Own your housing numbers Jo Lee (Peter Brett Associates) October 2013

Provide you with the skills required to understand how many homes you need to provide over the plan period demystify the process help you to get the information you need explore the data available enable you to ask the right questions Aim

ensures sufficient land for housing is available of the right type in the right place delivered at the right time to accommodate the supply of market and affordable housing required to meet the needs of present and future generations A local plan which

Making provision for housing is a fundamental part of setting a coherent strategy in a good and sound Local Plan Setting the level of provision: is the responsibility of the local planning authority requires evidence Providing housing

Para 7 - meet needs of present and future Para 14 - positively seek opportunities to meet development needs, sufficient flexibility Para 47 - significantly boost supply, meet full objectively assessed needs, deliver viable sites Para Use a SHMA, meet the need and demand, identify scale and mix Para ‘Assessments should be proportionate’ The NPPF

Usually associated with affordable housing Is best thought of as demand or more accurately the objectively assessed REQUIREMENT Now defined in the practice guidance Those in affordable housing ‘need’ is not same as demand, and include those with nowhere to live, homeless but staying somewhere on short term insecure basis, and those renting on short term basis What is ‘need’?

requirement is not the same as housing supply (Rother, East Hampshire, Ryedale, BANES, Dacorum) should not include policy judgements (Suffolk Coastal) should use national projections as the starting point (Rushcliffe, Ryedale, Dacorum) should consider the whole of the housing market area (Rushcliffe, East Hampshire, Coventry, Hart, Waverley, BANES) should use a transparent methodology and consider all relevant forecasts (Hull, BANES, North Somerset Judgement) absence of provision for an adequate future supply of housing (N W Leicestershire) Inspectors views

Hart Core Strategy – Inspectors letter 26 July 2013 Non compliance with duty to cooperate Significant failures with respect to soundness and requirement to identify objectively assessed need Waverley Core Strategy – Inspectors Preliminary Conclusions 13 June 2013 ‘Requires a more considered assessment of housing need within the context of the housing market area’ Expect the Council to take a positive approach Review of policy constraints and designations Inspectors views continued…

“In order for the Core Strategy to be found sound it must at least set out a policy framework which allows for an adequate supply of housing land over the plan period as a whole and a five year supply of deliverable sites to be identified” Wigan Core Strategy – Inspectors letter 14 March 2013 Inspectors views continued…

NPPF Para 49 – policies are not up to date if there is an identified need and no deliverable 5 year supply. Numerous appeals tested, upheld by Secretary of State which overrule employment protection, settlement boundary, landscape, green space and wedge policies and others. Costs being awarded. - Tarporley Cheshire (APP/P1133/A/12/ ), - Shutterton Combe in Teignbridge Borough Council (APP/P1133/A/12/ ) - Basingstoke and Deane (APP/H1705/A/12/ ) and Cherwell (APP/C3105/A/12/ ) - Ingleby Barwick, Stockton on Tees Borough Council (/APP/H0738/A/13/219538) - Guisborough, Redcar & Cleveland Borough Council (APP/V0728/A/13/ ) Appeal decisions

St Albans Hunston Judgement issued on 5 September 2013 CO/4686/2013 Wrong to base assessment of need on a constrained and revoked figure from RS Confirmed that the Green Belt Policy is not an outright prohibition on development in the Green Belt. Stratford upon Avon Shottery Judgement issued on 18 July 2013 (CO/12539/2012) “The Aarhus Convention does not require a blanket stop to be put on development that, potentially, might adversely impact on future policy; nor can it be used as a weapon for those who wish to inhibit development, in the hope that planning policy will change in the future to one which is more in line with their wishes.” High Court Challenges

Be based on fact and unbiased evidence To be done at relevant functional area Assists with defining housing market area and identifying sources Must start from ONS / CLG housing projections Must not make local adjustments about migration unless they have the agreement of other LPAs within their housing market area Only test realistic scenarios – not consider purely hypothetical future scenarios Supply constraints must not contaminate the assessment of housing need An allowance should be made to reflect past under delivery Increased emphasis given to market signals, land values, prices, affordability Encourages standard methodology to aid transparency Comprehensive assessment only required every 5 years, but regular local monitoring! Considerable detail on how to calculate affordable housing element National Planning Practice Guidance

What is your housing market area? NPPG: The relevant functional area – market based, migration flows and contextual How does your authority area relate to the housing market area (HMA)? What relationship do you already have with neighbouring authorities across the HMA? What information is available for that area? Going alone – communication is key The Housing Market Area

Practice Guidance: Market based - house prices and rates of change Household migration and search patterns Contextual – travel to work and catchment areas Defining the Housing Market Area

