Tuesday, December 16, 2014

Creating a new step onto the property ladder to buy votes?

Apologies for the length of this blog but it includes a response to a Government consultation that readers are welcome to copy, critique or amend. Replies by 6 February 2015 to:



Stepping onto the property ladder
Enabling more low cost, high quality Starter Homes for first time buyers

Consultation Response

I have worked as a professional planner for the last 40 years in the private, public and voluntary sectors. I have also taught both planning and housing at Oxford University Department of Continuing Education  and been a member of a parish council engaged in the preparation of a neighbourhood development plan.


1.    The following response is based on the premise that Government has failed to deal with the fundamental and systemic problem with housing supply that is the cost of land for housing. By feeding the demand side, Government has effectively passed public money into the pockets of landowners. As often as Government repeats the phrase ‘hardworking’ to describe the intended beneficiaries of housing policy, it should include ‘undeserving’ to describe the owners of land on which planning permission is granted.

2.    When, in 1992,  the High Court found there to be a material difference between an affordable home and one that was sold in the open market, this would have related to the building itself, and not to some unpredictable and often politically inspired public subsidy unrelated to planning controls.  A genuinely affordable home should not be one that is only made affordable through Help to Buy, Starter Home exception, Funding for Lending, grant to Registered Providers or Housing Benefit. These subsidies have served to raise the cost of building land and the price (and rent) of housing.  If the Government address the question of land prices, the only complaints from house-builders, who find themselves squeezed between the price paid for land and reasonable demands for infrastructure, would be from those holding land bought at inflated prices. Notwithstanding the perverse effect of raising land prices and the cost of housing, if asked, the Courts could find that in the exercise of planning control ‘affordable housing’ should not include pubic subsidy (on the demand side).

3.    There is a more difficult question about home ownership. It seems unlikely that much more than two thirds of the population will ever be in the position to own their own home.  Just as Germany has been responsible in this country for providing the best railways, water supply, power supply and grocers, it also has the best models for housing in the 21st century (especially co-housing, group self-build, infrastructure provision and energy efficiency).  This very successful country prospers despite a substantially lower level of owner-occupancy.  In fact there is a growing need to encourage mobility (that would come from a larger rental sector) to effect a  better balance between the size of households and houses.  The 80% level of under-occupation is unsustainable and partly responsible for the assumed requirement to build 250,000 new units a year.

4.    At para 2 there is a claim that the reform to stamp duty will reduce the price of houses, when the evidence since the Autumn Statement shows that this change to the demand side has already raised the price of houses.

5.    The proposal also flies in the face of the findings of the All Part Parliamentary Group on Housing and Care for Older People, The affordability of retirement housing 2014, that takes a systemic view of housing and explains why the most effective way to deal with problems of housing supply and affordability is not with starter homes, but homes for right- or down-sizers. This would create mobility in the market that would release smaller homes for first time buyers.

6.    It is counter-productive to relieve more sites and housing from supporting affordable housing and infrastructure costs.  Subsidising house-buying to penalise the social and affordable renting sector has no net benefit. The failure to contribute to essential infrastructure will produce housing without the necessary improvements to public services; schools, public transport and recreation.  The Government has already introduced this form of free-riding for self-building and small site development at the same time as service providers are facing severe cutbacks.

7.    There will not be a ready supply of these discrete brownfield sites, and those that are not currently being developed are likely to have substantial clean-up costs. Pointing to under-used sites is an invitation to businesses to scale back operations and employment (just as the right to change from B1 to C3 has reduced local job opportunities). A curious aspect of the proposal is the premise that brownfield sites could be treated like ‘exception sites’ that would not normally receive permission. In fact the kind of site being described is that which would already be looked at favourably and should not have the land cost discounted in the way of rural exception sites. In fact the inclination of the Secretary of State to grant permission on greenfield sites outside the existing built up area of towns and villages has severely limited the availability of rural ‘exception sites’ that were previously seen as having little or no hope value.

8.    The fact that an urban  site is not identified for housing usually means that it does not need to be identified as it would be approved on its merits (eg within a built up area and previously developed). These windfall sites are not ‘additional’, but allowed for in the development plan land supply figures.  The starter homes create demands that will not be covered by other housing on allocated sites which, by law, can only be expected to meet their own proportional needs.

9.    Government should stop making piecemeal changes to a complex planning and housing system.  The proposed changes will have any number of unintended consequences, perverse incentives and unfairness, without actually providing the good quality homes, sustainable communities and urban environments that are desperately needed.

10. Government should take into account the fact that in the era of neighbourhood plans, any changes to the planning system that should be embedded in democratically prepared development plans, has to be addressed by parish councils with very limited resources and expertise. 


Q1: Do you agree in principle with the idea of a new national Starter Homes exception site planning policy to deliver more new low cost homes for first time buyers?

No, the idea is fundamentally flawed.  This proposal is more tinkering and not based on a systemic view. By ignoring  the main cause of house price inflation,  which is the cost of building land,  would result in this public subsidy (primarily and ironically  from affordable housing provision through s106 and contributions  to essential local services through CIL) being an added to those already being passed on to landowners (eg Help to Buy, Funding for Lending, Housing Benefit and grants to Registered Providers).

