Tweaking the affordability criteria in the Government's housing
targets should help deliver more homes in areas with the most
economic potential, as well as in areas with acute affordability
challenges, since they are now more focused on the most
productive travel to work areas, the Resolution Foundation said
today (Thursday) of the Government's response to its planning
reform consultation.
While the Government is right to loosen planning rules in order
to increase housing supply, the Foundation had cautioned that the
pre-consultation national planning policy framework wasn't
focused enough on building homes where they are most likely to
boost growth. The changes announced today should go some way
towards addressing this.
Today's changes, relative to the original plans, should boost
building in productive travel to work areas in the South,
including London and Cambridge. However, they reduce targets in
major cities like Birmingham, Manchester and Sheffield, which are
currently more affordable. Housing targets have been reduced in
eight of the UK's ten largest cities (by travel to work area),
with only London and Slough/Heathrow seeing their targets
increased.
The Foundation notes that Britain's major cities outside London
have middling levels of productivity, but also huge potential for
growth through agglomeration – especially given the UK's
strengths in services industries. They should be more of a
priority in the Government's housebuilding agenda, advises the
Foundation.
And while the Government's housing targets have been pushed in a
more growth-friendly direction, more remains to be done to tackle
Britain's housing affordability crisis.
The Foundation says the Government should use the upcoming
Spending Review to supplement the ambition shown in its planning
reforms with hard cash – in the form of far greater investment in
social housing.
Emily Fry, Senior Economist at the Resolution Foundation,
said:
“The Government has shown welcome ambition on its planning
reforms, and the changes to its housing targets announced today
push those reforms in an even more growth-friendly direction,
with higher targets for London and Cambridge.
“However, we should also focus housebuilding efforts on areas
with huge economic potential, including our major cities across
the Midlands and the North. Building should happen not only where
productivity is highest now, but where it might most plausibly be
raised in the future.
“As well as rising to Britain's growth challenge, the Government
needs to tackle the housing costs crisis. Social housing will
need to play a key role – and the upcoming Spending Review offers
the perfect opportunity to fund a major uplift in affordable
housing.”
