning process which takes great account of environmental impacts.
There is no apparent ceiling on the money that councils could make if they exceed the targets for new homes set by Ruth Kelly, the Communities and Local Government Secretary.
Well, the total pot of money available for the Planning Delivery Grant in 2007/08 will be only £120m, equivalent to a whopping 0.6% of the total Council Tax take. Currently ‘Housing Delivery Grant’ accounts for only 20% of that (see page 4 here), with the remainder rewarding perceived good performance in adminstering planning decisions and policy-making. In a separate consultation paper, the government seems keen to tilt the balance more in favour of incentivising housing delivery, but there is no indication that the total pot available is going to increase.
Councils not reaching a threshold would be starved of cash.
If you call not receiving a very small bonus on top of a huge income from council tax, business rates, etc being ’starved’, yes. If not, then that’s just nonsense.
Government figures show that five million new homes are needed in England over 20 years, 1.5 million of them because of record levels of immigration.
Now, as it happens, I think the proposed Housing and Planning Delivery Grant is a pretty crude and bureacratic way to incentivise housing supply at the local level. But I also think it’s too insignificant to make much of a difference. Of course it was not in the interests of Charles Clover or the Telegraph’s editors to inform their readers of the amount of money involved, since that would have got in the way of their primary objective of stirring up paranoid visions of class warfare.
Superstar hamlets? July 19, 2006
Posted by Brickonomist in Design, Environment, Housebuilding, Housing inequality, Housing markets, NIMBYs, Planning, Rural housing.add a comment
In an earlier post, I wondered whether London might one day turn into the kind of ‘Superstar City’ researchers have identified in the US. But according to today’s Guardian, it looks more like the Superstar syndrome (high income households taking over areas that are unique, desirable and feature little or no new construction) is happening in many parts of the English countryside:
It may be an over-simplification to argue that a form of social apartheid grips rural England, with traditional country dwellers confined either to the remaining council houses or the tied cottages of the big estates, rarely in contact with their neighbours – the superannuated, and rich. But the divisions are apparent.
A good place to start is the roof of England. Drive on the country’s highest road, where the lush North Pennines briefly meets a more barren landscape, and the pressures and conflicts of the countryside are soon evident. Down the winding Hartside pass, old farmhouses and buildings – which once supported hundreds of agricultural workers – have become the preserve of a new rural elite. At the bottom of the pass, and over the Eden valley on the edge of the Lake District, Kit Scott-Harden, aged 59, has farmed 300 acres on a tenancy most of his working life. With his income around £45,000 annually – 60% met by subsidy from the EU’s common agricultural policy – he’ll be lucky to break even this year.
Most farmers are now in their mid to late 60s. The industry is rapidly contracting. Farmers’ sons often leave the land. The result: empty properties. As upland farmers, and the few remaining agricultural workers struggle to make ends meet, wealthy incomers splash out hundreds of thousands for small cottages – and, sometimes, close to £1m for larger properties. Over two years ago a two-bed cottage in the hamlet next to the Scott-Harden farm went for £280,000 to an investor. “Terrifying price,” he says. “And it would be worth much more now.”
There’s usually plenty of space to build in these areas – the main obstacles are NIMBY attitudes, an over-protective planning system and inadequate funding for new social housing in rural districts.
Lord [Ewen] Cameron, a cross-bencher in the Lords and former chairman of the government’s Countryside Agency, can see what is happening from his farm in south Somerset. He is alarmed by the rigidity of a planning system blocking affordable housing initiatives. This has led to “serious demographic mismatch in the countryside”. Why, he wonders, do the authorities approve plans to convert buildings into holiday cottages, yet refuse plans for low-cost homes? He would like to see redundant farm buildings re-classified as “brownfield land” so that they can benefit from urban-style grants and incentives. “Why can’t we build, say, 50% for straight purchase and the rest for renting? That would benefit people all round.”
But, as things stand, Mark Shucksmith, a professor at Newcastle upon Tyne University, a government adviser and expert on rural housing and planning, says the countryside is becoming too skewed in favour of one class. “While people have a clear aspiration to live in the countryside, it is becoming much more exclusive,” he laments. “You have to ask that if only people with higher incomes can afford the move, how this chimes with the [government's] agenda of choice that is rooted in the context of social justice.”
