Housing not Planning, Regeneration not Sprawl and Riots

I’ve spent more time than is healthy this week with my colleagues in the wider residential development industry. It was a week of insight and prejudice. The insight came from a small number of people (the prejudice was almost universal).

Andrew Carter of the Centre for Cities highlighted the dilemma that many of the places where people want to live for economic and quality of life reasons are the Green Belts in places like north Cheshire and around Guildford, Reading and Cambridge. They don’t want to live, or at least are not prepared to pay as much to live, in north Manchester orMansfield.

There are two issues here. One is that in some of these cases the pressure is primarily economic, jobs are growing in the sub regional economy and this is increasing the demand for homes. The other is that in other cases, people with higher disposable incomes are simply choosing to live in the most attractive local places rather than other places within the same travel to work area.

The market response in all these cases would be to develop homes in the Green Belt but this will inevitably bring environmental damage as well as lead to the abandonment of places that are seen as less attractive places to live.

There were a couple of sensible things said about this. The first is that we can’t pickle our urban areas in aspic at a particular moment in time. They must evolve to meet the changing needs of the times. The second is that the resultant abandonment of places brings substantial social costs and their successful regeneration can reduce these costs as well as reducing the environmental damage from urban sprawl.

This was one of the basic arguments of the Urban Task Force which was eloquently restated by Martin Crookston in the Guardian this week.

It was also one of the arguments put forward by Iain Duncan Smith this week when he talked about us having ‘ghettoised’ our urban areas. And the statistical analysis by Alec Singleton draws a pretty straight line between the riots and deprived areas.

Building on green fields and the riots are, if not two sides of the same coin, at least connected by a complex network of linkages.

The arguments around the planning system and the National Planning Policy Framework are essentially three. First how do we make the planning system work better (more quickly and cheaply), second how do we get these difficult decisions right (or as right as we can make them) and thirdly, who gets to make the decisions.

Inevitably there is no one size fits all answer to these arguments but by looking at them separately we might be able to get a bit more sense into the argument.

And just one point on this. I suspect that one of the aspects that is most inflaming at present is the bully boy threat that communities with no neighbourhood plans will have to accept whatever developers want to throw at them. A threat it is fair to say that the author of the planning policy paper on which the Localism Bill is (now more loosely) based, made some time ago. Inevitably in a process of change it is not enough to plan the desired end state. We must also plan how we get from here to there and in this case it might involve a reasonable period and sufficient resources given to neighbourhoods and local authorities to allow them to produce workable plans.

Eric Pickles gave greedy property developers a robust dressing down this week at RESI2011 telling them they had to learn to deliver well designed places that local communities wanted and valued. This is the core idea behind Localism in planning but changing the culture of an industry is a massive task. I was though, hugely heartened to hear leaders in the industry at a Housing Forum chief executives’ lunch decrying the greed that had led to the industry’s current difficulties.

The planning name calling, which Eric Pickles nicely described as having moved from ‘a NIMBY’s charter’ to ‘concreting over the countryside’ without a word being changed, has tended to revolve around the idea that the planning system is in some way preventing needed new houses being built. This is true in some places (sometimes for good reason and sometimes not) and not true in most others.

Some of the bigger barriers to housing delivery are within the housing development industry. In particular around money but also about the quality of the product and the way it is made available to customers.

David Cowans of Places for People is insightful in this area. His organisation makes housing available to customers on 10 different types of tenure to best suit their needs but the average customer has very limited understanding of these options with most thinking that their alternatives are either to buy or to rent on a six or twelve month lease.

There is the potential for a fundamental market shift here and if the current constraints on high loan to value mortgages (due to banking regulation and wholesale bank funding issues) and debt funding for housing development result in a long term stagnation in the owner occupier market and therefore in house prices it is possible that innovators like David Cowans will be able to demonstrate a new model of housing provision that catches on.

This model might be high quality new places with their own neighbourhood managers and the ability to pay for housing in a number of different ways with different sharing of risk and reward between funder and occupier. It might also involve the decoupling of a home from an investment through the creation of a market of long term house price linked derivatives underpinned by these large portfolios that allow people to invest in the housing market without buying a house.

A parallel innovation is Community Land Trusts which have been much in the press this week. These work in a similar way but the difference is that they are owned and managed by the local community rather than a major company and they deliver permanent affordability.

There is another dilemma here because it is the big organisations that have the resources, people and money, to try these things but it is usually the smaller organisations that are better managers being closer to their customers and providing more responsive customer service. Both models are worthy of trial and in the long run we need to have a housing market that provides understandable choices to consumers. In both cases Government has it in its power to deliver these trials, and the new housing they will produce, quickly, within months rather than years.

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