Housing the North

November 30, 2012 2:11 pm

By Ann Pittard

The minister charged with planning, Nick Boles, this week joined the chorus of those looking for more English land to build upon with his claim that we should find 2-3% more land to build on. This chimes well with the Northern Economic Futures Commission’s call for a ‘Mapping the Futures’ programme to drive national spatial planning for the next 20 years.

But he need look no further. Rich in land, home to vast construction supply chain and boasting world-leading specialist expertise, the North presents the ideal location to restock the English housing market, to rebalance the economy, and to develop innovation in housing and neighbourhoods. It is time that these Northern assets were used to their full effect.

All too often, comment on the malaise of our national housing market centres on London and the South East. There is little doubt that the problems in the capital’s housing market are wide, and run deep, with rents extortionate and prices prohibitive. As valid as these comments are, often they ignore the persistent problems to the north of the M25.

In fact, housing in the north is in a state of crisis; a crisis stemming from two problems. The first we share with other parts of the UK – not enough good quality homes. The widening gap between supply and demand has left increasing numbers of Northern families dislocated from the housing market. Unlike comparable areas further South, many Northern towns and cities face continuing stagnation in new housing supply.  In London last year, net completions were only 8% short of the levels achieved at the height of the boom in 2006/07.  Southern unitary districts were not far behind.  In contrast, new housing delivery in Northern Mets lagged at less than half the 2006/07 level.  And in Greater Manchester, that powerhouse of the Northern economy, completions were 70% below 2006/07 levels (NHF 2012).

This growing shortfall in housing increases pressures on house prices, which despite recession have risen in the North more than in any other region outside of the capital.  Between 2001-2011, house prices rose by 106% across the North East, North West, and Yorkshire and Humber, but earnings rose by only 31%. (NHF, 2012). The lack of affordable homes and available mortgages increases pressure on the rented sector, which are set to rise in the North by 29% over the next six years (NHF, 2012), while earnings continue to stagnate.  The result of the combined pressures is that more people are forced onto the housing waiting lists (already disproportionately high in Northern England).

The second problem Northern England has is very large numbers on Housing Benefit. There are 1.35 million Housing Benefit claimants in the three Northern regions of England, costing the country around £100million pounds a week in rent subsidies, and the numbers continue to rise (DWP, 2012). In the current spending round, Housing Benefit expenditure is projected to be £94.5 billion up to 2015 for the UK, against only £4.5 billion in grants and capital expenditure to build new homes.(Cooke and Hull, 2012) This significant mismatch between capital and revenue expenditure is doing little to resolve chronic under-supply.

A revival of Northern, and national economic fortunes would play a significant part reducing undersupply, and reversing Housing Benefit expenditure; equally, a revival of house building would have significant positive effects on the state of the Northern economy and the size of the benefit bill. But Northern councils have legal responsibilities but little power to deliver meaningful change for the people of their area.

This is a why a fresh approach is needed. Building upon the work of the Together at Home review (Cooke and Hull, 2012), the Northern Economic Futures Commission has argued that the expenditure on Housing Benefit would be better invested in solving the housing supply problem.

We recommend a Sub-regional Housing Fund, radically devolving funding to groups of local authorities, channeling capital expenditure on house building with Housing Benefit expenditure into one local block grant. Based on current expenditure, Manchester would be allocated up to £681million over a three year period, and £663million in Leeds. This level of devolved financing would allow communities to plan and decide on their own housing arrangements, from the houses they build, to their own model for replacing Housing Benefit. For instance, the grant could be used to commission long-term deals with housing developers to build new affordable housing; to purchase existing properties not in residential use, or to release rented housing for those who need it most by facilitating mortgages for those who want to get a foot on the housing ladder. Such proposals are not without challenges but the case is too compelling to ignore, and we are confident that Northern cities will look seriously at the concept in the next iterations of City Deals.

Ann Pittard is Large Business Development Lead for Leeds City Region and a member of IPPR North’s Northern Economic Future Commission. The final report was launched in Leeds today

Latest

  • Comment It’s morally wrong to make patients pay for hospital parking

    It’s morally wrong to make patients pay for hospital parking

    Over the Bank Holiday weekend the Health Secretary Jeremy Hunt was trumpeting his new ‘ground rules’ to address rip-off hospital car parking. Any action to curb extortionate car parking prices at hospitals should be welcomed. However, reading these new ‘principles’ it appears they are not enforceable. My assumption was confirmed when the Department of Health answered a tweet from me by stating that ‘NHS Trusts will be held accountable to local people and organisations that represent them e.g. HealthWatch’. This […]

    Read more →
  • News Failing to meet export targets – Osborne has got it wrong again, says Mahmood

    Failing to meet export targets – Osborne has got it wrong again, says Mahmood

    Today, Shabana Mahmood, Shadow Treasury Minister, has explained how George Osborne is on course to fall short of export targets he set for himself. Writing for PoliticsHome, Mahmood has released figures on British exports, which, she explains, “show that there are still major concerns about how balanced the recovery has been so far.” Two years ago Osborne said that by 2020 he would double exports to £1 trillion. However, Mahmood cites figures that suggest it looks highly unlikely that the UK could meet […]

    Read more →
  • Featured Labour call for Rotherham Police and Crime Commissioner to step down

    Labour call for Rotherham Police and Crime Commissioner to step down

    A Labour Party spokesperson has said the Shaun Wright should resign as South Yorkshire Police and Crime Commissioner (PCC). Wright, who is Labour’s PCC, was previously a councillor on Rotherham council and  between 2005-2010 was head of children’s services. In response to a report on child abuse in the area, which found that between 1997 and 2013 1,400 children were subjected to sexual exploitation in Rotherham, Labour have called for Wright to stand down. A spokesperson reportedly told PoliticsHome: “The report […]

    Read more →
  • Comment Life skills need to be at the heart of Labour’s curriculum

    Life skills need to be at the heart of Labour’s curriculum

    When Gove was demoted and moved away from his beloved education brief you could almost hear the sound of champagne corks popping in staff rooms across England. Yet two months after the most high profile demotion of this parliament, Labour’s policy on education remains one its most underdeveloped. This is not necessarily a bad thing, saving the education debate until nearer the election could be a shrewd move for the party given that all but one of the Education department […]

    Read more →
  • News Self-harm in mental health hospitals risen by over 50%

    Self-harm in mental health hospitals risen by over 50%

    Luciana Berger, Shadow Minister for Public Health, has found that between 2010 and 2013 the number of people in mental health institutions who have attempted suicide or who have been found self-harming has risen by over 50%. At 29 of the NHS’s 52 mental health trusts, the number of suicide attempts and cases of self-harming rose from 14,815 in 2010 to 23,053 last year –  an increase of 56% . These figures, obtained by the Labour Party through a Freedom of […]

    Read more →