Formulating the Housing Strategy

The housing needs and market analysis should provide a basis for determining:

  • • the match between the existing housing stock and the demographic profile of the area
  • • particular groups with unmet housing needs
  • • the availability and/or loss of lower priced housing
  • • changing tenure trends amongst particular age cohorts and,
  • • the quantity, characteristics, price and tenure of new housing likely to be required in the short-, medium- and long-term future.

This analysis provides a basis for formulating the range of specific strategies to pursue the overarching local or regional housing objectives. In practice, of course, the strategy will reflect a combination of the assessed housing needs and the available policy levers/resources able to address these needs within a given timeframe and within the wider policy and legal frameworks which delimit planning control and housing development processes. As noted throughout this book, central and local level jurisdictions differ in their respective roles for housing policy and assistance and in their powers of urban planning and development control. The scope of local government authority and the existence of regional level authorities or powers also affect the scale of strategic intervention in the housing market that may be possible.

Table 10.4 compares three different local housing strategies, applying to New York City, the Greater London Authority and the City of Melbourne. The comparison highlights the different ways in which local authorities mobilise available evidence and resources, to address housing issues within their jurisdictions. Of course the plans also reflect political statements as well, produced by Mayors Bill de Blasio (New York), Boris Johnson (London), and the Melbourne City Council, respectively. While the New York and London plans apply to global cities of similar population size (about 8.4 million people), the population covered by the Melbourne plan is much smaller (around 116,000 people and a relatively

Table 10.4 A comparison of three local housing strategies

Housing New York

London Housing Strategy

Homes for People; City of Melbourne

Scale

5 Boroughs, 10 years (2014-2024)

Greater London Authority (GLA) (33 Boroughs)

(2015-2018)

City of Melbourne local government area (2014-2018)

Study/analysis Demographic/ economic trends

Population = 8.4 million; growth = about 1 % per annum 35,000 households per year

  • 8.4 million (2013); about 1.3 % per annum
  • 40,000 new households per year Strong economic growth 1997-2012
  • 116,000 (2014)
  • 3-8 % per annum (150,000 by 2021)

(continued)

Housing New York

London Housing Strategy

Homes for People; City of Melbourne

Housing market trends

*Demand and supply indicators *Tenure ‘Special needs

  • 1 million earning less than 50 % AMI but only 425,000 affordable units
  • 30 % of renters (1 million) spend more than 50 % of income on rent
  • 50,000 in homeless shelters

Mismatch between dwelling units and household characteristics (need for smaller apartments)

48,000 dwellings needed per year producing around 20-25,000 per year (but permissions for 200,000 dwellings)

Growing private rental sector (falling home ownership)

  • 6 % of dwelling stock is overcrowded—11 % in private rental, 14 % in social rental 42,430 people in homeless accommodation per night 344,300 households on waiting list for social housing Affordable housing need =
  • 25,624 units per year 0.7 % of stock vacant for more than 6 months

50 % of renters in housing stress

$128 weekly shortfall for dual median income, household to afford the median rent on a 2-bedroom apartment 12,878 shortfall of affordable dwellings (19 % of total housing stock) Vacancy rates = 3-9.5 % of stock (but falling) Regionally, 2 % of homes within 56-minute commute of the CBD affordable for low- income worker Mismatch between dwelling size and resident needs

Policy goals/ objectives Housing delivery/ targets

Development/preservation of 200,000 affordable housing units by 2024 80 % of these = new construction; 78 % of total for low, very low and extremely low-income groups

  • 48.000 new homes per year
  • 17.000 to be affordable rent/buy (moderated in light of available subsidies/feasibility)
  • 25.000 market (of which 5000 to be long-term rent)

Deliver 1721 subsidised homes by 2024 Additional 24,000 dwellings anticipated by 2021

Housing New York

London Housing Strategy

Homes for People; City of Melbourne

Key Strategies

Support jobs through investment in housing strategy Introduce mandatory inclusionary zoning scheme Use of city sites and other government land/land owned by non-profits

City budget to support projects & offer financial leveraging for affordable housing development

New housing products, including infill affordable housing Small infill sites for affordable home ownership Encourage smaller apartments Develop vacant sites, and identify vacancy/underutilisation in public housing stock

Support jobs through affordable/ housing construction

Improve housing quality—design code for minimum space; 10 % of dwellings to be wheelchair adaptable

Reduce overcrowding

Encourage innovative construction

Introduce diversity of housing products—younger workers; the aged

Low cost home ownership options for 'intermediate' housing sector, that is, lower- income workers

Discounted/capped rents for very low income

Improve quality and security of private rental (e.g. long-term leases)

Reduce number of vacant homes

Unlock 'stalled sites'

Deliver affordable housing dwellings (about 6 % of total projected new dwellings, by imposing 15 % target on projects not yet permitted)

Impose up to 15 % target for affordable housing on City's land

Introduce development/ density bonus scheme (although current density permitted in high-density residential zones is unlimited)

Improve design quality and environmental performance

Coordinate with other local government authorities in surrounding areas

Resources

City capital and other funds (and land). Federal and State funding programmes, private equity

City funds/loans/guarantees/land Housing associations (encouraged to borrow against assets)

Central government (capital funding)

City land—'up to' 15 % for affordable housing Commonwealth funding (if available)

Source: The authors, with reference to New York City 2014, Mayor of London 2014, City of Melbourne 2014

small inner city core of 36 km2). The City of Melbourne forms the centre of the much larger Melbourne metropolitan area with a population of about 4.4 million people and spanning around 9900 km2; governance remains divided into 28 discrete local government areas. Melbourne is the second largest city in Australia and, like Sydney, has been affected by steep house price inflation and affordability pressures.

