South Cambridgeshire District Council: Calculation of five year land supply

Contents

Assessing Housing Supply
The Council fights to avoid building houses
Misrepresentation of projections
Those pesky big house-builders
Liverpool or Sedgefield?
Past shortfalls written off
Summary of supply position

A realistic assessment of housing need
Cambridge expansion now a serious problem
How the Council calculated demand
A better assessment
The message from the market
The Council calculation, as in the 2016 AMR
A calculation based on ONS figures and Savills' data


Assessing Housing Supply

  1. The purpose of this article is to present a realistic assessment of the five-year supply of housing land in South Cambridgeshire District ("the Council"). I look first at the Council's history of avoiding development, then at the assessed need and finally at the provision.
     
  2. In this paper, I have used the figures given in the annual monitoring review dated December 2016 covering the period to 31 March 2016. ("2016 AMR"). Even using the Council's own data, for all the faults I point out, the "five year supply" for the Council is far lower than they claim.
     
  3. All text in bold font has been emphasised by me.

    The Council fights to avoid building houses
  4. In several places I refer to the cumulative deficiency of houses built against the plan, one or more years earlier. For example, the Core Strategy referred to in the AMR for 2011-12 specifies that the cumulative deficiency in provision is 7,914. The cumulative figure from 2000 to 2011-12 in the 2016 AMR (core strategy less actual completions) given in table SC1b, p47 totals 9,365. That is to say, the Council achieved only 51.47% of what they said they would achieve over those 12 years. In only one year (2007/8) did they achieve their stated target.
     
  5. During this 12 year period, the Council has not been sufficiently unhappy with this repeated outcome to take any action to change it for the future. Each successive review provides projections required to satisfy the plan and in each successive year, only half the housing demand is met. The applicant submits that is the reason why house prices in Cambridgeshire show the largest five year percentage increase of any area in the country except Central London.
     
  6. That market demand is the reason given by the Council for its demand for 40% affordable housing, even on sites with fewer than ten units. The definition of “affordable” provided by the Minister is set out clearly in the Guidance at : https://www.gov.uk/guidance/housing-and-economic-development-needs-assessments as follows:

    Methodology: assessing housing need
    What methodological approach should be used?

    Establishing future need for housing is not an exact science. No single approach will provide a definitive answer.”

    “What types of households are considered in affordable housing need?
    The types of households to be considered in housing need are:
    homeless households or insecure tenure (eg housing that is too expensive compared to disposable income);
    households where there is a mismatch between the housing needed and the actual dwelling (eg overcrowded households); households containing people with social or physical impairment or other specific needs living in unsuitable dwellings (eg accessed via steps) which cannot be made suitable in-situ
    households that lack basic facilities (eg a bathroom or kitchen) and those subject to major disrepair or that are unfit for habitation;
    households containing people with particular social needs (eg escaping harassment) which cannot be resolved except through a move.

    Paragraph: 023 Reference ID: 2a-023-20140306"

     

    However, the Council does not use that definition. Instead, to the Council, “affordable” has its ordinary meaning of “what ordinary people can afford to pay”. So of course the demand for “affordable” housing in South Cambridgeshire is gigantic - not because it is an area of great deprivation, but because the Council are not allowing developers to build enough houses.

  7. The only penalty for the Council for this persistent failure has been for an inspector to add an extra 20% to the Councils projections. However, it is absolutely clear from the figures above that it would take an extra 100% to achieve even the modest projections proposed by the Council itself.

    Misrepresentation of projections

  8. The calculation of the five-year supply depends not only on demand but on estimates of completions. In this section I show the misrepresentations by the Council in the presentation of their figures. The following examples relate specifically to the five-year supply issue.

