Select Committee on Transport, Local Government and the Regions Appendices to the Minutes of Evidence

Memorandum by South Yorkshire Housing Association (EMP 67)



  South Yorkshire Housing Association manages 4,000 homes for people in South Yorkshire and North Derbyshire. One third of our homes provides some form of additional care and support for people with special needs. In addition we have set up a partnership with Yorkshire Housing Association, Safe Haven Yorkshire, which provides housing and support for 3,000 asylum seekers across Yorkshire and Humberside under the Home Office Dispersal Programme. SYHA's services are provided primarily in urban areas with high levels of deprivation and low property values.

  In preparing this memorandum we have drawn extensively on two research studies which, in our view, provide the best analysis we have come across of the reasons for housing market failure in some northern areas and the action required to address the issue of empty homes in our area. The first study is "Changing Housing Markets and Urban Regeneration in the M62 Corridor" (Brendan Nevin and his team at CURS 2001), and the associated reports prepared by this team. This report put forward the concept of a "Housing Market Area" to recognise that housing markets operate in localities across local authority boundaries and that public policy needs to address this; previous approaches based on small areas or neighbourhoods within one local authority boundary are no longer adequate to meet the major challenges of housing conditions, supply and demand. The second is the HARCC report (Housing and the Regeneration of Coalfield Communities) which has been published by the CRESR team at Sheffield Hallam University in August 2001. This memorandum also draws on the Regional Planning Guidance and the Regional Housing Statement.

  This memorandum seeks to establish why housing markets are failing in some areas, the problems that this causes and measures which can be taken by national and local agencies to address the problem of empty homes. The analysis seeks to challenge prevailing social policies in several areas:

    —  the way in which public subsidy for new social housing is currently allocated

    —  the overriding importance placed by Regional Development Agencies, European Objective 1 funding and other neighbourhood renewal funding programmes on economic revival

    —  current planning policies, particularly in relation to PPG3

    —  some elements of the Government's Housing Policy as set out in "Quality and Choice: a Decent Home for All"

  The two research reports referred to above are, we would suggest, worthy of detailed consideration by the Inquiry. Copies of the M62 study are widely available; copies of the HARCC report can be provided by SYHA for inquiry panel members if required.


  The Social Exclusion Unit PAT7 report highlighted the wide difference in the extent of low demand across the country. The proportion of Council stock considered to be difficult to let ranges from 5 per cent in London and the South East to 23 per cent in the North of England. The problem is compounded by migration of 20,000 households from the North of England to the South of England each year. In addition, migration into the UK, which is the largest source of population growth in this country, is concentrated in London and the South East in spite of recent efforts by the Home Office to disperse asylum seekers to the regions. It is not necessary to look far to find the cause of this trend—the North of England contains seven of the 10 areas with the lowest economic activity rates in England. The extent of the decline of the GDP in the South Yorkshire sub-region has been so marked that South Yorkshire now qualifies as one of four areas in the UK entitled to receive Objective 1 funding from the European community. (In 1996 the GDP dropped to 73.6 per cent of the European average.)

  The movement of population within regions is equally relevant with smaller urban areas and more rural locations benefiting at the expense of the larger conurbations. For the last 20 years planning policy has contained a presumption in favour of development, leading to decentralisation, peripheral development and an exodus of more affluent households from the big cities, and a net surplus of housing in some areas. As the HARCC report states:

    "Within the coalfield part of the sub-region the housing surplus derives primarily from the private sector house building programme" (page 13: HARCC report)

  One of the unintended consequences of this private sector house-building has been the loss of viability of housing in some older neighbourhoods as many purchasers have been able to leapfrog the older housing—which has been the initial destination of first-time buyers—and buy the newer housing, often on the periphery of existing communities. During the early 1990's forecasts of housing need were made by the South Yorkshire local authorities when Unitary Development Plans were prepared. It is likely that these forecasts have over-estimated population growth. The HARCC team analysed population figures from the censuses and predictions by the Office of National Statistics and concluded that the population in South Yorkshire had been remarkably stable over the last 20 years. In Rotherham the population has remained static at 252,000 between 1981 and 2001. By contrast, the UDP for Rotherham forecast a population growth to 258,000. Similarly, the Doncaster population has been static at 290,000 over the 20 year period, whereas the UDP forecast population growth to over 300,000. These figures conceal changes in age structure. A decline in younger age groups, critical for household formation, has been accompanied by an increase in the elderly population. One of our local Unitary Development Plans summarises the effect:

