Select Committee on Economic Affairs Minutes of Evidence


Memorandum by the National Housing Federation

INTRODUCTION

  While international migration is one of the causes of increased housing demand in the UK, it is one of a number of factors, alongside natural population (demographic) changes, internal migration, and increasing numbers of smaller households.

  According to CLG figures, 223,000 new households are projected to form in England every year for the next 20 years. However, in the period 2005-06, only 163,000 homes were built.

  In order to address this increase in housing demand we therefore support the Government's plan for investment in an additional three million homes. We are pleased that the modelling we have done on the need for more affordable homes for rent and Low Cost Home Ownership (LCHO) has informed the Government's plans to increase investment in new housing.

KEY MESSAGES

    —  Regional housing strategies appear to be planning appropriately for changing populations and household growth. However, there is continued depopulation of regions with the most spare stock and/or capacity.

    —  Natural change and household growth is driving much of the increasing demand for housing in the UK. With people living longer and changes to family structures, there is a marked increase in single person households and a corresponding decrease in the average size of UK households.

    —  International migrants are a diverse group. We need to factor in the demand for housing produced by immigration and plan to produce the housing needed to accommodate people who are playing a key role in our economy and society.

GROWTH OF SINGLE HOUSEHOLDS

Table 1

HOUSEHOLD ESTIMATES AND PROJECTIONS[1]


`000s
2004
2006
2011
2016
2021
2026

Married couple households
9,527
9,415
9,182
9,050
8,978
8,898
Cohabiting couple households
1,987
2,181
2,605
2,944
3,204
3,424
Lone parent households
1,591
1,655
1,760
1,830
1,882
1,928
Other multi-person households
1,421
1,452
1,538
1,629
1,708
1,775
One person households
6,536
6,816
7,562
8,384
9,200
9,951
All households
21,062
21,519
22,646
23,837
24,973
25,975
Average household size
2.33
2.32
2.25
2.20
2.15
2.11


  Table 1 shows the changing face of England's households, with many more single person households forming which is reflected by the decreasing projected average household size. Much of the increase demand for housing is being driven by these unprecedented changes in household formation and the increased life expectancy for UK residents.

THE REGIONAL PICTURE

  For eastern and southern England, where net population is increasing, change is spread across the separate components. In London, the pattern is different, and is largely explained by the "young" character of the capital. The patterns of in-migration and out-migration here are well documented. People moving to London tend to be young adults, such as students or first time employees, while those moving out are mostly older workers, retired people and young families.

Table 2

COMPONENTS OF POPULATION CHANGE

'000s

Natural
Change
[2]
Internal
migration
[3]
International
migration2
Total

North East
-2
-3
5
0
North West
3
-4
11
10
Yorks & Humber
5
0
8
13
East Midlands
3
19
2
24
West Midlands
8
-7
22
23
London
52
-84
104
72
East
9
20
-3
26
South East
12
8
15
35
South West
-4
32
5
33
ENGLAND
86
-16
172
242


  Table 2 shows that in the north and west of the country where population increases are smaller, the pattern of net out-migration to other regions is marked. Natural population change does not fully compensate for this, and populations either decrease, or are maintained only by international migration.

WHAT DETERMINES WHO GETS ACCESS TO HOUSING?

  Housing associations work with local authorities to meet local housing needs. Local authority nominations to housing associations are governed by Part 6 of the Housing Act 1996. Nationally, 80% of those housed by associations in Year 2006-07 came via local authorities.

  When allocating accommodation, including through a nomination to a housing association, local authorities must give reasonable preference to certain groups, for example people who are homeless, occupying unsanitary or overcrowded housing, or people who need to move on medical or welfare grounds. This is designed to ensure that allocation schemes are needs based. However, a local authority shall only allocate housing to eligible persons and thus need to test eligibility when people make an application to them:

    —  Certain categories of persons subject to immigration control, or from abroad, are not eligible for an allocation of housing accommodation. This includes for example, asylum seekers; or those with leave to remain in the UK on the basis that he/she will not have recourse to public funds and persons who are in the UK illegally or have overstayed their leave.