  9. The 2011-12 AMR published December 2012, says at page 23 that projected completions year by year, starting 2012-13 will be:

    2012-13   2013-14   2014-15   2015-16   2016-17   2017-18

    539           770          816          959          959          1177

    I note that the figure nearest in time covers a year which has almost elapsed. In other words, it is 75% fact and 25% estimated. What is more, the Council would appear incompetent if the actual figure turned out to be markedly different from the estimated figure. But the more distant the figure in time, the more difficult it is to challenge. the Council therefore always projects the five-year figures as low in the nearest years, and rising into the later years. In that way, they can create the illusion of an adequate five year pipeline. This is apparent from the above figures and it applies to every one of the last five years’ AMRs.

  10. You will see this pattern not only in the year I have mentioned. If you compare the most distant estimates - five years away, they are never achieved. Five years forward from the date of each AMR, there is always a large figure which “rescues” the 5YS from Armageddon. In each passing year, that figure is reduced, so that four years from when it first counted as part of the 5YS, it is a number not far from what should be achievable and is subsequently achieved.

    I now compare the figures above with the comparable figures in the 2016 AMR.

    2016-17   2017-18   2018-19   2019-20   2020-21   2021-22

    481          804           1271        1830        1321        1484

    The figure for the year 2016-17 has fallen from 959 to 481 in only four years. If the figures had always been estimated as the numbers actually achieved, the resulting 5YS would never have been greater than around two years.

  11. Now compare the upward trend year by year in both data sets. The 2015-16 data set above, shows a rising trend the more distant the date - except that in that year there is an exception for 2019/20.

    This is how the Council can always provide a five year supply while never actually seeing enough houses built.

  12. Note too: the higher figures in future years massage the five years supply because it is harder for an inspector or prospective developer to argue against what will happen in four or five years’ time.

  13. Note too: the higher figures in futurFor the annual total figures I have discussed above, to be credible, they must relate back to specific sites. They do. Here are examples. I refer to the AMRs for years ending March 2015 and 2016.

    Here are forecasts of completions for two years to March 2015 and March 2016. Both numbers estimated for year to 31 March 2016.

                                                    AMR to Mar 2015    AMR to Mar 2016

    Orchard Park                                       64                            30
    Trumpington Meadows                     124                            77
    Northstowe                                         32                             1

    At Orchard Park, for example, in the 2015 AMR with the benefit of actual data for 9 of the 12 months forecast, the Council was forecasting 64 units, yet the number of houses actually built, articleed 12 months later, was reduced by 55% to only thirty units.

    Now I will look at Northstowe. Back in 2004, the Council predicted houses would be built by 2010. As recently as 2010-11, the forecast was for 100 houses at Northstowe in year ended 2014. The figures above show a forecast of 32 houses only one year out, resulting in completion of a single house. The 2016 AMR, which showed that lonely house. Forecast that Northstowe will produce 194 houses in year to March 2018. Today, two months into that year, 10 have been built.

  14. However, Northstowe remains a gift to the Council in providing a boost to the 5YS. Take the AMR for 2010-2011. On page 43, I note that Northstowe is expected to produce houses first in 2013-2014. By 2016-2017 Northstowe builders are expected to have churned out a total of over 1,000 houses. In that year, that site alone enabled the Council to calculate a five year requirement 1,000 houses fewer than the actual outcome.

  15. Another example of misleading figures is that every recent AMR provides a table of “Predicted and Actual Housing Completions”. See figure 4.11, page 55 of the 2016 AMR. Unlike the data I have mentioned above from Figure SC1b, this data is eminently readable and transparent. It does not illustrate anything new. Note that the projections are generally far larger than the historic actual. To make it even more interesting, the projections for the next seven years are wonderfully optimistic. Looking at these projections, who would doubt that the Council will very soon be back within its 5YS?

  16. The actual outcomes of the last twenty years however, have shown similar optimistic projections. What we see is more of the same magic each year. In those ways, the Council has been able to show a greater five year supply than has been the true position. I will avoid pausing to consider the moral issues of the policies and procedures I have set out above.

  17. The Council admits it is fully aware of the problems of dealing only with large sites, but has refused to grasp the nettle. Year after year, the Council narrates how they have relied on third parties for the data they have given. It is not their fault. We should blame those pesky volume builders.

