b What are household projections and why are they important? - - PowerPoint PPT Presentation

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Calculating Fareham’s Housing Need

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• Household projections are the starting point for

assessing local housing need.

• The projections show the household numbers that

would result if previous demographic trends in population and household formation continue.

• They are not forecasts – they do not attempt to

predict the impact of future Government or local policies, changing economic circumstances or other factors that may influence household growth.

What are household projections and why are they important?

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Household Projections Stage 1 Stage 2

Household Projection Methodology

Projection for total number of households Provides more detailed breakdown of household types

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• Household projections used to be published by MHCLG, however, this changed to

ONS for the 2016 based release.

• The main changes include:

➢ In the 2014-based method the data included a marital status breakdown. This was removed from the 2016-based method as no up to date information available. ➢ The 2014-based projections used data from five census points whereas the 2016- based projections uses only the two most recent census points.

Recent Changes to the Methodology

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• The outcome of the change was a reduced number of additional

households projected: 159,000 additional households each year compared with the 210,000 previously projected.

• However MHCLG have made it clear that 2016-based household

projections should not be used for assessing housing requirements.

• The higher 2014-based household projections should be used for

assessing local housing need.

What the changes in methodology mean?

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544 346 478 857 479 348 462 595 300 400 500 600 700 800 900 Fareham Gosport Havant Portsmouth

Standard Methodology Housing Need Using 2014-Based and 2016- Based Household Projections

2014-Based 2016-Based

How the Different Household Projections Influence Housing Need

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Implications for Fareham

• Household projections are the starting point for assessing local

housing need under the new Standard Methodology

• The standard methodology is broken down into 3 stages:

1. Setting the baseline using national household growth projections from ONS 2. Adjust baseline to take account of affordability. This uplift is based on house price to earnings ratios. 3. Stage 3 involves applying a cap to limit the increase in the minimum annual housing need figure an individual authority can face.

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Standard Methodology for Housing Need

Standard Method Summary for Fareham Projected household growth over next 10-years = 398 homes per year Affordability uplift – house price to earnings ratio = 146 homes per year Overall housing need = 544 homes per year (398 + 146)

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398 351 146 128 100 200 300 400 500 600 2014-Based 2016-Based

Breakdown of Fareham’s Housing Need based on the Standard Methodology

Household Projections Affordability Uplift

Fareham’s Housing Need

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Any questions?