Professor Mark Shucksmith OBE, Director of the Newcastle University Institute for Social Renewal, considers the problem of providing affordable housing in rural areas, and presents the findings of the Rural Housing Policy Review group.

It’s now 34 years since my first book, “No Homes For Locals?” was published. This worries me partly because this suggests I’m not as young as I used to be; but mainly it worries me because we have made so little progress in addressing the challenges of enabling people to live and work in the countryside which prompted me to write that book. There are severe housing difficulties throughout the UK, but rural areas face special difficulties. In the UK, uniquely, rural house prices are higher than in urban areas – in fact, 26% higher on average. The ratio of house prices to local earnings is even worse. And there is far less social housing (council housing and housing association housing) than in urban areas, not least due to Right to Buy sales going through the roof in recent decades.

For the last year I’ve worked with other experts as part of the Rural Housing Policy Review group, chaired by Lord Best, to propose solutions to this challenge which acknowledge the current constraints on public spending. Last week we presented these at a launch in the House of Lords. Here is a summary of our proposals, the latest of our ‘Ideas for an Incoming Government’:

Because more sites are needed:

1. Since the vast majority of rural schemes are on small sites, Government’s policy is to remove from local authorities the power to require affordable homes on sites of less than 10 homes. This must be reversed. Local Planning Authorities should require all sites, whatever their size, to make an affordable housing contribution. The level of this contribution – in cash or kind – will be determined by what works in the housing market of that area.
2. Government should provide incentives to encourage land owners to develop rural affordable housing to meet local needs or to release sites for these homes, e.g. through tax incentives or nomination rights, which would also stimulate the local economy.
3. Since local communities cannot properly influence what kind of development takes place without a Local Plan, Government should require all local authorities to complete their Local Plan preparation within two years

Because new homes must be affordable to local people:

1. Government should exclude rural areas from the “spare room subsidy withdrawal” (commonly known as the ‘bedroom tax’) because there are so few opportunities for rural tenants in houses to move to 1 or 2 bedroom flats in villages; these households should not be forced to move away from their long-standing social and support networks to urban areas elsewhere.
2. Where there are already problems from the low levels of affordable housing and limited opportunities to build any more, Government should give rural local authorities the power to suspend the Right to Buy scheme.
3. To provide a driver for action and delivery by housing associations of all sizes, a new national target for delivery of rural housing through the Homes and Communities Agency should be established of 13% of the HCA’s national investment.
4. To address problems of accessing development finance, Government should find ways of supporting the development funding of small and medium-sized builders and housing associations that undertake smaller developments: e.g. recalibrating its loan guarantee scheme to cover schemes of less than 25 homes.

Because affordable homes need to be there for future households:

1. To ensure rents are affordable in low wage, high house price rural communities, Government should not require housing associations to charge so-called ‘affordable rents’ at 80% of market rental rate as a condition for receiving HCA funding. Instead, as in Greater London, rents should be charged at a level agreed between the local authority and the housing provider as being affordable in relation to local incomes.
2. Where an area is experiencing high levels of second home ownership, Government should endorse the approach taken by the Exmoor National Park Authority, and in other places, by requiring a proportion of open market homes – up to a 100% in exceptional cases – to be granted planning permission with the condition that they can only be used as principal residences.
3. Although those buying affordable homes on special terms need to be able easily to access a mortgage it is essential that they do not simply resell for a profit at a later date. The Council of Mortgage Lenders should, at long last, produce a standardised mortgage form for rural affordable home ownership which incorporates a ‘perpetuity’ arrangement.

Because leadership is needed from national to community level:

1. The Department for Environment, Food and Rural Affairs, as the champion for rural areas, should ensure ‘rural proofing’ is continuously and consistently applied to national policies, with specialist, rural technical expertise available to all Government departments.
2. Because Neighbourhood Plans are a vital means for rural communities to deliver affordable homes, yet require resources and expertise, Government should increase and extend its support (beyond April 2015) for more communities to produce Neighbourhood Plans. And the Homes and Communities Agency should offer match funding to housing associations for the employment of Rural Housing Enablers who can play the key role in bringing together parish councils, land owners, local authorities and housing associations to achieve affordable rural homes.

There is more detail in our full report which you can download free here. The shortage of affordable rural housing is an issue not just for young people and others earning middle to low incomes; it has a wider significance as our countryside becomes ever more socially exclusive, a place where only rich people will be able to afford to live and in which most members of society can never be resident. This growing separation between rich and poor threatens our social solidarity and is far from ideas of ‘one nation’, espoused by successive governments.

Members of the Rural Housing Policy Review

Lord Richard Best OBE DL (Chair of the Rural Housing Policy Review)

Lord Matthew Taylor

Lord Ewen Cameron DL FRICS

Elinor Goodman

David Fursdon DL FRICS

Margaret Clark CBE

Sue Chalkley

Professor Mark Shucksmith OBE

Peter Moore

Peter Hetherington

Cllr Anne Hall

Jo Lavis (Secretary and member)

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