WORKSHOP Five Year Housing Supply and Calculating Housing Needs

WORKSHOP Five Year Housing Supply and Calculating Housing Needs Robert Love Senior Planner - Bidwells Roland Bolton Senior Director - DLP Planning Limited/SPRU

Organisation of Workshop 79 people Form 12 groups of 7 Each group will be either A, B, C, D which will dictate your case study

Purpose of Workshop Introduction to 5 year land supply post Framework (2018) and Guidance Work though 4 case studies to identify Highest Potential Supply Lowest Potential Supply Likely Potential Supply Highlight emerging issues and challenges Review recent appeals Does it work?

Introduction to case studies

Case A Gelding: Starting Assumptions Adopted JCS (2012) plan period 2011-2031 = 500 dpa Local Housing Need (Standard Method) = 300 dpa Housing Delivery Test 5% Strategic Site with Outline Planning in submitted (2018) 2013/14 2014/15 2015/16 2016/17 2017/18 Average Windfall 25 100 25 25 25 40 2017/18 2018/19 2018/20 2020/21 2021/22 Total Strategic Site 0 250 250 250 250 1000

Case B Lazybeach: Starting Assumptions New SHMA (2014 based) emerging LP submitted for examination = 300 dpa Local Housing Need (Standard Method) = 400 dpa Housing Delivery Test 5% Strategic Site with Outline (2017) for 1000 RM consent for 200 (2018) 2013/14 2014/15 2015/16 2016/17 2017/18 Average Windfall 25 25 25 25 25 40 2017/18 2018/19 2018/20 2020/21 2021/22 Total Strategic Site 0 100 100 100 100 400

Case C Beachfield: Starting Assumptions New SHMA (2016 based) emerging LP submitted for examination = 400 dpa Local Housing Need (Standard Method) = 300 dpa Housing Delivery Test 5% Strategic Site with RM consent for 1000 (2018) 2013/14 2014/15 2015/16 2016/17 2017/18 Average Windfall 100 60 50 25 15 50 2017/18 2018/19 2018/20 2020/21 2021/22 Total Strategic Site 0 150 250 250 250 900

Case D Ladysfield: Starting Assumptions Local Plan (Adopted 2015) plan period 2011 to 2031 = 250 dpa Local Housing Need (Standard Method) = 200 dpa Housing Delivery Test 5% Strategic Site with RM consent for 1000 (2018) 2013/14 2014/15 2015/16 2016/17 2017/18 Average Windfall 50 75 50 75 50 60 2017/18 2018/19 2018/20 2020/21 2021/22 Total Strategic Site 0 150 250 250 250 900

The Framework: 5 year supply Paragraph 73 of NPPF: Local planning authorities should identify and update annually a supply of specific deliverable sites sufficient to provide a minimum of five years worth of housing against their housing requirement set out in adopted strategic policies 36, or against their local housing need where the strategic policies are more than five years old 37

Calculating LHN with the Standard Method Step 1 - Setting the Baseline: Set the baseline using national household growth projection. Step 2 - An adjustment to take account of Affordability: Adjustment factor = Local affordability ratio 4 x 0.25 Step 3 - Capping the level of any increase Where policies adopted/reviewed within the last 5 years - the LHN figure is capped at 40% above the average annual housing requirement figure set out in the existing policies. Where policies for housing were adopted more than 5 years ago, the local housing need figure is capped at 40% above whichever is the higher of: a. the projected household growth for the area over the 10 year period identified in step 1; or b. the average annual housing requirement figure set out in the most recently adopted strategic policies (if a figure exists).

Exercise what is the local housing need? Definition from NPPF Annex 2 Local housing need: the number of homes identified as being needed through the application of the standard method set out in national planning guidance, or a justified alternative approach.

Exercise what is the local housing need?