  18. In summary, the Council has provided the data it is obliged to provide, but dressed it up in the text so that the fudging of the figures over time is not immediately apparent. In this section I have tried to make clear the inaccuracies of the “trajectory” and the conclusions, consistently plucked from the air in order to satisfy the reader that the Council has a better five year supply than is truly the case and thereby preventing development. That is how the Council has been able to avoid building enough houses for at least the last 20 years.

    "Liverpool" -v- "Sedgefield"

  19. Over the last six years, alternative arguments for dealing with an accumulated deficiency have been used, based on two cases. They are commonly known by their abbreviated case names as “the Liverpool Method” and “the Sedgefield Method”. Liverpool allows the absorption over a long period or effective abandonment of a past deficiency. Sedgefield requires the deficiency to be made up in the immediately following five year period.

  20. The alternatives were discussed at great length in Bloor Homes -v- SSCLG and others. The judge strongly supported the Sedgefield approach made in an earlier case, but left it open to an inspector to decide otherwise.

  21. Since the judgement was given on 20th March 2014, Sedgefield has been accepted as the only basis of calculation. On 11th November 2015, the DCLG wrote to Gladman Developments:

    “Thank you for your letter of 27 October 2015 to Brandon Lewis MP, seeking clarification of whether local authorities should be using the Sedgefield or the Liverpool approach to calculating their five year housing land supply for planning purposes. I have been asked to reply on the Minister's behalf.

    I hope you will appreciate that I am not able to comment on the merits of the planning applications which are currently being considered by North Somerset District Council, or the apparently conflicting views of Case Officers of what is the most appropriate method for calculating the five year land supply position. However, the Government's planning guidance states that local planning authorities should aim to deal with any undersupply within the first five years of the plan period, where possible. Where this cannot be met in the first five years, local planning authorities will need to work with neighbouring authorities under the duty to co-operate.”

    I interpret this to mean that an LPA must either use Sedgefield or persuade an adjacent LPA to provide additional houses.

  22. The Sedgefield approach has been given added strength by NPPF Paragraph 47.

  23. The last nail in the coffin of the Liverpool method was support of the Sedgefield method again in the Court of Appeal in Suffolk Coastal DC -v- Hopkins Homes Limited and its sister case Richborough Estates Partnership LLP -v- Cheshire East Borough Council, judgement paragraphs 51-55 as recently as 17th March 2016. Note: this case was before the Supreme Court on February 22 and 23 2017, but as yet, judgement has not been given. However, the issues under consideration are most unlikely to change what I am discussing here.

  24. The Bloor Homes case hit the Council hard because it would no longer be able to abandon past deficiencies and start with a clean estimate for five years ahead. The solution the Council has adopted is to ignore the Bloor Homes judgement and carry on as before.

  25. The AMR for 2014/15 provides at pages 58 and 59 details of how they have calculated the 5YS. The outcome on their own figures was 1.8 years. In the 2016 AMR, the 5YS has increased to 3.7 years, but the Council is too shy - or wise - to publish the calculation.

  26. The response of the Council in the 2016 AMR is:

    1. at para 4.33, to present alternative propositions. They provide figures they allege are based on both the Liverpool and the Sedgefield method. They also include references to Cambridge City. These combinations give the 5YS proposition 12 alternative outcomes. This has the effect of giving the reader the impression that the Council could well have a full 5YS and may well defend its position at appeal. I note that the Council does not state categorically that it will rely on any specific figure. The reader is left with the implicit impression that she has a two in twelve chance of success at appeal on this point.

    2. the inclusion of Cambridge City in this context is interesting. In the entire 200 page AMR, there is no other critical data where Cambridge City is included. The local plan inspectors have already told the Council that they alone are responsible for their housing data.

  27. At 4.36, the Council again clouds the issue by reference to Greater Cambridgeshire and admits “the Councils cannot currently demonstrate a five year supply under the most stringent method of calculating supply (Sedgefield methodology with 20% buffer)”. This is a true statement, which defends any allegation that the Council is misrepresenting its data. Nevertheless, the effect is again clear. The Council is categorically stating that a 3.7 5YS is simply one of several alternatives. They “sell” this proposition as their own “cautious approach”, when in fact it arises because the ten alternatives are irrelevant.

