House Building: Yet more problems - Tim Jones

I am disappointed to have to return yet again to this troubled subject. It has been the subject of various previous articles. It is however a matter we cannot afford to ignore as a healthy, vibrant, and improving housing market is an essential part of ensuring that Northern Devon can continue to push forward with its business growth plans.

We need to be able to house our youngsters. We need to have adequate provision for first time buyers. We need to have decent living accommodation which complies with the very latest standards of energy efficiency. All our businesses need to be able to recruit a wide range of new staff members, many of whom will only take up positions if they have a house to occupy. In short, this topic is one of the most important drivers for all of us.

The situation we currently experience has been identified as a problem for at least the last two years. Progress to try and improve the current situation has been close to zero. A huge amount of rhetoric but no effective action. Our representatives in Whitehall have completely failed to tackle this challenge and have left us without the ability to secure the housing growth numbers we need. In so doing, they have also made life intolerably difficult for our Local Authorities, who must wrestle with the increasing problems around our broken planning system and the mountain of new regulations being introduced by bodies such as Natural England.

A recent demonstration of how chaotic this whole process has been played out in a debate in Whitehall regarding the somewhat obscure subject of “Nutrient Neutrality”. In simple terms, this is part of a debate about pollution to our rivers and watercourses. Natural England have decided to point the finger of blame for increasing levels of pollution at the house building industry. They say that new homes create additional levels of phosphates, which in-turn can cause pollution to water courses. The problem could/ should be resolved through sewage treatment works where these harmful chemicals will be filtered out. Unfortunately, however, it is the case that our water authorities have not upgraded their treatment works to deal with the problem. They have also got no authority from the Water Regulator to spend money improving treatment until at least 2030. The cost of dealing with this will run into billions. These costs will have to be absorbed through our water bills. Given the problems of inflation and pressures on our communities, this is quite simply an unacceptable solution.

As a result, in order to gain a planning consent, house builders have to prove that they are not increasing pollution levels – hence Nutrient Neutrality. To do this, they must acquire agricultural land and set this aside for at least 90 years and allow it to establish wetland areas, thereby effectively offsetting the pollution that new houses create. The impact of this is huge additional cost in buying often good quality farmland. Also, the loss of production from that farm which could be contributing to the shrinking provision of UK based food production. A more detailed look at this issue also reveals that the amount of pollution coming from new house building as a total is less than 5%. The main causes of new contamination are from the farming industry (40% of the total), existing houses (roughly 30%) and the balance from our industrial sector. The effect of all this is to cause the delivery of new houses to grind to a halt. It is currently estimated that around 170,000 homes nationally are stuck until this matter is resolved. To try and unblock this, the government introduced legislation, however, last week in the House of Lords debate the relaxation proposals were rejected.

Whilst the problems of water and river pollution are far more acute in other parts of the South West – principally Somerset, East Devon and around the Tamar – the burden of new regulations is increasing and Natural England, emboldened by their political success, are increasing environmental regulations. Inevitably, this will soon have an impact across Northern Devon.

Quite apart from this hugely contentious issue, is a new series of regulations which come into force in November this year under the heading of Biodiversity Net Gain. This means that every new development must make a positive contribution from their project by achieving at least a 10% improvement for Biodiversity. Behind this, there are a huge new raft of regulations and requirements. This is imposing even more intolerable burdens on our Local Authority Officers.

Unsurprisingly, the house builders are reacting badly to this. Any costs incurred will be added to the price of the house. Trying to agree the new planning conditions takes additional time, causing an even more significant impact on new housing delivery.

In order to keep pace with the growth of our population and to catch up with the backlog of supply, housing experts estimate that we need to build 300,000 new homes a year for at least the next 5 years.

We have not achieved any where near this level of delivery for the last 25 years. The cumulative effect of the problems I have just described are baring down on these delivery numbers. The increased interest rates have also made new homes less affordable for first time buyers. The consortium, which represents all the house builders, estimate that only around 37,000 new homes were built in the last 4 months. In Plymouth, where routinely 600 new homes are built every year, this has dropped by half. The Home Builders Federation estimate that there has been at least a drop of 20% in the approvals for new housing projects. If all these statistics are put together, then a bold estimate would be that we will only build around 150,000 in the next 12 months. Many predict that this could be even lower.

This is political dynamite for the government, particularly considering the likelihood of a General Election at around this time next year.

For Northern Devon, this could stifle many of our growth initiatives. It is crucial that this does not happen. With the cooperation of all of those who can influence the outcome plus support from business and communities, we can help to tackle this problem. Never has there been a more important time to address this critical issue.