Fit for purpose?
Proposed housing targets are flawed but our design game method shows how to build capacity - not just homes…
Dr Philip Graham, August 2024
To substantiate its manifesto aim to build 1.5m more homes (300,000 per annum), the incoming UK government has proposed changing the way housing targets are calculated. Their recommendation is to reform the planning system - which currently relies on demographic projections - with a new standard method derived from just two metrics. These are: (a) an affordability score based on local house prices relative to the local median workplace earnings; and (b) the number of homes that already exist in that area [1, 2].
Measuring affordability
The first problem with the proposed method is that it would focus on the highly generalised and therefore controversial metric of house price-to-earnings. This narrow view of housing needs overstates demand whilst overlooking vital details like overcrowding, under-occupancy and restrictions on house moves. Such narrowness also masks the significance to house price affordability of four key demand-side drivers: tax, borrowing constraints, interest rates and wealth [3]. Allowing for these rather than earnings alone makes the UK’s property market look eminently affordable, except amongst some specific and sometimes relatively well-earning groups for whom the problem is deposit affordability, rather than monthly repayments per se [4]. This crucial discrepancy can be illustrated by the fact that when interest rates are lower, mortgages become more affordable for those with a deposit, causing house prices to rise relative to earnings [4]. Hence, price-to-earnings can give the impression of worsening affordability and therefore a greater housing need, even when this cannot be the case because if it were, house prices would have fallen [4]. For these reasons, the ‘Build More!’ button is likely to keep flashing, not least because serious efforts to tackle property taxes and other important drivers of affordability contain political risks and take time [5].
Number of homes vs. housing capacity
The second problem with the newly proposed method, is that it would continue to set housing targets in terms of ‘homes’. This would be to the exclusion of more meaningful units of living space, such as habitable rooms, bed spaces or square metres - units that specify the housing capacity that is actually needed. If these were used, they would produce a more granular picture to show that the UK’s profoundly unequal distribution of housing space (note, not of discrete homes) has increased steadily over the last four decades [6]. This misallocation problem creates wellbeing and macroeconomic problems [7, 8] that are exacerbated by illiquidity in the market and the fixity of both new construction and homeownership, making it harder for people to rightsize their homes by moving, downsizing or making building alterations [9, 10]. Hence, the proposal to build 300,000 units of ‘home’ without also addressing the other drivers of affordability mean it is likely that existing distributional problems would only be replicated. This would perpetuate the problem that three-quarters of UK households have either just enough or not enough living space, with no margin for expanding their housing needs [11].
Climate consequences
Spatial distribution problems also exacerbate the serious climate consequences of housing and housebuilding. Not only do households with excess space use excess energy for heating and cooling rooms they seldom use [11], but adding 300,000 homes would use up the UK’s 2050 carbon budget for house-building by 2036 [12]. Furthermore, a significant portion of these units of home would simply replace unused or under-used living space that already exists [13]. It is therefore not enough for the newly created Design Council Homes Taskforce to claim that the government’s proposed house building programme can be ‘low-carbon’, ‘sustainable’, environmentally ‘regenerative’, ‘fit for purpose’ and ‘long-lasting’ [14]. Instead, the industry itself should understand how to design out the underlying distributional problems that have produced the ‘housing crisis’ in the first place.
Sufficiency-oriented housing
To tackle these transdisciplinary challenges - and together with colleagues at Clarion Housing Group and at the Universities of Cambridge and Twente (Netherlands) - we have shaped and tested some sufficiency-oriented housing solutions. Thanks to funding from the Arts and Humanities Research Council (AHRC) and the University of Cambridge, our method for testing these has been published in a new, co-authored paper for the journal, Buildings and Cities [15].
We have proposed a novel, game-based approach for simulating multi-stakeholder behaviour in apartment settings. These are environments where modules of living space can be continuously joined or divided over time, or augmented with certain shared amenities. Using players in place of residents, our design game, ‘Rightsize’, can reveal the efficacy of adjustable or sufficiency-oriented housing, such as apartment buildings by Swiss architect Walter Ramseier [16]. The next steps in this exciting research project will be to use our game to analyse certain UK case studies whilst they are still at the design stage, looking for opportunities to improve adjustability.
