Shaping the Future of North East Lincolnshire
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- Meryl Nicholson
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1 North East Lincolnshire New Local Plan Issues Paper: Housing Analysing the evidence and identifying the issues October 2014 Shaping the Future of North East Lincolnshire
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3 Executive summary 1
4 This paper is one of a series of Issues Papers prepared to support the progression of a new Local Plan for North East Lincolnshire. It summarises the evidence gathered and the key issues and challenges arising, in relation to housing, that will lead to the identification and appraisal of options in the new Local Plan. Deciding how many new homes are needed, and should be planned for, over the lifetime of the new Local Plan up to 2032 is a fundamental one, as is where these new homes will be built. New development and new housing development results in change to the places in which we live. It is one of the challenges of the new Local Plan to ensure that the positive changes arising from additional housing development are maximised, whilst any adverse impacts are reduced and mitigated against. North East Lincolnshire is a place of significant potential and improvements in the local economy have already been seen. The recent presence of the renewables industry, serving wind farms in the North Sea, is just one strand of this. The borough also has one of the country s most expansive areas of greenfield land available for employment development - adjacent to the south bank of the Humber estuary - with significant potential to create new jobs. Because of this, the council consider that it is entirely appropriate that it plans for significant growth in the borough, thereby maximising the benefits to local residents and businesses. To ensure that this is realised, the right number of new homes need to be planned for and built at the right time, so as to match this aspiration for economic growth. In addition to economic growth the number of new homes to be planned for is influenced by changes in the existing population, such as birth and death rates, as well as migration into or out of the borough. The average size of households and what this is likely to be in the future, is also a factor, as is the level of commuting into and out of the borough. These matters have been fully reflected upon. The council is required to objectively assess the local need for housing and then plan for its delivery. While previously this figure was set at a national level and targets set for each region, this is no longer the case. There is a wealth of information and guidance nationally to support the council in doing this, which has been reviewed and considered in the work undertaken. In addition, specific detailed technical work has been completed to inform the calculation of the borough s objectively assessed housing need. In completing the above, eight future scenarios have been identified, including three which take employment as the lead factor on which to base projections and assumptions. These aspirational employment-led scenarios are linked to the council s well founded evidence of the potential for future growth, as mentioned above and outlined in its recent Local Economic Assessment (2014). Based on official Government projections, the minimum number of new households that North East Lincolnshire should plan for is 307 per year which represents around 5,830 for the lifetime of the new Local Plan up to This projection however assumes that the 2
5 area would not see significant economic growth. Nevertheless, it shows that a significant proportion of the need for new households is driven by the need to meet the needs of the borough s existing population and immigration to the area. The employment-led scenarios are judged to be the main scenarios for consideration given that they are directly aligned to the council s evidence about the strong potential for jobs growth in the borough. The forecasts do though take a positive outlook as to the future performance of the local economy, albeit based on objective analysis of evidence and opportunity. As part of planning for the delivery of housing the council is obliged to consider what sites there is available to accommodate development in the borough. It does this through working with land owners and developers so as to identify and then thoroughly assess the likelihood of specific sites being developed during the local plan s lifetime. The result of this work is the council s regular production of a Strategic Land Availability Assessment (SHLAA). To date, the council has identified sites with a total combined estimated capacity to accommodate around 16,000 new homes, of which around 11,600 could potentially become available in the next 15 years. It will be the Council s intention to maximise housing development on previously developed (brownfield) land and on land which has the least environmental quality. However, the scale of new housing needed, combined with the poor viability of development in much of the borough, means that brownfield sites cannot be relied upon to entirely meet the objectively assessed need. In planning for new housing, the type and mix of new housing needed must also be taken into account, so as to make sure that the right type of housing is available; ensuring that sites do not remain undeveloped or new homes remain vacant for example, because they are too expensive, too large or are not available to rent. North East Lincolnshire has a high proportion of terraced homes, mainly within Cleethorpes and Grimsby; whereas other areas have a wider mix of house types. There is a growing need for housing to meet the specific needs of a larger elderly population and whilst housing locally is relatively affordable, a stronger housing market will result in increased house prices and a greater need for affordable housing and single person accommodation. The development of new housing will result in an increased demand for school places. It will result in a greater demand on the local sewerage system and put more vehicles onto local roads, alongside impacting upon a wider range of infrastructure. Consideration of such important matters is key to the local plan s success and is being assessed separately. Some of this infrastructure, to mitigate the additional impacts of new housing development, will be funded by the developer, at the time that individual planning permissions are granted. It is already a requirement that contributions are made towards financing local primary school provision, where a shortfall exists, and that developers pay for changes to road junctions required because a development will result in additional traffic movements. However, it will not be possible to finance from development all of the changes needed to local infrastructure, not least because in many parts of the borough the viability of building 3
