Appendix 6 – Cambridge Sub-Regional Strategic Housing Market Assessment
A6.2 This appendix gives a summary of headline information in the SHMA which supports the council’s requirements for provision of affordable housing, as well as providing guidance on the mix of sizes of affordable housing to be provided. Reference should always be made to the latest SHMA information and this appendix will be updated accordingly, if the SHMA identifies significant relevant changes to the market.
Need for affordable housing
A6.3 The SHMA identifies a significant shortfall in affordable housing provision in Cambridge, with high levels of need for new affordable homes over the life of the Local Plan. (SHMA Chapters 12 & 13). However, a balance needs to be struck between affordable and other tenures to create sustainable, inclusive and mixed communities as required by the NPPF, and recognising the need for developments to be financially viable.
A6.4 Data shows that demand for housing in Cambridge is high:
- Average and lower quartile house prices are considerably higher than nationally and in the rest of the housing sub-region (SHMA chapter 5);
- Ratios of average and lower quartile house prices to local incomes also remain high, and a significant proportion of local people are unable to afford to buy even a lower quartile one bedroom flat. (SHMA chapter 10);
- Private rent levels are also significantly higher than the national average and again the highest in the Cambridge housing sub-region. They are also rising faster than in any other part of the sub-region. (SHMA chapter 6);
- The way that Local Housing Allowance rates are calculated means that there are very limited numbers of properties available in the private rented sector in Cambridge for which the rent is fully covered by housing benefit. This, together with the reluctance of some landlords to let to benefit claimants makes it very difficult for those on low incomes to access private rented housing. (SHMA chapter 6).
- The city’s population rose by 15,000 (15.6%) between 2001 and 2011, and is projected to increase by a further 22% between 2011 and 2031 which will further increase housing demand.
Tenure of affordable housing required
A6.5 The greatest need for affordable housing in terms of numbers of applicants is for social and affordable rent homes. However, there is also strong demand in Cambridge for intermediate tenures – including shared ownership. The mix of social and intermediate tenures required by the SPD is based on balancing expressed need (through applicant registers) and projections of changes in household type and incomes, with the need to provide mixed communities.
Size of affordable housing required
A6.6 The SHMA contains a range of data which points to the sizes of homes required.
A6.7 Some data indicates a need for smaller affordable homes to be provided:
- The Census 2011 showed an occupancy rate of 2.54 people per dwelling, which is projected to fall in future years. (SHMA Chapter 14, and New Development Surveys)9.
- The greatest future increase in households is projected to be in single person households, and in those in the 45-64 and 65 plus age brackets. (SHMA Chapters 12 & 14).
- There is a higher number of applicants for social housing on the Home-Link housing register requiring one bedroom properties than other property sizes. Two bedroom properties are the next highest in demand, with lower need for three bedrooms or more. (Strategic Housing Key Facts).
- On the Homebuy Intermediate Housing register, the majority of applicants are one and two person households, and the local market for one bedroom homes is currently strong. (SHMA Chapter 8).
- Households aged over 85 showed the largest percentage increase between 2001 and 2011 compared with other age groups. Couple households had the largest numerical increase 2001 to 2011 compared to other household types. (SHMA Chapter 3)
A6.8 By contrast, other data points to the need for larger properties:
- The greatest projected need across all tenures in Cambridge is for homes with three bedrooms or more. (This is based on past trends, and does not take into account actual population change recorded in the 2011 Census, but it gives a starting point for assessing the actual mix required in the local area). (SHMA Chapter 14);
- The number of single person households in the city is projected to decrease slightly up to 2021. (SHMA Chapter 3)
- Cambridge currently has a generally younger population than the rest of the sub-region. The largest numerical increase between 2001 and 2011 was in the 0-19 age group. (SHMA Chapter 12);
- Turnover of larger properties for rent tends to be lower – more one bedroom properties are let each year than other property sizes. (SHMA Chapter 7);
- Applicants for intermediate housing are permitted to apply for one more bedroom than their household is deemed to require, and purchasers – as is the case with market housing - will generally buy the largest home they can afford. (SHMA Chapter 8).
A6.9 This range of data needs to be understood in the context of the current supply of affordable housing. For example, nearly thirty per cent of the council’s homes (the council being the largest social housing provider in the city) are currently one-bedroom properties, with around one third having two bedrooms. The council’s supply of one bedroom dwellings includes some sheltered housing for older people, and other temporary and specialist housing. (SHMA Chapter 7, and local data).For historic reasons, the profile of the affordable housing may differ from that of private housing
Required size mix, based on data and issues
A6.10 The SHMA indicates the size mix of new housing between 2011 and 2031. The SHMA tends to overstate the need for larger homes for affordable housing as studies show that market housing is generally under-occupied by one bedroom in relation to the size of the household. The council has therefore undertaken further analysis of SHMA data to provide a more reasonable split of the size mix of new affordable housing. This involves reducing the percentage of 4 bedroom properties by half, and adding this percentage to the three bedrooms, then repeating this process for the smaller properties to dampen the number of larger properties and increase the number of smaller ones as follows:
SHMA Chapter 12, Table 12 – summarised and ‘dampened’
|Four bedroom||Three bedroom||Two bedroom||One bedroom|
|Starting point (SHMA) - summarised||
|Applying ‘Dampening’ effect||
|Resulting Recommended mix||
A6.11 It could be argued that the estimated dwelling mix should be further ‘dampened’. However, the above allows a realistic - and progressive - degree of under-occupation on new affordable housing: i.e. around 10%.
A6.12 The following mix should be taken as a guide:
No more than 20% one bedroom general needs
At least 40% two bedroom general needs
30% three bedroom
10% four bedroom
A6.13 In view of the ageing population and the need to provide a better range of options to enable older people to down-size, a percentage of the smaller properties should be provided for older people, or as other forms of specialist housing to meet the needs of disabled or vulnerable people.
A6.14 This should be seen as a guideline for the mix on new developments. However, variations from this may be required from site to site, depending on issues such as: the size and character of the site; the character of the wider area; existing housing provision, housing need in the local area; etc.
9 Cambridgeshire New Development Surveys: www.cambridgeshireinsight.org.uk/housing/new-development-surveys