Memorandum by The Royal Institution of
Chartered Surveyors (HOU 12)
INTRODUCTION
The Royal Institute of Chartered Surveyors (RICS),
represents the views and interests of 120,000 chartered surveyors
worldwide covering all aspects of land, property and construction.
Under the terms of its Royal Charter, RICS is required at all
times to act in the public interest.
RICS welcomes this opportunity to submit evidence
to the House of Commons Select Committee on Transport, Local Government
and the Regions' re-investigation into affordable housing. Following
the Chancellor's Spending Review and the proposed increase of
around £1.4 billion for the housing sector, it is essential
that the Government develops a sound and coherent strategy for
reinvestment. For London and the South East the problem revolves
around acute housing shortages, while large areas of the North
and the Midlands require strategies to tackle low demand.
The over-riding objective must be the provision
of good quality, affordable housing, be it social rented or privately
owned. This will only be possible by harmonising housing and planning
strategies and by utilising good quality, innovative design wherever
possible. RICS is encouraged that the Select Committee's new inquiry
appears to focus on these crucial areas.
We would like to comment on the following issues:
MEETING THE
DECENT HOMES
TARGET
The principle of a decent homes standard is
an admirable one. RICS wholeheartedly supports the Government's
commitment to ensuring that all social housing is of a decent
standard by 2010. However, the release of additional funds for
tackling home conditions will require sound management and realistic
expectations. Too many areas, especially in parts of the North
and Midlands, are in a state of irreversible decline with the
housing stock in a chronic state of disrepair. In such instances
it is worth questioning whether further significant investment
is worthwhile.
The Government appears committed to the principle
of housing stock transfer from local councils to housing associations
as a means of ensuring more homes meet the decency standard. However,
in some instances, as was recently the case in Birmingham, this
policy is likely to generate resistance from tenant groups keen
to see a retention of council control. RICS is therefore encouraged
that the Government is addressing this issue by allocating more
money to councils to renovate run-down stock by relaxing the requirements
for arms length management organisations (ALMOs) and is seeking
to amend the 1985 Housing Act to make it easier for councils to
enter into Private Finance Initiatives. Both of these policies
can potentially lever in the necessary finance to improve stock
condition.
The setting of stock condition and improvement
targets (including energy efficiency targets) must cover the private
as well as council and housing association sectors, together with
demolition and replacement targets for the stock as a whole. The
rate of housing demolition must increase with national, regional
and local demolition targets being negotiated and publicised by
government.
RICS supports the Government's intention to
streamline the powers and procedures relating to compulsory purchase
orders (CPOs). We particularly support proposals to introduce
wider powers for local authorities to use CPOs to tackle planning
and regeneration issues. In addition, the proposal to enhance
home loss payments for owners and occupiers will provide fairer
compensation and will help to reduce delays in the system.
RICS also advocates the active development of
new policy instruments to deal with the improvement of low value
owner occupied properties. Where households are affected by compulsory
acquisition, the principle of equivalent re-investment should
apply wherever possible. Owner-occupiers living in Right-to-Buy
(RTB) properties on one-time council estates and affected by compulsory
acquisition should be enabled to maintain their position in the
housing market.
BALANCING SPENDING
BETWEEN SOCIAL
HOUSING AND
OWNER OCCUPATION
FOR THOSE
WHO CANNOT
AFFORD TO
BUY
If the Government is committed to the creation
of mixed and balanced communities, then it must ensure the provision
of a range of tenure options designed to meet all housing needs.
For lower income households, social housing may prove to be the
most suitable, while more affluent households are more likely
to aspire to home ownership. Those caught in between may turn
to the rented sector or a form of shared ownership scheme.
Unfortunately excessive house price inflation
in many areas has forced many would-be-buyers into rented of temporary
accommodation in order to minimise the distance between home and
work. Affordable rented social housing is essential for low income
groups. But this should not be to the neglect of middle income
groups, unable to buy their own property but not eligible for
social housing.
RICS is also concerned at the adverse consequences
of RTB activity. The acquisition of affordable housing through
RTB in areas of high demand may no longer be feasible given prevailing
market conditions. There are also considerable management problems
where "mixed tenure" areas have been created (particularly
in relation to flats and low demand areas where ex RTB properties
may have become privately rented) and with the difficulties that
some RTB households have in sustaining their owner occupation.
Whilst RTB discount arrangements have been changed over the years
(demonstrating that they are not inviolate), these continue to
be haphazard and inequitable. It is over 20 years since the initial
comprehensive legislation was introduced. A formal review is now
badly needed.
More generally, RICS is concerned at the current
British obsession with home-ownership. Unlike many successful
housing economies elsewhere in Europe, the UK housing market is
driven by an almost unhealthy interest in home ownership. It is
therefore important that new flexible forms of tenure be developed,
such as low cost ownership and other equity sharing schemes including
those that give the option to "staircase down" when
a household's financial circumstances change. However, we recognise
issues of complexity, consumer and legal resistance and the fact
that new and flexible forms of tenure are likely to be of only
limited or niche interest for the foreseeable future.
THE ROLE
OF PLANNING
OBLIGATIONS IN
PROVIDING AFFORDABLE
HOUSING
The current system of planning obligations is
often a barrier to the delivery of affordable housing and, therefore,
is in need of modification. Changes are needed to introduce greater
consistency between authorities in the use of their powers, to
provide for greater transparency and to give developers greater
certainty about the affordable housing contributions that they
may be called on to make. There is currently excessive variation
in the level of developers' contributions towards affordable housing
sought by different local authorities as well as excessive demands,
sometimes unrelated to the development in question, which act
as a barrier to delivery.