6 new houses is poor. The council is required to have regard to the viability of development and not impose unnecessary burdens where it would mean that development does not happen. In planning for new housing development the local plan will also need to explain what is expected in terms of achieving good design. It is vital that new housing developments, of all scales, contribute positively to their wider context through, for example, the layout of new streets and buildings and associated open spaces. That the design and appearance of buildings is appropriate to their context will also be significant. Key Issues The key issues identified for housing in the new Local Plan are: 1. Establishing the supply of housing land over the plan period so as to meet the objectively assessed need; 2. Determining the level of supply of windfall sites; 3. Identifying delivery rates. Historically, the borough has had a low rate of new houses built each month and there is a need to attract larger regional and national house builders so as to accelerate this; 4. Viability. There is a strong desire to see new housing development on brownfield sites, but these are often the most challenging with respect to viability; and, 5. Meeting the requirements for affordable housing and the right mix of dwellings. 4
7 A Introduction Legislation, Policy and Guidance Policy context including the existing Development Plan Guidance Evidence and analysis Evidence analysis: Housing delivery Evidence analysis: Housing Needs What factors affect household need? Background Evidence Dealing with the issue of backlog or shortfall Evidence analysis: Housing Supply and Allocations Evidence base Evidence analysis: Housing Mix Evidence analysis: Affordable Housing What is affordable housing? Context Affordable housing need Key issues for North East Lincolnshire Bringing the evidence together Conclusions Overall strategic approach Housing Need Housing supply Delivery Affordability and mix Appendices Housing completions by settlement
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9 Introduction 7
10 1.1 The provision of housing is a key strategic issue to be addressed in the new Local Plan. It is the council's responsibility to identify the scale of need for new homes, and to identify specific sites capable of being developed to provide new homes to meet this need. This introduction sets out why more homes are needed in North East Lincolnshire, and addresses the spatial approach considering the distribution of development. Why do we need more homes? 1.2 In simple terms, more homes are required to provide for the needs of the community in North East Lincolnshire. The area's population is increasing, and a range of changes in the structure of the borough's population is contributing to an increase in the need for new homes. 1.3 Trends occurring in the borough's population (known as 'demographic factors') is contributing to increased need. The ambition to deliver local economic growth and create more jobs also has a direct impact on the number of new homes required. 1.4 Not delivering enough homes would result in higher prices, insufficient housing, and employment and skills shortages as skilled workers move for the housing that they require. It can also lead to the over-crowding of households, due to households not forming due to a lack of homes. Spatial Approach 1.5 The need for new homes will need to be balanced with the variety of challenges and constraints that are present in North East Lincolnshire. This includes issues such as market perception, development constraints, infrastructure, viability, and land supply. 1.6 The rental and buyer market is most active in the urban area of Grimsby and Cleethorpes, with the latter settlement regarded, by local property agents, as the more popular place to live. However, much of the urban area is subject to significant constraints which need to be considered, including flood risk and proximity to hazardous installations. These are constraints which also affect much of Immingham. 1.7 The buying market is particularly active in the western and southern arc settlements of Humberston, Waltham and New Waltham. Equally, Healing and Laceby are popular locations for families. The western and southern arc features land that is relatively unconstrained, when compared to the urban area. 1.8 The rural area has seen very little growth in recent years. The area comprises small villages and hamlets, many of which are set within the scenic Lincolnshire Wolds, an Area of Outstanding Natural Beauty (AONB). The larger villages of Stallingborough and Habrough accommodate much of the rural area's population. 8
11 1.9 Land supply is also an issue. Land becomes available for development only where a landowner is willing to see it developed. Land does not always become available in the 'right places', for example, it may be constrained and inappropriate Viability is also a key issue in North East Lincolnshire. Much of the urban and estuary areas have lower housing and land values. Property development is a commercial business and developers expect a competitive return on investment in a scheme Where a scheme is unviable (i.e. a competitive return will not be achieved), development will not take place. In areas where the housing market sees low values, there is a reduced chance of schemes being viable. In these areas, the cumulative impact of policy burdens placed on development by the local plan is important. Figure 1.1 'Housing Market Value Areas' provides an illustration of North East Lincolnshire's housing market areas. This presents an initial picture of local market values based on very broad assumptions, but does serve to highlight that there are marked differences in viability across the borough. This identified areas of high, medium and low value (based on post code data) across the borough, which are reflective of the relative values within the local market, not based on national figures, which are significantly higher Further discussion about the overall spatial approach can be found in the New Local Plan Issues Paper: Strategic Context and Spatial Approach (2014). 9
