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

Calculating Fareham’s Housing Need b

What are household projections and why are they important? • 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. b

Household Projection Methodology Household Projections Provides more detailed Projection for total Stage 1 Stage 2 breakdown of number of household types households b

Recent Changes to the Methodology • 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. b

What the changes in methodology mean? • 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. b

How the Different Household Projections Influence Housing Need Standard Methodology Housing Need Using 2014-Based and 2016- Based Household Projections 857 900 800 700 595 600 544 479 478 462 500 400 346 348 300 Fareham Gosport Havant Portsmouth 2014-Based 2016-Based b

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. b

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) b

Fareham’s Housing Need Breakdown of Fareham’s Housing Need based on the Standard Methodology 600 500 146 128 400 300 200 398 351 100 0 2014-Based 2016-Based Household Projections Affordability Uplift b

Any questions? b