As I said, NIMBYism is a big reason for resistance to new housing developments in rural areas, but it’s hard to disentangle pure selfishness from the quite justified perception of much new housing supply as ugly, sprawling and car-centric. This takes us back to the vexed questions of design quality and planning and funding new public transport, which I hope to look at in more detail in the near future.
Superstar cities July 19, 2006
Posted by Brickonomist in America, Housing economics, Housing inequality, Housing markets, NIMBYs, Planning.add a comment
According to Joseph Gyourko, Christopher Mayer and Todd Sinai, ‘Superstar Cities’ arise when high income households are sorted (or sort themselves) into areas that are (a) desirable, (b) unique and (c) feature low rates of housing construction. Their very restrictiveness makes them desirable, and perhaps their desirability makes them more restrictive. A similar dynamic certainly appears to be happening in some parts of the UK, but will it ever go so far as to make London, for example, the exclusive domain of the rich?
Here’s the abstract from NBER (the full paper is here):
Differences in house price and income growth rates between 1950 and 2000 across metropolitan areas have led to an ever-widening gap in housing values and incomes between the typical and highest-priced locations. We show that the growing spatial skewness in house prices and incomes are related and can be explained, at least in part, by inelastic supply of land in some attractive locations combined with an increasing number of high-income households nationally. Scarce land leads to a bidding-up of land prices and a sorting of high-income families relatively more into those desirable, unique, low housing construction markets, which we label “superstar cities.” Continued growth in the number of high-income families in the U.S. provides support for ever-larger differences in house prices across inelastically supplied locations and income-based spatial sorting. Our empirical work confirms a number of equilibrium relationships implied by the superstar cities framework and shows that it occurs both at the metropolitan area level and at the sub-MSA level, controlling for MSA characteristics.
Public attitudes to housing development July 13, 2006
Posted by Brickonomist in Housebuilding, NIMBYs, Planning.add a comment
In her interim report into the planning system, published last week, Kate Barker included the following table.
It’s interesting data, but importantly it’s also a bit incomplete. The figures here give the impression that people are much more opposed to social rented than to private housing (net support of -10 versus +28), but if you go to the original data (Q15 here) you can see that it is really flats that people are opposed to, with private flats getting the same net opposition as social rented ones. It’s not immediately obvious why this should be, but there are plausible possibilities – is it because flats tend to be more high-density, or because they’re often poorly designed in this country, or because they’re associated with unsociable or anti-social inhabitents, or because they mean more households per hectare and therefore more perceived strain on local services and amenities?
There are a few other interesting findings from that survey (called the ‘Saint Index’), such as high public support for getting more money or in-kind benefits out of developers through planning obligations and very strong support for case-by-case assessment of those obligations instead of using the fixed tariff approach apparently favoured by the government.
Deluded of Tunbridge Wells May 29, 2006
Posted by Brickonomist in Environment, Factoids, Homelessness, Media, NIMBYs, Party politics, Planning.2 comments
Greg Clark, Conservative MP for Tunbridge Wells, has a shocking tale to relate (via obliging Times journalist Rosemary Bennett):
Up to 20,000 new homes each year that ministers claim are going up on brownfield sites are actually being built in back gardens, figures show.
That “up to”, friend to alarmists everywhere, sets alarm bells ringing, as does the implication that unsuspecting homeowners are waking up to find that sneaky developers have dumped a block of flats on their geraniums. So let’s do what Rosemary Bennett didn’t and give this factoid more than a moment’s reflection.
Her article goes on:
“Garden grabbing” now accounts for 15 per cent of all new housing as family homes in towns and suburbs are pulled down by developers and replaced with flats.
The Conservatives, who obtained the figures from the Department for Communities and Local Government, said that the public was being “deceived”.
Greg Clark, Tory MP for Tunbridge Wells, said: “Most people assume that when the Government talks about building on brownfield sites it means ex-industrial land, like disused factories and railway sidings. They have no idea that much of it is actually beautiful, green, environmentally important gardens.”
