Memorandum by the South East England Regional
Housing Board
1. The South East England Regional Housing
Board (RHB) is a partnership board. It is responsible for identifying
regional priorities for housing investment through the Regional
Housing Strategy (RHS) and providing advice to ministers on the
allocation of investment in affordable housing in the region.
2. The Board's investment programme for
2006-8 gives priority to increasing the supply of new affordable
housing, allocating 92% of the funding available to the provision
of additional affordable housing with the remainder targeted at
private sector renewal and local authority decent homes.
3. The comprehensive evidence base developed
by the Regional Assembly in preparing the draft South East Plan
(the Regional Spatial Strategy) and the Regional Housing Strategy
underpins the work of the Board. The draft South East Plan provides
for an annual average of 28,900 net additional dwellings between
2006 and 2026.
4. The evidence base shows a backlog of
29,000 households in need of social rented housing or private
rented housing with the support of housing benefit. Analysis of
affordability shows that although some households can afford forms
of home ownership, there is a core need for social rented housing,
and that 25% of new housing to be social rented and 10% other
forms of affordable housing.
5. This requirement is set out in the draft
South East Plan. In order to fulfill it the region needs to deliver
7225 social rented homes and 2890 other forms of affordable housing
per year (10,115 in total). (See Table 1)
6. The Regional Housing Strategy published
in 2006 gives priority to:
— increasing the supply of affordable
housing and in particular new social rented housing to meet identified
need;
— achieving the Government target of
halving the number of homeless households in temporary accommodation
by 2010; and
— addressing the needs of the most
vulnerable and those with support needs.
Alongside this, it recognises the value of mixed-tenure/
mixed-income developments to achieve sustainable communities and
support economic growth.
7. The region's annual monitoring indicates
a significant increase in housing completions in recent years.
Completions have increased from just over 25,000 per year in 2001-02
to 33,300 in year ending March 2006.
The evidence indicates that increased public sector
investment in delivering affordable housing is increasing the
number of completions.
8. The 2006-8 affordable housing programme
is on track to deliver significantly more homes overall and particularly
social rented housing than in the previous two years (Table 2).
Nonetheless, social rented provision falls short of the current
level of planned growth in the draft South East Plan by 2560 homes
per year. Further progress will be difficult to achieve without
additional public sector funding. This reflects the higher cost
of providing social rented housing and the need for grants to
be made available in order to ensure the financial viability of
development sites.
9. The Implementation Plan for the draft
South East Plan identifies a role for the RHB in maximising opportunities
to act as a catalyst for the delivery of affordable housing. The
Board is already taking action by:
— Working with local authorities and
the Housing Corporation on improving the assessment of financial
viability of sites for housing development to make cost effective
use of public funds. Recent research indicates that acute affordability
problems occur in urban areas within the region and are caused
by a diverse range of factors which cannot be addressed by a single
measure or package of measures. The same research suggests that
public subsidy could be used more effectively if financial viability
issues were better understood and managed by local authorities.
More effective application of public investment could release
additional funds for social rented housing.
— Working with public sector landowners
to identify a portfolio of brownfield land suitable for use to
deliver affordable housing and which could be purchased with RHB
funds to deliver affordable housing that meets higher standards
of design and environmental sustainability.
— Maintaining a list of strategic sites
which offer potential to deliver a significant increase in the
supply of affordable housing.
— Investing £20 million per year
in improving unfit private sector housing. Research for the RHB
confirms that the private rented sector plays an important part
in the provision of affordable housing for people who are vulnerable
and/ or on low incomes. However, the condition of such housing
stock gives cause for concern. Of 2,981,040 private sector dwellings
in the South East, 166,465 private rented dwellings fail the Decent
Home Standard. Of these, 47,703 are vulnerable households least
able to improve the condition of their homes and most reliant
on a complex network of advice and assistance from a range of
providers.
— Considering how funds can be targeted
most effectively to improve the condition of empty homes. The
most recent (2004) validated returns from local authorities show
that just over 32,000 homes (most of them privately owned) in
the region had been vacant for 6 months or more. The overall level
of empty homes in the South East represents 2.7% of the housing
stock, lower than the 3% vacancy rate recognised as a necessary
level for the housing market to function effectively. Work is
progressing with the Empty Homes Agency to assist local authorities
to reduce the long term vacancy figure and hence contribute to
the supply of housing.
10. The Implementation Plan also emphasises
the importance of aligning investment strategies at regional level
and, most importantly, improving the alignment of the investment
strategies of national agencies with regional priorities. The
Board welcomed the proposals set out in the recent Housing Corporation
consultation on Future Investment Approaches which offers continuity
and innovation through approaches such as those described above.
11. These areas of work have the potential
to deliver more affordable housing in a cost effective way but
it is unlikely that these initiatives alone will bring provision
up to the level identified in the draft South East Plan. The shortfall
is particularly acute in the social rented sector. Additional
public sector funding is likely to be the only solution to this
problem.
12. The supply of new housing in the South
East relies to a considerable extent on smaller sites. The identification
of thresholds at a national level, replicated at a local level,
limit the opportunity for smaller sites to make a contribution
towards delivery of affordable housing. In addition, there are
increasing concerns that the pressure for higher thresholds for
affordable housing as part of Section 106 agreements creates a
perverse incentive that encourages the construction of smaller
units and flats rather than a better balance of housing size and
type. This may have negative effects on the sustainability of
communities. The Regional Assembly has commissioned work on the
issue of size and type of housing being delivered; this will be
available early in the New Year. We welcome the greater flexibility
introduced by PPS3 but are concerned that the inclusion of a national
indicative threshold could limit such flexibility in practice.
13. To conclude, regional evidence of the
need for affordable housing and the region's ability to deliver
a greater supply are clear. Through the RHB, significant funding
has been made available for 2006-8 to increase the supply of rented
housing and to improve conditions in the private rented sector.
However it is clear that with the current level of resources available
for the public sector it will not be possible to tackle the backlog
of need for decent, affordable rented housing.
December 2006
Table 1
|
| Type of affordable housing | South East
Plan target
| Housing
Corporations
Affordable Housing
Development
Programme
| Shortfall |
|
| Social rented | 7,225
| 4,665 | 2,560
|
| All others | 2,890
| 2,070 | 820
|
| Total | 10,115
| 6,735 | 3,380
|
|
| Note: Figures are on annual basis.
|
Table 2
INVESTMENT BY THE REGIONAL HOUSING BOARD (RHB) THROUGH
THE HOUSING CORPORATION'S AFFORDABLE HOUSING DEVELOPMENT PROGRAMME
(AHDP) FOR 2006-08
|
| Type of affordable housing | Units completed during 2004- 2006 programme
| Units of accommodation in 2006-2008 programme
| Cost £m |
|
| Social rented | 5,806
| 9,330 | 502
|
Newbuild HomeBuy
(formerly Low Cost Home Ownership)
| 4,146 | 3,871
| 71 |
| Other | 1,823
| 269 | 5.6
|
| Total | 11,775
| 13,470 | 578.6
|
|
| Note: Figures are for two years.
|
[Note that the programme also included funding for HomeBuy
Market Purchase for key workers/ first time buyers which made
no addition to the existing stock).
| 
