Why May and Khan are in a ‘War of Words’ over Housing

Evening Standard – 13/10/2017 Oddly not on website.  Briefing from No 10 not city Hall.  Thanks to Daniel Bentley for the Pic.

The fatal weakness of PM May is her inability to partner with anyone.  She behaves with everyone like the worst form of hectoring boss.  Contrast her behavior on Friday with that of Lord Adonis and City Mayors in launching the National Infrastructure Assessment   on the same day.

Clearly Gavin Barwell is having an influence, but in giving May more things to panic and strut about not necessarily a good one.

The mistakes on housing, particularly planning for housing land, and the taxation of land, are so longstanding and systemic.  You can’t turn that around in a couple of years.  It would be much better to take bold long term decisions, like on Garden Cities and New Settlements, that will leave a legacy.

But lets look at another reason for Khan’s beration.  London overspill – the elephant in the room of British Planning.

London Annual Shortfall
Target
OAN per year to 2052 Annualised Current London Plan Target Employment led (Oxford E) Total  2016-2032 Total  2016-2052
Shortfall Completions 39,351 42,000 50,000
Typical 25,000 14,351 17,000 25,000 625,000 875,000
Typical +20% 30,000 1,351 12,000 20,000 500,000 700,000
Highpoint 38,000 1,351 4,000 12,000 300,000 420,000
Highpoint +20% 45,600 -6,249 -3,600 4,400 110,000 154,000

 

What this table shows is scenario planning for different levels of housing shortfall in London over medium and long term planning horizons.  The three target scenario are the OAN derived from the ONS tables, the current London plan target, and the Oxford Economics estimate which Khan in speeches has said the new London Plan will adopt.  So lets go with that one.

In terms of completions I have modelled four scenarios.  The typical completions in London over the last 15 years (outside Great Recession Years), this years estimated figures as a highpoint, unlikely to be repeated, at the top of the market (permissions are slowing down markedly in London), a one off distorted by years of delayed completions from the Great Recession.  To each of these two I added a 20% uplift which assumes new policies in the London Plan to increase housebuilding.  I think by far the most likely scenario is typical +20%.  This leads to an overspill requirement outside London by 2052 of 700,000 dwellings. (note I choose 35 years as that is the time needed to build out to design size a large New Town such ad Milton Keynes or Almere, 2016 is the base for the household projections).

This is what is driving Mays panic, unless there is a doubling of completions in London there will need to be massive overspill to the shires.  The DCLG know this.  They have the data.

So how realistic is it for the Great Wen to consume all its own smoke?

700,000 dwellings = 5,833 40 Storey Tower Blocks

Hong Kong Worlds Tallest urban agglomeration has 1,303 = up to 4.4 Hong Kongs of Tower Blocks

Do we want to see this Asian Style Vertical Sprawl?

Evidence strongly that at these densities diseconomies of congestion strongly outweigh positive urban agglomeration effects (Rappaport 2008)

Mayor of London – Post Grenfell – looking at alternative to tower blocks in
Revised London Plan

At 10 Storey Olympic Village Density – 335 DPH needs 1,791 Ha – 62.5 Olympic villages, 73.2 Aylesbury Estates – 8.06 sq miles –
Westminster=8.29 Sq miles

Equivalent to All Large Scale Housing Estates in London Capable of Demolition 1,750 HA (Complete Streets/Savills for Cabinet Office 2015)

At Least £5 billion cost of demolition plus cost of rehousing – we know post Grenfell nowhere to decant to (Professor Anne Powers estimate)

At Complete Streets favoured mansion block density 135 dph only capable of 1/3 this number

Equivalent to 10 Park Royals at Complete Streets Densities

So at Complete Streets densities need to knock down all of London’s Large Estates, All its Strategic Employment Sites and then start knocking down semi detached London

Every City that has tried development on this scale and density in recent years – e.g. Moscow, Harare, Seoul has seen mass protest, mass corruption, failure of developers after mass demolitions, overcrowding from decants and political climbdowns. Unlikely to be possible in a democracy.

Its politically impossible.  Khan knows this.  May sadly is not sharp enough to realise this and worries about ‘concreting over the countryside’ like the old style Tory she is.

 

 

 

May (in panic) to Housebuilders – You Naughty Naughty Boys

Telegraph   

Given the lead in times between outline on big sites and development – even with a drop in ‘landabnking’ only a realtively number of extra homes could be buolt by yhe next election.  Upping numbers is a long term game.  The Tories are paying the consequences years later of Eric Pickles breaking the Planning System for Growth areas/

Theresa May has called Britain’s biggest developers to a Downing Street summit this week after pledging to “dedicate” her premiership to fixing the “broken” housing market.

Government sources said the Prime Minister will “lay down a challenge” to the industry to construct more homes, in a “significant intervention” following her promise to get more people onto the housing ladder.

Leading developers and building firms are expected to attend the summit on Tuesday, together with representatives from local authorities and housing associations.

The meeting comes after Mrs May used her conference speech to identify housing as the central domestic issue on which she will focus in the coming months.

The Sun

THERESA May is demanding  Britain’s ­biggest housebuilders construct more homes.

The PM will hold a No10 summit with  their bosses next week, we can reveal.

Theresa May has lost patience with construction bosses and will hold showdown talks with them at No10

Tuesday’s showdown comes as Downing Street runs out of patience with the sector, as James Forsyth reports in his ­Sun column today.

Senior Cabinet ministers admit the Tories will not win the next election unless they can solve the housebuilding crisis.

One told The Sun: “We have to get more homes built, it’s as simple as that. If we can’t get more people owning homes by 2022 we’ve lost.”

Earlier this year, ministers threatened to punish housebuilders who did not develop plots they own. They believe they sit on land to wait for prices to rise.

 Senior Cabinet ministers admit the Tories will not win the next election unless they can solve the housebuilding crisis

Senior Cabinet ministers admit the Tories will not win the next election unless they can solve the housebuilding crisis

Communities Secretary Sajid Javid published proposals to “use it, or lose it” amid fury at the slow pace of construction.

He also laid out plans that would force councils to approve more homes if prices get too high. Consultation on his Housing Strategy ends next week.

A report by the Civitas think-tank last year, meanwhile, revealed  two million planning permits were issued between 2006 and 2015, yet foundations were  laid on only 1.3million.

The Tories have promised  a million new homes by the end of the decade. Mrs May used her  conference speech to pump  £10billion into Help to Buy  and to step up a council house building. No10 refused to comment.