Barwell Backs Away from Starter Homes

Telegraph

Starter Homes was always an Alex Morton gimmick to reprioritise home ownerership over affordable rent given low completions.  With that gone the policy has no political purpose.

The new housing minister Gavin Barwell has used his first major speech to shift Government policy away from a singular focus on home ownership.

Speaking at the RESI conference, he said: “We need to build more homes of every single type and not focus on one single tenure.”

He also indicated that the Government is considering abandoning its pledge to build 200,000 starter homes by 2020 due to a shift towards supporting the rental sector.

The Government campaigned on a policy of building houses which would be sold to first-time buyers at a discount of 20pc. However, Mr Barwell said that such policies which encourage ownership and increase the level of demand could affect the number of homes built for rent.

He said: “There’s a little bit of a tension between the overall supply objective and measures specifically to help people on to the housing ladder”. He indicated that affordable rental homes may now be included in that target figure for starter homes.

Mr Barwell added: “The way you make housing in this country more affordable to rent and buy is you build more homes. There is still a role for the government doing specific things to help people on to the first rung but this can’t be at the exclusion of all else.”

In the past, Government policy has largely backed ownership, at the expense of developing the rental market. The Starter Homes policy, which has been greeted with a hesitant response by much of the property industry, has been changed to make councils require a certain amount of them on developments.

The increase of stamp duty for buy-to-let landlords, for example, was also levied on institutional landlordsdespite them having received word from government that would not be the case.

Mr Barwell added: “A growing number of families and young professionals are choosing the [private rental sector], and while home ownership is still the goal for the majority, many will rent for some years before they buy.

“I’m very clear that our ambitions will never be achieved without a significant boost in institutional investment to the [private rental sector], to ensure more choice and quality for people living in rented accommodation.”

Adam Challis, head of residential research at JLL, described the Starter Homes policy as “a big distraction”, and added: “This is welcome news as it signals this Government’s desire to support housing across all tenures.

“The private rented sector is the fastest growing tenure, but had been overlooked under old policy. This is the first step in putting that right.”

Mr Barwell also gave his backing to built-to-rent schemes, and highlighted one by Essential Living in north London, and another by Pocket Living in south London which uses modular techniques.

He added: “Recent growth in the bespoke rental market has been impressive, but this progress must be expanded.”

London’s deputy mayor for housing, James Murray, added his backing to the private rental sector, while defending his 50pc affordable housing target.

He said: “If we’re going to increase supply and have affordable [housing] within that, you need to use every route of delivery, and if build to rent can deliver at scale and speed then we should support that”.

Green Belt saves Teresa May her Seat

The boundary commission proposals for English Parliamentary constituencies today shows 68 seats remain unchanged including Teresa May’s Maidenhead – because there electorate has changed less than 5% since the prior census.

The south east is the area with least constitutions changes – try expanding a town in the south east by more than 5% in the Metropolitan Green Belt.

Why Geoids Matter for Planning

The UK has a new Geoid OSTN15

What is a GEoid and why does it matter?

To obtain accuracy in any plan it needs to be referenced.  There are to, a projection and a datum/geographical coordinate system.  The former describes how the flat plan wraps around a sphere, the latter the mathematical difference between that sphere and the warped and bumpy shape of the earth.  Its derived from a gravity model so the more hilly or mountainous the terrain the bigger the problem.  You can use a global model – such as WGS84 – used in Google and by GPS, but that will be way too inaccurate at local level for infrastructure purposes. So ideally you develop a local geoid which is only really detailed in your local area.  Ideally each significant patch of the earth should have its own geoid.

I found the importance of this in three recent cases.  Firstly been doing a lot of work recently in Afghanistan – recently.  GPS signals were showing a road 25m in elevation off true, why, because the survey was based on US maps based on WGS84 not the local HArat North and the area was surrounded by 3,000m + high mountains.

Secondly I was managing a new masterplan for a city in Saudi near Mecca where the cut and fill calcs made the site uneconomic. The reason it was drawn on a google maps base and transposed to the local system.  Leading to a 25m shift the mountains were in the wrong place.  The matter was coumpounded by the military moving the whole coordinate system by several meters – believed to protect the Kabaa from Drone attack – a not uncommon tactic internationally I understand.

Finally I had an infrastructure plan for a new city – it was shifted as a whole by the corect amount.  The problem is the differences are different for every point in space.  It should have used a mathematical MLS model to calculate the correct shift for every point in space.  We had already done that for the Riyadh Metro.

So if you are shifting to OSTM15 from old survey data – be careful – you likely need specialist GIS advice to transform all yur survey and engineering data accurately.

Housing Expensive! You can buy a brick of a house for 67 dollars

A strata ownership scam in AUS those brick better be numbered so they dont sell them over.

WANNABE property investors now have another option for getting a toehold in the booming Sydney property market. A new company is selling houses just one brick at a time.

There’s no need to attend a single open inspection or auction, pay stamp duty, or deal directly with tenants.

And you can do it all in 10 minutes, online, and sell whenever you want.