We hope to publish the results in a follow-on paper and will be feeding some of our recommendations into the National Planning Policy Framework (NPPF) consultation that closes on 24th September.
Overview of the 'Rightsize' design game built on a conceptual framework of the adjustable housing proposition.
Playing a beta version of 'Rightsize' using printed dwelling tiles and pieces gathered from other games.
Adjustable housing combines (from left to right): joinable/divisible dwellings that can be connected vertically as well as horizontally; alternating tenures to encourage downsizing; and shared infrastructure for spill-over (e.g., shared outdoor space and amenities such as storage and guest rooms).
See also:
References
Haynes, B., Hynes, P. and Spry, M. (2024) ‘A new Standard Method: Stocking up?’, Lichfield: Planning matters, 30 July. Available at: https://lichfields.uk/blog/2024/july/30/a-new-standard-method-stocking-up (Accessed: 13 August 2024).
MHCLG (2024) Proposed reforms to the National Planning Policy Framework and other changes to the planning system, www.gov.uk. Available at: https://www.gov.uk/government/consultations/proposed-reforms-to-the-national-planning-policy-framework-and-other-changes-to-the-planning-system/proposed-reforms-to-the-national-planning-policy-framework-and-other-changes-to-the-planning-system#chapter-4--a-new-standard-method-for-assessing-housing-needs (Accessed: 19 August 2024).
Meen, G. (2021) ‘House prices: the risks of a fall are higher than most people think’, The Conversation, 28 June. Available at: http://theconversation.com/house-prices-the-risks-of-a-fall-are-higher-than-most-people-think-163377 (Accessed: 16 August 2024).
Meen, G. and Whitehead, C. (2020) Understanding Affordability: The Economics of Housing Markets. Bristol University Press.
Hilber, C.A.L. and Lyytikäinen, T. (2017) ‘Transfer taxes and household mobility: Distortion on the housing or labor market?’, Journal of urban economics, 101, pp. 57–73.
Tunstall, R. (2015) ‘Relative housing space inequality in England and Wales, and its recent rapid resurgence’, International Journal of Housing Policy, 15(2), pp. 105–126.
Cheshire, P., Hilber, C.A.L. and Koster, H.R.A. (2018) ‘Empty homes, longer commutes: the unintended consequences of more restrictive local planning’, Journal of public economics, 158, pp. 126–151.
Muellbauer, J. (2018) ‘Housing, debt and the economy: a tale of two countries’, National Institute economic review, 245, pp. R20–R33.
Hudson, N. and Green, B. (2017) Missing Movers: A Long-Term Decline in Housing Transactions? Council for Mortgage Lenders. Available at: https://thinkhouse.org.uk/site/assets/files/1756/cmlmissing.pdf.
Gough, I. et al. (2024) ‘Fair decarbonisation of housing in the UK: a sufficiency approach’, (232), p. 70. Available at: https://sticerd.lse.ac.uk/dps/case/cp/casepaper232.pdf
Drewniok, M.P. et al. (2023) ‘Modelling the embodied carbon cost of UK domestic building construction: Today to 2050’, Ecological economics: the journal of the International Society for Ecological Economics, 205, p. 107725.
Huebner, G.M. and Shipworth, D. (2017) ‘All about size? The potential of downsizing in reducing energy demand’, Applied energy, 186, pp. 226–233.
Design Council (2024) ‘Design Council Homes Taskforce launched to support the new government in creating 1.5 million homes within UK climate commitments’. Available at: https://www.designcouncil.org.uk/fileadmin/uploads/dc/Documents/Press_Releases/Design_Council_Homes_Taskforce_Press_Release_17_July_Final.pdf.
Till, J. and Schneider, T. (2005) ‘Flexible housing: the means to the end’, arq: Architectural Research Quarterly, 9(3-4), pp. 287–296.