The strategies are chosen for comparison because each represents a key reference point or benchmark within their own countries of origin, and more widely in relation to New York and London (Marom and Carmon 2015). Each strategy was completed in 2014, and relates to slightly different timeframes (10 years for the New York Plan and 3-4 years for London and Melbourne, although longer planning horizons are recognised). Although both London and New York have long histories of planning for housing (with the first 10-year housing strategy for New York launched in 1986), the Melbourne Strategy represents a more recent attempt for a city council to develop awareness about housing affordability and design issues.

Affordability pressures clearly beset each city, yet the strategies defined by each city government to address these pressures are distinct. The London Plan is informed by a comprehensive SMHA, which, in turn, follows the standardised approach for undertaking housing market analyses in England as described in relation to Bristol. Annual monitoring and reporting are undertaken against this assessment and the commitments outlined in the London plan. By contrast, the information base informing the New York plan is more bespoke, drawing on data collected specifically for the planning process. The Melbourne plan relies primarily on available indicators based on median incomes and median rental data to determine affordability, and qualitative assessment of the design quality and environmental performance of new housing development.

Both the London and New York plans have been criticised in recent years for focussing primarily on the needs of moderate-income earners at the expense of low and very low-income groups (Marom and Carmon 2015). However, the current London and New York plans appear to emphasise a reorientation towards those at the bottom of the income spectrum, along with commitment to additional subsidy to address the needs of these groups through dedication of local authority land to housing projects, and the use of City funds, particularly to leverage other resources. The aims—and resource commitments—of the Melbourne plan are much more modest when it comes to providing for affordable housing. Yet when considered in the context of wider efforts to plan for affordable housing provision in Australia the Melbourne plan reflects what might be regarded as leading practice (Gurran 2003; Williams 2000; Gurran et al. 2008; van den Nouwelant et al. 2014).

This comparison of three contemporary housing strategies illuminates some of the strategic opportunities and constraints that may face local or regional planning authorities in developing a housing strategy on the ground. Table 10.5 draws on our work in this area over a number of years to summarise the range of strategic options in a more generalisable and open-ended way, in response to a set of specific housing needs and market characteristics.

As shown in the table, a variety of different land use planning and other approaches can be used to address particular housing needs and market trends, depending on the availability of resources to support specific initiatives. These include identifying opportunities to change planning controls so they support more diverse housing options in line with changing population needs; targeted improvements to local infrastructure and service delivery; and, to address spatially concentrated disadvantage measures to protect and promote affordable housing supply.

Regular monitoring is important to determine the extent to which strategic actions are being carried out, and potentially, the impacts of these actions. This involves regular reporting on strategy milestones, and ways to address any implementation barriers. While it is more difficult to determine the impact of housing strategies on levels of housing need within a locality or region, regular updating of the key housing trends (identified during the housing study) is important to identify potential outcomes as well as emerging problems.

Housing Market Analysis

Strategic Response

Need for additional housing for projected population increase associated with forecast economic/employment trends, e.g.:

  • • Anticipated new industrial development
  • • Growth in service sector
  • • Ageing population and need for aged care services
  • • Seasonal employment trends

Assess capacity within existing housing stock and supply of residential land; identify new housing opportunities; consider allocating new areas for residential uses or permitting additional higher density residential development in appropriate locations (near transport and services) Consider introducing planning approaches to ensure affordability of housing for "key workers" and those in the service sector (e.g. nurses, personal care assistants, childcare workers, hospitality staff, teachers, police)

Consider need for appropriate seasonal housing opportunities, such as well located and serviced caravan parks, manufactured home estates, or zoning provisions for temporary/permanent employee housing

Changing demographic profile and household size e.g.:

  • • Increase in numbers of families with children or group households
  • • Increase in couple or lone person households
  • • Ageing population

Assess residential development opportunities and consider changing controls to encourage:

  • • A sufficient new supply of larger or smaller dwellings (for instance, a requirement that medium density developments include a minimum number of one-, two- and three-bedroom configurations)
  • • A sufficient supply of adaptable or accessible housing (for instance requirements that certain housing forms include a proportion of adaptable housing)
  • • Different residential lot sizes to promote housing diversity in suburban settings

Proportion of population on very low incomes experiencing housing stress or at risk of housing stress, including:

  • • Increasing numbers of homeless people or people at risk of homelessness
  • • People living in semi-permanent accommodation such as residential parks and manufactured home estates

Foster additional forms of crisis and supported accommodation serving the needs of particular groups at risk of homelessness.

Enhancing local community services for people in housing need, such as emergency referral networks

Housing Market Analysis

Strategic Response

High spatial concentrations of people on low incomes, who may be at risk of social marginalisation or exclusion, such as:

  • • Large public housing estates
  • • Large concentrations of private tenants on low or moderate incomes

Encourage infrastructure investment in local infrastructure and facilities, to improve accessibility and amenities within the area Consider working with social housing landlords to improve services for tenants or to promote new, mixed residential developments within or in proximity to large estates

Consider ways to coordinate services for low income private tenants

Loss or shortage of low cost rental housing stock and declining housing affordability Shortage of social housing opportunities

In addition to the above strategies, introduce planning approaches to secure existing supplies of low cost housing and deliver new affordable homes in new and renewing communities (discussed further in chapter 11)

Consider facilitating specific housing projects for affordable housing or special needs groups

Develop an advocacy strategy to demonstrate the need for more affordable housing within the local community

Low/declining demand for housing in certain neighbourhoods, leading to risk of abandonment, 'trapped' low income owners, environmental deterioration, 'ghost estates'

Review overall housing plans/strategy to curb overall oversupply in market

Measures to acquire or lease vacant property for let to households in need

Area-based regeneration programmes 'Greening' initiatives

Source: Adapted from Gurran et al. (2008)

 
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