  28. The reference to “the Councils” in the plural does however misrepresent the fact that the Council is in trouble alone and that the inclusion of the City makes their position no better.

  29. Paragraph 3.6 continues their “cautious approach” by explaining that “these robust, realistic and somewhat cautious expectations are appropriate”. The reader is then given further justification for the proposition that: “In future years the five year supply is predicted to grow substantially”. No reason is given.

  30. I respectfully submit that paragraphs 4.25 to 4.28 constitute blatant misrepresentation. The result is:

    1. only the largest “master developers” will dare to challenge them.

    2. development will consist in large estates of red brick boxes wherever there is space to put them, despoiling the Cambridgeshire countryside which those same councillors say they cherish.  

      I do not pause to consider what the response of the media would be if the directors of a bank were to present their data in the way I have described above.

      Past shortfalls written off

  31. At Para 4.9, the Council explains the sources of data for the housing trajectory. Every source is concerned with completions. What the Council is saying is that 80% of their estimates of delivery up to five years ahead, are based on planning permissions already granted. That means the next five years are dependent entirely on sites with planning permission today. It therefore appears that the Council does not expect to approve any new development on small sites which could produce houses fast. That is to say - the Council does not have a forward plan which will provide the sites they need.

  32. At Para 4.10, we are assured that past trajectories have proved to be reliable. By way of reply, please see my paragraphs 4-7, above.

  33. In its submission in respect of the local plan, Savills provides a succinct article. At paragraph 2 they say about the Council proposals:

    “Projections of past rate
    The assessment of housing “need” is based on the projections which in themselves are simply a reflection of past planning policies. Because Cambridge’s planning policies have sought to restrict housing growth, house prices have risen. Cambridge residents have been forced to move to villages and market towns in the Ouse Valley and Fens. The projections of so-called “need” are not a reflection of Cambridge’s real needs, but simply a reflection of development restraint policies, which are based on a view that constraints are more important than meeting housing needs. An approach which is clearly at odds with the NPPF.”

    And

    “The projections therefore are based on the under delivery of new homes against planning targets. The East of England Plan required the delivery of 1,175 homes a year. Actual completions from 2001 to 2011 were 7,663, against a requirement for 11,750 – a shortfall of 4,087. Accordingly, the projections are based on having under delivered. Households whose needs should have been met by 2011 are thus excluded form projections of future needs given those homes weren’t delivered.”

    These points are absolutely clear, accurate and logical - except that the last sentence requires further explanation.

  34. The Council fails to acknowledge in any local plan document or any AMR, the proposition that by restricting the supply of housing it is restricting future economic growth and hence restricting demand for housing in the future. The larger the local economy, the larger the nominal growth each year. (A cumulative or geometric progression). By its failure to provide houses over the past twenty years the Council has also succeeded in its aim to keep South Cambridgeshire rural and undeveloped.

  35. South Cambridgeshire, however, is not a self-governing island. Worse, it wraps around the fastest growing city in England. As a result, the lack of economic growth in the District has not prevented dynamic growth in the City from spilling over to increase demand in the District. Indeed, this City-based growth tends to obscure the stagnancy of the District economy which results from the restricted supply of housing. The hypothesis to be drawn from Savills’ last sentence, above, is that the figures for the Council’s housing demand today would be an order of magnitude greater if the District had contributed to solving the housing crisis over the last twenty years. In my calculation below of the 5YS, I have ignored the cumulative effect, not because it is irrelevant or insignificant, but simply for the sake of sticking to solid, incontrovertible data.