RICS is encouraged by the Government's decision
to abandon its proposals for a tariff-based system. Genuine improvements
are more likely to be realised through a modification of the existing
system. To this end, RICS would like to see the introduction of
model clauses to provide clearer indicators for developers and
alternative dispute resolution procedures to minimise the time
given over to negotiation.
Local Authorities must also be discouraged from
setting prohibitively high affordable housing targets. In its
recent commercial impact assessment of the 3 Dragons/Nottingham
Trent University report, ATIS Real Weatheralls concluded that
a rigid 50 per cent affordable housing figure was unrealistic
in two thirds of the London Boroughs. Excessive demands on developers
will stifle development and limit the opportunity for new affordable
housing. Local Authorities must therefore adopt a flexible approach
that reflects local and market realities and that enables the
development of economically marginal schemes.
RICS welcomes the ODPM's pledge to intervene
where Local Authority targets for affordable housing are not being
met, although far more detail is needed on the criteria for and
the means of intervention. It is also imperative that greater
fiscal incentives be given for the development of brownfield sites
and for higher density affordable housing. Developers should be
accorded the choice of off-site provision or commuted sums wherever
this is feasible.
THE EFFECTIVENESS
OF THE
HOUSING MARKET
RENEWAL FUND
IN TACKLING
HOUSING NEEDS
IN AREAS
OF LOW
DEMAND
If the Government is to remain committed to
the housing market renewal in areas of low demand and extend its
programme beyond the current nine Pathfinder projects, then it
will require a clear focus and vision. In particular, it must
be clear what the risks, costs and benefits of renewal attempts
are when compared with those of managed decline or even abandonment.
Regeneration priorities need to rebalanced and
oriented towards approaches which "invest in the best"
(ie best chance of success) rather than those which address "worst
first." There is a clear need for more robust approaches
to asset management by government, landlords, and individual households
together with a clearer focus on preventing urban and rural decline
from the outset rather than seeking to reverse that which is already
underway. RICS is concerned that a key test of the efficacy of
housing market renewal (namely a robust assessment of the likely
costs and benefits of intervention) is not more rigorously applied.
A renewal strategy for particular housing markets
must therefore be carefully targeted and sensitively managed.
In some areas this may involve "downsizing" some housing
settlements—thereby increasing the chances for long term
sustainability. This downsizing must seek to capitalise on those
areas that are proving to be successful. Other areas may be in
a state of irrevocable decline and therefore unlikely to benefit
from housing market renewal. In such instances policies designed
to increase social mobility and manage decline will be more appropriate.
If housing markets and communities are to be
renewed then a number of policy and practical changes need to
be introduced in relation to urban management, housing mix and
investment priorities to further support the development of sustainable
neighbourhoods. In its recently published Housing Manifesto, RICS
offered a number of suggestions to this end, including:
— housing and land-use policies that
minimise travel demand and the promotion of home-based work;
— the piloting on new forms of neighbourhood
management, including practical and vocational support to those
that wish to take up this new career;
— the integration of policies relating
to open space, concierge, highways, police, and caretaking services,
including the participation of local groups;
— Local Strategic Partnerships to be
able to spend a proportion of public funds currently available
for core programmes, on locally-determined schemes; and
— greater preventative, curative and
legal measures to stamp out anti-social behaviour.
Healthy, viable, sustainable neighbourhoods
will form a sound basis on which to build any housing market renewal
strategy. This is based on the increasingly accepted assumption
that under-achievement in education, poor health, high levels
of crime and difficulties in gaining employment are all related
to deficiencies in the supply of adequate housing.
ENSURING GOOD
QUALITY AFFORDABLE
HOUSING WHILE
AVOIDING POOR
DESIGN OF
PREVIOUS HOUSE
BUILD PROGRAMMES
Strategies designed to increase the supply of
affordable housing must be based on good design, sound planning
and with "quality" as priority. In announcing the introduction
of new regional bodies, the Government appears to be making the
intrinsic link between housing, land-use, planning, transport,
economic development and regeneration policy. The Government will
need to spell out, however, how these new bodies will relate to
a range of existing regional structures, particularly Regional
Development Agencies.
Much new housing design is modest in quality
and frequently uninspiring. For their part, many developers perceive
consumers as conservative in terms of design, environmental, running
costs, home technology, security specifications and in their attitude
to off-site prefabrication. In part this is true. However, the
more innovative characteristics of much self-build housing (and
that of non-residential buildings) would tend to confirm at least
some consumer appetite for better design. Eitherway, all parties
must be encouraged to make a greater commitment to new approaches
and technologies.
RICS supports greater local and regional variation
in house design in a manner that is sensitive to local heritage
but does not stifle innovation. In many cases there is scope for
higher density housing development. RICS therefore welcomes the
Secretary of State's intention to intervene where proposed housing
developments fall below a threshold of 30 dwellings per hectare.
However, even higher densities will be required, where appropriate,
if urban sprawl is to be contained and the use of brownfield sites
maximised. It is crucial that high density is combined with good
quality design and integrated with local transport infrastructure.
The means of achieving such development has
been demonstrated in the recently published RICS guide to good
practice for "Transport Development Areas" (TDAs). TDAs
are designed to secure and develop a sustainable and high density
mix of land uses including housing centred around key transport
nodes. The RICS Guide also demonstrates the wider benefits of
engendering early dialogue between all the parties involved, including
the local community and between the public and the private sectors.
The principles underlying TDAs are already being taken on board
in many of the emerging new regional strategies including those
for London and the South East. The guidance is freely available
at www.rics.org.
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