Does the Social Housing Sector have a landbank for Corbyn’s 1 million homes?

In a leadership campaign tweet reinforced by Corbyn Tweet the Guardian  is reporting that

A Labour government run by Jeremy Corbyn would borrow £15bn a year to build houses across the country – half of them council homes – as part of a £500bn programme of public investment, new policy papers have revealed.

It would aim to build one million homes during a five-year parliament

Whilst welcoming expansion of social housing and council house building what evidence is there that councils and housing associations have a landbank of ‘shovel ready’ sites with planning permission to hit this?

Councils have sold off most easily developable land and most projects by even the most progressive council involve intensification of existing land such as council estates – which take time.  Faced with difficult financials  and cuts in funding housing associations have run down their land banks.

The fact is such targets could only be hit through private land and their is a huge risk of a public spending induced land price bubble blown up by slow progress on local plans.

This policy is introducing a 1950s level of social housing spending to a teenies level of public sector landbanks, a recipe for disaster.

The sad fact for those on the momentum left is this policy is unimplementable.  It could only stand a chance of success with some form of public sector partnership with existing landowners where profits are shared and where partnership is forced by some form of land tax.  There would also need to be dedicated development corporation like delivery bodies to build new sites – that kind of policy can bring back housebuildings to historic post ware levels but would take at least 4-5 years to gear up – especially with the almost total absence of serious masterplanning for large new communities whether inner urban or Garden City.

Oxford Green Belt is Pushing Major Development outside It

Greater Oxford does not have a plan of course – rather Oxfordshire districts are all individually seeking to allocate the overwhelming overspill housing from its long overdue SHMA to sites just outside the Green Belt

For West Oxfordshire Eynsham North of the M40 a new Garden Village

For South Oxfordshire Chalgrove Airfield 

For Cherwell Bicester Garden City

Vale of White Horse is the exception proposing Green Belt Amendments in four areas which the Inspector has accepted.

The issue is does this add up to a can of beans.  Eynsham makes sense, it is a proposed Park and Ride station and the A40 is to be upgraded.  One day the former rail line to Whitney might be restored, possibly as guided bus.

So most of Oxfords overspill is accounted for – the great exception being South Oxfordshire who stick out with an unsustainable site – rather than the site next to Oxford at Grenoble Road – which the County Council said

“The decision favouring Chalgrove Airfield as the preferred site, largely due to the fact that it is outside Green Belt has to be weighed against the highly likely severe transport implications in a location with such a high degree of inaccessibility and an extreme lack of potential sustainable travel.

“Oxfordshire County Council considers that the choice of Chalgrove Airfield as the site for a single strategic allocation is not based on sound evidence.”

Of all of Englands Great cities with Green Belts achieving a sustainable strategy for housing and transport for Oxford seems most within reach.  The loss of Green Belt at Grenoble road would be comparatively small and it achieves an accessible site around a city where flooding and landscape constraints make expansion hard.  It is time for South Oxfordshire to take one for the time and achieve the wider goal of protecting the vast majority of Oxford’s Green Belt for the next generation.

Approved in Local Plan, Refused by District, Appeal allowed by Javid

We covered this case last year.  The district refused a scheme even though it was in a joint local plan it had just adopted.

The key phrase

The Secretary of State agrees with the Inspector that the allocation of the Appeal A site in the Local Plan as a SUE effectively amounts to an ‘in principle’ mandate for development

Decision

On Loose definitions of Stock Flow Consistency

Jo Mitchell on Noah Smith claiming

Some heterodox macroeconomists, it’s true, do have quantitative theories. One is “stock-flow consistent” models (a confusing name, since mainstream models also maintain consistency between stocks and flows).

 

He rightly notes that the name is confusing — any correctly specified closed mathematical macro model should be internally consistent and therefore stock-flow consistent. This is certainly true of DSGE models.

No DGSE models cannot be called Stock-Flow Consistent

A correctly specified closed mathematical model will only have a ‘netting’ of flows to zero in one case – equilibrium.  In that case you have all stocks no flows – but it cannot handle any out of equilibrium case of its time path – the real world.   Because orthodox Neoclassical models are not defined in strict accounting terms – as a balance sheet of assets and liabilities that are unable to model consistency of relations that are defined as assets and liabilities, simple things like assets, debt and money.   Crude attempts to overcome this – such as measuring in flows and outflows to a blobby body such as K the stock of capital have irresolvable issues of dimensionality through over over-aggregation.

Whatever the arguments over the definitions of neoclassical and orthodox, and the not always helpful chasm this attempts to define, it is clear that economics cannot get out of its funk unless it redefines its basic principles an an accounting and dimension consistent foundation of mathematical identities, starting with the fundamental equation of accounting. 