  36. In the appeal by “Persimmon” against the Council, planning appeal Reference: APP/W0530/A/13/2209166, decided 24 June 2014, the Inspector referred to the Council’s historic provision as follows:

    “The pattern and pace of housing provision is unlikely to change in the short term because the spatial strategy evident in the CS is carried forward into the emerging LP. . . . closing a shortfall of 1,027 dwellings within the last 3 years does not appear to have been a cause of concern for the Council or to have resulted in remedial action. Although I appreciate that the Council has a limited range of options to address under-supply and that it is not a developer, the Council does not appear to have proactively sought to boost the supply of housing in the District, e.g. by bringing other allocated sites forward.”

    I suggest that this is as damning a condemnation as an inspector might make.

    Summary of supply position

  37. Paragraph 4.36 is the grand summary of this year’s reasons why the Council has failed once again to achieve its target. Note that there is still no admission of the need to stop relying on the small number of large sites. In the AMR for 2014/15, the Council was quite open about what development it would accept:

    “The adopted development strategy focuses growth in a limited number of sustainable major developments on the edge of Cambridge and at the new town of Northstowe.”

  38. There is no explanation of this absurd proposition which condemns every village in the District to become a museum housing old people while the young have no alternative than to emigrate to the cities as they did 200 years ago. In the context of the 5YS, I suggest it is hardly surprising that demand for “affordable” homes is soaring while the Council can openly admit that they are “focussing” the small amount of growth they allow, only in two areas.

  39. For a final suggestion, I refer to paragraph 4.37, where there is yet another table showing difficulties today which will be overcome tomorrow.

  40. The history of acknowledging problems, but disowning them, then grossly exaggerating future outcomes, is so consistent that it can have occurred only as part of a plan to show a higher figure for the immediate five year figure and thereby reduce the susceptibility to penalties for under-performance. I believe it is inconceivable that the Council should be unaware that using the same method of calculating supply year after year, will produce the same inadequate outcomes.

  41. Against the history set out above, I suggest that the Council’s calculations of the number of houses which will be built in any future period has been deliberately fixed so as to enable the Council to continue to build as few houses as possible.

    A realistic assessment of housing need

    Cambridge expansion now a serious problem

  42. Cambridge will continue to grow, only as long as new and expanding firms and institutions continue to assess that it has advantages over other locations. The more problematic the housing situation becomes, the less attractive will be the external perception of expanding in Cambridge. Fundamental political decisions affect the future of the City and the consequences for housing need. Cambridge is on the cusp of an extraordinary challenge. Will it become a giant technology hub at the forefront not only of research but of edge-of-knowledge manufacturing, or will it sink back into the limitations of mere academia where it was 30 years ago?

  43. The “City Deal” website said of Cambridge in 2014:

    “ . . . the shortage of available, and affordable, housing within a reasonable distance of key employment centres has driven an unsustainable increase in house prices, which in turn affects the recruitment and retention of talented employees. Average house prices in Cambridge have increased 50% in the last 8 years are now 9.2 times average salary compared to 6.7 for England. Housing waiting lists across the City Deal area exceed 11,000 people. Population growth in Cambridgeshire from the 2001 census to 2011 was faster than in any other English county. The City Deal will enable further economic growth by enabling and connecting housing growth.

    Greater Cambridge partners have long recognised the need to support housing development, and are planning for this in the draft local plans which are planned for adoption in early 2015.”

  44. As the last paragraph indicates, the Council is a partner in the City Deal project. That means they had access to the underlying data supporting the above propositions. But fine words do not remove the difficulty faced by the Councils. How can 160,000 rural residents be persuaded to allow their councillors to expand their villages to the extent required? The Council saw this problem ten years ago but failed to grasp the nettle. Instead, they voted for a small number of large schemes combined with forecasts intended primarily to discourage development.

  45. That last problem affects the data for both authorities. If people who come to the area for work based broadly on the City, they will have to live in the District because there will be no space in the City - or at least not enough space at a price most people can afford. That means that a projection of future jobs in the City is also a projection of the housing required in the District. (I ignore Cambridge City’s own housing assessment because it is not directly relevant to this paper.)

  46. To summarise this section: more than for any LPA outside London, it is political decisions that will control both demand, as evidenced by the expansion of the City, and supply, evidenced by the low numbers built in the District.

