Nowhere is this more obvious than in the debate which surrounds the provision of new homes to meet the needs of an ever growing population. Our persistent failure to build enough new homes has been a clear contributor to rising house prices. Every Government promises to increase the supply of new homes by changing the planning system, releasing public sector land, and underwriting mortgage lending (Help to Buy). Yet the numbers of new homes being built is only now recovering to pre-crisis level and remains well below what is needed.
Why is that? Well Government has effectively curtailed public sector house building as it seeks to tackle fiscal deficits. Housing associations are forced to raise money on the private market and local authorities have neither the budgets nor the capacity to restart building Council housing in any meaningful way. So we have become ever more dependent on private house builders as the main source of new homes.
The difficulty is that their business model, which seeks to maximise return on capital employed commensurate with risk, appears unable to deliver either more or better quality housing at a price which people can afford.
So there is a lot of interest at the moment in Cranbrook, a new settlement to the east of Exeter. Planned as a sustainable community, which will shortly have its own railway station, Cranbrook aims to be a sustainable community providing a mix of affordable and market homes all linked to a district heating system and served by a new railway station and cycle links. Based on construction rates and sales (one new home is being completed every day) Cranbrook looks like a success for the private house builder model. But dig more deeply and you will find out that it has been underwritten by some £90 million of public expenditure on infrastructure as well as social housing grant. And with strategic land companies and speculative house builders in control the opportunity to create a place of enduring quality is being lost.
Contrast this with Poundbury, Prince Charles’ much derided new community to the west of Dorchester. Here the pace of development has been much slower but, even if you don’t like neo classical and pastiche architecture, few could argue with the quality of the place which is emerging. This extends to creating work spaces for small businesses within the urban fabric and creating a pedestrian friendly environment by rejecting standard highway engineering solutions. All this has been achieved using an approach to development which is controlled by the land owner and not the developer.
So what conclusions can we draw from this?
- We know how to plan, design and build sustainable communities. The UK planning profession pioneered garden cities and new towns and developed the tools to deliver them.
- The private sector is capable of producing new houses in both quantity and quality. However depending entirely upon the market is unlikely to produce the optimum result in terms of sustainable development.
- Adopting the right delivery model is key. Allowing developers to extract profit from both land value increase and housing development is unlikely to deliver either the infrastructure or facilities which communities require to be truly sustainable.
The essential difference between Cranbrook and Poundbury is between maximising development profit in the short term (inelegantly termed ‘build it and bugger off') and long term value creation and stewardship. It is to be hoped that Plymouth’s new community at Sherford will combine the best of both approaches.
Professor Chris Balch is Professor of Planning and Chair of the ISSR Management Team