Dilnot Care Reforms Equivalent of building 21,000 less houses a year – Its Right to Scrap Them

Jeremy Hunt when health Secretary claimed that 70,000-80,000 people a year were forced to sell homes to cover care costs.  Sadly a figure which dates back to research for the Panorama programme in the mid 90s.

Guardian

Theresa May’s policy chief has suggested that people with valuable homes who face high social care costs in old age should downsize or re-mortgage to cover their bills, the Observer can reveal.

Director of policy John Godfrey has suggested that over the next 10 years the solution to the social care crisis lies in people selling up or releasing some of the equity in their property.

John Godfrey, Theresa May’s director of policy.

“On a 10-year view … equity release is going to be hugely important, because if you look at the amount of housing equity across the UK that is owned by people of post-retirement age, that is really where an awful lot of the money sits at the moment,” Godfrey told an independent commission last year. “Can people either downshift or liberate some of that money through equity release to fund their living costs?”

Full Fact correctly apply a stock-flow analysis to the argument.  What matters is not just the ‘stock’ of people in care but the ‘flow’ of people into care.  To obtain that number you have to divide it by the mean stay in care – 2 1/2 years.

According to Laing & Buisson’s most recent figures, in 2011/12 175,000 people paid for their own care – an increase on 2009. If we repeat the calculation above, we arrive at a figure of 52,500 self-funders selling their home or 21,000 per year.

Lets be clear the supply of new homes on the market is the total of new housebuilding plus the existing stock recycling onto the market.  Each house not sold for equity release is one less house released to the market.  The Dilnot reforms would have been a disaster for intergenerational equity.

The issue of whether a family should be able to retain an asset is conceptually different from the issue over whether they should be required to sell a portion of that asset to release equity. A more carefully tailored policy would cap both care and ‘lodging’ costs at around 150,000 pounds which might be revenue neutral to the treasury.  Local authorities should be banned from implementing ‘costs deferral on death’ policies which keep houses empty whilst elderly citizens live in homes.  Contra those entering care should be encouraged to sell and downsize heir homes to purchase an annuity which would fund care costs with the remainder of the equity used to purchase a smaller home which would revert to the family on death. This home would be rented to fund the lodging costs of a care home.  If there was proper integration of health, housing and social care at a local level then this would result in a flow of 21,000 rental units a year for affordable housing leading to considerable savings to housing benefit and an essential new source of rental housing to younger people.  Indeed the scheme could be extended.  If capital gains on houses were properly taxed on death tax breaks could be extended for homes released to affordable housing providers in similar schemes.

The Equivalence of Fiscal and Exchange Rate Monetary Targetting

There have been a number of favorable posts recently from market monetarists in favour of swiss style exchange rate targeting as a means of escaping the ZLB.

How different is this from fiscal policy?  In one sense it is the same.

From a circuitist perspective if the central bank purchases financial assets denominated in another currency to deflate the exchange rate then the real value of the government debt will also deflate by the same amount.

If however the central bank purchased bonds on the secondary market of the same amount and there was no expectation of there repayment then the value of the government debt is deflated by the same amount.

in both cases the price neutral fiscal ceiling of the state is raised and government spending- at the ZLB – can expand; reflating the economy.

So at the ZLB -with expectations that the monetary injection is permanent and the asset is no redeemed (destroying the money created) they are fully equivalent.

So why argue about the relative merits of fiscal and monetary policy?

 

The Historic ‘Life on Mars’ Pub Gary Neville and Ryan Giggs want to Knock Down

Manchester Evening News

It is understood Historic England, which used to be English Heritage, is not impressed by the scale of the skyscrapers.

But Mr Neville said the only way to fit everything wanted by the council onto the site – while also opening it up and including considerable public space – was to build upwards.

He said for him the two plazas, to be known as St Michael’s Gardens and St Michael’s Square, were the stand-out part of the development.

“A large part of the site is usable to the public. That’s something that was driving us from day one and that’s what pushed us,” he added.


The most controversial aspect of the development is likely to be the demolition of the historic Sir Ralph Abercromby, said to have been the inspiration for the pub in TV cop show Life on Mars.

The site lies entirely in the St Peters/Deansgate Conservation Area.  The pub is the gem, few tears will be shed for the ugly synagogue of replaced, the front block of the police station (council owned) though is well mannered and could be converted.The site is aching for a place centered treatment retaining the pub and building up on the site of the Synagogue.  The problem is that the strategic regeneration framework for the site is an overlong laundry list and is confusing on which historic assets to retain, triumph of conflicting interests over good urban design.  By not being ‘prescriptive’ it abrogates the first statutory duties of the City towards heritage conservation. Indeed the document was prepared by Make rather than independently by the council.

