Can Housing Zones help the housing crisis?

By James Carson

The UK government believes that brownfield land has a crucial role in meeting the need for new homes. But development of brownfield sites has often been held back because of the need for high upfront capital and delays in obtaining planning permission.

Last year, a new programme of Housing Zones (HZs) was launched by the chancellor of the exchequer and the Mayor of London with the aim of breaking down the barriers to brownfield development.

What are Housing Zones?

HZs are areas where home building will be accelerated by partnerships between local authorities, land owners, investors and builders. The areas proposed by local authorities (which may include brownfield sites and town centres) will receive a share of government funding that will unlock vital components of the HZ scheme, such as infrastructure, site acquisition and leaseholder buyouts. In addition, planning restrictions will be removed, enabling rapid delivery of residential development.

Housing Zones in London

London’s HZ programme was launched in 2014 as part of the Mayor’s housing strategy. The aim is to build 50,000 new homes in 20 HZs across the capital by 2025. The £400m programme is also expected to create 100,000 new jobs.

The first 18 zones in London include:

  • Abbey Wood, Plumstead and Thamesmead (Greenwich)
  • Hounslow Town Centre (Hounslow)
  • New Bermondsey (Lewisham)
  • Tottenham (Haringey)
  • Wembley (Brent)

Most London’s boroughs have published their HZ plans. Examples include:

  • The Royal Borough of Greenwich has identified Abbey Wood Plumstead and Thamesmead as an HZ, with the aim of providing 1,512 homes. The borough sees the programme as an opportunity to improve public space and infrastructure in advance of the arrival of Crossrail in 2018.
  • Hounslow’s HZ will create three residential sites with 3,478 new homes by 2025. The HZ will also host relocated council offices, a flexible community space and a new primary school.
  • Tottenham’s HZ plans include 10,000 new homes. Supporting this growth, infrastructure development will comprise a revamped Tube, bus and rail station at Tottenham Hale, three Crossrail 2 stations and overground rail upgrades.

Housing Zones beyond London

In his March 2015 Budget speech, the chancellor of the exchequer confirmed the creation of 20 new HZs outside of London. Among the areas included are:

  • Guildford and East Hampshire
  • Bristol
  • Derby, Stoke and West Lindsey
  • Wakefield and York
  • Gateshead.
  • Preston.

The Treasury hopes that central government investment of £200 million will result in up to 45,000 new homes in these regional HZs.

HZs: the reaction

There has a been a range of responses to the HZ initiative.

Home Group, the UK’s fourth largest housing association has warmly welcomed the new HZs:

“Enterprise zones worked for business when implemented correctly and the concept will work to help housing providers deliver the homes which are so desperately needed.”

The National Housing Federation (NHF) also welcomed the linkage of planning, housing and infrastructure delivery. However the NHF indicated that the HZ programme lacks ambition:

“Housing Zones are currently relatively small-scale, and the principles should be applied at a larger scale to genuinely tackle the housing crisis.”

The HZs received a cautious response from the Royal Institute of British Architects (RIBA):

“RIBA is wary of such a large release of public land on very tricky brownfield sites with lots of issues that require strategic planning at a local level. We await the detail on how the Government would support delivery of high quality infrastructure and ensure high standards of design in new development.

As host to one of the new regional HZs, Bristol City Council has welcomed the “much needed investment”. However, Hackney Council believes the HZ model is less appropriate for inner London boroughs because the challenges are more to do with making affordable housing viable than providing infrastructure.

The law firm Pinsent Masons has highlighted one possible unintended consequence of HZs.

“As Housing Zones pick up momentum, this may have the adverse effect of increasing surrounding land values and stimulating more right to buy, which may affect the viability of future phases.”

They may not match the 260,000 homes required to tackle England’s housing shortage, but the broadly positive welcome HZs been given suggests that they are a step in the right direction.

Follow us on Twitter to see what developments in public and social policy are interesting our research team.

Read our other recent articles on housing:

Budget 2015 – how does it tackle the housing crisis?


By Alan Gillies

1p off a pint of beer, 2p off cider and whisky, wine duty frozen… “a beer-soaked election budget”, according to the International Business Times. But of course there’s more to the Budget than tax cuts, even in the last Budget before the General Election.

One of the most pressing concerns of many commentators in the build up to the Budget was the housing ‘crisis’, with recent estimates suggesting that 245,000 homes a year need to be built in England alone, whereas only half of that number have been built in recent years.

So what’s been announced in the Budget in response?

The two headline announcements are a new Help to Buy ISA and more housing zones outside London – 20 zones compared to the 10 announced last June. While initial reaction to the Help to Buy ISA appears to be mixed, as it targets demand rather than supply, the new housing zones have been more warmly welcomed.

The government originally announced plans to create 30 housing zones on brownfield sites across the country in order to increase housing supply – 20 in London and 10 elsewhere. Local authorities would bid for investment funding, usually in the form of a loan with an appropriate interest rate applied in accordance with the state aid rules. In addition there is the opportunity to put forward an additional bid for a £5m ‘local development order’ incentive fund, to encourage bids from areas which can provide sites with outline planning permission to speed up the housebuilding process.

The first nine zones in London had already been announced on 20 February, which led to Peabody Housing Association reporting that it had increased the number of homes it plans to build from 700 to 3000 at two sites in Thamesmead. There were however suggestions from the Labour-led Hackney Council that the housing zone model is less appropriate for inner London boroughs because the challenges are more to do with making affordable housing viable than providing infrastructure.

Calls to encourage the release of more public sector land for housing have also been addressed in the Budget with the announcement that the government will implement a new ‘commercially-driven’ approach to land and property asset management across the central government estate. A new central body or bodies will own and manage central government property and land assets, which it is hoped will release land and property for productive use, “including building new homes”.

Further housing measures, already announced just prior to the Budget, included a Housing Finance Institute to address the skills and knowledge gap in delivering local authority housing, as recommended by a recent review of the local authority role in housing supply. Also measures to streamline the sales process for shared ownership properties in outright ownership and a wider review into shared ownership.

According to the Budget document itself, the new housing zones ‘could support up to 45,000 new homes’, so they are not going to solve the housing crisis by themselves. However the government argues that things are starting to move in the right direction, claiming that levels of planning approvals and housing starts are at 7-year highs.

Whether the effect of the housing measures announced in the Budget turn out to be a drop in the ocean or an important impetus to increasing supply to the levels required remains to be seen, with the president of RIBA already suggesting that “Whoever forms the next government must go much further and champion the long-term sustainable supply of high-quality new homes that people want to live in and communities will support”.

The Idox Information Service can give you access to a wealth of further information on housing policy and practice, to find out more on how to become a member, contact us.

Nooks and crannies – 50,000 new homes on brownfield sites in London

work site

by Brelda Baum

The UK Government recently announced plans to build up to 50,000 new homes on 20 brownfield sites across London and plans to achieve this by creating 20 new housing zones in London (with a further 10 new housing zones outside the capital). The aim is to get new (affordable) homes built quickly. Local authorities will identify and package together brownfield land which could be used for development into a housing zone, remove all unnecessary planning restrictions across it and partner with a developer to build new homes. The absence of planning constraints in these zones should significantly accelerate construction and central government will also support housing zones by making loans available to local authorities for necessary infrastructure and other remedial work on the site. Continue reading