    "This indicates a scenario of urban decline in terms of losing the very people who are likely to set up home, take up jobs and invest in the local economy (Doncaster Unitary Development Plan)"

  This suggests an increase in household formation, particularly of single person households, and a decrease in households requiring larger three and four bedroom family accommodation. However, the inaccuracy of the local plan projections, combined with a planning system which saw its role as primarily ensuring land was released to meet demand from owner occupiers, has meant that large numbers of three bedroom and four bedroom houses have been built. The HARCC team estimate that approximately 20,000 new three and four bedroom houses have been built in the coalfield area during the 1990's. Although the new Regional Planning Guidance indicates a change in direction, suggesting in excess of 60 per cent of new homes should be built on brownfield sites, the trend of building on new greenfield sites is taking time to turn round. Indeed the largest single greenfield housing estate being developed in the UK is the 750 home development in Bramley, Rotherham. The HARCC team were able to identify 67 private newbuild sites with over 10 homes under construction or planned—the majority comprising greenfield sites outside urban centres.

  The migration of large numbers of affluent—substantially white—people from urban areas has placed further pressure on town and city centre housing markets. Property values in some urban areas have collapsed as a result. A study carried out by the City of Sheffield found that one third of homes on the market were available for less than £35,000. Low property values combined with reduced interest rates have increased the attractiveness of owner occupation in relation to renting. At the same time, social renting is becoming a less attractive option. Rents have been forced up by systematic cuts in grant rates for RSLs. As a result many social landlords, including SYHA, are experiencing "churn" in their tenants and properties have become harder to let with properties remaining empty for longer.

  Problems of market failure in some areas which resulted from these pressures have not been met by a corresponding increase in housing funding in neighbourhoods requiring renewal. For example, the housing capital budget held by the Regional Development Agency for Yorkshire and Humberside has dropped from £20m to £3m this year. In the private sector,

    "Clearance and renewal has increasingly become marginal to the regeneration process leading to increasing environmental distinction between the core and periphery of cities" (Discussion Paper produced for Liverpool City Council—Brendan Nevin—June 2001)

  In the same report, Brendan Nevin comments on the obsolescence of much local authority housing:

    "The social housing stock in some towns and cities in the North is a product of the local social-economic conditions prevalent in the 1930's and 1950's. The history of higher unemployment, low wages and structural changes particularly in northern England provided the political impetus for the mass provision of public sector housing. This housing is now frequently not of the type or scale of provision required in the 21st century."

  As the affluent, suburban market expands, the contrast between these areas and the declining inner city neighbourhoods with obsolete properties becomes more marked. The capital required to deal with these problems has not been made available by Government. Although in the last Comprehensive Spending Review resources for housing investment increased significantly, the majority of new Housing Corporation investment has been diverted to meet the housing needs of London and the South East. This switch has been dramatic over the last 12 months. Locally, attempts to tackle urban degeneration have all too often focussed on economic solutions with only limited success:

    "A singular focus on traditional forms of economic investment will not promote the sustainability of a vulnerable neighbourhood. Residents who secure jobs, or better jobs, are likely to leave their neighbourhood if it is not an attractive place to live. A balanced strategy of investment in four forms of capital—human, social, environmental and fixed—is necessary to ensure community well being and a sustainable future for vulnerable neighbourhoods." (page vi—HARCC report)

  For all the talk of "joined up policy making" the case for housing investment as an essential part of neighbourhood renewal has been left in the wilderness. In Yorkshire and Humberside, the Regional Economic Statement has little to say on housing. Housing professionals in South Yorkshire are fighting a rear-guard action to include housing related investment and activity as part of the Objective 1 funding programme. Locally, no housing associations have been able to secure places on Local Strategic Partnerships and there is little prospect of significant investment in housing coming from the Neighbourhood Renewal Fund. Nationally, housing investment patterns are substantially driven by housing shortage and not the need for neighbourhood renewal and housing market restructuring.