For a housing market area provide evidence of the level, type, size and tenure of housing undertake further detailed analysis as required such as detailed affordable housing needs assessment, analysis of affordability and consideration of sectors of population such as older people The SHMA

involve others by taking a corporate approach working across the Council, with key partners, stakeholders and registered providers Information on homelessness, those in temporary accommodation, overcrowded and concealed households and on waiting list in bands A-D Will provide a basis for informing strategies across the Council continuous monitoring The SHMA continued…

A proportionate response – no single right answer out there waiting to be discovered Accept that uncertainty is inherent and judgement will be necessary “it is better to be broadly right than wrong in very fine detail” (How Many Homes: A Companion Guide March 2013) NPPG – ‘no one methodological approach’ Ensure evidence based and justifiable What information have you got? What more do you need? Do you have the in house skills and time? Starting out

Set out the questions you want answers to Work closely with them to understand the best methodology, the appropriate data sources and its limitations and relevant assumptions to be applied. Explore relevant scenarios appropriate to your area, not necessarily importing standard approaches Ensure you understand exactly how the calculations work and what assumptions are included Commissioning work?

It requires agreement of the plan period use of up to date information – baseline data and projections coverage of the functional area - understanding the relationship between the local authority area and housing market area to be considered Establishing an objectively assessed requirement

Through a comprehensive understanding of what is required to address demographic change and the implications of achievable economic potential in the area to understanding how your population will change over time. Establishing an objectively assessed requirement

The past allows us to understand the present How did our previous policies shape the population? Is this what we wanted and needed? What would happen if past trends continue ? Projections - are based on the information from the previous five years. Demographic issues

Does the projected population profile fit your vision and aspirations? For example - want economic growth but insufficient working age population How can past trends be changed– what policy mechanisms are there to do this? what would the mix of housing be? Demographic issues continued …

Need to understand the drivers of population change. Explore existing balance and future predictions of births and deaths and migration ONS, DCLG data - Mid year estimates What Homes Where Tool kit Understanding past trends

How the population of the area has changed since 1991 What has caused the growth in population and what the main drivers of population change have been How the age profile has changed How the mix of household types – single person households, couples, families etc. – has changed Which groups are likely to grow and which are likely to get smaller in the future What Homes Where?

is people arriving from elsewhere in the UK (internal) and abroad and people leaving to go to other parts of the UK and abroad (international) sensitive and volatile can be varied to test different assumptions not influenced by policy choices - no prospect of zero migration so is a wholly inappropriate scenario Migration

any variation of assumptions – need to be justified and best used as sensitivity tests ‘forecasts only a good as the assumptions made’ (Cambridge Centre for Housing and Planning Research March 2013) An example might include migration rates explained by local knowledge - ie the drop in population in 2010 was as a direct result of the closure of a factory So legitimate to explore what longer term rates of migration demonstrate Varying assumptions

Most up to date information source Comparisons 2001 and 2011 Already have: Age, sex and household information Key and quick statistics Due July 2013 onwards: Detailed themed and local characteristics Specialist data (flows alternative population base) Using Census Data

Official ONS and DCLG statistics What homes where toolkit Census information Mid year estimates Population projections latest interim 2011 based to 2021 – published 28 September 2012 Household projections latest interim 2011 based to published 9 April 2013 Demographic sources of information

Understanding data Using a laptop and the internet work through the questions on the handout Workshop 1

Own your housing numbers Part 2 – setting your requirement Datewww.pas.gov.uk

Requirement should be met Requirement is NOT the same as the provision to be made through a target within the Local Plan. The provision could be different from the objectively assessed requirement: Use of options Any difference has to be justified What to do with the unmet element? Requirement and provision

A robust approach Start with up to date demographics Sensitivity test for local circumstances Benchmark against economic objectives and projections Use realistic scenarios Separate out the supply side

establish how the population of area has developed understand the components of change (births, deaths migration) set out in the various data sources compare with the recent projections identify what the latest household projections show What is the most appropriate information to use to provide robust demographic data to cover the whole plan period? Demographic led approach

a key assumption is perhaps not falling as fast as previously predicted, but this may be self fulfilling because of the restricted access to suitable housing is very sensitive to small changes Average household size

difference it makes to a population of 150,000 Average household size Average Household Size Population150,000 Households68,18170,09372,11573,170 Additional dwellings +1,912+3,934+4,989

A key area of challenge – if you can’t justify them don’t make them Be transparent about the assumptions used What projections are most appropriate? What trends are the scenarios using? If the information is set out within a model - how does it work? Ensure consistency of dates, baseline information and data sources Assumptions

Integration between assessment of and strategies for housing and employment (as required by NPPF). But not all demand for homes is created from new jobs - considerable demand coming from existing population. key issue in the North Somerset high court challenge Jobs based calculation are useful to: cross check and corroborate demographic information ensure housing doesn’t constrain growth influence distribution of jobs and homes Jobs and Homes

Understanding the implications of sectorally based achievable economic potential in terms of future job levels: testing up to date employment projections using economic activity rates to convert job growth into the level of population needed to provide the employees required to fill the jobs translating the total population into households according to predicted household size An employment led approach

