Housing: Construction

(asked on 5th October 2020) - View Source

Question to the Department for Levelling Up, Housing & Communities:

To ask the Secretary of State for Housing, Communities and Local Government, what the housing need for each local authority is when calculated through the standard method.


Answered by
Christopher Pincher Portrait
Christopher Pincher
This question was answered on 13th October 2020

To get enough?homes built in the places where people and communities need them,?a crucial first step is to plan for the right number of homes.??To support our overall aspirations, and to?target more homes into areas where they are least affordable, we are proposing to revise the number of homes authorities should plan for.

We have not published an authority by authority list of numbers generated by the formula. The formula uses variable?data?and it is down to local planning authorities to calculate their local housing need.

Paragraph 23-39 of the Changes to the current planning system consultation explains step-by-step the proposed calculation for the updated standard method.???

Lower household projections do not mean that fewer homes are needed?– in some cases they reflect existing under-supply, where lack of provision stops new households from forming.

Not all homes that are planned for are?built, so our proposed formula includes a buffer to account for the drop off rate between permissions and completions. This?gives the best opportunity to?deliver against our aspirations while also ensuring that the market offers?a good?choice of homes.??

The affordability adjustment used in the proposed standard method is based on the median house price to workplace-based earnings ratio, published annually by the Office for National Statistics.

The house price to workplace-based earnings ratio compares the median salary earnt in a local authority against the median house price in that same authority area. This ratio is used as people typically choose to live close to where they work – and therefore is a proxy for demand within the housing market.

Earnings data is taken from the Annual Survey of Hours and Earnings (ASHE) Release, which provides data on the levels, distribution and make-up of earnings and hours worked by UK employees. This data does not cover the self-employed.

The proposals were out for consultation until 1 October 2020. Following consideration of the consultation responses received, the Government will publish a response in due course. The response will set out any decisions and any associated proposed implementation.

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