Finding solutions to the UK housing crisis is now a top government priority, and building more homes is a big part of the solution. Bidwells looks at new government housing targets and asks if a standardised approach to house-building can really work in each region of the Golden Triangle.

A National Infrastructure Commission (NIC) report delivered to government in November, highlighted that the corridor connecting Cambridge, Milton Keynes and Oxford has the potential to become the UK’s very own Silicon Valley.

The NIC warns, however, that a lack of sufficient and suitable housing presents a fundamental risk to the corridor’s success: “Without a joined-up plan it will be left behind by its international competitors – a once-in-a-generation opportunity to secure the area’s future success”, the report says.

The government appears to have taken this advice on board. Strong support for the Cambridge-Milton Keynes-Oxford corridor in the Autumn Budget outlined the ambitious plan to build one million homes in the corridor by 2050, re-open the dormant Varsity Line railway route and support the delivery of an expressway between the UK’s two university cities.

The housing markets along the corridor vary greatly, as do the approaches to housing delivery by each local authority. Cambridge and Oxford have two of the most in-demand but least affordable housing markets in the UK, and cities between the two universities face challenges to attract talent and diversify their economies.

Many local authorities have an opportunity to supercharge their economies on the back of these proposed new transport connections. But, can housing delivery keep up with demand?

FAST-GROWING MILTON KEYNES VS. HISTORIC OXFORD AND CAMBRIDGE

The demand for occupied floor space in Milton Keynes has increased by 1.1m sq. ft. since 2010, with a 28.6% growth in secondary rents since 2012. As the fastest growing city in the UK, with very little land designated as green belt land, Milton Keynes has an opportunity to grow exponentially.

As revealed in the Best Cities for UK Business, Milton Keynes is not just the fastest growing city, but also the number one contributor to job creation, growth and employment in the UK, making it a top choice for people looking to be in an up-and-coming business hub, with new transport and housing developments in progress.

Cambridge and Oxford, however, are surrounded by a green belt, so more creative, sustainable ways of meeting the housing need in these cities must be explored. Improved transport infrastructure is key to this, but making the most of Oxford and Cambridge’s knowledge economy and its varied employment opportunities by providing the right housing in the right places is equally as important.

The corridor, which stretches north and west of the Golden Triangle, incorporates around 3.3 million people, but the housing shortage is a national issue that government is trying to solve with its proposed approach to housing targets.

CAN A ONE-SIZE-FITS-ALL SOLUTION WORK?

The government backing to the NIC’s recommendation was welcomed by all following the budget, but government had already set out a proposal to significantly boost housing delivery across the UK by standardising the methodology used for calculating housing targets.

Bidwells has studied the Department for Communities and Local Government (DCLG) proposals in great depth and has several serious concerns about the way it is proposing to tackle the need for housing. A full copy of its response to the department’s housing need consultation can be found here.

Specifically, Bidwells has considerable reservations over the proposed methodology for calculating the city’s housing needs. Divisional Managing Partner of Planning, David Bainbridge, notes:

The standard approach is too simple and ignores fundamental variables that influence local housing markets, including geographical factors. The proposed approach might actually worsen regional disparities and slow down delivery.

Bainbridge highlights that the new method for calculating housing targets lifts the target in Milton Keynes, but actually lowers the number of houses needed for Oxford and Cambridge, despite the housing demand rising each year.

Golden Triangle Cities
ONS Code	Local authority	Indicative assessment of housing need based on proposed formula, 2016 to 2026 (dwellings per annum)	Current local assessment of housing need, based on most recent publicly available documents (dwellings per annum)	Proportion of local authority land area covered by green belt, national parks, areas of outstanding natural beauty, or sites of special scientific Interest
E07000008	Cambridge	583	700	24%
E06000042	Milton Keynes	1,831	1,766	0%
E07000178	Oxford	746	1,200 – 1,600	29%

Government Housing Need Consultation Table

Bainbridge concludes:

Several elements are excluded, such as the analysis of employment trends in relation to the assessment of housing need. We have grave reservations about the new methodology proposed by DCLG and do not believe it will increase delivery. Neither is there any consideration of affordable housing needs in the new methodology or allowance for vacant or second homes.

If not addressed and planned for adequately, the need for investment in infrastructure, both for housing and transport, risks restricting the growth of Milton Keynes, Oxford, and Cambridge. The large pool of talent and businesses that stem from, and flock to, the Golden Triangle may also begin to reconsider the attractiveness of these locations compared to other competitive areas in the UK.