12 Figure 1.1 Housing Market Value Areas 1.13 The sustainability of settlements will also affect choices for growth. The council undertook a Settlement Accessibility Assessment (2013) which provided a hierarchy, ranking settlements based on the level of access they provide to key services. This includes education, health care, recreation, and shopping. However, it considers 10
13 only ease of access, and not the capacity for these facilities to accommodate additional growth. This will be assessed in the council's forthcoming Infrastructure Delivery Plan The Settlement Accessibility Assessment concluded that that Grimsby, Cleethorpes, and Immingham provide the best level of access to services. These settlements are closely followed by New Waltham, Waltham, Laceby, Healing, and Humberston. Stallingborough provides some access to services, however, all other rural settlements received a neutral or negative score. Spatial Zones 1.15 The council identified four distinct 'Spatial Zones' in North East Lincolnshire in the former Local Development Framework (LDF) Core Strategy. These are likely to be retained in the new Local Plan. Reference is made to spatial zones throughout this document, and data analysis has been undertaken based on these four zones. Figure 1.2 'North East Lincolnshire's Spatial Zones' shows the extent of North East Lincolnshire's spatial zones The spatial zones provide a simple method for considering and illustrating how "planning for growth" will be delivered in different geographical areas, and it also provides a reflection of local distinctiveness. The area boundaries are deliberately not distinct as the issues pertinent to different areas can overlap in some instances. 11
14 Figure 1.2 North East Lincolnshire's Spatial Zones 12
15 Legislation, Policy and Guidance 13
16 Legislative Content 2.1 The council is required to consider the need for further housing in North East Lincolnshire by the Housing Act 1985, this requires a 'periodical review of housing needs' (1). The council when undertaking this review must also carry out an assessment of the accommodation needs of gypsies and travellers residing in or resorting to the area (2). Provision for gypsies and travellers is discussed in the New Local Plan Issues Paper: Gypsies and Travellers (2014). Policy context including the existing Development Plan National Planning Policy Framework (NPPF) 2.2 National planning policy for housing is outlined in the National Planning Policy Framework (NPPF) and Planning policy for traveller sites (3). The NPPF seeks to significantly boost the supply of housing, and ensure that council's identify sufficient land for housing which is available for market and affordable housing. At the heart of the NPPF is the principle of achieving sustainable development, focusing on economic, social, and environmental outcomes. 2.3 The NPPF places a number of specific requirements on local authorities. This includes: Developing a proportionate evidence base to support housing policies including allocations; Producing a Strategic Housing Market Assessment (SHMA). The SHMA should assess the full housing needs of the housing market area (4). Local authorities can work together where a housing market area crosses administrative boundaries. Through the SHMA, local authorities should identify the scale of housing required, the mix, and range of tenures likely to be be required over the plan period. The NPPF states that migration and demographic change should be be taken into account using evidence including household and population projections; Addressing the need for all types of housing, including affordable housing and the needs of different groups including families with children, older people, and people with disabilities. The NPPF makes specific reference to people wishing to build their own homes; and, Preparing a Strategic Housing Land Availability Assessment (SHLAA) (5). The SHLAA should establish realistic assumptions about the availability, suitability 1 Section 8, Housing Act Section 225, Housing Act Published by CLG alongside the NPPF in Paragraph 159, National Planning Policy Framework (CLG, 2012). 5 Paragraph 159, National Planning Policy Framework (CLG, 2012). 14
17 and the likely economic viability of land. It should demonstrate that the council can identify sufficient land to meet housing need over the plan period. 2.4 This evidence should be used to ensure that local plans meet the full, objectively assessed needs for market and affordable housing (6). This is except in cases where 'doing so would significant and demonstrably outweigh the benefits, when assessed against the policies in the [NPPF] taken as a whole', or where specific policies in the NPPF indicate that development should be restricted (7). Specific policies which restrict development include those related to sites protected under the Birds and Habitats Directives (8), Sites of Special Scientific Interest (9), Areas of Outstanding Natural Beauty (10), heritage assets, and locations at risk of flooding. 2.5 The NPPF requires local authorities to "identify and update annually a supply of specific deliverable sites sufficient to provide five years worth of housing against their housing requirements" (11). This is effectively a comparison between the number of homes required to be built to meet the area's identified housing need and the number of homes that are estimated to be built over a 5 year period. Authorities are also required to identify an additional buffer of land capable of delivering a number of homes equal to either 5% or 20% of the housing requirement, depending on local circumstances. Authorities are required to identify a 20% buffer where they have a persistent record of under delivery of housing (12). 