Relationship between authority areas and settlements and implications of current commuting levels Travel to work data census release due late 2013 and comparison with 2001 data What level of self containment do your settlement have? Is it possible to reduce out commuting? Taking account of commuting

Most recent household projections (interim to 2021) Previous household projections – ie 2008 based household and 2010 based population Long term growth trends – using 10 years worth of components of change information Sensitivity testing in terms of reduced migration levels Benchmarking against job growth targets Identification of affordable need Developing Scenarios

The requirement does not equal the supply – it is a separate stage which has been done through objective assessment, taking account of all relevant factors Understand the existing stock – what do you have? how is it occupied? SHLAA is a separate assessment of suitable sites sets out what is available, suitable, deliverable Used for five year land supply Must be critically assessed to determine realistic potential Relationship with supply issues

Ensure any windfall rate is based on past data, cleaned of any sources appearing elsewhere in the supply contains no double counting of sites with permission in the first few years Common mistakes: assuming development rates ie per site/ sales outlet per annum that are higher than development industry agree not factoring in long enough lead in times between sites getting permission and delivering houses SHLAA

Understand market signals Understanding completions, as far back as possible by year to assess long term averages – indication of what was possibly under previous policies and in different /better market conditions Use Developer workshops to explore viability issues: understand market areas land and house prices likely build rates market for different types of houses Market capacity and deliverability

Review of: Landscape designations Employment land Settlement boundaries Green belt – Hunston judgement Using Sustainability Appraisal as a key tool to understand the implications of various options Reviewing designations and policies

Can the requirement be met? Should the level of provision be different ? inability to deliver what is required inability to fund infrastructure needed to make the place work Factor in policy issues: economic growth, reduction in commuting, high affordable need, green belt, environmental capacity Any difference must be FULLY JUSTIFIED Translating the requirement and supply into a provision target

Effectively a distribution issue To adjacent authorities within the HMA, but what if they: cannot meet their own need are equally constrained Duty to co-operate Is a legal test and soundness test Ensures working together at the functional area to deliver effective spatial plans Examples – Where does the unmet requirement go?

Can only be identified once the provision in the plan is set. It is the provision (10,000) divided by the years covered by the plan (20) and multiplied by five, ie 10,000 / 20 X 5 = 2500 To this is added : Flexibility allowance of between 5 – 20% Level above 5% depends on whether there has been a record of persistent under delivery (measured by analysis of completions against previous requirement) Data from last 10 years and evidenced from AMR Five year supply

“underprovision that has accrued against previous development plan target” Two schools of thought: ‘projections take account of all need and any shortfall is reflected’ v ‘trends reflects low household formation rate and pent up demand should be added’ Practice Guidance now concludes that household projections do not reflect unmet need, and so evidence of whether household formation rates have been constrained by supply should be considered. How it is addressed in the plan: preferably front loaded using Sedgefield approach v Liverpool (residual) approach Backlog

Your five year supply and trajectory will be heavily scrutinised Need overrides out of date policies Costs awarded where unreasonable reliance on out of date evidence What sites should be included – Engine Common appeal APP/P0119/A/12/ Clear preference for frontloading any backlog - Sedgefield approach. Endorsed by the Secretary of State APP/H1840/A/12/ , APP/Z3825/A/12/ , APP/PO119/A/12/ , APP/P1133/A/12/ ) and Shottery judgement. Appeals - Lessons

“Not need to undertake comprehensive assessment exercises more frequently than every five years” NPPG But regularly updated using up to date information: Population and household projections every 2 years – what are the implications? Mid year estimates every year – how does migration level compare with any assumptions made? BRES (Business Register and Employment Survey) employment figures every year Annual Population Survey – unemployment and economic activity rates Monitoring

Used to assess performance: Completions – compare to average expected rate set out in five year supply New jobs – is this in line with your economic strategy and any jobs targets within the plan? Unemployment rate – how does it relate to any assumptions you have made? Percentage economically active – has it been maintained? Household formation rates, housing waiting list applications, market signals Monitoring continued …

Providing the right amount and type of housing as part of a good and sound plan by using: Up to date information across the Housing Market Area Models are transparent and do not use a ‘closed box’ method to hide assumptions Realistic assumptions - not based on very low migration, over optimistic economic activity rates or rely on large change in out-commuting Appropriate scenarios and options Ensuring the deliverable supply meets the objective requirement Evidence for and justification of provision figure Conclusions

Consideration of the supply side as a separate exercise Robust SHLAA and assessment of deliverability, viability, market capacity and involvement of developers in the process Housing policies are consistent with economy policies ie the objective to achieve jobs is supported by the delivery of a suitable number of homes Consistency with the logic set out in the SHMA in terms of affordable housing need Regular monitoring of information to review assumptions and assess achievement against key objectives Conclusions

Translating the requirement into plan provision Workshop 2