RESPONSE TO CONSULTATION: Proposals for enabling more low cost, high quality starter homes for first time buyers.

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1 Royal Town Planning Institute 41 Botolph Lane London EC3R 8DL Tel +44(0) Fax +44(0) Website: Registered Charity Numbers England Scotland SC Patron HRH The Prince of Wales KG KT PC GCB 06 February 2015 Dear Andrew Short, RESPONSE TO CONSULTATION: Proposals for enabling more low cost, high quality starter homes for first time buyers. Thank you for the opportunity to respond to the above consultation. The Royal Town Planning Institute (RTPI) is the largest professional institute for planners in Europe, representing some 23,000 spatial planners. The Institute seeks to advance the science and art of spatial planning for the benefit of the public. As well as promoting spatial planning, the RTPI develops and shapes policy affecting the built environment, works to raise professional standards and supports members through continuous education, training and development. Yours Faithfully, Joseph Kilroy Policy Officer Royal Town Planning Institute 41 Botolph Lane, London EC3R 8DL +44 (0)

2 General comments Government proposes that no CIL or affordable housing obligations will apply to schemes which are designated for First Time Buyers so t that these and the lower land cost could fund the discount. The housing delivered would count as part of the 5 year land supply. Furthermore buyers could only sell to other First Time Buyers (FTBs). The RTPI welcomes any attempts to increase housing supply and affordability, but we think that a strategic approach is better as explained in our policy papers on housing 1 and strategic planning 2. The proposal as it stands has a range of problems. At a time of acute need it may lead to a reduction in affordable housing available to all on the basis of need. The cost is not born by government but rather by lost CIL and Affordable Housing receipts for the local authority area. At a time when there is already a financial squeeze on Local Government this measure would take more money away from an already beleaguered stratum of governance. CIL and S106 contributions are necessary in order to overcome reasons for the refusal of planning applications. Such reasons include the burden placed by development on physical and social infrastructure. FTB developments place burdens on infrastructure. DCLG has not indicated that it has secured backfilling capital contributions from other spending departments to make up for the lost contributions. Yet our understanding of policy changes is that the impact on other departments budgets should always be assessed. RTPI s work on housing, particularly our housing policy paper 3 provide ways of addressing this in a comprehensive way and we continue to press for a much more strategic and imaginative approach. Q1: Do you agree in principle with the idea of a new national Starter Homes exception site planning policy to deliver more new low cost homes for first time buyers? There is a real need to look at the wider affects of passing on these savings to first time buyers. If this saving for individuals is paid for by less social housing then it is questionable whether this is in the wider national interest. There is also a fundamental planning issue here. It is doubtful that low value housing in poorer locations all occupied by First Time Buyers is a realistic let alone desirable outcome. Targeting underused or unviable industrial and commercial land to provide discounted homes for first time buyers raises the question of whether people, first time buyers or otherwise, actually want to live in these kind of areas. The desirability of such areas will be further weakened by the fact that these developments will be exempted from CIL obligations making it less likely that the necessary social infrastructure will accompany these new homes. Regardless of type, development needs to happen in a holistic way; this means delivering social and physical infrastructure alongside housing. The proposed measure discourages this by exempting development from CIL obligations