2.6 The NPPF allows "local authorities [to] make an allowance for windfall sites (13) in the five-year [housing land] supply if they have compelling evidence that such sites have consistently become available in the local area and will continue to provide a reliable source of supply" (14). The evidence required to provide the justification for any windfall allowance should include an assessment of historic windfall delivery and expected future trends, but calculations should not include housing development on residential gardens (15). Local plans should support wider council initiatives, such as identifying and bringing back empty housing into residential use (16). 6 Paragraph 47, National Planning Policy Framework (CLG, 2012). 7 Paragraph 14, National Planning Policy Framework (CLG, 2012). 8 For further information, please refer to the New Local Plan Issues Paper: Biodiversity (2014). 9 For further information, please refer to the New Local Plan Issues Paper: Biodiversity (2014). 10 For further information, please refer to the New Local Plan Issues Paper: Green Infrastructure (2014). 11 Paragraph 47, National Planning Policy Framework (CLG, 2012). 12 Paragraph 47, National Planning Policy Framework (CLG, 2012). 13 A windfall site is land that has not been specifically identified as available in an existing Local Plan or Strategic Housing Land Availability Assessment, and which have come forward through the development management process. In North East Lincolnshire, all minor consents are counted as windfall sites. 14 Paragraph 48, National Planning Policy Framework, CLG (2012). 15 Paragraph 48, National Planning Policy Framework, CLG (2012). 16 Paragraph 51, National Planning Policy Framework, CLG (2012). 15
18 2.7 Housing applications should be considered in the context of the 'presumption in favour of sustainable development'. This means that where a plan is absent, silent or policies are out-of-date, planning permission should be granted, unless the "adverse impacts of doing so would significantly and demonstrably outweigh the benefits" (17). Further to this, the NPPF states that where a local authority is unable to demonstrate a five year supply of housing land to meet the area's objectively assessed need for housing, that "relevant policies for the supply of housing should not be considered up-to-date" (18). To ensure that a five-year supply of housing is supplied, the council should set out an implementation strategy for the full range of housing (19). 2.8 The NPPF allows local authorities some flexibility to reflect local circumstances. Planning Policy Statement 3: Housing (PPS3) (20) outlined a minimum density requirement for new developments, of 30 dwellings per hectare (dph), the NPPF allows authorities to set out their own approach to housing density (21). 2.9 The NPPF states that where affordable housing is needed, policies should require this need to be met on site unless off-site provision or a financial contribution can be robustly justified (22). With regards to affordable housing, policies should be flexible to take account of changing market conditions which will occur during the plan period In order to boost housing supply, the NPPF states that planning authorities should approve planning applications from change of use from commercial premises (23) where there is an identified need, unless there are strong economic reasons why such development would be inappropriate (24). The framework also suggest that extensions to existing villages and towns that follow the principles of garden cities may provide an appropriate way of achieving sustainable development. When considering these options, council's should consider whether it is appropriate to establish Green Belt around or adjoining this form of new development (25). Where council's consider that housing development in existing residential gardens would cause harm to a local area, the NPPF suggest outlining policies to resist this type of development (26). 17 Paragraph 14, National Planning Policy Framework, CLG (2012). 18 Paragraph 49, National Planning Policy Framework, CLG (2012). 19 Paragraph 47, National Planning Policy Framework. CLG (2012). 20 This document was superseded and replaced by the NPPF. 21 Paragraph 47, National Planning Policy Framework (CLG, 2012). 22 Paragraph 50, National Planning Policy Framework, CLG (2012). 23 Buildings in 'B' Use Classes. 24 Paragraph 51, National Planning Policy Framework, CLG (2012). 25 Paragraph 52, National Planning Policy Framework, CLG (2012). 26 Paragraph 53, National Planning Policy Framework, CLG (2012). 16
19 2.11 Local authorities are encouraged to meet local needs when planning for housing, particularly where affordable housing is concerned, for example through the allocation of rural exception sites (27). Local authorities have discretion to allow small numbers of market homes to come forward on these sites (28) Additionally, the development of isolated homes in the countryside should be avoided (29)(30), and housing should be located where it will enhance or maintain the vitality of rural communities, for example, by supporting services in neighbouring settlements Further policy affecting housing is provided throughout the NPPF, however, 'Chapter 7: Requiring good design' provides an indication of how council's should react to development proposals. It states that council's should seek to ensure that development responds to local character and history, is visually attractive, and creates safe and accessible environments (31). However, it further states that in seeking to achieve these aims, innovation should not be stifled (32) and prescription and detail in policies should be avoided (33). To achieve these aims council's should concentrate on guiding the overall scale of development, density, massing, height, landscaping, layout, materials and access (34). Laying the Foundations: A Housing Strategy for England 2.14 The Government published Laying the Foundations: A Housing Strategy for England in 2011 outlining the Government's wider policies aimed at reinvigorating the housing market, establishing a stable housing market for the future, supporting choice and quality, and improving environmental standards and design quality. In particular, the document outlined commitments to make it easier to secure mortgages on new homes, improve fairness in social housing, and bring empty homes back into use. 27 Small sites used for affordable housing in perpetuity which would not otherwise be released for general market housing. 28 Paragraph 54, National Planning Policy Framework, CLG (2012). 29 Paragraph 55, National Planning Policy Framework, CLG (2012). 30 Except in special circumstances. 31 Paragraph 58, National Planning Policy Framework, CLG (2012). 32 Paragraph 60, National Planning Policy Framework, CLG (2012). 33 Paragraph 59, National Planning Policy Framework, CLG (2012). 34 Paragraph 59, National Planning Policy Framework, CLG (2012). 17
