Letter: Housing Target – We Should Consider The Longer Term

Published on: 11 Aug, 2016
Updated on: 11 Aug, 2016

From Gordon Bridger
Hon Alderman and former Mayor of Guildford

Mr Mckinney in his letter The Real Crisis Is Of Housing Affordability thinks there is so much wrong with my arguments that he does “not know where to start” – but then starts by claiming “that housing supply meets demand” and “it’s just a question of affordability”

Of course supply always meets demand – at a price. He correctly points out that supply is meeting demand at a price which many young and poorer people cannot afford.

Those younger people who do not have affluent parents but who we need to staff our high-tech enterprises which are our economic future, and staff hospitals, our schools and university and research park are those taking the brunt.

The supply of houses has been woefully inadequate and prices have been forced sky high by a self imposed restriction on the supply of land. It is not unreasonable that those of us fortunate and wealthy enough, who are well housed, to prefer to have green fields and birds and bees as neighbours?

As one of the wealthiest communities in Britain it is understandable that further development is not a priority. However, should we not consider our longer term needs and how to meet existing housing shortages?

How are we to meet our need for skilled labour to keep our institutions going and how are we going to maintain our undoubted economic success in a competitive world if we do not find more housing for younger people who have accounted for it?

Since the government makes meeting this unmet demand by limiting council housing and then extends the right to buy to “affordable” housing, it is far from easy finding a solution. While we should certainly provide more space at the expense of retail in the town centre this is land which has a high private market value and is suitable for elderly and single people and not for younger people with families.

This is why the council has rightly allocated some marginal areas of green belt which would allow a considerable amount of “affordable” housing funded by financial community gain from development of market housing. This seems to be the only practical way forward to meet a very optimistic 40% affordable housing target.

Responses to Letter: Housing Target – We Should Consider The Longer Term

Valerie Thompson Reply

August 11, 2016 at 5:05 pm

I do not consider the use of land at West Horsley, to provide over 400 new houses, all of which are proposed by GBC in its draft Local Plan, to be built on green belt land, as “use of some marginal areas of green belt.” This is a serious incursion into a moderately sized village, at present comprising 1,100 houses.

I think that Mr Bridger is misguided in claiming that the council has “rightly allocated” this land. At present it only a proposition, not a done deal, unless Mr. Bridger knows otherwise. No land has been allocated, merely marked on a map as possible development sites.

As we know, plots developed with fewer than 14 houses do not have to include any affordable housing. We also are aware that if a development proves not to be economically viable, then developers can get away with not putting any cheap houses on their land. That is what will happen in this area.

I have said it before but will continue to emphasise: demand is not the same as need. There will always be a demand for houses in nice environments, usually from people from outside the area, but what is actually needed in the Guildford Borough are small, starter or retirement homes. These can be flats.
Michael Aaronson Reply

August 11, 2016 at 8:19 pm

Valerie Thompson is right to contest the notion that the incursion into the green belt envisaged by the Guildford Local Plan amounts to nothing more than building on “some marginal areas of green belt”. Certainly, the proposal for 1,100 extra houses in Normandy/Flexford, joining up those two settlements and entailing a 175% increase in their population, doesn’t fit that description.

And I am surprised that Gordon Bridger doesn’t acknowledge that, if he is correct, and land in the centre of Guildford which “has a high private market value and is suitable for elderly and single people and not for younger people with families”, then this must apply equally to the land that the developers are trying to get their hands on on in the open spaces between our villages.

As Roland McKinney’s original letter pointed out, it really isn’t a question of whether we should build houses in the town or in the villages, but how we can ensure that housing development, wherever it happens, benefits those who need affordable homes rather than serving purely commercial interests. That aspect of the “Submission Local Plan” remains unconvincing.
Lisa Wright Reply

August 11, 2016 at 10:48 pm

Since the whole Local Plan process started Mr Bridger has been keen to support the proposal to build a couple of thousand houses on Blackwell Farm. Opposition to the university development from the public has been high since it was included in the first draft for a whole host of reasons.

This land has just been evaluated as warranting inclusion into the Surrey Hills AONB. Does Mr Bridger still support housing on a large swathe of beautiful countryside?

Furthermore, Mr Bridger fails to admit that central government has no intention of providing a countrywide solution to our housing needs and is hell bent on pushing a very large problem up an even steeper hill hoping that someone else will bale them out of its current financial mess by using the construction industry to generate profit and taxes.

Does Mr Bridger seriously think that ‘affordable housing’ anywhere within an hour of London is actually feasible? Developers build for profit and adding a few large housing estates to Guildford Borough (or Woking and Waverley) will not make any difference to house prices.

It’s time this Conservative government had a rethink. Our local MPs and borough councillors should be sending public feedback and ideas to those ministers that can actually make the changes we need to look after our service industry and young people.
Chris Dick Reply

August 12, 2016 at 8:27 pm

It may be worth repeating once again the article in the Effingham Resident’s Association website that reported that our local MP, Sir Paul Beresford, has stated: “The position of central government with regard to local planning and development on the Green Belt is clear. Residents have heard in the past comments to the effect of ‘it is the government in Westminster which is forcing us to do this…’

“This was not true then and it is not true now. I have met with Ministerial colleagues on multiple occasions and corresponded with the Department for Communities and Local Government at length on the questions of Local Planning and Green Belt policy.

