What gets measured gets done – Affordable Housing targets

By Jerry Gilbert · 8 August 2024

Angela Rayner is to be applauded for her ambition to accelerate and increase housing production. The increasing of compulsory affordable housing solutions throws down the gauntlet to Local Authorities, and, as the old adage goes, what gets measured gets done.

However, volume alone is not enough, affordability is the key to helping those in the most need. Increasing supply of housing will not drive down prices, the market simply isn’t that elastic for either buyers or renters. As the pressure to increase numbers ramps up, so will land prices, with geography, employment opportunities and infrastructure all playing a part in places where people want to live and influencing prices. The focus on brown field sites and the notion of grey land are again to be applauded but land is a “one off “opportunity, a commodity with a finite supply. Experience shows that if the land owners don’t feel they are receiving a good return, they simply hold on to their assets.

Red Tape

Having made their intentions clear the process has started on the red tape of the planning system to unblock the pipeline schemes, however now is the time for the Government to tip the balance in favour of affordability. Construction is a driver for growth, and we all know that having good affordable housing solutions improves health and wellbeing limits the need for temporary accommodation and reduces anti-social behaviour. The economic arguments for a more interventionist approach to create affordability as well as volume are well evidenced.

It has always been difficult for RPs to compete on the open market for land, made increasingly challenging given rising costs and the competing demands for cash that upgrading existing stock creates, particularly in a housing market that is relatively flat and failing to provide significant opportunities for cross subsidy. Without support it will become increasingly difficult, especially for the medium to small RPs, to provide additional quality homes at prices or rents that people can afford.

Affordability and Volume

Focus now should be on the practicalities of delivering affordability as well as numbers. The government has it in its gift to create affordability, be it through grant, tax breaks, subsidised loans or deposit schemes, land acquisition and assembly and a myriad of other schemes and initiatives to either subsidise costs or reduce repayment. Now is the time to decide which is the right combination of levers to pull to create affordability.

There is no magic wand, we have been advising social landlords on development and regeneration for over thirty years and there has always been a “housing crisis” in some form or other, what we do know however, is that increasing numbers alone is not the answer. Angela Rayner has started on the path by setting the targets and reducing bureaucracy in the planning system, she now needs to give affordability equal billing.

To speak to our Development team about the new Government’s focus on Social Housing and how we can guide and support you to build new homes, or please contact me and I will be happy to have a chat with you.