    How the Council calculated demand

  47. The Council first proposed a need for 19,000 homes in the plan period. That proposal was not accepted by the plan inspectors.

  48. The Council ignored the specific criticisms by the Inspectors and instructed Peter Brett Associates (“PBA”) for a article. The invitation to tender for this article is almost hidden at https://www.scambs.gov.uk/sites/default/files/documents/Letter%20to%20Inspectors%2028.09.15%20%28RD-GEN-240%29.pdf . I note:

    “The appointed contractor will be required to take account of the Cambridge Sub Region Strategic Housing Market Assessment (SHMA) and supporting Technical Article previously produced . . .”

    In other words, the Council made it clear that they wanted PBA to use the same data as they themselves had used in the rejected local plan. The implication is that they wanted PBA to confirm the Council’s conclusions.

  49. To cover themselves, PBA carefully confirmed their instructions and the limits of their article. They say:

    “This article was commissioned by Cambridge City Council and South Cambridgeshire District Council to provide evidence on housing need and housing targets (requirements), in response to questions raised by the Inspectors examining the plans.”

    Those words did not accord with the requirement set out in the tender, but maybe they did confirm the terms of the actual contract document.

  50. PBA were then in a difficult position. They had no alternative than to article in the form that their client was paying for. PBA then paraphrase over 2,000 clear words from the Inspectors into:

    “In their letter to the Councils the Inspectors asked the Councils to consider whether these numbers were compliant with national Planning Guidance (PPG), in three respects:

    Whether they took adequate account of market signals;
    Whether they should be increased in order to provide more affordable housing;
    Whether they should be reconsidered in the light of the new official household projections published by the Department of Communities and Local Government (CLG) in February 2015.”

    This was not what the Inspectors asked for.

  51. Against that history, it is unsurprising that PBA produced a article which provided a figure only 2.6% greater than the figure submitted by the Council. That figure was adopted by the Council, and submitted to the Inspectors as a direct response to their requirement.

  52. That figure has not been accepted by the Inspectors as being adequate, yet the Council makes clear in the AMR that it will stand by the five-year figure which results from it. In other words the Council is taking advantage of their own delay in dealing with their plan, caused by their own failures to provide what the Inspectors wanted, to continue a course of action which produces not only an overblown 5YS but a continuation of a set of policies which are absolutely “restrictive of development” in the context of Suffolk Coastal District Council  -and- Hopkins Homes Limited .

  53. A further point missed by the Council is that an assessment of housing need should not be regarded as a bare minimum. A projection is ultimately only a “best guess”. It will not turn out to be accurate. However, in connection with housing supply, if the projection turns out to be too high, there is no downside - a few fields stay green for a few more years. But if too low, serious social damage results. This means that a responsible authority should over-provide, rather than attempting to reach a minimum target, as the Council does.

    A better assessment

  54. I will now explain why a more accurate assessment can be provided by looking at what is happening on the ground.

  55. In paragraph 4, above, I used long term data to show the persistent intention of the Council to avoid building houses. However, to look at a realistic projection, I will look only five years back and five years forward. I calculate a reasonable expectation of the delivery in the next five years as follows. All figures taken from 2016 AMR, table SC1b.

    1. Target completions 2011-12 to 2015-16                     4875

    2. Actual completions 2011-12 to 2015-16                     3401

    3. Deficiency                                                                    1475

    4. Percentage shortfall                                                 30.25%

    5. Target completions 2016-17 to 2021-22                     5707

    6. Historic percentage shortfall                                   30.25%

    7. Actual likely achievement 2016-17 to 2021-22,
      based on historic shortfall                           3,980


      This last figure is statistically the most probable outcome. For a different outcome, it is necessary for the Council to have changed its working methodology in some fundamental way. There is no evidence in the 2016 AMR that they have done so or intend to do so. I carry this figure forward to calculate the basis of the true 5YS.