“The Conservative Government is absolutely committed to Green Belt protection, I would urge the leadership and planners at Guildford Borough Council to closely study both the National Planning Policy Framework (NPPF) and the various Ministerial statements published on this topic.

“The only message one could draw from these needs re-emphasising. There is nothing in national policy which supports, encourages or condones any development on the Green Belt save for the most exceptional – and housing need is acknowledged as not falling into this category.”
Jim Allen Reply

August 22, 2016 at 11:06 am

I would agree that the whole concept of green belt grabbing to the north of Guildford is unsound. The land was designated green belt in the 1940s as it was considered essential to maintain separation from London (not prevent expansion of Guildford to the west) yet after 60 years of sound green belt policy has been in place – it is deemed that Ash needs a piece of green belt, never needed before, to separate it from what exactly? I’m not sure there is provision for making new green belt in the NPPF without providing new development adjacent to it.

In 1949 the burgers of Guildford protected Merrow Common (west side of the railway line) by a tree protection order along the development line in Burpham and green belt boundary. Where is the logic of moving this boundary to the middle of nowhere?

The whole concept of green belt destruction needs revisiting. As Guildford green belt policies are in direct conflict with statements from central government and the true wishes of the people of Guildford Borough.
Ben Paton Reply

August 24, 2016 at 11:30 am

Gordon Bridger will convince himself of anything if he chooses to disregard the facts.

The government’s estimate of the stock of dwellings in the UK in 2015 was 23.5m. The number of dwellings has increased by roughly 11% since 2001. That’s roughly in line with the growth in the population.
See: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/519475/Dwelling_Stock_Estimates_2015_England.pdf

If Mr Bridger wishes to demonstrate that it is lack of supply that has driven up house prices then he needs to show us that the stock of dwellings has grown substantially less fast than the population. That’s not what the numbers tell us.

An armchair expert might conjecture that supply versus demand would drive prices. After all for annual and perishable commodities like wheat, soya and maize that is mainly true.

But houses are capital goods not perishable consumables. They endure for hundreds of years. They are also the biggest single source of security for loans from the banking sector. The inescapable consequence of these facts is that people buy houses not just to live in them but also as stores of long term value. They are capital assets.

The ratio of annual supply of dwellings to the stock of dwellings is under 1%. Even if by some miracle Mr Bridger were able to ordain that supply should increase three or fourfold it would not have a material effect on house prices.

The price of a modest one bedroom flat in many areas of London has gone up by two to five fold in the past ten years. This is the result of capital investment more than population growth.

Mr Bridger conflates house price inflation with a shortage. That’s a false correlation. The main drivers of house prices in the UK are investment demand driven by interest rates, the value of Sterling, and massive quantitive easing – also known as printing money.

The problem is not a shortage of houses. It is interest rates lower than at any point in modern history, massive money printing in all the major economies, and rational capital allocation by citizens and institutions who do not want their wealth wiped out in the inevitable inflation that will ultimately arrive.

The real shortage of houses in this borough is in the social housing segment i.e. council houses. In point of fact that’s a direct result of government policy. It is the direct result of selling off 15% of the stock of council houses since 2001 and not building any replacements – until very recently.

No wonder politicians want to blame someone else – and also help out their friends in the house building sector who’ve never had it so good.
Adrian Atkinson Reply

August 25, 2016 at 1:04 am

Even if one ignores the debate about if the number of homes has kept up with population growth (which it seems to have done if one actually looks at the facts) together with the dynamics of consumable commodity/asset pricing, Mr Bridger is falling into the trap or attempting to wrongly convince others, that a correlation is the same as causation. Just because A happens and B follows does not mean that A causes B.

One can have a very strong correlation between two events/trends which are not caused or affected by each other. This area is chapter 1 in statistics and psychology text books as it is such a common “mistake” to make.

For example there is an almost perfect correlation between the number of Nicholas Cage films per year and the number of people drowning by falling into a swimming pool. But we know that stopping Mr Cage from appearing in films will not affect swimming pool deaths and more houses will not mean cheaper house prices.

I believe Mr Bridger is exhibiting confirmation bias which is the tendency to search for, interpret, favour and communicate information in a way that confirms one’s own beliefs or agenda. It is cognitive bias rather than objective science. Happy to be proven wrong, but the facts, as Mr Paton and others in the thread point out, do not support a causal link between increased housing supply in the current economic environment and the price people are willing/able to pay for a property i.e. “the price”.

Just watched program on TV where some landlords have 70 houses or more – when did that happen in the past on such as wide scale as today? This, and the examples Mr Paton describes of other factors, are the “confounding variables” as they are called, absent from Mr Bridger’s thesis of asset pricing economics.

My economics professor at Manchester put it simply, the cockerel crows at dawn, but the crowing does not bring on the sunrise.