That first line really is a peach. What Clark and Bennett call “Garden grabbing” actually covers any and all construction of new dwellings on previously residential land – including the land occupied not by gardens but by the buildings themselves. So if, for example, someone pulled down a block of flats without gardens and replaced them with semi-detached homes with gardens, Clark would call that “garden grabbing”. The logical extension of the argument is for all current residential land to be frozen in its current state of development for perpetuity or for it to be declared undevelopable greenfield as soon as the current dwellings are demolished. That would naturally create far more pressure for greenbelt land to be developed, but I’m sure Clark doesn’t actually want that.
The article implies that “garden grabbing” is a new or growing phenomenon, since it “now accounts for 15 per cent of all new housing” and Bennett cherry-picks 1997 as a base year since the figure then was only 11 per cent. What she mysteriously omits to say is that back in 1986 (under the Conservative government), fully 26 per cent of all new housing was built on previously residential land, and that this “garden grabbing” accounted for half of all brownfield development. This was revealed by Yvette Cooper in her answer to Clark’s parliamentary question on the matter, but he naturally chose to ignore the far more serious offences of his party colleagues, and Bennett naturally chose not to bother herself fact-checking the figures he spoonfed her.
NIMBYism resurgent May 14, 2006
Posted by Brickonomist in Housing economics, NIMBYs, Party politics, Planning.add a comment
The NIMBY News Daily Telegraph reacted with predictable horror to Ruth Kelly’s determination to increase housing supply even in middle-class areas. This is anathema to the Telegraph and its readership, who seem to agree that more housing should be built somewhere, just not in their ‘local communities’. Instead, it should be built somewhere comfortably distant so as not to affect the ever-rising value of their property.
It is notable that nowhere in the story is there any acknowledgement by the Tories or their journalistic mouthpiece of the huge unmet need for social housing. Instead, the shadow local government minister is more concerned opposing densification and Labour’s (non-existent) “plans to bulldoze Britain’s back gardens”. Maybe this indicates the future path of Conservative housing policy – paying lip-service to the aspiration to increase housing supply while objecting to any practical means of achieving it, and insisting on the right of local communities to block housing development (but especially housing for those on low incomes) in their areas.
Since it was precisely this NIMBYism that created the current concentrations of social housing in inner-city areas and all its attendant problems, and since its other main consequence is to boost house prices in the non-developable areas, it seems to me there is a case for making NIMBYs pay for the priveleges they enjoy at significant cost to others. I don’t mean “make them pay” as in kick over their garden gnomes and key their cars – I mean councils that don’t build their fair share of the affordable housing needed in their region should make a financial contribution to the councils that build more than their fair share, and that this charge be recovered from homeowners through the council tax. I hope to come come back to this rather appealing notion later.
“Concreting over the countryside” March 16, 2006
Posted by Brickonomist in Environment, NIMBYs, Party politics, Planning.add a comment
From a news story in yesterday’s The Daily Telegraph:
Five million new homes will be needed in England over the next 20 years, 1.5 million of them because of record levels of immigration, according to Government figures published yesterday.
From the accompanying editorial:
The basis of this claim is questionable.
Indeed it is. From the government press release announcing the new figures:
The household projections are not an assessment of housing need.
The basis of the claim in the Telegraph is questionable mostly because the Telegraph has invented it. The government figures released are projections of future household growth if current demographic trends continue. They are unconstrained by the availability of housing.
But as both the government and the Telegraph are well aware, housing is extremely expensive at the moment, and likely to remain so for some time. So whereas one person households account for 150,000 of the 209,000 projected annual household growth, in reality many of these single people will not form households of their own, but will stay at home or share with other single people. Alternatively, they’ll all go live in tiny flats in London, sparing the Telegraph’s beloved South East from the depradations of Mr Prescott’s bulldozers.
But even if that doesn’t happen and every single new household requires a new home, every single one of which must be built on new land – how much land would be used up? Handily, Charles Clover of the Telegraph has the calculation to hand:
If translated into new homes built, this would mean the loss of more than 368 square miles of countryside … in 20 years. That is a rate of urbanisation of 16 square miles a year.
The total area of England is over 50,000 square miles. I would have thought that a government that allegedly wants to ‘concrete over the countryside‘ can do better than less than 1% of the land area in 20 years.
