The government has recently revealed their ‘Levelling-Up’ plan. It offers 12 missions to improve disadvantaged areas across the UK. They will focus on education, employment and housing. Announced by Michael Gove, it will see an eight-year initiative that moves towards a more equal landscape across the UK. So how will ‘Levelling-Up’ affect affordable housing?
What does this mean for affordable housing?
The Government’s previous 80/20 rule meant that 80% of affordable housing funding was aimed at arguably misplaced areas, is being dropped. It will now focus on areas in the North of the country and the Midlands. This is a change to the areas deemed to offer ‘maximum affordability’ like the South-East of England.
The regeneration of brownfield sites (areas of land that are no longer used) will aid the government in its commitment to more affordable housing. It will also aim to ‘create more first-time homebuyers in all areas, and reduce the number of “non-decent rented homes” by 50%’.
How will the levelling up of affordable housing work?
Given the recent announcement, no clear guidelines have been announced just yet. Nor do we have any milestone goals from Government officials. As the plans are set for 2030, we hope more explicit information will be provided to understand more about these efforts. Acknowledging the supply and demand issues surrounding affordable housing is a step in the right direction.
It’s a good start, but how do you determine which areas need affordable homes?
We’re glad to see the government making an active effort towards addressing differences with areas of the UK. Due to the ambiguous nature of these plans, it’s hard to see how this will address the demand for affordable housing.
The solution isn’t one size fits all, as demands differ up and down the country. There’s a lot to consider, such as:
- Where do people want to live such as which postcode?
- What types of property are in demand in those areas?
- Are councils aware of what is needed and by when?
- What will the knock-on effect be for those areas that people are moving away from?
We are using our data to understand where the biggest the demand and supply issues for affordable homes are. The levelling up plan to build affordable homes will not be as effective without such data. There needs to be a clear understanding of what areas need affordable homes and what type to build. A big question that hasn’t been asked is whether such areas and homes are appealing to house builders. There may be a better margin to build luxury instead of affordable homes. So the government need to look at this seriously and meet it head on to find a way.
This could be more housing building on brownfield sites. It could be converting old retail space that is no longer required due to changes caused by the Covid pandemic. What we do know is more affordable housing will appear up North and in the Midlands, but the solution isn’t that simple.
A number of stakeholders will need to be aligned to make this work. Everyone deserves a home and we look forward to more information unfolding.