20 Regional Strategy 2.15 Under the previous Government, housing requirements were calculated at a national level and targets were set for each 'regional planning authority' (35) The Regional Strategy for Yorkshire and the Humber was comprised of two documents: The Yorkshire and Humber Plan Regional Spatial Strategy to 2026 (May 2008) (RSS); and, The Regional Economic Strategy for Yorkshire and Humber (2006) The regional planning authority divided the regional target between each local planning authority (36). Targets were set for each authority in the Yorkshire and Humber Plan (hereafter referred to as the 'RSS'), and this document formed part of the council's development plan. This document has now been substantially revoked by the Government (37). The RSS housing targets is discussed further in Section 5 'Evidence analysis: Housing Needs'. North East Lincolnshire Local Plan (2003) 2.18 North East Lincolnshire's development plan currently comprises the saved policies of the North East Lincolnshire Local Plan, adopted in November A direction made by the Secretary of State under Paragraph 1(3), of Schedule 8 of the Planning and Compulsory Purchase Act 2004 saved a number of policies which relate to housing. Guidance National Planning Practice Guidance (2014) 2.19 The National Planning Practice Guidance (NPPG) (2014) provides guidance for authorities in forming the evidence essential to support a local plan, including a standard methodology for housing needs assessments and housing land availability assessments The NPPG provides further guidance across a range of technical areas relevant to the provision of housing including the duty to co-operate, design, flood risk, rural housing and viability. Guidance is referred to in the evidence chapters. 35 For North East Lincolnshire, the regional planning authority was the Yorkshire and Humber Regional Assembly. 36 Planning for housing. Standard Note SN/SC/3741. House of Common Library, 16 June The Regional Strategy for Yorkshire and Humber (Partial Revocation) Order 2013 (S.I. 2013/117). Policies relating to the Green Belt around the City of York were retained. 18
21 Ten key principles for owning your housing number - finding your objectively assessed needs (2013) 2.21 Ten key principles for owning your housing number - finding your objectively assessed needs was published by the Planning Advisory Service (PAS) in April The document identifies ten key principles which it is recommended local authorities follow in establishing the objectively assessed housing requirement The document provides guidance on understanding and calculating need; the evidence required; housing market areas and affordable housing; translating the objectively assessed requirement into a figure to be provided in the plan; dealing with unmet requirements; using the SHLAA; ensuring a deliverable supply of sites; dealing with backlog and shortfall; determining the level of buffer to be applied to the five-year supply; and continuous monitoring. Objectively Assessed Need and Housing Targets: Technical advice note (2014) 2.23 Objectively Assessed Need and Housing Targets: Technical advice note was published by PAS in June It provides an overview of the NPPF requirements, and provides additional commentary on the standard methodology outlined in the NPPG. The document provides advice on defining housing market areas, the use of official projections, alternative scenario modelling such as employment based forecasts, and translating housing need to plan targets. How Many Homes (2013) 2.24 This document, published by the Royal Town Planning Institute, was developed alongside the What Happens Where toolkit (38), to help local authorities develop a baseline evidence which together with an understanding of local areas should enable a view to be taken on the number, and type of homes that should be planned for. Choice of Assumptions in Forecasting Housing Requirements (2013) 2.25 Choice of Assumptions in Forecasting Housing Requirements: Methodological Notes was published by the Cambridge Centre for Housing and Planning Research (University of Cambridge) in March The document considers the assumptions used in official population and household projections and provides commentary on the case for modifying these assumptions. Overall, the conclusion of the document suggests that modifications should be restricted to sensitivity testing The document provides a useful guide to the range of assumptions used, and the impact that they have in forecasting. In particular, the document concludes that birth rate assumptions have a negligible impact on the number of homes to be planned for, as those who will form households during the plan period will have been born 38 Local Housing Requirement Assessment Working Group. 19
22 well before the period began. The document also considers that variations to Government assumptions regarding death rates would not have a significant impact on planning for new homes (39) However, the document concludes that there is significant uncertainty for local authorities in internal and international migration. The document suggests that local authorities should not depart from recent trends in flows to and from the rest of the UK, unless there is a clear justification for doing so. The document goes on to state that authorities should attempt to plan for projected net inflows of people, and should carefully consider whether in doing so there would be adverse impacts which outweigh the benefits or providing additional homes It goes on to state that by not accommodating this need, there is the potential for other adverse impacts to arise, such as the overcrowding of households and households being prevented from forming (40). With regards to international migration, it