Member Article

Housing will be key investment for future

The UK is supposed to build 240,000 new homes per year, as recommended by the Barker Review (2004) and covered by this column about two years ago. In reality, we are lucky to be achieving 125,000.

In its draft Strategic Economic Plan, the North East Local Enterprise Partnership (LEP) says that its local authorities estimate a minimum of 37,600 new homes will be constructed between now and 2021. In the Tees Valley LEP they identify that there are opportunities within the area for significant housing growth.

To achieve that the region will really need to up its game. While the social benefits of having the region’s population properly housed are obvious, such investment – the NELEP proposes an £880m housing delivery fund – will do wonders for our economic growth.

In the region on Monday Michael Newey, president of the Royal Institution of Chartered Surveyors (Rics), held a residential Question Time-style event for Rics members at which these challenges were addressed. It will capture the region’s voice and feed it into Rics policy.

Property professionals, like me, have long been involved in the delivery of housing developments. I was an independent board member of the Pathfinder scheme for delivery of housing in Newcastle and Gateshead. This oversaw the budget of about £100m to deliver a housing renewal programme.

This achieved the kick-starting of development at Scotswood in Newcastle and about 19 sites around Gateshead. But this was during an economic recession which saw the inability of local people to buy and the unwillingness of lenders to lend. The Pathfinder scheme was ended by the Coalition Government, which created a seismic shift in the delivery of housing renewal schemes in inner urban or brownfield sites.

A fillip to delivery of new housing has been achieved by Government schemes NewBuy and Help to Buy. Both assist buyers who can only raise funds for a 5-10% deposit by using some form of loan or guarantee system to make up the difference for lenders.

However, the impact of the recession has meant that the focus on housebuilding is where the market wishes to buy – and this is predominantly on the greenfield sites. In addition to this, brownfield inner urban sites are more difficult and of higher risk to develop.

While the barriers to delivery of housing are numerous and inter-related, the supply of sites is a key one. Perhaps we should structure a programme of greenfield new-build with encouragement to housebuilders to also take on the more difficult task to build within the inner urban areas.

The planning process needs to address the faster delivery of development. I am a supporter of the localism idea and have become an independent examiner for Neighbourhood Plans. My concern is that, apart from a handful in this region, the bulk of Neighbourhood Plans are being progressed in the South of England.

There are other issues. For instance, we need to find new ways to deliver better design and sustainability. This needs to be balanced by early delivery of a high provision of numbers but working toward a step change in qualitative matters, even to creating garden-style suburbs, instead of the monotonous and limited mass build that is apparent.

There are also matters in procurement that need to be addressed. Sale of sites must be quickened as well as the provision of infrastructure and supply of materials. Another issue that will be key to the future of housing in the North East is the training of more young people for trades in the construction industry.

This was posted in Bdaily's Members' News section by JK Property Consultants .