Select Committee on Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Written Evidence

Memorandum by Daventry District Council (AH 63)


  1.1  To inform ODPM of the comments made by Daventry District Council of the issues facing the provision and affordability of housing within our District.


  2.1  The issue of House Prices and affordability has grown in importance over the past few years. Rising home price inflation has far outstripped average wage increases and mean that house prices are now between six and seven times average household incomes. The traditional mortgage income multiplier of three to three and a half times income would not be enough for a low-income family to purchase an averagely priced house in the Daventry area.

  2.2  Additionally, this rising house price inflation has meant that even the smallest and least desirable of properties have become unaffordable for many first-time buyers locally. The price for a small one-bed roomed flat has increased to approximately four-times average individual income in the district. Consequently, the pressure upon the social and private rent sector has increased measurably, as many people are unable to meet their housing needs through purchasing upon the open market locally.

  2.3  The necessary 5% deposit required for many mortgage purchases is also creating a problem for many prospective homeowners within the Daventry area. As house price inflation has increased, so consequently has the 5% deposit necessary for most transactions. The length of time, first-time buyers need to save the deposit has increased as a result due to the higher amount required for deposit.

  2.4  The rising houses prices within both the district and nationally have had a large social and economic impact upon the wider economy. Due to wide differentiations of house prices within the UK, a lack of social mobility and its potential knock-on effects upon industry has been highlighted. Individuals living in areas where house prices are lower upon average may be unable to afford to move to areas for employment, where housing costs are very high but jobs available. Additionally, some individuals due to the perceived and actual volatility existing within the housing market may not wish to sell their property for fear of losing equity. This may mean that economic development in certain areas may be affected as a consequence. Indeed it has been highlighted in the media that some firms are looking to relocate solely because labour costs due to the local housing market is too high.

  2.5  As Daventry is a mainly rural district, the problem of affordable housing supply in rural areas is particularly acute. The work of the Northamptonshire Rural Housing Enabler (RHE) has highlighted the need for such housing in rural areas, explaining the importance and necessity for such provision to local landowners and Parish Councils. The stigma attached to LCHO and social housing has meant that many areas for different reasons do not wish to support such developments, believing that it would not enhance the overall sustainability of their villages.

  2.6  This important issue within rural areas highlights the importance of the role played by RHEs in similar districts. Acting as a first point of contact between PCs and interested RSLs and other Developers, the RHE helps locate possible sites for development, pinpoints areas where affordable housing is sorely needed and helps to develop lines of communication between landowners and other interested stakeholders. The importance of this role in similar districts to DDC cannot be underplayed.

  2.7   The supply of LCHO housing and the consequential planning process, has led to the proposed development of a countywide Section 106 protocol in addition to the proposed Daventry DC definition for Affordable Housing. DDC believes that planners should be able to stipulate the housing mix and tenure upon proposed housing development sites and that a national affordable housing definition, would provide a robust basis for planners and developers to clearly begin negotiations over all developments.

  2.8  The proposed DDC definition is:

    Affordable housing is defined as housing that meets the housing needs of individuals and families who cannot afford to rent or buy* on the open housing market and includes social rented, shared ownership and low cost home ownership tenures.

    To be defined as affordable, Daventry District Council recommends that rents and or mortgage costs on all affordable developments should not exceed one third of the average net household income of the district, inclusive of all service charges and management costs.

    * Assuming mortgage lending criteria of three and a half times household income over 25 years.

  2.9   The present problems of differing definitions of affordable housing has led to some developments of "affordable housing" actually being more expensive, when mortgage, rent and service charge costs are accrued than a 100% mortgage for a similar sized property in the same area. DDC believes that all developments should take more into account actual housing need, the local pressures of affordability and possess a housing mix which will contribute to the overall sustainable communities agenda as laid down by ODPM guidelines.

  2.10  Daventry DC also believes that all affordable housing developments should be built of the same materials and to the same quality as surrounding developments. Affordable Housing should be pepper-potted around new developments as per the sustainable communities agenda helping to create mixed and balanced communities. Although the initial costs of construction would be higher due to this insistence, the long-term benefits of such a policy should not be understated.

  2.11  The DDC Planning Team, working closely with the DDC Affordable Housing Working Group, believes that any Corporate Response to demands for housing for sale should be informed but not led by the market. This should be done upon a regional and sub-regional basis and if necessary involving cross-boundary work, encouraging partnership Housing Market Assessments to be completed frequently and greater strategic thinking to tackle this problem. HMA and other Housing Need reports should be updated frequently, ensuring that any possible issues that are arising can be planned for quickly, rather than allowing problems to amalgamate until the end of a set period.

  2.12  Daventry is identified for significant growth as part of the Milton Keynes and South midlands sub-regional strategy. A key aspect of this growth agenda is providing affordable and key worker housing of the right type and at the right time to ensure that the rapid growth is not hampered by a lack of appropriate housing. The local authorities are faced with some difficulty on this issue, as there is no information at the sub-regional level on the type of housing that will be required

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