Exercise what is the local housing need? Appeal: Land off Brindle Road, Bamber Bridge, Preston, PR5 6YP Council wanting to use: Calculated standard method dwelling requirement of 209dpa Vs. An older development plan requirement of 785dpa The standard method was rejected for four reasons:

Exercise what is the local housing need? The standard method was rejected for four reasons: 1. The figure was significantly lower than the plan based housing requirement in the Central Lancashire Core Strategy full objective assessment of need. Despite this being >5 years old, it had been subject to a more recent (2017) memorandum of understanding. 2. The reduced figure would not reflect the Government s objective to significantly boost the supply of homes. Nor would it assist in fulfilling the Council s City Deal obligations. 3. Housing requirements need to be agreed with neighbouring authorities in the housing management area to ensure the overall requirements of the areas are met. The council did not fulfil this, and deciding on a constrained housing requirement figure is not a matter for an Inspector on a Section 78 as it involves many more parties. 4. Government guidance indicates that the new methodology for assessing the housing needs is incomplete and so it would be premature to make and rely upon such an assessment.

Exercise what is the local housing need? Appeal: Land to the south of Bromley Road, Ardleigh, Colchester CO7 7SE Council wanting to use: Housing requirement of between 480 to 485dpa Vs. The draft local plan figure of 550dpa But both these figures are substantially lower than the results of the standard methodology calculated as 838 dpa

Exercise what is the local housing need? The Draft Plan figure of 550dpa was agreed because: The inspector found no good reason to depart from the local plan Although this was lower than the SM, the inspector accepted evidence presented in terms of the Unattributable Population Change (UPC) that showed that the difference between ONS estimates and census outcomes was exceptionally high and that the official population projections had been uniquely compromised

The Framework: The Buffer Paragraph 73 of NPPF: The supply of specific deliverable sites should in addition include a buffer (moved forward from later in the plan period) of: a) 5% to ensure choice and competition in the market for land; or b) 10% where the local planning authority wishes to demonstrate a five year supply of deliverable sites through an annual position statement or recently adopted plan 38, to account for any fluctuations in the market during that year; or c) 20% where there has been significant under delivery of housing over the previous three years, to improve the prospect of achieving the planned supply 39.

The Housing Delivery Test and the Buffer Housing Delivery Test % = Total net homes delivered over three year period Total number of homes required over three year period In identifying the correct housing requirement figure for the calculation, for the financial years 2015-16, 2016-17 and 2017-18, the minimum annual local housing need figure is replaced by household projections in all aspects of the Housing Delivery Test measurement stated in this Rule Book 18 Where the rolling three year Housing Delivery Test period includes any of the below financial years, the version of household projections to be used is as follows: Financial year of three year rolling Housing Delivery Test period Version of household projections 19 Annual average taken of years 2015-16 2012-based household projections 2015-2025 2016-17 2012-based household projections 2016-2026 2017-18 2014-based household projections 2017-2027.

Buffer Use 5% in case studies

Definition of delivery Annex 2 Reasonable Prospect of delivery for: Small Sites Sites with Full or Reserved Matters consent Clear Evidence of delivery for: Sites with outline planning permission; Sites with permission in principle; Sites that are allocated in the development plan; or Sites identified on a brownfield register.

The definition of Reasonable prospect In St Modwen v SSCLG [2017] EWCA 1643, Lord Justice Lindblom concluded that in terms of the previous Framework: [There is an] essential distinction between the concept of deliverability, in the sense in which it is used in the policy, and the concept of an expected rate of delivery. These two concepts are not synonymous, or incompatible. Deliverability is not the same thing as delivery. The fact that a particular site is capable of being delivered within five years does not mean that it necessarily will be. For various financial and commercial reasons, the landowner or housebuilder may choose to hold the site back. Local planning authorities do not control the housing market. NPPF policy recognizes that. Sites may be included in the five-year supply if the likelihood of housing being delivered on them within the five-year period is no greater than a realistic prospect the third element of the definition in footnote 11 (my emphasis). This does not mean that for a site properly to be regarded as deliverable it must necessarily be certain or probable that housing will in fact be delivered upon it, or delivered to the fullest extent possible, within five years.

Exercise: What is Clear Evidence?

