PLANNING


sports and recreation ground were lost to development between 2005 and 2009; outdoor recreation land alone represented 3.1 per cent of all development land in 2009. Rather than ‘concreting the countryside’, the planning system is successfully ‘de-greening our cities’ instead. Green Belt Legislation was created in an


era well before the M25 was even a loop in the countryside around London; the land pressures have increased significantly since then. It had, and still has, a tremendous impact on both our urban and our rural environments. However, much has changed since that time. City populations have surged over the past two decades and going forward the population of London is expected to grow by approximately 20 per cent by 2033 (17 per cent across England). This means that huge pressures will continue to be exerted on the house- building industry to increase delivery. It is within this context that the current


discussion on housing provision must be had. The ‘pro’ vs ‘anti’ debate is antiquated and genuinely misses the key social impacts. The Green Belt was created in order to restrict urban sprawl and to prevent the countryside from being consumed by urbanisation. It has been successful, perhaps too successful, as the pressure on our urban envelopes is increasing rapidly due to the demands of a rapidly growing urban population. As a result our urban fabric is being consumed from the inside out and we are failing to provide the sort of decent homes and decent lifestyles that the Green Belt policies were put in place to provide.


Harnessing tHe zeitgeist


To move the debate forward, the social impacts must be better understood. This includes the impact of constrained land supply on the cost of housing provision and ultimately on house prices. Contrary to popular rhetoric, ‘land banking’ by housebuilders and developers is a necessary by-product of tight land supply and uncertain planning outcomes. Just like any other manufacturing process, to maintain any rate of housebuilding requires the raw materials, first and foremost of which is land. Without a reliable supply of development land coming forward, houses will not be built. As Nick Vaughan, Head of Residential


Development and Investment (RDI) at Hamptons International notes, “One of the outcomes of a more stable development land supply would be a lower and less volatile average cost of land suitable for


46 DECEMBER 2011 PROPERTYdrum


best’ price for the land and the desire to place restrictive covenants on what can be developed on the site. In short, Government must accept a discounted land price in order to achieve affordable housing objectives; this is effectively affordable housing grant under a different guise. 2. The provision of ‘Affordable Housing’


We are failing to provide the


decent homes that Green Belt policies were put in place to provide.’


development. This would help to reduce land bank requirements and make development more accessible for smaller players.” More stability in land prices would


fundamentally alter the development equation, improving the viability of constructing and delivering lower cost homes. As we saw in the SixtyK Challenge endorsed by former Deputy Prime Minister John Prescott, it is possible to build quality houses very cheaply. However, when the concept was turned to the market, land costs pushed up the price of these properties by two to three times of the original cost of construction. The challenge of affordable housing


provision is now being exacerbated by the current Government’s fiscal challenges. The Homes and Communities Agency


(HCA) has a vastly restricted budget for affordable housing grant and this places an increased burden of affordable housing provision on the private sector. To achieve this, there are a few options available to Government: 1. Government is already selling off


departmental land holdings (i.e. surplus NHS or MoD property), but there is a conflict between achieving ‘highest and


is in part derived from Section 106 requirements and the lack of grant funding has increased the importance of this funding source. Section 106 is a negotiated cost absorbed by the housebuilder for ensuring provision, but of course creates an offsetting premium to the price of private housing on that development site in order to make the site pay for itself. In reality, the definition of affordable housing in the broadest sense within Section 106 agreements should encompass market-facing, but lower cost properties; exactly the type of starter homes that are desperately required but are very difficult to make viable in the current market. This would also include purpose-built private rented stock. 3. Incentive Schemes: Examples


schemes such as FirstBuy have proven to be successful at attracting demand and therefore stimulating housing supply, but at a significant cost to Government. These schemes are fundamentally unsustainable to support housing supply in the long-term and can only help to paper over the cracks of a system that is just not working. Housing costs are already having a


debilitating impact on the UK economy. A lack of choice limits the flexibility of workers to follow employment opportunities. Further, the cost of provision distorts the type of housing being built and limits the extent to which housebuilders can cater for local market demand. This fundamental debate deserves more


than the partisan-style rhetoric that is too commonly featuring in the media about greenfield development. It is about time that we get real about housing need, as current actions on all sides fall woefully short of what is required to improve housing delivery volumes. This country can ill-afford to make the existing house price pressure any worse, leaving a generation unable to aspire to home ownership and unable to buy a physical stake to call home.


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