Memorandum by Stoke-on-Trent City Council
(AH 46)
SUMMARY
— Stoke-on-Trent has many thousands
of terraced properties no longer suitable for modern day living.
Many of these properties are in unsustainable locations close
to roads and industry and have very poor ground conditions.
— The poor housing offer is a potential
disincentive to inward investors.
— Earnings in the City are considerably
below regional and national averages and this affects ability
to secure affordable, well-maintained and sustainable housing.
For many low-income owner-occupiers the poor
housing offer at the lower end of the market creates inequalities
in the amount of equity they can build up and thus affects their
future housing choices.
— The Market Renewal Pathfinder programme
aims to redress the current imbalance in the housing market through
renovation and clearance. Survey and consultation work undertaken
for the programme identifies the pressing need for quality affordable
housing in advance of clearance.
— Twin pressures of clearance linked
to the market renewal programme and the emerging more general
problem of affordability in the City, not least related to the
widening gap between incomes and prices, mean that the City is
likely to face an affordability gap for the first time.
— In areas of poor ground conditions
and stigmatised neighbourhoods the planning system alone will
be unable to deliver sufficient numbers of quality affordable
homes in the early years of the programme.
— The West Midlands RSS presumes that
residential development will be largely focussed on the Major
Urban Areas (MUAs). Any large scale development of housing in
the hinterland of the North Staffordshire conurbation is likely
to impact adversely on the market renewal strategy.
BACKGROUND
The North Staffordshire Market Renewal Partnership
has a strategy for the long term renewal of the housing market
in North Staffordshire. The strategy is based upon a programme
of both clearance to remove unfit properties, and a major new
build programme. The issues around the current stock include poor
quality, the exceptional small size of many dwellings, even by
the standard of terraced properties, and the very poor ground
conditions, making clearance a necessity. There are many thousands
of properties within North Staffordshire that can be described
as technically obsolete. The transformation of the housing market
in North Staffordshire is based on the removal of substantial
numbers of these properties, the majority of which are not suitable
for modern day living.
The existing housing stock is largely the product
of a low wage and poorly performing economy and the quality of
the stock is now, in relative terms, so poor that it is potentially
a significant disincentive for inward investors in the local economy.
The North Staffordshire economy is now moving from a position
of persistent net contraction in employment, to one where the
new economy, characterised most visibly by logistics and distribution,
is adding enough jobs to offset the contraction of traditional
industries. However, there are spatial implications to the pattern
of economic development and deindustrialisation within the conurbation
which will have an impact upon the Market Renewal process
The West Midlands RHS supports the RSS and presumes
that residential development will be largely focussed on the Major
Urban Areas (MUAs). Any large scale development of housing in
the hinterland of the North Staffordshire conurbation is likely
to impact adversely on the market renewal strategy as it will
tend to continue the trend of drawing people who can afford to
move out of the urban core and thus increase its fragility, whilst
at the same time increasing the level of commuting with all the
adverse effects that this has.
Low earnings compared to the region, health,
economic activity, skills and education and employment opportunities
affect many residents' ability to secure affordable, well maintained
housing, particularly in the owner-occupied sector. There are
clearly equity issues for owner occupiers arising from this. Those
who can afford to move out of inner core areas leaving deprived
communities and environments in neighbourhoods offering an extremely
poor quality of life with households having little opportunity
to retain wealth through their housing. Ironically these areas
are often in the most accessible and potentially sustainable locations.
The imbalance in the housing market means that home owners in
"overheated" areas benefit from rising values and conversely
homeowners in poorly performing market areas are falling further
behind the national/regional average.
Survey and consultation work undertaken in the
market renewal programme areas of major intervention clearly identify
the need for replacement affordable housing (social rented and
low cost home ownership) in advance of clearance. Whilst economically
active residents in clearance areas have been able to make their
own way in the market it is clear that there are immediate and
pressing needs emerging for more vulnerable groups of people.
In addition there is the need not to break up existing communities
where there are strong community ties. In areas suffering from
poor ground and environmental conditions and stigmatised neighbourhoods
it is very difficult to use the planning system alone to deliver
sufficient good quality affordable housing to meet these needs.