Indeed it shows why Ken Shuttleworth is our worst architect.  The description of úrban grain’ entirely neglects indeed wipes out teh existing buildings on site, and rather than repeating and connecting that grain simply proposing two monolithic pavilion blocks in New York Style plazas entirely alien to Manchester, and obliterating the setting of the Grade 1 listed Town Hall.  a monster.

StPeters

 

 

 

Alex Morton Admits “presumption in favour of development’ has failed

Some admission from sacked Alex Half Baked Morton one of the key architects of  the NPPF

Con Home

The sanction of the Presumption in Favour of Sustainable Development is simply inadequate to get them [housebuilders] to increase output and is largely a way for developers to capture large greenfield sites (it also basically repeats a 1980s failure termed ‘planning by appeal’).

Despite the debates around Right to Buy, Starter Homes, and sale of high value assets, the most important reforms underway since 2015 were a low-key battle to reform the system so that:

  • Councils were assessed against a delivery test. Each council would be required to deliver enough homes to meet housing need.
  • Up to date local plans would move from 500 pages of verbiage and policies on everything from climate change to an ageing society, and instead focus on delivery of homes – with infrastructure, design and political engagement prioritised.
  • Central Government would “put plans in place in consultation with local people” in areas without an up to date local plan that failed to deliver. It was hoped in Number 10/the Treasury this could be rolled out if we were able to find a way to do this in a politically acceptable fashion.

There were moves around ‘direct commissioning’ (opposed by parts of the Treasury) so that councils could control the land market themselves and, without taking on balance sheet risk directly, allocate land to developers in return for agreement to build at a set rate.

These reforms were not particularly supported by the sector or within DCLG, despite help from some good officials and ministers, (particularly Brandon Lewis). DCLG was far too focused on mayors (despite clear evidence that London’s mayor, who has extensive housing powers, had not stopped London seeing the biggest housing failure of all). Against all the headwinds and vested interests the agenda set out above barely moved – much like housing numbers.

Green Belts/Urban Growth limits Increase Construction (for a Time)

Kip Jackson at LSE

[Studying in California] Taken as a whole, regulation reduces residential development. However, the degree to which individual regulations affect development varies, and some “anti-growth” policies actually increase development (at least in the short run). …

While commonly touted as an effective remedy to urban sprawl, I find that urban growth boundaries (also known as “green belts”) actually increase the construction of single-family homes. Urban growth boundarieshave been shown to increase the value of new homes, so it is not surprising that development would accelerate until abutting on the established boundary.

It is easy to forget the policy intent of Green Belt was never primarily to protect the countryside – rather it was to prevent urban sprawl by shaping urban growth.  Indeed Green Belt was promoted in periods when there was widespread consensus about the need to dramatically increase housebuilding.

Consider Circular 1/55 where the purpose was to ‘[check] the unrestricted sprawl of the built up area and of safeguarding the surrounding countryside against further encroachment’

The purpose was not to prevent all growth but ‘unrestricted growth’ and the surrounding area was that surrounding the inner limits of Green Belt where growth was permitted to grow to.

This double purpose of Green Belt was implicit rather than explicit in the poorly worded 1/55.  The pioneers of Green Belt such as Unwin and Abercrombie were clearer on its purpose – as a long term land bank shaping urban form and providing recreational opportunities.

For example in Unwins 1929 Gre4ater London Plan

Regional Planning consists primarily in the laying down of an appropriate design for urban growth. The plan or pattern of development should be laid out on a field or background of open land. The difficulty hitherto has been that no such background is in fact available. All land is assumed to be potential building land; and the reservation of any tracts from use for building development may be sufficient to constitute such land in the words of the Town Planning Acts “property injuriously affected” and to establish claims for compensation. The result is that Town Planners have been constrained to design rather meager patterns of open space on a background of potential building land.

If the contrary method were adopted, and the areas adequate to meet any extent of urban or suburban growth which can be foreseen were planned on a secure background of open land, a true proportion between the two could be maintained. Open space for public enjoyment by the growing population could then be secured upon the free land as and when required. This wider aspect of the matter, and the possibility that additional powers may render the correct method of planning practicable, will be discussed in a. later section. In the meantime it must be recognized that, with the existing powers, the only possible way of restraining sporadic developments from ruining the remaining tracts of land which have special suitability for playing fields or other kinds of open space, is to acquire or preserve those areas in adequate quantity for present and probable future needs. (Illustrations 13 to 16 & 42).

The problem now being that this positive purpose – the regional planning purpose has gone – Green Belt became a purely negative concept.

So I dont suggest that Green Belt is abolished or weakened, rather that is original dual purpose is rediscovered, that it becomes a container of land banks and is redrawn where necessary to allow for New Towns/Garden Cities and Sustinable extensions/Garden Suburbs, with the Green ‘background’ used as publicly accessible open sapce where prcticable.