The best business advice, opinion, news and expertise in Greater Manchester and further afield.

Friday, 10 February 2017

Chamber Blog: Fixing our broken housing market?

By Christian Spence - Head of Research & Policy at Greater Manchester Chamber of Commerce

The publication on Tuesday 7 February 2017 of the government's housing white paper Fixing our broken housing market is a welcome addition to the policy landscape if only for the tacit acknowledgement that the failure to deliver an adequate supply of housing in the UK is a long-term problem that requires significant remedial action to fix. However, it is not clear that this publication offers any new answers to this critical issue.

The paper correctly states that the fundamental problem is one of under-supply, and that the lack of suitable land and sufficient planning permissions lie at the heart of the issue. Local authority plans are often incomplete or not up-to-date which slows down the planning application process, a problem that has been exacerbated over the recent past by significant cuts to local authority planning departments caused by fiscal constraints imposed by central government. Coupled with an old-fashioned and out-dated approach to Green Belt use where the arbitrary caps on city growth established in the 1940s are considered suitable for today and a lack of acceptance that brownfield land can only provide a limited amount of development and that much of it requires remediation of a scale that makes development commercially nonviable, the system overall seems incapable of delivering what is needed and some of the changes proposed fail to take into account the challenges of developers.

Introducing timescales within which development must be completed after planning permission is approved misunderstands the complexities and financial risks that developers face in bringing forward proposals, particularly of a large-scale. Government and planning authorities must work more closely together to ensure they understand each other's position and that the length of time required to move proposals from conception to delivery, often slowed down by the planning system itself, exposes builders to ever-greater risks. Combined with other issues such as difficulty accessing capital and skills and increasingly complex regulations and requirements, together these push up the development costs requiring ever further intervention to provide affordable homes.

Planning, at a local and city-regional level must develop beyond simple land-use allocation and seek to release greater areas of land for development alongside the development of all other infrastructure, whether physical, digital or social, required to support sustainable communities of the future. Our response to the Greater Manchester Spatial Framework consultation highlights these issues in detail. Identification of land for housing development, seemingly chosen because it is politically easier to justify rather than ensuring that the road, public transport, digital, school and health facilities are in place, or at least the needs have been identified and planned, is not in itself sufficient.

For too long this country has been held back by artificially introduced barriers to development. Government and local authorities should approach this problem not through further interventions, but by removing the barriers that exist. It is not clear that this white paper, or the GM Spatial Framework, as they stand, answer these questions.

You can read the GMCC consultation response to GMSF by clicking here.