AFFORDABLE HOUSING
IN STOKE-ON-TRENT
The Housing Market Assessment (HMA) carried
out for the Renew North Staffordshire Prospectus in 2003 showed
that the areas programmed for major intervention are located towards
the bottom end of the housing market hierarchy with properties
more than a quarter lower than the already low Stoke-on-Trent
average. The HMA showed that 51% of residents in the major intervention
areas own their own home with just over half of these owning outright.
Two key groups were identified:
— owner occupiers with an existing
mortgage (24% of all households) whose average age made it likely
that they could purchase a replacement property through a further
mortgage, although the new-build market is not likely to be a
major option for them;
— occupiers owning outright (27% of
all households) whose average age of 59 made it unlikely that
they would be in a position to purchase a replacement property
through a further mortgage. The only purchase option for this
group would be an unmodernised very basic terraced house on a
like-for-like basis which would perpetuate the mismatch of provision
to need and moreover represent a switch to a dwelling that is
likely to be subject to eventual clearance. It is this group that
will need significant financial support should rehousing through
an alternative purchase be preferred.
The 2003 survey results showed that half of
existing owner occupiers expected to buy for their next move and
most of the remainder did not know. Very few wished to move to
other tenures. A further key finding was the extent of health
and mobility problems in these communities. 31% of those interviewed
had a household member with a long-standing illness, disability
or infirmity indicating potential housing need. 41% of those with
mobility difficulties (10.3% of all households) needed but lacked
a suitable domestic adaptation. These findings were made before
a significant rise in house price that has not yet been matched
with a rise in incomes.
Average households incomes for the city are
still very low. In 2005 the average gross household income was
£23,590, an increase of 10% on 2003 (but this from a very
low base point, the national gross household income for 2004 was
£29,374). Furthermore 18.9% of all households in Stoke-on-Trent
have an annual gross household income below £10,000, compared
to 14% nationally. Only 6.6% have an income in excess of £50,000.
This means than almost one in five households will face severe
affordability issues, and will be unable to purchase a property
in the city in almost all neighbourhood areas. Without intervention
through the market renewal programme and National Affordable Housing
Programme (NAHP) the most vulnerable households would be forced
into the least sustainable areas of the City.
There is still an incomplete picture of the
impact of the market renewal programme on affordable housing requirements
in the City but it is evident that there is likely to be an upward
pressure on the number of households falling into the affordability
gap. The draft Renew North Staffordshire scheme update (October
2005) identifies key outputs for the period 2006-10, including
proposed levels of acquisitions, demolition and new build. In
terms of creating and addressing new housing need, over and above
that identified in the Stoke-on-Trent 2005 Housing Needs update,
the key statistics are acquisitions and new build. Although there
are difficulties in using these statistics to model future affordable
housing need, it is fairly safe to assume that, at least in the
short term, the planned acquisitions are likely to cause an increase
in the number of households needing affordable housing. Delivery
of the market renewal programme will clearly exact a time limited
pressure for the affordable rehousing of affected households.
Work undertaken to define affordable housing in the
North Staffordshire context identified that the demand arises
at two levels:
— As a result of a "one-off"
housing re-provision requirement, following programmed demolitions
in given areas where subsequent housing market restructuring and
renewal will, by design, result in a quantum leap in house prices
(as described above).
— As a result of "ongoing"
variable demand over time due to new household formation, migration,
changes in household circumstances, broader economic restructuring,
as well as from the pool of people in housing need, such as hidden
households, those living in poor quality accommodation in the
private rented sector and the statutory homeless.
Recent assessments of changing affordability
in the City suggest that rising house prices mean that many first
time buyers, and families on low incomes, may be struggling to
buy in the City—particularly in more sustainable areas.
In 2004 the Stoke-on-Trent Housing Needs survey showed a surplus
of affordable housing but the recent update and recalculation
(2005) suggests that whilst there is still a net surplus there
is a trend towards a net shortage, particularly if house prices
continue to increase. Within two to three years the market could
be in balance in terms of numbers, although given the issues of
quality, type, size and location this would not remove the need
for new supply of good quality affordable housing of the right
size, tenure and location. Supply side factors have also changed
with a falling supply of local authority and RSL relets due to
continuing high levels of Right to Buy sales and the increased
costs of house purchase, particularly for first time buyers.
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