is suggested that local authorities with small international flows should not regard this as an area of significant uncertainty in projections (41) The document further notes that there have been significant variations in household formation rates in recent years, owing to economic and housing market volatility. Unless there is strong local evidence to suggest otherwise, the guidance recommends planning for household formation patterns in the official projections The document suggests that local authorities should consider whether historic trends are likely to continue in their areas, but overall, that any modifications to official assumptions should be used purely as sensitivity tests to provide an indication of the level of flexibility that should be built into a plan. One particular factor which could suggest a departure from trends is the potential for significant economic growth (42). Planning for housing in England: Understanding recent changes in household formation rates and their implications for planning for housing in England (2014) 2.31 This report was commissioned by the Royal Town Planning Institute (RTPI) and based on research undertaken by academics at the University of Cambridge. This document considers the changes in household formation rates between the CLG's 2008-based and 2011-based models. It highlights potential issues with each model, 39 McDonald, N. (ed.), (2012). Choice of Assumptions in Forecasting Housing Requirements: Methodological Notes. Cambridge Centre for Housing and Planning Research: Cambridge, England. p McDonald, N. (ed.), (2012). Choice of Assumptions in Forecasting Housing Requirements: Methodological Notes. Cambridge Centre for Housing and Planning Research: Cambridge, England. p McDonald, N. (ed.), (2012). Choice of Assumptions in Forecasting Housing Requirements: Methodological Notes. Cambridge Centre for Housing and Planning Research: Cambridge, England. p McDonald, N. (ed.), (2012). Choice of Assumptions in Forecasting Housing Requirements: Methodological Notes. Cambridge Centre for Housing and Planning Research: Cambridge, England. p
23 and provides guidance to plan makers on the implications of using each model in forecasting. The document states that the significant changes in trends between the 2008-based and 2011-based models are unlikely to continue unchanged, and therefore concludes that planning using 2011-based formation rates could lead to an under-provision of housing. 21
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25 Evidence and analysis 23
26 Our evidence The key documents that form the housing evidence base are: Strategic Housing Market Assessment (2013) Demographic analysis and forecasts (2014) Local Economic Assessment comprising the Economic Baseline, Sector Study and Economic Futures reports (2014) Strategic Housing Land Availability Assessment incorporating Five Year Housing Land Supply Assessment (2014) Strategic Housing Land Availability Assessment Methodology (2014) Strategic Housing Land Availability Assessment: Viability Assessment Methodology (2014) Monitoring Report 2012/13 (2013) Settlement Accessibility Assessment (2013) Residential Density Study (2013) English Housing Survey: Households (2014) Revocation of the Regional Spatial Strategy: Housing - A Response (Background Paper for LDF Core Strategy Submission August 2010) (December 2010) Interim Planning Statement: Affordable Housing (2010) Windfall Allowance Technical Paper (2014) (in preparation) Local Plan and CIL Viability Assessment (2013) 3.1 An analysis of this evidence is provided as follows: Section 4 'Evidence analysis: Housing delivery'; Section 5 'Evidence analysis: Housing Needs'; Section 6 'Evidence analysis: Housing Supply and Allocations'; Section 7 'Evidence analysis: Housing Mix'; and, Section 8 'Evidence analysis: Affordable Housing'. 24
27 Evidence analysis: Housing delivery 25
28 4.1 This section provides an overview of historic housing delivery in North East Lincolnshire, focusing on the ten year period from 1 April 2004 to 31 March 14. Where additional data is available this has been included. 4.2 Information is provided about the number of new homes built in North East Lincolnshire, including: Where homes have been built; The proportion built on previously developed (brownfield) and greenfield land; and, The contribution made by windfalls. 4.3 Commentary on how the delivery of homes compares to the area's identified housing requirement is covered separately in Section 5 'Evidence analysis: Housing Needs' later in this paper. How many homes have been completed? 4.4 Table 4.1 'Housing Completions' presents gross, net and new build completions in North East Lincolnshire for this period, alongside the number of demolitions and losses. 4.5 Gross annual completions have not risen above 450 (43) in any of the previous ten years. The monitoring of performance against the borough's housing requirement is however, based on the number of additional homes provided, known as net completions (44). Net completions in North East Lincolnshire exceeded 400 homes in just one of the past ten years. Housing Completions Year Gross Completions Demolitions and Losses Net Completions New Build Completions 2002/ / / / Gross completions represents all homes formed and includes new build, conversions and change of use. 44 Net completions represents the additional homes provided and is the gross completions minus demolitions and losses. 26
29 Housing Completions Year Gross Completions Demolitions and Losses Net Completions New Build Completions 2006/ / / / / / / / Table 4.1 Housing Completions 4.6 Housing completions is illustrated in Figure 4.1 'Housing Completions'. This highlights the impact of demolitions and losses, in particular, for the 2008/09 period when a significant number of demolitions were made on regeneration sites. The impact of demolitions and losses from regeneration sites is evident in the period from 2010/11 to 2013/14, where demolitions from Freshney Green and Guildford Street (now known as Orchard Drive) accounted for 56% of all demolitions. The plan will need to acknowledge the impact that any future large scale programme of demolitions would have on overall housing completions. In the past ten years, on average, new build housing has formed 80.6% of gross completions, and the remaining 19.4% accounts for conversions and change of use. 27