Exercise- What is Clear Evidence? Clear evidence may include: any progress being made towards the submission of an application; any progress with site assessment work; and any relevant information about site viability, ownership constraints or infrastructure provision. For example: a statement of common ground between the local planning authority and the site developer(s) which confirms the developers delivery intentions and anticipated start and buildout rates. a hybrid planning permission for large sites which links to a planning performance agreement that sets out the timescale for conclusion of reserved matters applications and discharge of conditions. (NPPG Paragraph: 036 Reference ID: 3-036-20180913)

Exercise- What is Clear Evidence? Appeal Land to the south of Bromley Road, Ardleigh, Colchester CO7 7SE: In terms of a site with full permission paragraph 93 the council conceded that the site could not be delivered, and the inspector found that reference to a new as yet undetermined application was insufficient for the site to be retained in the supply (paragraph 93). For sites with outline consent, the lack of reserved matters applications was considered to be a key milestone, but uncertainties regard viability and access as well as the need to complete earlier phases resulted in the sites being omitted from the supply (paragraph 94). On two of the sites that had applications for reserved matters the long planning history highlighting delays, meaning only the first phase of the site was considered to be deliverable within the five years (paragraph 95). In terms of allocations the inspector found that even with a recently granted outline the absence of a reserved matters approval and clear evidence of the developers intent then it would be too early to confirm this site in the supply (paragraph 97). In considering other local plan allocations the inspector found that even though the plan was at examination and all but one was subject to an application (paragraph 103) but all should be omitted from the supply (paragraph 104).

Delivery of large sites From the Dancing Lane, Wincanton Decision: 18. The Council regularly consults developers to determine progress on sites. Nevertheless, I concur with the Inspector who stated that the number of developers on larger sites affected completion rates and that caution should be exercised where the delivery rates suggested by developers are out of step with the figures in the trading statements of those developers. The appellant has produced evidence to show that developers trading statements indicate a build rate of 30 to 35 homes per annum per developer per site. The appellant has confirmed that in the last five years they have completed 35 dwellings with 40 in the preceding two years. While this may have been due to increased involvement with commercial developments, it is an indication that the appellant s suggested build rates are not unreasonable.

Delivery of large sites Sources of Evidence a) Available national research i. Size of sites can influence lead in times (NLP start to finish suggests large sites 1,000+ take more than 5 ii. years from submission of planning to delivery) Size of sites can influence buildout rates (NLP start to finish suggests sites up to 1,499 rarely exceed 100 dpa) b) Individual rates from house builders in their annual returns c) Local evidence d) Letwin Review on build out rates

Approach to Windfall? Windfall sites are sites not specifically identified in the development plan. The current NPPF paragraph 48 states: Local planning authorities may make an allowance for windfall sites in the five-year 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. Any allowance should be realistic having regard to the Strategic Housing Land Availability Assessment, historic windfall delivery rates and expected future trends, and should not include residential gardens.

What are lapse rates? Lapse rates factor in the non-implementation of planning permissions. It is not intended to allow for competition, which is the purpose of the buffer. Lapse rates should not be used indiscriminately but instead focussed on those elements of the supply that have not been dealt with in detail (e.g. through the use of lead in times and build rates). Therefore should only be applied to: Small scale developments with planning permission that could easily be implemented within 5-years (e.g. 50 or less dwellings). Sites on the brownfield register. Sites with permission in principal. Windfall sites.

Exercise: Bringing it altogether and Calculating 5 year land supply

Case A Gelding: Issues Choice of LHN is the old JCS a justified alternative? Sites with detailed consent: Test "Reasonable Prospect" Usually included unless large site (phasing) or specific evidence OL - Test only if "clear evidence" of completions is available which is unlikely for all Strategic Sites - Site has only submitted OL this year so clear evidence required on lead in times and build out rates national evidence suggests no starts in 5 years Draft allocations test "Clear Evidence" is available which is unlikely for all WF - the 100 in one year looks incongruous so compelling evidence this will occur again unlikely use lower average excluding this figure

