So how did a weekend in Alicante trigger a blog on UK housing policy? Well it started with Peter Rees HERE reminding us that the residential tower blocks sprouting up in most of our city centres are likely to be derelict in 80 years’ time.
The next day I felt chuffed on booking a large 7th floor penthouse apartment, nicely presented internally, in a superb Old Town location, for only £45 a night. But with the Peter Rees article ringing in the ears, on arrival the cheap price was explained.
Constructed in the 1970s the common areas of the apartment block were clearly a la mode when built. But the brown marble and dark wood is now hopelessly dated, and despite its great location, the block is half empty with dirty reinforced concrete for its external appearance.
The building has been overtaken by events and technology. It’s fragmented ownership means there is simply no financial mechanism for comprehensive refurbishment. So the plumbing system wasn’t up to C21 expectations, the small dark entrance area was leaking and only one of the two tiny lifts worked. The future for the block is already mapped out – further dilapidation, further capital value falls, increased vacancies, decay and dereliction.
So what is the link to planning in the UK?
Well firstly we won’t even consider whether the apartment, clearly owned by an elderly Dutch couple, goes towards meeting Alicante’s Standardised Objectively Assessed Housing Need!!!
And secondly we won’t mention how similarly bad, outdated office buildings are actually becoming new homes in the UK via Permitted Development and without the need for planning permission!
No, it focused the mind on the fact within many UK city centres the same market forces are in play, right now, as in 1972 Alicante. Namely an investment appetite and political support, to build thousands of small flats, often aimed at overseas buyers. But as Peter Rees confirmed, these luxury flats may look great now, but for sure many will be outdated and obsolete within 80 years, lacking a financial mechanism to refurbish. Especially the ones not even subject to the scrutiny of the planning process.
Many of these proposed new flats are for the private rented sector. Until recently viewed as the tenure of last resort but now the darling of a housing establishment driving for higher housing delivery, irrespective of type, quality, size or tenure.
When these private rented flats are delivered by long established and trusted players like Grainger there is the surety that the quality will be good and the funding will be set aside each year to enable comprehensive refurbishment when needed. But for many others, driven by policy support and international investors, and based on a current yield position, the future is much more worrisome. The Government’s clear desire to remove Ground Rents leaves nobody who actually wants the freehold of the common areas. If left solely to the residents the desire will usually be for minimal service charges and hence no mechanism for the inevitable future capital projects.
And when we at look at the architectural quality of some of these new schemes, either built or proposed, the worries only increase.
But does this even matter?
In London arguably not. Such is the undersupply of new housing against need, that any opportunity to increase supply and reduce pressure on the housing system should perhaps be supported.
But in the North and Midlands it really does matter. For three reasons:
Firstly housing requirements in local plans are being dramatically reduced via SOAN. So big housing choices need to be made, in terms of what type and tenure of housing should be prioritised to meet need and address a capped housing target. Swallowing up these reduced housing targets, on thousands of ‘luxury’ PRS flats is the wrong choice. Yes, some good quality quality rented homes may provide additional market choice but 86% of people in the UK aspire to own their own home. Planning and funding policy must respond to that.
Research consistently shows that investing in your own home is far better for financial security, stability and mental wellbeing, especially for children in a house with outdoor space. This should be the policy focus, alongside an ambitious social housebuilding programme to address the needs of the weakest and excluded.
Using up the majority of a precious and reducing housing requirement, on a private product aimed solely at 20/30 somethings, is simply storing up further housing shortages. That demographic will soon turn 40, will want a family home of their own, and will find that not enough have been built in the 2020s. The existing and future difficulties facing generation rent are outlined HERE and the particular risks in the North are outlined HERE.
Secondly, as confirmed by Peter Rees, there is a troubling long term future for many of these new high density flats.
And thirdly it is simply political cowardice. The main reason these blocks are being supported by the planning system is to avoid releasing sites on the urban edge of our great cities, for the housing product which is needed and wanted most – namely the family homes which will better support physical and mental wellbeing.