This is an email to York councillors on a housiing report by Ove Arup in May 2013.
Arup’s report does not sufficiently address two key issues:
(i) the effect of planning permission on house prices and
(ii) the restrictions that prevent low-cost housing.
The Arup Report: Will York exile the poor?
The report is Housing Requirements in York, Assessment of the Evidence on Housing Requirements in York by Ove Arup & Partners Ltd.
The report raises concerns but provides insufficient solutions. I have copied and annotated a section of the report and suggested potential paths to solutions. The telling part of the report is in section 6.3 Broader relationships and impacts. I have added numbered headlines (in bold). The text from the Arup report are in green.
6.3 Broader relationships and impacts
1. First time buyers cannot even afford lower priced houses
Although headline prices have remained in line with national trends in York, lower quartile priced housing has become less affordable suggesting that established home owners are probably compromising their choices at the lower end of the market, probably in homes that were previously available to first time buyers.
2. Older, more affluent people will displace traditional population.
The consequences of such changes are complex, but are likely to include the development of an increasing proportion of older, more affluent (and socially conservative) population over time. There will also be displacement of traditional population, perhaps to locations such as Selby or Leeds as gentrification becomes more widespread.
3. Incomers from London and the South East will move to York because of lower house prices
However, perhaps more positively is that the city may become more attractive for high skill groups, perhaps relocating from the higher house price areas of London and the South East.
4. These incomers cannot return to the South East
Relocation from such places is typically constrained by the assumption that moving to a cheaper location means that it will never be possible to move back and that relocation may prove to be the “graveyard of ambition” as in the future it could constrain future career choices.
5. High skilled people move in
For example, surveys suggest that the parity of house prices between say, Cambridge and London, has been a factor that improves the attractiveness of the city to the highest skill groups. To some extent Harrogate and the Wharfe Valleys, as a premium housing locations for the Leeds labour market also may be demonstrating this effect. The issue here concerns the type of role as a City that York wishes to play.
6. Neighbouring local authorities may not help
York is located is a broader strategic housing market in which most indicators suggest strong demand. There is thus no obvious sub area options to disperse growth to neighbouring districts, indeed on the contrary it is likely that York will face additional pressures both because surrounding districts may under provide for housing. Such pressure also arises because York is and is likely to remain the major source of employment and services in its sub region and York’s range and choice of housing is broader.
7. Higher house prices will cause commuting to increase
Whilst is possible, that market processes in terms of higher house prices may encourage a wider area of housing search, including most obviously Leeds (or perhaps Hull) this is likely to be associated by additional in commuting. There are opportunities for sustainable travel choices for commuters in the sub-area, including rail links from Malton and Selby and there is scope for a future, more planned, sub-regional approach.
The Arup report mentions “affordable housing” several times but does not explain what this means. A Guardian article this February, Affordable housing does not mean what you think it means said:
In a move worthy of George Orwell’s Ministry of Truth, affordable rent will be higher lorazepam than before, set at up to 80% of the local market rent. Across whole swathes of southern England affordable rented properties will simply not be affordable to people on low incomes.
This also applies to York. “Affordable housing” does not mean affordable housing. I suggest two approaches to make housing more affordable.
Solution 1: More planning permission
The Arup report does mention the increased demand for housing by older wealthier people but it says little about why houses are so much more expensive than they cost to build. Several free-market economists put much of this increased cost down to restrictions on planning permission. For example, the Institute of Economic Affairs in Abundance of land, shortage of housing says
Other main findings include:
· Housing affordability measures show housing to be unaffordable in every single one of the 33 regions in the UK.
· There is still plenty of room for development in the UK:
· Only 1/10th of England’s surface land is developed and even in developed areas, the single biggest item is gardens.
· Literally ‘concreted-over’ land makes up only 1/20th of England’s surface area.
When more planning permission is allocated for housing, it should have the effect of reducing house prices because more houses can be built. This should, by influencing the supply side of the supply and demand equation, reduce the price of housing. This effect is diminished if planning permission is allocated in a monopolistic fashion so that only a few organisations corner the market. In York this may be a problem. See York’s great £1 billion giveaway and How the ‘Halifax tax’ adds £50k to the price of every new York house.
Solution 2: Less restriction on building type
As Arup have pointed out the “traditional population” may have to leave York at current and projected property values. Having spoken to several people under 35, I have found there is a demand for very much cheaper housing options than the £200,000+ that an ordinary house in York now costs. In Can your children afford to live in York? I suggested that other, much less expensive housing types should be allowed:
An article in the Daily Mail Who needs a mortgage? Couple’s ultimate downsize from a 2,500 sq ft home to a shotgun shack reported “Their house cost them less than $20,000 [£12,784] to make their home and they only pay $145 rent for the lot on which their shack and workshop stands.” It is noteworthy that readers of the Daily Mail supported this couple who got out of the rat-race to live in very cheap housing.
Many people would welcome cheap, less formal housing. Esther commented…
“My Grandma lived in a Victorian house in Bristol…Her family bought her a holiday chalet by the sea in Westward Ho! It was hoped she’d spend a few weeks every year there… she began living there 9 months a year. Last year she said she dreaded going back to Bristol for the winter. I believe she died because she couldn’t face the loneliness and struggle she faced back in Bristol.”
Others love these very cheap homes as a comment from Lisa affirmed…
“I’ve been living in a holiday home, similar to the place her grandma lived in, on a site near York. At first it was just a stopgap but I’ve grown to really like it here and I’m thinking of staying permanently. There’s nothing more life affirming than waking up surrounded by nature- woods, birds, the occasional deer and falling to sleep to the sound of hooting owls. The space and the fresh air put a bounce in your step!”
Under the influence of the older and wealthier classes, many of the traditional York population are being squeezed out of York, especially if they are young. Arup’s report gently alludes to this without proper analysis of the causes or effective solutions. Here I have pointed to two policy areas that should be investigated. For more details see relevant articles on my BrusselsBlog.co.uk and watch for “Why don’t the young rebel?” coming soon on YorkMix.com.
A final thought: Why doesn’t York Council ask the young themselves?
P.S. I have just remembered my old website from 2003. It can be seen here
Plus ça change?
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