Copied from Local Government Chronicle online

Homeowners prevent housebuilding, report finds
24 October, 2014 | By David Paine

House-building rates are lower in local authority areas with higher proportions of homeowners, according to analysis by the Institute for Government (IfG).

The report,‘Housing that Works for All – The Political Economy of Housing in England’, covered the period from 2001 to 2011.

It follows the publication of the Lyons housing review, which outlined how up to 200,000 new homes a year could be built by the year 2020.

The IfG said there was a risk of planning decisions being biased in favour of current homeowners.

This was in part because of a lack of city or region-wide planning co-ordination, which meant planning policy operated “exclusively at the local level and is responding to the interests of local residents”.

It said new developments often created new infrastructure costs for councils, and extra demand for public services, yet the increase in revenues from developments was “limited”.

The report also warned that the requirement for planning permission to be granted for any change of land use made decisions “slower and more uncertain”. Homeowners were among the most likely groups to oppose new homes, it said.

Miguel Coelho, IfG fellow and co-author of the paper, said: “A common accusation is that planning decisions tend to cater for the interests of current homeowners, rather than allow for a wider, more balanced set of interests. New empirical presented in this paper lend support to this hypothesis.

“Our analysis shows in particular that in the decade to 2011, housing stock grew significantly less in local authorities where there were higher proportions of owner-occupiers amongst local households.

“Credible proposals to reform the planning system should address this problem and ensure that planning decisions allow for the full breadth of interests affected by development.”

However, the paper acknowledged reforming the planning system would be difficult.

It claimed there had, so far, been a lack of public support to do so, and that the wealth of households and health of the UK financial sector had “become inextricably intertwined with the macro-economy, thus undermining the case for fast, radical reform”.

It also claimed that “successive governments have struggled to find a sensible balance between regional/national planning co-ordination and local democratic legitimacy”.

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