1. Kath Scanlon, Christine Whitehead and Nancy Holman
Rising to the challenge:
London’s housing crisis
Kath Scanlon, Christine Whitehead and Nancy Holman
London School of Economics
1 December 2016

2. Our interim view in June 2016
We now have a real opportunity with many things pointing in the right direction
BUT there has to be a coherent package not just tinkering
We identified five core issues:
Planning certainty and viability: the system is dysfunctional
Large sites need infrastructure and there aren’t enough small sites
Purpose-built PRS showing promise
Housing Zones focus attention but few results yet
Policy and expenditure often works better at London-wide level

3. What we did in summer/autumn
Talking with stakeholders better to understand their priorities:
Land availability/ green belt
Viability
Local planning powers including impact of permitted development
Build to Rent space standards and modified regulation to make it work
Addressing homelessness
London housing policy specifics - notably emphasis on owner-occupation

4. Addressing the issues: London
Data
Net new additions > 30,000 for last year of old Mayor’s regime (some of it from permitted development)
GLA
SPG on affordable housing and viability and Build to Rent
London Living Rent

5. Addressing the issues: national
Autumn Statement
Funding for 90,000 affordable homes in London (not all new) – calling London’s bluff?
Infrastructure funding for LAs tied to enabling housing
More freedom on mix of affordable
Some minor changes to help homelessness
White Paper (expected later in ‘autumn’ – now January) to set out coherent approach covering
viability?
objectively assessed need?
site development timetables?
etc etc?

6. Affordable housing and viability
GLA’s new approach: developers offering ≥ 35% affordable housing will not have negotiate or provide viability information
Should—in principle—lead to greater certainty and affect land values
…and increase % of affordable housing from current levels
Actual impact will depend on how market perceives—an experiment in behavioural economics

7. Large sites and small
Large sites: high % of planning permissions but low % of output, reflecting standard developer business model and need for £££ of infrastructure investment
Compulsory annual monitoring often not followed up
Adding Build to Rent can increase build-out rate
Housing Zones target medium-sized sites—focus is good but outcomes still unclear
More small sites would help SME builders and improve choice

8. Build to Rent
Advantages: professional management, speed of delivery, contribution to placemaking, meeting needs of underserved market segment
but rents are relatively high and subsidy (not necessarily financial) often required
Operators want to own/manage all units, including affordable (discounted market rent) —but some boroughs reluctant to allow
Housing associations and local authorities now becoming involved as providers
Living space and internal organisation – should standards be different from for-sale units?

9. Permitted development
Does provide a lot of units so at some level it works
Doesn’t provide affordable housing or community facilities—and this should be changed
There may be a trade-off between numbers and quality
cf Vantage Point (Archway):
TfL continue to own land and gets good rental return. Space standards based on tenants spending more time outside individual homes but elsewhere in the building

10. ‘50,000 Homes’ an ambitious goal… but not enough
Into the future, younger households will face even worse conditions
We call for a London Emergency Package:
Money, land, and public-sector involvement
Backed by central government, GLA and boroughs
Providing homes for young households
Proposal to be fleshed out by summer 2017