  56. The requirement for houses follows the number of jobs, employed and self employed, plus net migration by older people. An LPA can prevent new employment by restricting the supply of housing. It can encourage the growth of employment in many small ways, but it cannot “create jobs” (outside its own organisation). Although every LPA gives lip service to economic expansion, the Council has for many years discouraged new housing and thereby discouraged employment. Despite that, Cambridge employment has expanded while the housing shortage has created an enormous increase in house prices.

  57. Many of the points I make in this article are also covered in representations made in late 2014 in connection with the emerging plan. These include authoritative forward forecasts by commercial property agents like Savills and Bidwells. Their data is one to two years ahead of that provided by the ONS because they field the first enquiries for the business property that eventually provides new places to work and hence the increase in employment and requirement for houses - the data picked up by the ONS.

  58. Based on ONS data, Savills published an article at http://www.savills.co.uk/research_articles/141280/202894-0 estimating the historic ten year employment growth rate as 31.3%. That period includes the greatest recession in 80 years. One would therefore reasonably assume that the rate would be higher if it was based on a period of normal economic activity. Indeed, if 3.3 years of recession are assumed, the underlying growth rate increases to 47%. In support of the Savills figures, I refer again to the City Deal website:
    “Average house prices in Cambridge have increased 50% in the last 8 years are now 9.2 times average salary compared to 6.7 for England. Housing waiting lists across the City Deal area exceed 11,000 people. Population growth in Cambridgeshire from the 2001 census to 2011 was faster than in any other English county.”

  59. Despite that, I take the Savills employment growth figure as it has been given - a mere 31.3% for the ten years to 2015 of 31.3%. Since there are only 15 years left of the plan period to 2031, I project the Savills expansion forward by fifteen years. 31.3% for ten years gives 46.95% for fifteen years. That gives us a 46.95% increase over the number of people employed today, by 2031. That is without regard to the recession and without cumulation.

  60. As the number of jobs increases, so the area for daily commuting will extend. The fact that house prices have increased by 30% in the last five years indicates that many people will have been priced out of the local market. In the medium term, ever longer commuting is unsustainable. Accordingly, all of the increase in population must be housed within comfortable commuting distance of the area of the increased employment; that is, within South Cambridgeshire District. No adjacent district has taken account of this increase, but those people have to live somewhere.

  61. For South Cambridgeshire there is another problem. There is little space in Cambridge City, as I have discussed above. The Council and the City have worked closely together for several years. It is not relevant to this appeal to challenge the figures proposed by the City, but it is difficult to imagine that the long term housing requirements of the City can be accommodated within its territory.

    The message from the market

  62. This by far the most important evidence of housing need. According to the Land Registry and Zoopla, house prices have risen in Cambridge over four years by around 30% and in almost every village within ten miles of the City by 25%. That is the message of the market. So what does that mean?

  63. For all our statistics, assumptions and calculations, the “objectively assessed housing need” can be expressed as “the number of units required to reduce the cost of one plot to inflation-adjusted equilibrium - that is, the price which is in line with other living costs. The market is in charge, not the planning authority, nor even Central Government.

  64. The formula for restoring house price equilibrium cannot be calculated. Such action may not be politically possible either. But that does not mean we should ignore the state of the market. House prices in Cambridgeshire have increased in the last few years faster than any area outside Central London. In any consideration of the data we do have and the decisions we can make, it is therefore reasonable and essential that we over-provide for houses rather than looking for the minimum.

  65. To achieve equilibrium in the short term requires an immediate boost to supply of the sort of houses people want to live in, in the places where they need to live. Developing “rural suburbs” around the City, or making a start in Northstowe will not cut it. The only way to provide more houses in the short term is to grant permission on a large number of small sites in every village.

  66. I will now convert that to numbers. First, for comparison, here is the Council’s calculation, with my comments in red.

