Housing and Planning Bill

Written evidence submitted by HARAH (Hampshire Alliance for Rural Affordable Housing) (HPB 107)

About HARAH

1. HARAH is the Hampshire Alliance for Rural Affordable Housing which was formed in 2005 to increase the supply of affordable homes in the rural communities across Hampshire. The membership of HARAH comprises six Local Authorities (Basingstoke & Deane BC, East Hants DC, Hart DC, New Forest DC, Test Valley BC and Winchester CC) plus Action Hampshire, Hampshire County Council, New Forest National Park Authority and the Homes & Communities Agency.

2. Over the past 10 years, working with Hyde Housing as Registered Provider partner, HARAH has provided 365 new affordable homes across 39 schemes, and housed 1,300 residents- 96% of whom have a proven local connection to the immediate community and are in housing need. There are currently around 400 units in the pipeline for development over the next 5 years or so.

3. HARAH works very closely with local communities and the parish councils that represent them. The support for new affordable housing schemes is high in most Hampshire rural communities now, because local residents recognise the high levels of housing need in their villages. In HARAH’s experience, communities support the development of small exception sites because they know such homes will be allocated to local people in need, and will remain affordable in perpetuity.

4. The changes being proposed through the Housing and Planning Bill have the potential to significantly undermine HARAH’s ability to deliver new homes and to meet the needs of rural communities across Hampshire.

Right to Buy

5. Without exemptions to the Right to Buy, many communities are unlikely to support new affordable homes, as the new homes will be able to be bought by the tenant 5 years after they move in and then can be sold on the open market. These homes will no longer be available for those in housing need and will become another high value market home that is beyond the reach of many local residents. Realistically, in many small rural communities there is not the capacity to produce further affordable housing, so once homes are lost there will remain a net loss of affordable housing, which will mean it will be harder to have mixed rural communities in the future, as younger households and those on average or lower incomes cannot afford to remain in these villages.

6. Currently, land owners are prepared to sell their land to HARAH’s partner Registered Provider at exception site value, on the basis that the land would not otherwise be used for market housing and what will be provided will be affordable housing in perpetuity. Unless Right to Buy exemptions apply in rural areas, it is likely landowners will simply not be prepared to sell their land to an RP, or will seek overage clauses so that they benefit from any future sale. Both outcomes will reduce the availability and viability of land for new affordable homes.

7. In rural communities, on average only 8% of the housing stock is affordable compared to an average of 19% in urban areas. Simply put, Right to Buy will lead to a small stock diminishing further, placing a huge demand on the remaining limited stock.

8. HARAH is aware that regulations will be required to underpin the voluntary Right to Buy proposed by the Registered Provider sector. HARAH would like to see these being very closely drafted to ensure both communities and landowners are reassured that the affordable homes they support remain affordable and for the benefit of the local community in perpetuity.

9. HARAH supports an exemption for rural affordable housing based on the following definition of ‘rural’, as this will best protect all vulnerable rural communities:

· All affordable housing in areas designated as National Parks and Areas of Outstanding Natural Beauty

· All affordable housing delivered on rural exception sites or by Community Land Trusts or similar community led organisations

· All affordable housing in rural communities with under 3,000 population as at 2011 Census

· All affordable housing in rural communities with under 10,000 population as at 2011 Census as designated by the Secretary of State, taking into account the following criteria - the proportion of second home ownership; the proportion of holiday lets; the level of disparity between lower quartile average earnings and lower quartile house prices; and the extent to which the community operates as a rural ‘hub’ for surrounding settlements.

10. Currently only 40% of homes in HARAH’s pipeline are in National Parks and Areas of Outstanding Natural Beauty (AONB), despite having 2 National Parks and an AONB in the HARAH region. An exemption based on this definition would

therefore be inadequate to ensure healthy future delivery of new affordable homes.

11. HARAH does not believe that sufficient alternate protections are in place, for example the use of s106 planning agreements. S106 agreements can be rescinded after 5 years and the wording tends to vary on existing agreements, meaning protections are likely to be very limited. Regulations safeguarding rural exemption to the Right to Buy will be the most effective way of ensuring affordable homes are available to future residents in housing need.

Starter Homes

12. HARAH is very concerned about the impact of Starter Homes in rural communities.

13. Across Hampshire, the average cost of a new home in rural communities is such that anyone wishing to purchase a Starter Homes would need to pay the proposed maximum cost of £250,000. This would require almost 6 times the average (median) salary. As a result, many local households are likely to be unable to afford to purchase a Starter Home within their community. If a local resident is able to purchase a property under this scheme, we understand there are no proposed restrictions at the point of resale, so the homes will be sold in the future at full market value and so will be even less affordable for local people long term.

14. The biggest concern about Starter Homes is if planning rules are changed so they can be built on a site instead of traditional affordable rented or shared ownership homes. As an addition to these existing tenures, there may be limited local need for Starter Homes. However, if Starter Homes replace traditional affordable housing in planning terms, then in rural locations where land availability is limited, the supply of new affordable housing may be significantly eroded. As a result, housing need in these communities will increase and more households will end up living in unsuitable, often overcrowded, housing or will have to leave the community to meet their housing need.

15. Landowners are likely to favour the building of Starter Homes on their land as the receipt for them will be higher. In practice then, Registered Providers will be unable to purchase land for traditional affordable housing as landowner expectations on land value will make a scheme unviable.

Conclusion

16. HARAH asks the Committee to take into consideration the need to protect both the existing supply, and future delivery of affordable rented and shared ownership homes in rural communities across Hampshire. These homes demonstrably meet the housing need of local residents, and help contribute to the social and economic wellbeing of rural communities by ensuring a broad spectrum of residents can afford to live and work locally.

17. HARAH believes that strong exemptions from the Right to Buy are needed for rural homes, based on the definition above.

18. HARAH believes that Starter Homes should not be considered ‘affordable housing’, but rather should be seen as a complementary tenure, enabling the continuing provision of affordable rented and shared ownership homes to meet identified local need. This can be achieved by retaining the existing definition of affordable housing contained in the National Planning Policy Framework.

December 2015

Prepared 3rd December 2015