The BrickX investment scheme which launched officially today is billed as Australia’s first stock exchange for residential property, offering part ownership via buying single ‘bricks’, which start at $67, under a system called ‘fractional ownership”.

CPRE wants to Freeze Green Belt Boundaries forever and abolish ‘exceptional circumstanes’ Test Abolished. DCLG doesn’t even understand what it is

Telegraph

England’s Home Counties are facing their “greatest threat” with plans to build new homes on more than 200 sites on the protected Green Belt, campaigners are warning.

A report to be published this week from the Campaign to Protect Rural England (CPRE) has uncovered blueprints for more than 123,000 new homes on 203 sites in the London Green Belt.

More than nine out of 10 sites have been allocated by councils under pressure from “unclear national planning guidance and confusing government messages”, the charity said.

CPRE warned that the figure could be an underestimate as only two-thirds of local authorities were surveyed for the report, entitled “Safe Under Us?”.

There was also evidence that planning inspectors were telling councils the Green Belt cannot be a “constraint” on development.

The Green Belt is the protected ribbon of land around towns and cities intended to prevent urban sprawl.

The London Metropolitan Green Belt is one of 14 Green Belts in England. It covers 514,040 hectares and is more than 60 years old.

The report said that most of the 203 sites “are allocated in Local Plans documents, so the threats are real”.

It added: “Already some areas of Green Belt have lost their designation, a number of sites are threatened with planning permission, while others are being built or have already been built.”

The report found in Hertfordshire 84,000 hectares (207,000 acres) are under threat, as well as 121,000 hectares (300,000 acres) in Surrey and 97,000 hectares (240,000 acres) in Essex.

CPRE blamed the threats on councils using a demand for more housing as justification for building on the Green Belt in “exceptional circumstances”, which is a loophole in new planning rules from 2012.

The campaign group said that “national pressure” was being applied “to deliver inflated housing targets. These targets are being inflated by unrealistic economic growth targets , forcing councils to give up Green Belt land”.

The problems were being “exacerbate by the effects of land-banking”, it said, adding: “Companies, having obtained planning permission, hoard the land until the profit forecast has been achieved. They then sell it on to a developer at an inflated price.”

The report concluded: “The planning system is not able to protect Green Belt in the way it was intended and current policies will result in considerable areas of Green Belt being lost.”

It urged the Government to stop councils using the “exceptional circumstances” clause in the National Planning Policy Framework to justify building on the Green Belt.Richard Knox-Johnston, chairman of the London Green Belt Council, said: “Promises were made in the Conservative general election manifesto that the Green Belt would be ‘safe under us’.

“However, councils are telling their residents that there is no alternative but to build in the Green Belt.

“Our evidence shows that in spite of the Government’s promise, councils are responding to a series of national messages and policies which forces them to release Green Belt land to receive financial incentives and avoid sanctions.

“The system is clearly not working and is not protecting the Green Belt. It seems likely that the government target of two million homes by 2020 will not be met due to land-banking and hoarding.

“By not taking action to unlock the land which already has planning permission, more pressure is being put on Green Belt land.

“We now need government to appreciate that this situation is not acceptable and to introduce measures to reinstate the protection of Green Belt as a matter of urgency.”

A Communities and Local Government Department spokesmen said: “These claims are totally misleading as they are based purely on projections in Local Plans, including Plans not yet adopted.

“We have been absolutely clear that councils must prioritise development on brownfield land.”

A source said: “We’ve been repeatedly clear that demand for housing alone will not justify changing Green Belt boundaries.   (sigh when will they ever get the difference between the very special circumstances test – for planni ng applications – which NPPG makes clear has no housing need exemption and the exceptional circumstances test 

“Councils are expected to prioritise development on brownfield with 90 per cent of suitable sites expected to have planning permission for new homes by 2020.”

In May, Sadiq Khan, the London Mayor, pledged to protect the Green Belt land in and around London from developers.

Mr Khan told The Telegraph he would not allow building on any of the 90,000 acres of Green Belt land within the M25. He instructed his planning officers to ensure his view that the Green Belt is safe is reflected in all planning decisions by the Greater London Authority.

Mr Khan said: “It is vitally important we protect our city’s precious green spaces and that must include opposing building on the Green Belt.

“I’ve now met with my team of planners to make absolutely clear that this must stay at the forefront of planning decisions.

“Ensuring everyone in our city, especially young people, has access to green spaces from parks and playing fields to community gardens is vitally important.”

All the Empty Bits of Europe where Millions of Refugees can Go

Rather confused today

Donald Tusk

EUROPE is “close to the limit” on accepting a new wave of refugees, according to EU bigwig Donald Tusk.

Speaking ahead of his visit to the G20 in China, the European Council President said: “The practical capabilities of Europe to host new waves of refugees, not to mention irregular economic migrants, are close to the limits

Wheras a German Minister in a speech in India says

‘We need more immigrants we welcome them we have room in Germany

Ok whats the evidence over what bits of Europe are full and which are empty?

Luckily the OECD publishes an index of rurality measuring how much of an area’s p[opulation is not living in urban areas.

