Almost as bad as the demographically and numerically innumerate recent DCLG consultation on standardizing (basterdising) OAN is the equally unhelpful CPRE report by Trinley Walker Needless Demand. It makes a good point already made by many including us. Need is not the same as demand, need is not always expressed in the market, if you neglect need and focus only on demand you will get the wrong mix of homes.
As well of course – the preposterous NPPF definition which defines need as housing that is needed, and hence doesn’t define it at all, and then in the same breath housing demanded in the area (I demand a house in the Lake District therefore it is part of the Lake District housing need, rather than where I live or where I might realistically live).
But now comes the obfuscation.
The conflation of need and demand in the calculation and application of OAN is a problem in itself because it distracts from the priority activity that is required to resolve the housing crisis: the provision of homes that meet actual local needs. This is of particular concern to CPRE because homes that are planned and/or built that address demand but do not meet need waste valuable countryside,
Lets pick this apart. I am a rich person. I want to express my demand by buying a newly built house in South Oxfordshire District. Is it saying that this countryside should not be built on or that to avoid wasting it the housing built on the South Oxfordshire Countryside should be prioritised to locals in need?
I dont think they can claim the latter rather than the former is later in the report they are explicit that expensive market housing restricted by planning policy in one area is not made up in other areas. In other terms rich people dont need homes. A policy which would lead to housing affordability becoming ever worse because rich people aren’t restricted to living in new homes, they can instead live in the 95% of the stock that it is existing and with housing not built in an area meaning the same number of people chasing fewer houses pushing up prices for everybody and creating need by some household falling off the bottom rung of the affordability ladder. This is clear in their section 6.0 on a new approach, an approach oddly enough repeating many of the same mistakes than the government OAN paper makes – which would lead to a systematic under supply of housing.
Take the following – it has a correct definition of housing need (Alan Holmans/Duncan Bowie taken from well done) then adds the following poison pills.
It adds ‘at local level’ so exuding in migration. So implying someone short of a home in London cant move to a new job in booming Science Vale. An old trick tried by the keep them out at all costs CPRE branches, then adds the following nonsense.
Housing demand is recorded as the market demand for housing that exceeds the minimum requirements to meet housing need
This is entirely and precisely wrong. Housing need is housing need able to be realised in housing market+ need for affordable housing.
The implication of the CPRE subtle definition is that housing need is ‘locals only’ need for housing and anyone trying to buy a house in the local market doesn’t need one. This is explicit in the title of the report’ Needless demand’. Ok then where should they be able to buy a house?
It goes on ‘ The desired development, including new homes, needs to be calculated on the basis of realistic assessments of the ability of the economy and the capacity of the
development industry to meet those aspirations, as well as taking account of constraints such as Green Belt and other planning or environmental designations. Such aspirations should be presented as separate from housing need and demand’
Point 1 according to the CPRE planning constraints such as Green Belts mean I dont need a home. They dont claim anywhere else that this need should be made up elsewhere through regional planning. Indeed step one of their OAN model exudes migration from constrained areas by definition.
Point 2 yes there is a fair point about overly aspirational job targets which dont add up nationally. Not everywhere can have the highest and most aspirational growth levels. However lets imagine im a firm that wants to locate to south Oxfordshire but cant because of shortages of labour force, or’i’m a worker that wants to migrate there because of lack of a job or a home. Is this aspirational? Imagine then that that person wants to migrate from a constrained area or an area without a chronic shortage of housing such as London? The CPRE definition excludes them from its definition of need. What this illustrates is the common flaw of both the CPRE paper and the DLCG paper. Housing need is not local it is universal. It is a political decision where that need is met. That political decision will include some already living in an area and some moving there to work and retire. By saying those moving to high paid jobs in an area is ‘demand’ and not need the CPRE is saying nothing about where those people will be housed; implying that those houses wont be built. It is in effect a policy of internal pass laws where villages and towns are kept in aspect for a rapidly aging and dying population and where in migration is left of the figures to minimise ‘concreting over the countryside’.
The last time the CPRE succeeded in convincing a gullible planning inspector on this point was in the 1990s with the West Sussex structure plan. They havn’t once won it since because everyone in the planning world has learned it to be a fallacious argument. The same argument reproduced 100s times over each time with a new DTP gloss and padded and hidden with correct statements and nice data and footnotes around it is designed to disguise the central fallacy.
They go on
‘A policy-on’ scenario should change the amount and type of housing that is planned for in order to meet policy outcomes insofar as can be realistically and sustainably achieved in the plan period’
You can never have a policy off scenario without migration. That is a policy on scenario of restricting housing numbers nationally because of a failure to meet housing shortfalls in some areas with housing boosts in others. There is only a choice between one policy and another. Never a policy off scenario. What can be realistically and sustainable achieved again is a policy issue. We realistically and sustainably met national housing requirements through New Towns programme and mass housebuilding of social housing in the 50s and 60s and can and should do so again.
Much else in the paper is good. Standardizing OAN, great, but the paper came out a week late. Please DCLG dont follow the CPRE method as you will systematically undersupply housing even more than your own weak effort does. It misquotes my friend Duncan Bowie I think in a worrying way.
The standardisation of the SHMA process has also been called for by Bowie, who noted the additional benefit that estimates of housing need produced at a local level could be aggregated up to a national level
He meant estimated in the correct way, not totting up local models that exclude migration. In a correct model all inflows and outflows of migration add up so there is no double counting and all need is met. In such a balance sheet consistent model the same model can be seen as an aggregation of local models or segregationist of a national model to many local models. Mathematically they are and should be the same as the sub national geographies are man made and however they are drawn should make no difference to the total national need.
The CPRE need to more honest. for all of the households who would not get a house in their OAN model where would they go? Similarly with the DCLG. Neither can at the moment claim a credible answer to our housing crisis. Only those brave enough to say where the missing millions of houses should go are forming a constructive part of the debate.