  Ethnic minority communities have lost out disproportionately from neighbourhood degeneration. For example, Asian communities in Yorkshire are predominantly clustered in high density neighbourhoods, living in smaller terraced properties many of which were built before 1919. The National Strategy for Neighbourhood Renewal Action Plan contains the alarming statistic that 70 per cent of all people from BME communities live in the 88 most deprived local authority districts. Segregation of communities between black and white, affluent and poor, is accelerated by sharp contrasts in housing conditions and the relative ease of access for affluent people into more desirable neighbourhoods. It will be important to monitor the impact of the Government's rent restructuring framework as the CRE's Race and Housing Inquiry report states:

    "There is some prima facie evidence that the new rent regime has the potential to create perverse consequences. It appears that in some places RSLs are moving their bidding away from lower value areas. This movement may adversely affect BME communities if there is a wider disinvestment effect." (Challenge Report 2001)

  One of the phenomena we have experienced increasingly in recent years is the speed with which neighbourhoods can experience a spiral of decline. In particular, crime and the fear of crime, can drive people away from particular areas leaving both empty properties and, for social housing, landlords experiencing problems in re-letting this stock. Pressures to drive down voids can lead councils and RSLs to offer the homes to anyone willing to take them. This can enable criminal communities to establish themselves quickly and can lead to concentrations of vulnerable people. If action is not taken quickly, marginal areas can quickly deteriorate into neighbourhoods for which clearance becomes the only solution. Action taken to address the problems of particular neighbourhoods can, even if successful, have side effects for neighbouring areas:

    "Expansion of some neighbourhoods is at the expense of others. The circumstances engendering growth in one neighbourhood have a bearing on the decline of another." (page 12: HARCC report)

  Similarly, Brendan Nevin comments:

    "Many of the areas worst affected by housing market change have been recipients of every government sponsored initiative over the last 30 years. These initiatives have not succeeded in altering the trajectory of inner urban areas. In a rapidly changing housing market, small area renewal may simply transfer problems to adjacent neighbourhoods."

  One of the side effects of low demand in Yorkshire and Humberside has been that opportunities have been created to house asylum seekers in the region. The Home Office's Dispersal Programme has seen 5,800 homes in Yorkshire and Humberside made available for asylum seekers—the highest number dispersed to any region outside London and the South East. Over 1,000 asylum seekers now live in Sheffield alone. This has helped to stabilise housing markets in some areas. Safe Haven Yorkshire now works with 170 landlords, many of whom have purchased low value properties and refurbished them to the high standards set by the Home Office. There is an opportunity to build on the positive effects of this programme provided policies are developed to retain asylum seekers receiving positive decisions in the regions to which they have been dispersed. The policies and mechanisms to achieve this do not currently exist.


  The following proposals are broken down by organisation:

(i)  Central Government

  Establish a Housing Market Renewal Fund to enable local authorities and RSLs to tackle housing market failure across all tenures.

  Equalise rates of VAT between newbuild and rehabilitation.

  Adapt PPG3 to ensure that newbuild estates provide balanced communities (through requiring developers to incorporate social housing in new schemes, and not to escape this through the payment of commuted sums).

  Policy needs to be adapted so that additional private sector house-building does not lead to or exacerbate market failure in existing neighbourhoods.

  Develop a policy for move-on accommodation for asylum seekers with positive decisions ensuring that access to housing and jobs is made available in the Regions.

  Consider the opportunities for RSLs to rehabilitate older council stock to prevent a spiral of decline on vulnerable estates (if the Inquiry visits Sheffield we would be pleased to show you how this works in action on the Longley estate in Sheffield).

(ii)  Housing Corporation

  Assess the effectiveness of the Approved Development Programme by the impact of RSL investment in marginal areas, and not solely by the numbers of new homes developed. (Rent restructuring has meant that grants will increase in low value areas. There is a real danger that a target-driven approach will provide a disincentive to the Corporation for supporting schemes in low value areas in the North. Action taken now could prevent this.)

  Roll out across the North of England the "new tools" pilot programme which allows the ADP to be used to take action in multi-tenure areas, including funding RSLs so they can acquire and demolish homes that are obsolete and have no viable future.

  Support research into the operation of local housing markets.

  Allow associations to invest in run down neighbourhoods and take the risk that, on occasions, mistakes may be made.

  Take forward recent work on developing joint strategies and allocating new funds to programmes which meet these priorities.

(iii)  Local Authorities

  Provide the strategic lead in determining where investment and renewal is required, and where clearance and disinvestment is a better option.

  Work across local authority boundaries to consider the impact of wider housing market areas (if the Inquiry visits Sheffield we would be pleased to explain how the local authorities and RSLs have formed such a partnership in South Yorkshire).

(iv)  Housing Associations

  Maintain their traditional values, commit to working in low value areas and be willing to take risks. (Note: there is an alarming trend for some RSLs to pull out of neighbourhood renewal and concentrate their new service developments in high value, high demand areas.)

  Adopt the spirit and the letter of the CRE's Race and Housing Challenge report.

Tony Stacey

24 September 2001

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