    The Council’s calculation, as in the 2016 AMR

    Using the ‘Sedgefield’ methodology

    a  Housing provision required in the
    Local Plan 2011 - 2031                                                     19,500

    b  Requirement up to 31 March
    2021 (based on 5 years out of 20)                                    4,875
    But should be based on assessed housing need.        

    c  Dwellings completed up to 31 Mar 2016                      3,401

    d  Shortfall against annualised average requirement     1,474

    e  Five year supply requirement                                      6,349
    f  With 5% buffer = 6,666
    not realistic

    g  With 20% buffer                                                            7,619

    h  Number of dwellings predicted to be completed         5,707

    i Five year supply (= h/e x 100 x 5)   4.5
    Not realistic

    j  Five year supply (with 5%) (= h/f x 100 x 5) 4.3
    Not realistic

    k  Five year supply (with 20%) (= h%÷g x 5)
    and figure now claimed                                                3.7

    A calculation based on ONS figures and Savills’ data

  67. Now here is the comparable requirement based on hard data

    Number of new houses.

    Present combined South Cambs and City population                        287,000
    Number of people per household, per ONS                                          2.3
    Estimated no of homes (287,000 / 2.3)                                              124,000
    Working population increase %, over last ten years, per Savills          31.3%
    Working pop increase over 15 years, no cumulation (31.3 x 1.5)         46.95%
    Increase in housing stock required over 15 years                               46.95%
    Actual number of homes needed (124,000 x 1.5)                               183,000
    Net new homes needed (183000 - 124000)                                        59,000
    Annual requirement (15 years) for new homes (both authorities) 4,875

  68. Apportionment between the Council and the City. Today, the City is proposing to build a substantial proportion, but that cannot continue. The only way that the City can provide the housing needed is by building upwards. In the context of the architectural heritage contained in the City centre, substantial construction can take place only by demolition and new build in the suburbs. However, the people migrating into the City are unlikely, as a class, all to be happy in suburban towers. They will commute in from wherever they can afford. That means, mostly, from the South Cambs District. So jobs based on the City will mostly increase housing demand in the District.

    I do not think that the City will be able to provide more than 25% of the 15 year need, but since I am not analysing City data, for the sake of this exercise I will generously apportion 50% to the City and 50% to the Council. Accordingly, of the requirement for 62,300 houses, that gives an allocation of 31,150 to the Council for the remaining 15 years. That is 2,077 per year, or 10,385 over five years.

  69. The document “Greater Cambridge City Deal says:

    “Greater Cambridge partners commit to the delivery of an additional 1,000 new homes on rural exception sites. This will support the creation, and maintenance of sustainable rural communities in market towns and villages”.

    There are no rural areas in the City, so the deal must be that 1,000 new houses will be built on rural exception sites within five years of a date in 2014, in South Cambridgeshire. City Deal housing is specifically stated to be in addition to the number required to satisfy assessed need. That is what makes it a “deal”.

    There is no mention of the City Deal in the 2016 AMR. It has disappeared from view. The number of affordable houses on rural exception sites completed in 2015/16, Figure 4.26, page 75, is 28. That may include City Deal sites. If the target is 1,000 over five years, the Council is at least 70% short in the first year. That leaves at least 972 to be carried forward over the following three years of the five year City Deal period. For ease of calculation, I treat this addition as appropriate for a five year spread. I therefore increase the five year total to 11,357 or 2,271 per year.

  70. In the AMR for 2014/15, at page 59, the Council admits to a cumulative deficiency of 6,832 houses. The comparable figure is not published in the 2016 AMR. However, the deficiency for 2015/16 can be calculated from the Council’s table SC1(b). It is 335. The total shortfall, according to the Council, is therefore 7,167. All of that shortfall must be added to the number to be provided in the next five years of the plan. We had a five year total of 11,357. If we now add 7,167, the five year total is 18,524, or 3,705 per year.

  71. Against that requirement, the most likely actual outcome for the next five years, can be calculated as follows:

    Likely five year supply, per para 54, above              3,980
    Five year requirement, per Council’s data               22,229
    Percentage of five year supply likely to be provided  17.9
    17.9 percent expressed as number of months          10.74

    I respectfully submit that the 5YS is generously calculated as 10.74 months.

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