The Rent Trap – How a Lack of New Housing and Inaction from the Planning System Curbs our Aspirations

Aline Kirkland, Graduate Planner at Barton Willmore in Edinburgh and member of the RTPI Scottish Young Planners’ Network Steering Group shares her views on the housing crisis in advance of an SYPN event on the Housing Needs and Demand Assessment process later this year.

Concerns with the state of both housebuilding and the private rented sector are becoming increasingly a mainstream issue within the UK and Scotland and one that I can relate to both as a private renter and a town planner.

I keep hearing stories of shoe-box flats in London rented out for thousands of pounds a month and of the ‘Housing Crisis’ sweeping the country. However, despite the noise that surrounds these issues there appears to have been limited political action.

These problems are rising and are no longer solely the interest of the construction industry and of town planning professionals like me. They are issues that now concern my friends and family and that potentially curb their aspirations, because of the high cost of living.

Home ownership and the housing crisis are becoming the concern of young professionals, stuck privately renting in the knowledge that a property of their own is something they are unlikely to achieve for another 10 years, if ever. It is also the concern of their parents who don’t have the option to provide them with an average of £15,000 for a deposit on their first home.

Part of the challenge to achieving home ownership is in the private rental sector itself. The UK has the highest percentage of income spent on rent of any European country. The National Housing Federation found that in the UK the average rent consumes 40% of income. This is compared to 32% in Switzerland, 29.5% in France and 24.8% in Germany. The average UK rent is £750 compared with a European average of £400.

To top this off, only one third of private rented tenants felt that they usually enjoy a good standard of housing (British Social Attitudes Survey) and my experiences of rented student housing would largely back this up. In light of this private renting reality, it is unsurprising that 72% of private renters would rather own their own home.

We are seeing the backlash against the private rented sector and it is based largely outside of the political system. There are campaigns running to challenge the status quo including Shelter Scotland’s ‘Make Renting Right’. While these campaigns raise serious issues with renting and offer short term solutions, for me they do not address a key driver of problems within the rented sector: the lack of new housing in Scotland.

Quite simply there are not enough houses being built to meet demand resulting in higher house prices pushing people in to rented accommodation. This is my own personal experience and one I don’t suspect I will be able to extract myself from in the next five years. In addition, a home of one’s own shouldn’t be reliant on having a significant other, so that between you, you can scrape together a 30% deposit to take on a 20 year mortgage on a tiny flat. However, despite the seriousness of this issue, there is little or nothing that the major political party in either the UK or Scotland are doing to address the shortfall.

There is no target in Scotland for new housing completions and no attempt to address the lack of housing supply across the planning system as a whole, let alone in market hot spots like Edinburgh and Aberdeen.

The method used to evaluate the number of new houses needed in Scotland is the Housing Need and Demand Assessment (HNDA). This system examines previous levels of household formation via census data and then predicts, on the basis of historic trends, how much new housing we need to manage population growth and respond to demographic change. The output of the HNDA is the number of additional homes needed, broken down into the estimated number of households who can afford a) owner occupation b) private rent c) below market rent or d) social rent.

Unfortunately this system fails to account for suppression of household formation when many graduates and school leavers realise they can’t afford to leave the family home to rent a flat, let alone buy one. It also fails as a system to take into account individuals desire to not be within the private rented sector. It does not make any attempt quantify this desire and apportion housing need to manage it. There is no recognition of housing poverty either, where more than a third of income is spent on housing costs, and no attempt to directly challenge this market failure.

In my opinion, building more housing and making the system as a whole more affordable is the obvious way to address these problems. Having enough new housing would facilitate a rebalance of the market and reduce pressure on rents and house prices as a whole, opening the market to a much greater number of people.

I don’t expect an overnight solution and realise that this is not an instantaneous fix. It will take time and long term political resolve to deliver more housing over the next 10, 20 and 30 years to gradually rebalance our markets. However, doing so could be the difference between addressing our housing crisis at its inception, or waiting until it is far more deep rooted and impacting much more negatively on the people of Scotland and the UK.

If you are a planner in the first 10 years of your career – join the RTPI Sottish Young Planners’ Network mailing list by emailing sypn@rtpi.org.uk to be kept up to date on our upcoming HNDA event, and others across Scotland.

One thought on “The Rent Trap – How a Lack of New Housing and Inaction from the Planning System Curbs our Aspirations

  1. I’m afraid this prescription is too simplistic…and too planning centric. The issue is much more to do with the system as a whole than with the role played by the planning system…although we also have an important role to play. The housing market in Scotland is fundamentally broken and it will not produce socially desirable outcomes (well designed, energy efficient, sustainable places in sufficient numbers at an affordable cost) until fundamental changes are made. It will be interesting to see whether the politicians are up for it…or whether we go through another year or two of tinkering with the current planning system…however ‘root and branch’ it is spun.

    FYI – the Aberdeen City and Shire Strategic Development Plan has played a significant role in increasing the supply of land for new housing in the north east, with completions almost back to pre-recession levels last year and predicted to exceed them this year (2015). The established land supply has increased by 222% since 2010. However, this should not be seen as a panacea…wider systemic change is required.

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