3 Q2: Do you agree that the Starter Homes exception site policy should focus solely on commercial and industrial brownfield land which has not been identified for housing? Focusing on commercial and industrial brownfield land is one option, but former utilities land, that of water companies for example, could also be used. There are sites other than industrial and commercial, such as redundant leisure sites (subject to Sport England approval). There may also be quite a few retail sites coming up soon as the impact of online retail is felt by out of town retail parks. The NPPF allows for changes of use in town centres, which may also free up land for housing, However given that the brownfield first agenda has been in place for quite some time, where there are local authorities that are not striving purposefully to bring brownfield land into use, It is hard to think of any other reason than resources. As planning departments have taken the biggest budget hits in local government, with much more to come, the cumulative impact of all of the above reforms is affecting overall capacity not least because prior approval processes cost money and human resources to implement without the full fee. Q3: Do you agree that the types of land most suitable for Starter Homes will be under-utilised or non-viable sites currently (or formerly) in commercial or industrial use? The suitability of under-utilised or non-viable sites in commercial or industrial use will depend on decontamination measures, the provision of infrastructure, and the location of these sites. The measures proposed exempt proposed developments from CIL contributions, and this is likely to count against the provision of necessary social and physical infrastructure. Furthermore sites are not nationally uniform and while some under-utilised or non-viable sites currently or formerly in commercial or industrial use will be suitable, not all will be. It seems likely that local rather than national government will be in the best position to make a decision on whether or not a site is suitable for development. As the largest landowner in the country it is also important that the public sector releases land for sale and development in appropriate places for sustainable communities. Public sector landowners are obliged to hold out for the best price on land. While rational, this requirement needs to have regard to the role the public sector can have in developing successful places that people want to live, work and thrive. Cross departmental and border collaboration will allow neighbouring sites to be brought together to provide a large site which could be used for a large number of houses and necessary infrastructure. We recommend that Government departments and agencies should be required to dispose of their surplus land holdings in a way which takes account of the wider community value rather than maximising the capital receipt, and to do so with alacrity. Q4: Do you consider it necessary to avoid Starter Homes developments in isolated locations, or where there would be conflicts with key protections in the National Planning Policy Framework? Absolutely, for the reasons discussed above. Residents require transport links, and access to health, education, employment, and social activities. Building homes in isolated locations restricts access to these services. Isolated locations are also unlikely to be areas of high housing demand; therefore there will be difficulty in actually selling homes built in such locations.

4 Q5: Do you agree that the Starter Homes exception site policy should allow at the planning authority s discretion a small proportion of market homes to be included when they are necessary for the financial viability of the Starter Homes site? Yes, continuing the analogy with rural exceptions sites policy. Q6: Do you agree starter homes secured through the Starter Homes exception site policy should only be offered for sale or occupation to young first time buyers? No. A growing percentage of first-time buyers are in their thirties or forties and have been trying to enter the market for some time. It is at best unfair and at worst ageist to discriminate between first time buyers on the basis of age. A strong social case would have to be made for this being compliant with discrimination legislation. This is moving citizens private details into a realm in which they are not typically dealt with or relevant, i.e. the planning system. Q7: Do you think there are sufficient existing mechanisms in place to police this policy? No: and arguably it is inappropriate for planning staff to be intruding into details of either people s ages or previous property ownership history. Is this not additional regulation when the aim is to be reducing regulation? The proposal raises policing issues regarding age and property ownership. It is not clear that it is practicable for local authority planning staff to obtain evidence that an individual has never owned a property before. This is increasing the workload of an already stretched function. Q8: What is the most appropriate length for a restriction on the sale of a starter home at open market value? How should the sliding scale be set? No comment Q9: Do you agree that guidance should make clear it is inappropriate for Starter Homes exception site projects to be subject to section 106 contributions for affordable housing and tariffs? No comment. Q10: Do you agree that Starter Homes exception site projects should be exempt from the payment of the Community Infrastructure Levy? This would make it impossible for local authorities to require contributions to bringing infrastructure up to scratch in the wider area. As stated above the RTPI supports place making not just isolated house building. Therefore any measures, such as the exemption from the payment of CIL, that prevent the delivery of infrastructure in any housing development are not acceptable. Q11: Do you have any views on how this register should work and the information it should contain? No comment.

5 Q12: What kind of vanguard programme would be most helpful to support the roll out of Starter Homes? Any program that invites the involvement of SMEs into the house building sector would be welcome. As it stands 70% of all private sector housing output is now being produced by the largest house builders. This lack of competition means housing supply in the UK is quite rigid, not responsive when demand increases, and ultimately leaves the sector vulnerable to a crisis of the current kind. New actors are needed in the sector, and a vanguard program could play a key role in coaxing new small to medium sized builders and other construction companies not currently involved in house building into action.

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