30 Figure 4.1 Housing Completions Where have the homes been developed? 4.7 The vast majority of new homes built in North East Lincolnshire have been built within the urban area over the past 11 years. During this period, 73% of homes were built in the urban area; with 15% built in Healing, Humberston, Laceby, New Waltham and Waltham (45) ; 4% in Immingham; and the remaining 3% built in the rural area. Figure 4.2 'Housing delivery by Spatial Zone' illustrates the number of homes built by spatial zones and by year. In the most recent year for which data is available (2013/14), 79% of new homes were built in the urban area, 15% in the western and southern arc, 7% in the estuary area, and 0% in the rural area. Appendix A 'Housing completions by settlement' provides a breakdown of homes built by settlement. 45 The 'Western and Southern Arc'. 28
31 Figure 4.2 Housing delivery by Spatial Zone How fast has development taken place? 4.8 The council has undertaken an assessment of sales rates on housing schemes built out in the past ten years. This evidence was prepared to support the Strategic Housing Land Availability Assessment Methodology (2014). 4.9 This work established that, on average, a housing site in North East Lincolnshire will sell two homes per month. However, where a site had multiple developers in place this was capable of being exceeded, at around 45 dwellings per year. 29
32 Figure 4.3 Sales Rates 4.10 Many of North East Lincolnshire's housing sites are, however, relatively quite small. Figure 4.3 'Sales Rates' illustrates the results of the council's research. For each site, the total period that sales occurred was compared against the number of sales, to produce an average. This shows that many of the sites are small sites that sell slowly. What proportion of development has been on brownfield land? 4.11 The council monitors the percentage of new homes built on previously developed land (brownfield land) in each year. The number of new homes built on previously developed land has increased in recent years, and rose from 49% in 2012/13, to 57% of all new homes formed in 2013/14. 30
33 Figure 4.4 Proportion of homes built on previously developed land 4.12 Since June 2010, development on 'garden land' (46) has been classed as development on greenfield land and not brownfield land (47). The impact of this in North East Lincolnshire is, on average, a four per cent reduction per year on the percentage of dwellings delivered on previously developed land in the period from 2010/11 to 2013/14. The impact of this is illustrated by the red hatched area in Figure 4.4 'Proportion of homes built on previously developed land' In future years, in can be expected that the proportion of new homes built on previously developed land will reduce. This is discussed further in Section 6 'Evidence analysis: Housing Supply and Allocations' later in this document. 46 Land that is in use as a domestic garden and is classified as falling within the curtilage of an existing dwelling. 47 The Government revised Planning Policy Statement 3: Housing (PPS3) in June 2010 to reclassify garden land. 31
34 What contribution has been made by windfall sites? 4.14 A windfall site is land that has not been specifically identified as available in an existing Local Plan (48) or Strategic Housing Land Availability Assessment (SHLAA), and which has come forward through the planning application process. In North East Lincolnshire, all minor consents (49) are counted as windfall sites, however, some major development sites do come forward unexpectedly Major and minor windfall sites have, in the last ten years, made an average yearly contribution of around 120 dwellings to supply. In the past five years, new homes delivered on windfall sites have accounted for around 30% of supply Of the total number of homes provided by windfalls, minor schemes comprise around 66% of the overall supply provided by windfalls. It is also worth noting that the vast majority (91%) of new homes delivered on windfall sites have been on brownfield land. Many of these relate to conversions of existing buildings, and small "infill" opportunities The council is undertaking further work analysing historic windfall delivery. What success has been made returning empty homes to use? 4.18 Recent targets set by the council for returning empty homes to use have been exceeded. The target has been further increased for the year 2014/15. Empty homes brought back into use are counted as part of the existing stock, and do not count towards the net additional homes delivered. However, empty homes are taken into consideration in vacancy rates established in the council's Strategic Housing Market Assessment (SHMA). Bringing empty homes back into use can contribute to the provision of affordable homes, and provides additional regeneration benefits Other initiatives target the improvement of existing dwellings which bring forward significant improvements to the existing stock of dwellings and bring wider regeneration benefits. These initiatives do not not however add to the overall supply of new homes. 48 North East Lincolnshire Local Plan, including Minerals and Waste Policies (2003). 49 Sites of nine dwellings or less. 32
35 Number of empty homes returned to use Year Baseline 2007/08 Number of homes returned to use Target Result / / / / / / Table 4.2 Number of empty homes returned to use What is the picture of house prices, sales, and the rental market? 4.20 Houses prices in North East Lincolnshire are comparatively low, with an overall average price of around 120,000 in This compared to an overall national average price of around 247,000, meaning that the average property price in North East Lincolnshire's is less than half the national average. The average price of an older property in North East Lincolnshire stood at around 115,000; whereas the average price for a new build property was higher, at around 174, Prior to the economic downturn, average house prices grew steadily in the borough, but have remained relatively stable since The economic downturn had a dramatic effect on the housing market in terms of house sales, with the number of transactions falling dramatically. In North East Lincolnshire, transactions dropped to a rate less than half of pre-recession sales rates. This will in part be due to lenders becoming stricter with the amount of money that potential buyers can borrow. The removal of 100%, 95% and many 90% mortgage offers from the market in particular will result in a lack of mobility in the local housing market. The number of transactions saw a significant increase between 2012 and At this stage, it is uncertain if this trend will continue, however, the economic climate is improving. 33