Case B Lazybeach: Issues Choice of LHN - LP requirement to be used even though it is still at examination are there exceptional circumstances? Sites with detailed consent: Test "Reasonable Prospect" usually included unless large site (phasing) or specific evidence OL - Test only if "clear evidence" of completions is available which is unlikely for all Strategic Sites - Site has only has RM for 200 therefore rest of OL requires clear evidence Draft allocations test "Clear Evidence" is available which is unlikely for all WF - consistent supply so compelling evidence this will occur again

Case C Beachfield: Issues Oversupply can not to be taken into account as it is not an adopted LP Assume 5% LP requirement to be used even though it pre dates Framework 2016 Test "Reasonable Prospect" Usually included unless large site (phasing) or specific evidence OL - Test only if "clear evidence" of completions is available which is unlikely for all Strategic Sites - Site has only has recent OL so clear evidence required on lead in times and build out rates national evidence suggests no starts in 5 years Draft allocations test "Clear Evidence" is available which is unlikely for all WF - a declining supply so questionable if compelling evidence the average (50 dpa) will be achieved will occur again

Case D Ladysfield: Issues Issues Adopted Local Plan 2015 so within last 5 years therefore Use Housing requirement in policy Calculate Backlog Advisory Note - Low level of completions could indicate 20% buffer but for this exercise assume 5% Sites with Full/RM consent: Test "Reasonable Prospect" Usually included unless large site (phasing) or specific evidence Sites with OL - Test only if "clear evidence" of completions is available which is unlikely for all Strategic Site - Although whole site has RM still need to take into account lead in times and build out rates BF register / SHLAA sites test "Clear Evidence" is available which is unlikely for all WF - Appears consistent with consist policy regime

Cases Study Summary of Issues Issues Housing Requirement: LP if adopted in last 5 yrs (but backlog/oversupply need to be taken into account Standard method or justified higher number, lower requirement only in exceptional circumstances Buffer judged against 2012/14 Househild projections with SM feeding in over next 3 years Sites with Full/RM consent: Test "Reasonable Prospect" Sites with OL, BF register / SHLAA sites Test "clear evidence" Strategic Site - still need to take into account lead in times and build out rates (Local evidence preferred) Windfall requires compelling evidence

When is a five year land supply not a five year land supply? When it is: a. Neighbourhood plan which includes housing allocations b. Oxfordshire?

NPPF Para 11 and the Housing Delivery Test The Housing Delivery Test Looks at performance against 2012 and 2014 Household projections for years 2015/16, 2016/17 and 2017/18 After 2017/18 the lowest of either Adopted local plan (included stepped approach) if less than 5 years old or Minimum Local Housing Need (including unmet need form neighbouring authorities) Under 75% triggers presumption in Framework para 11 after 2020 this escalates up from 25% from November 2018, to 45% from November 2019)

Will it work? a. Timing for Standard Method in plans choice of preceding with old approach prior to 24 th January 2019 or waiting to use Standard Methodology b. HDT implications of SM not until 2020 otherwise a blend of 2012/14 Household projections and LHN c. Impact of 2016 Household Projections d. If all councils choose the lowest LHN of their own SHMA vs 2016 LHN (Standard Method) then uptodate plans adopted in next few years will cumulatively plan to supply 190,000 dpa

Appendix 1: Case study A Example A: Gelding Starting Info JCS 2012 (High) JCS 2012 (Low) LHN SM (High) LHN SM (Low) a Annual Housing Requirement 500 500 500 300 300 b Completed 2011-2018 3000 3000 3000 3000 3000 c Percentage 86% 86% 143% 143% d Backlog -500-500 -1500-1500 e Requirement plus backlog 2000 2000 f Buffer HDT 5% 5% 5% 5% g 5 Year Requirement 2100 2100 1575 1575 h Supply i Sites with full Planning Permission or Reserved Matters 1000 1000 1000 1000 1000 j Sites with Outline Planning Permission 500 500 0 500 0 k Strategic Site with Outline Planning submitted (2018) 1000 1000 0 1000 0 l Draft allocations 499 499 0 500 0 m Windfall 200 200 125 200 125 n Deliverable supply 3199 1125 3200 1125 o 5 year land supply 7.62 2.68 10.16 3.57 2013/14 2014/15 2015/16 2016/17 2017/18 Average Alternative Windfall 25 100 25 25 25 40 25 Strategic Site SHLAA Strategic Site reviewed 2018/19 2018/20 2020/21 2021/22 2022/23 Total 0 250 250 250 250 1000 0 0 0 0 0 0

