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Kent Housing Group3rd February 2011
The Implications of the
Spending Review and
Emerging Policy for
Housing
Chris CobboldDirector of Housing Practice [email protected]
The Policy Deluge
The Abolition of the RSSs
New Homes Bonus
Local Standards Framework
The Spending Review
Local Growth
The Policy Deluge
Local Decisions – Social Housing
LA Financial Settlement
Localism Bill
Self financing for Council Housing
...etc
...etc
The RSS Boomerang
July – the RSSs revoked
160,000 homes ditched
300,000 by end of 2011
Revocation ‘unlawful’
Localism Bill published
Inter-regnum
Planning for Housing without the RSS
Local Plans have to be ‘sound’
Sub-Regional Market analysis
Key Elements of Analysis Economic Drivers Demographic Drivers Housing Need Land Supply – Capacity
Where are you in the LDF process?
The New Homes Bonus
Average Council Tax
Band D = c£1,440
Paid a year in arrears...
...for 6 years
Plus £350 for each affordable home
New homes and empties
The New Homes Bonus – what is it worth?
250 homes pa
£1,400 pa
£350k in 2012-13
Grows by £350k pa
By 2017-18 receive £2.1 m
Issues
Managing community expectation
Expenditure outside CSR Period
Impact of a change of government?
Borrow against anticipated income?
Potential to forward fund infrastructure
How much additionality?
The Local Standards Framework
Building regulations and standards
Simplification and standardisation
A menu approach
Housebuilders and LAs to work together
An agreed Local Standards Framework
National Planning Policy Framework 2012
The Spending Review – the NAHP
CSR 2008-11 CSR 2011-14
No. of Years 3 4
Funding in £bn 9.0 4.5
Funding pa in £bn 3.0 1.125
Dwellings Target 153,176 up to 150,000
Public cost per dwelling
£59,000 £30,000
Existing commitments on NAHP - £2.4 bn
Affordable Rent from 2011
Up to 80% of market rents
Shorter term tenancies
New development and empties
Re-lets can be changed to AR
New ‘Flexible Tenancy’
The Affordable Rent Programme
Opportunities and Challenges
Stretches NAHP resource
Enhanced RP borrowing
Impact on scheme viability
Social rent
Impact on HB budget
Different providers
Other Features of the Spending Review
£2 bn for Decent Homes
Reform of the HRA Borrow against rental streams? For repairs, improvements, new building Link to prudential borrowing? New housing on LA land
£100 m for Empty Homes 3000 homes £33k per home
Other Features of the Spending Review
DFGs £720 m Not ring fenced
Preventing Homelessness - £357 m
£200 m for continuation of Mortgage Rescue Scheme
£6.5bn for Supporting People
Local Growth: Realising Every Place’s Potential
Tax Increment Finance Mixed use regeneration
Local Enterprise Partnerships Role in strategic planning ‘Transport, housing and planning’ ‘strategic housing delivery.... ...pooling, aligning funding streams’!
Business Increase Bonus
Business Rate Retention
Reform of Planning
Presumption in favour of sustainable development
Communities ‘centre stage’ in planning
Neighbourhood Plans
Right to Build
Streamlined Local Development Plans
Streamlined National Planning Framework
Regional Growth Fund
£1.4 bn over 4 years
Objectives Stimulate enterprise and private sector jobs Focus on areas over dependent on public sector jobs
Includes infrastructure investment...
... ‘to improve housing supply
Round 1 bids emphasis on jobs
Local Decisions: A fairer future for Social Housing
New tenure for Affordable Rent Fixed period Continuation subject to review
Broader tenancy options for LAs Existing secure tenants unaffected Flexible Tenancy option for LA relets Time limited, minimum 2 years
LAs to prepare Tenancy Strategy
New Tenancy Standard
Local Decisions: A fairer future for Social Housing
Management of waiting lists
Foster mobility of social tenants
House people in the PRS
Regulation of social housing
Reform of the HRA
Self Financing for Council Housing
HRAs to be run as social businesses
Move to self financing by April 2012– step 1 – value the business– step 2 – estimate current housing debt– step 3a – surplus value paid to the government– step 3b – surplus debt paid off by government
Rental growth formula specified
Controls on HRA borrowing
Freedoms to dispose of assets
But 75% of RTB receipts to HMT
To summarise: Affordable Housing
Less money
More flexibility
Greater scope for innovation
New forms of provider
Increased local decision making
Greater diversity of provision
To summarise: Planning
Enhanced uncertainty
Push LDFs forward
Establish new evidence base
Work sub-regionally
Unlikely to deliver more housing
Page 23
Page 25
Mortgage Availability and Cost – significant constraints continue on mortgage lending
Volume of Mortgage ApprovalsAugust 2001 – Aug 2010
Value of Mortgage Approvals August 2001 – Aug2010
Page 26
Current Position: The market remains subdued by historic standards
Index of Sales Volumes 4 Quarter moving average: Prime London defined as Kensington & Chelsea, Westminster and Camden Boroughs
Page 27
Conclusion
Local Authorities and their partners are going to have to work harder still to get the homes their
communities need
The Kent ForumHousing Strategy identifies what needs to be done
Questions and Comments
