1. Planning, housing and markets Sarah Monk and Aoife Ni Luanaigh

2. Planning for housing How much housing is produced through s106?
What are the main impacts of s106?
Is s106 housing additional?
Who pays?
Is s106 housing replacing traditional new build by housing associations?
Is what is promised through s106 actually delivered?

3. Figure 1:Trends in permissions and completions for ‘S106’

4. Figure 2: Trends in ‘S106 ‘ as proportion of all affordable

5. Main impact? Changing geography of new affordable housing
More expensive because on more expensive sites / areas
But meeting mixed communities agenda as most is on-site provision
Most in pressured areas of South but rural affordable housing very problematic

6. Is it additional?
Not wholly additional because more expensive sites / areas
S106 contribution ‘stretches’ social housing grant – makes schemes viable
Provides land in areas where housing associations can’t compete / public land supplies drying up

7. Who pays? In theory landowner pays
But on difficult brownfield sites developer may also pay (lose profits)
Easiest on high value sites
Developer contribution often small proportion of total development value
Market houses often modified because of s106 – easier to provide small, dense units

8. Is s106 replacing 100% sites?
S106 is an increasing proportion of all new affordable housing
Time and other resources spent on s106 rather than traditional 100% sites
Appear to have lost traditional sites and cannot get them back
Using public land which would have been non-s016 but now becomes mixed – good for mixed communities but using up assets

9. Main messages from s106 work
The case for linking planning and affordable housing is relatively weak
But practical reasons why it works on its own terms – local, hypothecated, housing
Concerns about how far it can actually increase output and affordability
But it’s the only game in town – so try to make it work better?

10. Main messages from s106 work
Anything that replaces it must be able to do more, otherwise no point
Has proved that something thought to be difficult could work – mixed communities – but at a cost? (units getting smaller, social rented being squeezed out)
Value for Money message: the apparently easier options to get more (off site, commuted sum) turn out not to work better

11. Related research
S106 policy must be supported by evidence of housing need
Recent policy requires understanding whole housing market, demand and not just need
New draft Guidance updated housing needs assessments to include housing markets
Methods on needs assessments more prescriptive to aid consistency

12. Problems and difficulties
Understanding housing markets often seen as looking at total stock and demographics to see if ‘in balance’ but market is buyers and sellers and the main indicator is price
Sub-regional working in context of planning framework, legal implications
Relationship between using local surveys and adding them up to sub-regional and regional levels – also use of secondary data

13. Planning for housing
Recent post-Barker consultation paper proposes take up of land as trigger to inform planners about how market operating
Barker highlighted land supply as constraint on house building and hence affordability
But there are other constraints including infrastructure provision and relative profitability of building more housing in one location

14. Planning and markets
The key market signals to inform planning policy must be relative prices
Because planning aims to address market failures, policies should not be made on the basis of the market
But it is essential that planners understand the market outcomes of their decisions even if that doesn’t change the decision

15. Sub-regional and regional working
Regions are identifying sub-regional housing markets – not in a consistent way
Also undertaking household projections (SEERA) and estimates of future need for social rented housing (SEERA, EERA, GLA)
And estimates of future need for key worker and intermediate market housing

16. Key workers and intermediate market
Intermediate housing defined as housing below market prices but above social rented – some but not full subsidy
No accepted methodologies so developing a new approach
For key workers and others in the ‘gap’, cannot just add up all those in the income range because they won’t want the products
Nor predict from past because lack of supply

17. Key workers and intermediate market
For South East, could use SEH to estimate totals in relevant income band
Then use CORE on characteristics of households who entered shared ownership
Then project forward as demographic approach
But shared ownership ‘lost’ to market when move (at least in the past)
So had to use gross flows in relevant income/age groups – this produced estimate of 7,000 p.a. (9% of dwellings after social housing overlap)

18. Market Intelligence Toolkit
Market Intelligence Report
for the
Thames Gateway-South Essex Sub-Region
Cambridge Centre for Housing and Planning Research
Department of Land Economy
19 Silver Street
Cambridge
CB3 9EP

19. Market Intelligence
Developed templates for analysing local housing markets
Ward, district and sub-regional levels
Social, economic, demographic and stock information as well as incomes and relative prices
Also looks at the affordability of different tenures and the ‘gap’ between market and social housing

20. Sub-regional Market Intelligence
Sub-regional groupings approximate the geographical extent of the housing market
Assessing housing market across the board feeds into Sustainable Communities agenda
Provides a more accurate way for Local Authorities to understand the housing market in their area

21. Benefits of commissioning a Market Intelligence Report
Improved understanding of the local housing market enables:
appropriate and cost-effective allocation of resources
better forecasting of housing demand and need within an area
development of a suitable mix of dwelling types, adapted to local needs
informational advantage when negotiating housing development with other parties.

22. Why is any of this important?
Feeding directly into policy
Improving the evidence base
Clear links between mixed communities agenda and understanding housing market economics
Difference between outputs and outcomes – often not intended – can be highlighted