In the past this was difficult to apply across Europe because of differing sizes of statistical areas.  Those fine fellows at Eurostate have applied a straightforward GIS technique to remap it based on a consistent raster grid.  Heres the result.

The green areas being the rural ones.  The results are striking, there are areas about 6 or 7 times larger than England as empty as the borders of Scotland.  How can Tusk reasonably claim Europe is full.  Also notably Hungary and England have no or few very rural Green areas perhaps explaining a little of their politics.

Given that there is a close correlation between urban expansion, economies of scale and economic growth if aging Europe is to match emerging economies growth rates it need to find areas for rapid large scale urbanisation as the national strategies of India and China do.

Certainly the green areas contain many mountainous and/or arid areas – though for right or wring this never held back China.  But it also contains many wet lush and flats areas, especially in Poland and the former East Germany.

Adjusting for post-war border changes both countries have lost around 10 million population each which have only been made up in the last few years, and both countries have static and declining populations.

But what about infrastructure etc.  If you had followed this argument Europe would still be in the Dark Ages.  Why because it is urbanisation which creates the innovation and economic growth that pays for the infrastructure.  The harmful effects of immigration only occurs when nations restrict immigrants access to land and the extent of new urbanisation.

The level of refugees reaching Europes shores by boat in 2015 is around 1/10 th of those that reached the US by boat in its peak immigration years before WWII.  The issue isnt the number of immigrants’, perfectly manageable, but the quality of the boats.

 

 

 

Why SFC models are based on Better Theory – a Response to Simon Wren Lewis

What makes Stock Flow Consistent models distinctive?

Simon Wren Lewis enters the fray following the publication of a paper jointly by Stephen Kinsella and Bank of England Collaborators.

Simon Wren Lewis damns with faint praise.

SFC models are popular with Post-Keynesians, and the definition you find on Wikipedia is “a family of macroeconomic models based on a rigorous accounting framework, which guarantees a correct and comprehensive integration of all the flows and the stocks of an economy.” Now I suspect any mainstream macroeconomists would immediately respond that any DSGE model is also stock-flow consistent in this sense. This point is made in a post by Noah Smith, and it is completely valid,…it would be a mistake for others to believe that the properties of their model show the importance of accounting rather than the theory they have used.      (my emphasis).

First off impressive as it is the BOE model has flaws.  Its treatment of investment and savings is insufficiently Kaldorian/Kaleckian to my taste, hence its unsurprising estimate of the fiscal multiplier as 1 – missing the fundamental Keynesian insight that savings are driven by investment.  Also its treatment of banking (and central bank ) equity is too Godleyian, so it still retains vestiges of the treatment of the financial sector as barter.

Unsurprisingly though Simon Wren Lewis misses that and feigns a ‘so what’response as if they are no different that pre DGSE aggregate models.  They are not.

Simon seems to treat accounting and theory as if they are counterposed.  The fundamental insight of SFC models is that modelling must be based on accounting theory.  Fundamentally the identity Assets=capital+liabilities.  With this one relationship you can derive all other economic identities Bourbaki style, such as equity, profits, debt and money.  Done properly you can avoid elementary errors which have led to such confusions as neoclassical capital and growth theory, the neglect of the financial sector and unsound concepts of state money where central banks have assets but no liabilities.

Simon is right that DGSE neglects through theory  intertemporal wealth balances, and doesn’t even have an accounting framework for measuring them.  This is why Noah Smith, Nick Rowe and others are wrong to state DGSE models as SFC.  If you allow this is an error the fundamental theoretical break with SFC models is they enable all economic actors to target some level of balances.  For example a householder saving for a deposit on a loan, or targetting investment returns for retirement, or a business forgetting  rate of return (as of course businesses maximise returns not profits).

In my own work I have used Ole Peters concept of rational leverage to replace the Euler equation approach which dogs DGSE and develop a concept of demand for money deriving from technological change which drives the financial sector.

The so called ‘heterodox’school has done a poor job of selling how and why SFC is theoretically superior.  It needs to get fundamental and undertake a project of defining all foundation economic concepts from accounting identities – right back to the roots of value theory, and tackling each and every component of orthodox theory.

 

 

Castlepoint Submits Local Plan it Own Officers Say it Won’t Support

This week submission

However it only meets 1/4 of OAN

Professional Planning Officers of the Council have stated on record that they do not endorse the current NLP (2016) document and will not act as advocates at Examination. This was confirmed in the Committee Report to Ordinary Council on 23 March 2016 (Appendix 2) which states that Officers consider that to support this plan would be a breach of the RTPI professional Code of Conduct and that ‘ Members must not make or subscribe to any statements or reports which are contrary to their own bona fide professional opinions, nor knowingly enter into any contract or agreement which requires them to do so’ .

It scales back from a 2013 consultation plan that proposed Green Belt release.   The excuse seeming to be that 2013 NPPG allows Green Belt to be considered as a constraint and a rather badly worded training talk ill advisedly given by Keith Holland that members could in effect do what they like on the Green Belt – without considering possible consequences of the Duty to Cooperate – of course all neighboring authorities have objected with NPPG significantly tightening the DTC approach.