Q2: Do you agree that the Starter Homes exception site policy should focus solely on commercial and industrial brownfield land which has not been identified for housing?

This proposal exposes the lack of understanding of how the planning system actually works.  The kind of site being described is not ‘exceptional’ in the sense of a rural site which would be unlikely to receive permission,  but would be  windfall sites that are allowed in accordance with criteria based policies – and allowed for in housing supply figures.   Support for  the redevelopment of commercial and brownfield  land  will reduce the opportunities for local employment (as is occurring  through the relaxation of the GPDO)

Q3: Do you agree that the types of land most suitable for Starter Homes will be under-utilised or non-viable sites currently (or formerly) in commercial or industrial use?

This requirement would introduce the perverse incentive of businesses to scale down their operations and a need (impossibility) to define ‘under-utilisation’ and ‘viability’ in local and neighbourhood plans.

Q4: Do you consider it necessary to avoid Starter Homes developments in isolated locations, or where there would be conflicts with key protections in the National Planning Policy Framework?

No housing should be built in isolated and unsustainable locations.  The need to build in existing settlements is not for landscape protection reasons but primarily to enable social inclusion.

Q5: Do you agree that the Starter Homes exception site policy should allow at the planning authority’s discretion a small proportion of market homes to be included when they are necessary for the financial viability of the Starter Homes site?

This is another over complicated mechanism for which the local planning authority is completely unprepared.  Affordability and viability should start with the valuation of development land at existing use value with a small but attractive uplift (see Lyons Review)

Q6: Do you agree starter homes secured through the Starter Homes exception site policy should only be offered for sale or occupation to young first time buyers?

Age is a ‘category error’ at both ends of life.  It hides the wide variety of personal circumstances.  Limiting a subsidy to under-forties and first time buyers misses those hardworking people in broken homes (sometimes with young children)  who are in housing need. There are couples of very different ages who may or may not be actually intending to live together.  All generations should be living together and not receive inducements to live apart.
Q7: Do you think there are sufficient existing mechanisms in place to police this policy?

No.  Planning departments will be subject to severe cutbacks (one of the vulnerable services not ring fenced) and should not be given additional responsibilities.  The best way of delivering houses would be to stop the  tinkering which limits the effectiveness of local government, and central government should deal at national level with ‘affordability’ by addressing the cost of development land.

Q8: What is the most appropriate length for a restriction on the sale of a starter home at open market value? How should the sliding scale be set?

If there is a sliding scale there is no reason to worry about the length of the taper.  However, the principle of Starter Homes introduces the need for strict definitions (individual or shared responsibility of singles, couples or triples) which will then intrude on the freedom of people to choose whether or not  to continue to live together.

Q9: Do you agree that guidance should make clear it is inappropriate for Starter Homes exception site projects to be subject to section 106 contributions for affordable housing and tariffs?

No.  There should be no further exemptions from s106 (including affordable housing)  that, by definition and case  law, can only be  required  if necessary and fairly related to the development and/or in accordance with the development plan.  Exemptions imply a public subsidy being paid to the landowners and freeloading by the Starter Home development at the expense of the private and social/affordable rental sector.

Q10: Do you agree that Starter Homes exception site projects should be exempt from the payment of the Community Infrastructure Levy?

No.  There should be no further exemptions from CIL which has been methodically worked out and examined  on what is required to pay for local infrastructure and must be justified as  necessary and fairly related to the development and/or in accordance with the development plan.  Exemptions imply a public subsidy being paid to the landowners and freeloading by the Starter Home development at the expense of other housing providers and occupiers. The assumption that occupiers can simply use services provided by other new development is wrong and legally flawed.  Other new development would only have provided that which was necessary for its own needs (eg school places, bus services, Citizen Advice provision and recreational facilities). Exemptions would deprive parish councils of the funds necessary to enhance facilities to make locations more sustainable.

Q11: Do you have any views on how this register should work and the information it should contain?

LPAs should usefully be keeping registers for self-builders, group self-builders and potential co-housers. Another register with individuals and possibly related people of different and increasing ages and possibly local needs implies careful judgements (possibly by panels or committee), appeal procedures and possibly judicial review of mistakes or apparently unreasonable decisions. All this at the time of severe cutbacks?

Q12: What kind of vanguard programme would be most helpful to support the roll out of Starter Homes?

The Starter Home exception is misconceived as it is a replacement for the failure to tackle land prices as the fundamental key to affordability. In the case of necessary systemic changes there should no need for  ‘vanguards’,  which is a mechanism suited for changes where Government anticipates problems.  There are enough difficulties with the proposals to know that problems will arise without these being uncovered by vanguards or trial and error.  For example vanguards would have to be those authorities in the process of review of their local plans so that these could include the many definitions on which the proposals are predicated; what would comprise an exception site which would or would not be a normally occurring windfall, decision-making and appeal procedure and  fair but flexible eligibility criteria.  Introducing these novel and potentially contentious policies would delay the approval of new and replacement development plans and their implementation.

The proposal of a Design Advisory Panels (there is no question dedicated to this?) should be abandoned. There is a very carefully constructed Building for Life scheme operating with the support of LPAs and housebuilders.  There are design guides produced by LPAs and (unfortunately) more design guidance in neighbourhood plans. The last thing that is required is more design guidance especially from higher levels.