    —  Other categories of people subject to immigration control are eligible for allocations, for example those granted humanitarian protection or refugee status or indefinite leave to remain or exceptional leave to remain, where that leave is not subject to conditions requiring him/her to maintain him/herself and dependents.

    —  EU nationals with a right of residence or EEA nationals who are classified as workers or self employed are eligible for accommodation via a local authority.

    —  People coming from the A8 Succession countries[4] are treated slightly differently as they are only counted as workers if they are working and registered with the Workers Registration Scheme, or have been in continuous registered work for more than 12 months.

    —  People from Bulgaria and Romania are treated differently again. They are only entitled to work here (and count as workers for eligibility purposes) if they are skilled workers or, if unskilled, are authorised to work by the Home Office.

  Housing associations record information about every household they house and this gives us a good picture of who is accessing social housing. From April 06 to March 07 the percentage of housing association lettings that went to non-UK nationals was on average 4.3%, which equates to 6,523 of an overall total of 150,522 lettings. Of these an average of 1% of the households said they were an A8 national and 0.9% other EEA nationals.

  A8 nationals housed by housing associations were more likely to report a loss of tied accommodation or racial harassment as the reasons they needed housing. Overcrowding is the most common reason given for seeking a housing association home amongst both A8 and UK nationals, though more prevalent in A8 nationals. A8 nationals newly housed were more likely to be in households of two adults or two adults with one or more children and less likely to be single people or single parent families.[5]

HARDSHIP AMONGST IMMIGRANTS

  Our members report that through the wider work they do to support communities, such as providing community allotments or play schemes, they are seeing non-UK nationals, who through ineligibility for benefits and insecure employment face extreme hardship. This includes people who are ineligible for access to social housing, or unable to secure access because other people are above them on the waiting list and are literally roofless or living in extremely unsatisfactory conditions in the private sector. They are often living in extremely overcrowded conditions or in property that is in disrepair and certainly would not meet the Decent Homes Standard.

  This is supported by reports from the Home Office and the Institute of Community Cohesion (ICoCo) in their studies of the impact of migration at local and regional levels. The ICoCo study, based on research with over 100 local authorities, found that in areas of high economic growth many migrants are living in overcrowded properties in poor states of repair, mainly in the private rented sector.[6] Conversely, in areas of economic decline and aging populations, migrants are moving in to vacant properties in declining areas, and the local areas are benefiting from new labour in hard to fill occupations.[7]

  CLG statistics[8] show a slight increase in assistance given to homeless A8 nationals by local authorities from 2004 to 2007—up from 0.3% of the overall total of applications in May 2004 to 0.7% in June 2007. In total during the period May 2004—June 2007 the total number of applications made to Local Authorities for homelessness assistance which were accepted by the LA was 902. The number of applications rejected was 1633.

CONCLUSION

  Housing demand is affected by many causes: population growth, changes in household formation, internal migration within the UK, and immigration.

  As a result of all of these factors in combination, the number of households is growing at a faster rate than the number of homes which are currently being built.

  If we are to take advantage of the possible benefits from international migration, and successfully adapt to the demographic changes which are taking place, housing supply needs to expand to effectively respond to this additional demand.

20 November 2007



1   CLG Live Tables 404 Back

2   Regional Trends 39, Table 3.7, 2003 Back

3   Regional Trends 39, Table 3.12, 2001 Back

4   Poland, Hungary, Slovenia, Slovakia, Czech Republic, Estonia, Latvia, Lithuania Back

5   Evidence from our regional consultation on the impacts of migration. Home Office Migration Impacts Forum. October 2007 Back

6   Estimating the scale and impacts of migration at the local level. Institute of Community Cohesion / Local Government Association, November 2007. p45 and p49 Back

7   Ibid. p45 Back

8   Tables 628 Social housing: local authority assistance to A8 and A2 (2007) nationals under homelessness provisions of the 1985 and 1996 Housing Acts: decisions on applications for assistance by A8 nationals, England, Department of Communities and Local Government, 2007 Back


 
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