36 Figure 4.5 House sales and average house price trends 4.22 North East Lincolnshire has a strong private rented sector, which has formed the second largest tenure in the borough for some time. Average rents (50) across all types of properties in North East Lincolnshire are 412 per month, compared to 475 in Yorkshire and the Humber, and 575 across England. However, the gap in average price values between North East Lincolnshire and England increases significantly with larger properties. Typically, 4+ bedroom properties have average rents of 643 per month in North East Lincolnshire, but 1,100 in England In North East Lincolnshire, lower quartile rents are therefore much lower than in England. The typical lower quartile value across all properties is 360 per month, compared to 450 in England. There is a marginal difference in average North East Lincolnshire and national lower quartile in smaller properties, however, the difference increases significantly for larger homes. 50 Values quoted are median rental values. 34
37 Evidence analysis: Housing Needs 35
38 Definitions Housing need Need for housing refers to the scale and mix of housing, and the range of tenures, that is likely to be needed in the housing market area (HMA) over the plan period. This should cater for the housing demand of the area and identify the scale of housing supply necessary to meet demand (51). Housing market area A housing market area (HMA) is a geographical area defined by household demand and preferences for all types of houses, which reflects the linkages between places where people live and work. Housing market areas can overlap (52). 5.1 The council has responsibility for establishing the level of housing to be provided through the local plan. This includes identifying the overall need for market and affordable housing. This is a key strategic issue and affects all other aspects of the plan. The need for affordable housing is considered separately in Section 8 'Evidence analysis: Affordable Housing'. 5.2 The assessment of housing need must be objectively assessed. It must take relevant published evidence into account, considering official population and household projections, which form a starting point. The assessment should only consider future scenarios that could be reasonably expected to occur (53). Critically, the assessment should not be constrained, for example, by limitations imposed by the supply of land, historic under performance, viability, infrastructure, or environmental constraints (54). 5.3 Throughout this document, reference to the council's work to assess its housing requirement is referred to as establishing the 'objectively assessed need' for housing in the area. This section provides an overview of the factors which affect the need for additional homes, background information on the council's historic housing requirement, and an overview of the on-going work to establish North East Lincolnshire's objectively assessed need for housing. 51 Paragraph: 003, Reference ID: 2a , National Planning Practice Guidance (CLG, 2014). 52 Paragraph: 010, Reference ID: 2a , National Planning Practice Guidance, (CLG, 2014). 53 Paragraph: 003, Reference ID: 2a , National Planning Practice Guidance (CLG, 2014). 54 Paragraph: 004, Reference ID: 2a , National Planning Practice Guidance (CLG, 2014). 36
39 What factors affect household need? Natural Change and Migration 5.4 Natural change is the difference between the birth (fertility) and death (mortality) rates. Where the birth rate in an area is higher than the death rate, the population will increase, and vice versa. Population projections, released by the Department for Communities and Local Government (CLG) (55) expect birth rates to continue to be higher than death rates in North East Lincolnshire, for much of the projection period from 2013 to This results in a net increase in population. 5.5 While a higher birth than death rate will result in an increase in the population, it does not result in significant additional need for homes, as the children born during the plan period will not be of an age to form homes until later plan period. However, high birth rates can place demands on the types of homes required, for example, the need for larger homes to accommodate families. 5.6 People move (migrate) for a variety of reasons. The English Housing Survey identified that a fifth of house moves are made for family and personal reasons (this is discussed further in demographic trends), and a tenth of moves are made for job related reasons. The need for a larger property is also a popular reason given for moving (56). 5.7 Migration occurs when people move between North East Lincolnshire and other areas within the UK, known as internal migration (57), and movements made into or out of North East Lincolnshire from the rest of the world, which is known as international migration. 5.8 Existing migration trends in North East Lincolnshire indicate that there is a net loss of people from the area due to internal migration, but a net gain of people from international migration. Existing trends projected forward would result in a net loss of people with the rate of outward migration gradually decreasing in the period to 2026, after which, it is expected that there will be a net increase in population due to inward migration. It should also be noted that while the area sees net international 55 CLG, Sub-National Population Projections (SNPP) 2012, Released: 29 May CLG (2014). English Housing Survey: Households CLG: London, England. 57 The Government's Sub-National Population Projection datasets make a further distinction between internal migration, which refers to moves within England; and cross-border migration, which refers to moves between England, Scotland, Wales and Northern Ireland (UK). 37
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