From Michael Donnelly in Planning Daily
"The ICM survey, commissioned by the National Housing Federation (NHF), also found that 66% of rural dwellers would support the building of new affordable homes where they live."
More information on the definition and categories of affordable housing in paragraph 8 of the guidance here
Can anyone explain exactly what an "affordable home" is?
ReplyDeleteAs in "Alice in Wonderland", it appears to mean whatever people want it to mean.
Is there any distinction between houses for rent (and the level of rent), and houses for purchase (and the asking price)?
Without relating cost/value to local average incomes, and the local property market, the notion of "affordability" is surely meaningless, if not misleading.
According to Highland Council's Supplementary Planning Guidance:
ReplyDeleteAffordable housing: Broadly defined as housing of a reasonable quality that is
affordableto people on modest incomes. In some places the market can provide some or
all of the affordable housing that is needed, but in other places it is necessary to make
housing available at a cost below market value to meet an identified need with the support
of subsidy.
I'll amend the post with the link to the Guidance which describes the categories of affordable development.
Oh dear. That's no definition at all.
ReplyDeleteWhat is "reasonable" quality? Minimum NHBC standards?
What is "affordable"? Monthly rent equivalent to a week's wages? A mortgage of 3 times income? 4 times? 5? Whatever Northern Rock thinks its clients could afford?
What is a "modest" income? The national minimum wage? The average wage? Jonathan Ross' annual contract?
If there's no threshold and no figures, there's no definition. Which was the point in the original comment.
The HNDA talks about affordabiilty and my personal response to the MIR deals with the issues of affordability.
ReplyDeleteI got the point, but whether it is or is not a satisfacory definition the paper was produced in 2008 as supplementary guidance.
The whole housing thing needs shaking up and challenging. Any ideas?
The whole problem of "unaffordable" housing has arisen because of the phenomenon of cheap credit over the last (several) decades. This has grossly distorted the market, inflated house prices, caused a bubble (now burst?) and left a lot of people unable to afford even a modest home.
ReplyDeleteThe housing boom(s) have tended to become a vicious spiral. Banks made easy and generous mortgage-loans available; people used the money to buy houses; that demand drove prices up; the appreciation in property values prompted banks to lend more, and people to trade up or use their property as collateral for further credit; house prices rise even more.... Meanwhile those not already on the property ladder see house-prices escalate out of reach. Hence the affordability "gap" and the problem of those who can't afford even a starter home. And so it goes on, until a crisis of confidence punctures the bubble - as has just happened.
This is a grossly simplified analysis, but the basic pattern is clear.
The answer is not to loosen credit and make more money available to the banks to lend: that will simply relaunch the spiral again.
Nor is public subsidy to house-builders to build affordable houses the answer. It doesn't help solve the wider problem of house-price inflation, it just makes builders rich and traps occupants/tenants in housing-association ghettos.
So what alternatives? More rigorous restraint by lenders on salary-multiples for mortgages, and higher deposit thresholds - in order to restrain, if not prevent, house-price inflation. Tax-breaks, rather than subsidies, for private owners/builders of rental property, to increase that pool of accommodation. Generous grants to renovate older, even derelict, existing housing stock. Incentives for self-build. Bigger incentives for energy-efficient and eco-friendly building (will help meet other targets too).
Well, you asked for ideas - there's just a few for starters.