Lessons from Elsewhere Growth & Development in the South West Barbara Richardson Executive Director Growth & Investment building communities
Introduction… • Setting the scene • Issues to consider • Potential solutions • Kingsdown, Bridgewater building communities
Setting the scene… • Average House prices • Average Income • Average age of FTB • No of homes built building communities
NHF Statistics for 2013 • Average house price £241,300 • Average Regional income £19,573 • House price 11.5 x income • 21,500 new households formed • 13,460 new homes built in 2013-2014 building communities
Issues to consider… • Access to Finance • No of organisation building new homes • Planning Process • Employment Opportunities • Transport & Infrastructure building communities
Regional summary of labour markets… Headline estimates for October to December 2013 Economically active Employment Unemployment Economically inactive Aged 16+ Aged 16-64 Aged 16+ Aged 16-64 Aged 16+ Aged 16+ Aged 16-64 Aged 16-64 Level Rate (%) 2 Level Rate (%) 2 Level Rate (%) 3 Level Rate (%) 2 1 2 3 4 5 6 7 8 North East 1,304 75.1 1,174 67.4 130 10.0 423 24.9 North West 3,423 74.9 3,146 68.6 277 8.1 1,117 25.1 Yorkshire and The Humber 2,781 78.0 2,541 71.2 240 8.6 763 22.0 East Midlands 2,328 78.1 2,166 72.6 162 6.9 631 21.9 West Midlands 2,712 75.7 2,486 69.2 226 8.3 835 24.3 East of England 3,141 80.4 2,961 75.7 180 5.7 734 19.6 London 4,352 77.6 4,001 71.3 351 8.1 1,224 22.4 South East 4,596 80.8 4,362 76.6 233 5.1 1,049 19.2 South West 2,736 79.8 2,559 74.6 177 6.5 664 20.2 England 27,373 78.0 25,396 72.3 1,977 7.2 7,440 22.0 Wales 1,492 76.3 1,387 70.8 105 7.1 447 23.7 Scotland 2,751 78.5 2,556 72.8 195 7.1 732 21.5 Great Britain 31,617 78.0 29,339 72.3 2,277 7.2 8,619 22.0 Northern Ireland 871 73.1 807 67.6 64 7.4 313 26.9 United Kingdom 32,488 77.9 30,146 72.1 2,342 7.2 8,932 22.1 building communities
Unitary County/District • Legislation • Planning framework • Funding • Statistical analysis • National v Regional infrastructure • Plus lots of non- housing functions building communities
Potential Solutions… • Help to Buy Scheme • Flexible Tenures • PRS • LEP’s • Joint Venture Partnerships • Proactive Planning • New Homes bonus building communities
Help to buy v shared ownership… Help to Buy Shared Ownership (50% share) Equity Loan Mortgage Guarantee Value of property £200,000 £200,000 £100,000 Deposit required (%) 5% 5% 5% Deposit required (£) £10,000 £10,000 £5,000 Household income required (x 3.5 £42,857 £54,285 £27,143 multiplier) Interest rate* 2.39%* £4.99%* 4.99%* Mortgage term 25 yrs 25 yrs 25 yrs Monthly mortgage payment £660 £1,110 £561 Monthly rent payment £0 £0 £229 Total monthly costs £660 £1,110 £790 *Lowest available rates (2/1/2014) building communities
Potential Solutions… • Housing benefit currently costs taxpayers £24bn a year and most of it goes to private landlords rather than towards building new homes. • For a fraction of that, the Government could support areas experiencing economic growth by building more affordable homes. building communities
Aerial view of Kingsdown building communities
Development overview • Issues – • Solutions – – Infrastructure timing – Re negotiated triggers – Ground Conditions – Temporary change – Planning s.106 of use – planning contributions – Cash flow of – Low value area contributions – High build costs – Re-appraise viability building communities
Kingsdown • Largest kick-start £8m • Gov. funding to start site • Phase 1 - 200 affordable units part of 1,000 site • Keeping economy moving and providing homes • Tenure and clustering building communities
EDF – Hinckley Point – Power Station… building communities
Summary • Government central/local • Need for housing • Role of Registered Providers • Financing low cost homes • Kingsdown and EDF • Role of Developer and land owner • Standards of new homes • Tenure building communities
Questions? Barbara.richardson@yhg.co.uk building communities
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