Appendix 1: Case study B Lazybeach Starting info SHMA SHMA 2014 2014 (High) (Low) LHN SM (High) LHN SM (Low) a Annual Housing Requirement 300 300 300 400 400 e Completed 2014-2018 1199 1200 1200 1200 1200 f Percentage 100% 100% 75% 75% b Backlog Housing Requirement plus Backlog 1500 1500 1500 2000 2000 b Buffer HDT 5% 5% 5% 5% 5% 5 Year Requirement 1575 1575 1575 2100 2100 d Supply g Sites with full Planning Permission or Reserved Matters 1000 1000 1000 1000 1000 h Sites with Outline Planning Permission 600 600 600 0 i Strategic Site with Outline (2017) for 1000 RM consent for 200 (2018) 1000 1000 200 1000 200 j Draft allocations 1500 1500 1500 0 k Windfall 125 125 125 125 125 l Deliverable supply 4225 1325 4225 1325 m 5 year land supply 13.41 4.21 10.06 3.15 2013/14 2014/15 2015/16 2016/17 2017/18 Alterna Average tive Windfall 25 25 25 25 25 25 25 2018/19 2018/20 2020/21 2021/22 2022/23 Total Strategic Site SHLAA 200 200 200 200 200 1000 Strategic Site revised 0 100 100 0 0 200

Appendix 1: Case study C SHMA 2016 SHMA LHN SM LHN SM Beachfield Starting Info (High) 2016 (Low) (High) (Low) Annual Housing a Requirement SHMA 2016 400 400 400 300 300 e Completed 2016-2018 900 900 900 900 900 f Percentage 113% 113% 150% 150% Backlog Requirement plus backlog 2000 2000 1500 1500 b Buffer HDT 0.05 5% 5% 5% 5% 5 Year Requirement 2100 2100 1575 1575 d Supply g Sites with full Planning Permission or Reserved Matters 1000 1000 1000 1000 1000 Sites with Outline Planning h Permission 250 250 250 0 Strategic Site with RM consent for 1000 (2018) 1000 900 170 900 170 i j Draft allocations 500 500 500 0 k Windfall 250 250 125 250 125 l Deliverable supply 2900 1295 2900 1295 m 5 year land supply 6.90 3.08 9.21 4.11 2013/14 2014/15 2015/16 2016/17 2017/18 Average Alternative Windfall 100 60 50 25 15 50 40 2018/19 2018/20 2020/21 2021/22 2022/23 Total Strategic Site SHLAA 150 250 250 250 900 Strategic Site Revised 100 100 100 100 400

Appendix 1: Case study D Ladysfield Starting Info LP (start date LP (start date 2011) adopted 2011) adopted 2015 2015 LHN SM (High) LHN SM (Low) a Housing Requirement 249 250 250 200 200 c 5 Year Requirement 1245 1250 1250 1000 1000 e Completed 2011-2018 1099 1100 1100 1100 1100 f Percentage 63% 63% 79% 79% g Backlog 650 650 b Buffer HDT 5% 5% 5% 5% 5% h 5 year requirement 1995 1995 1050 1050 d Supply i Sites with full Planning Permission or Reserved Matters 500 500 500 500 500 j Sites with Outline Planning Permission 150 150 150 0 Strategic Site with RM k consent for 1000 (2016) 1000 1000 500 1000 500 Brownfield register / SHLAA sites 200 200 200 0 l m Windfall 250 300 300 300 300 n Deliverable supply 2150 1300 2150 1300 o 5 year land supply 5.39 3.26 10.24 6.19 2013/14 2014/15 2015/16 2016/17 2017/18Average Alternative Windfall 50 75 50 75 50 60 60 2018/19 2018/20 2020/21 2021/22 2022/23 Total Strategic Site SHLAA 100 150 250 250 250 1000 Strategic Site 100 100 100 100 100 500