Local authorities have a vital role in leading local communities during this economic downturn. A strategic and joined-up approach with partners should recognise the links between housing, the local economy and local asset management. This is in order to help local residents left exposed by the recession.
The strategic housing role of local authorities should be maximised to pave the way for the recovery of communities and mitigate the effects of the recession.
The current recession is seen to be one of the worst the world has known and it is set to last. The International Monetary Fund (IMF) has predicted that Britain's gross domestic product (GDP) will contract by 4.1 per cent in 2009. This is much greater than the rate predicted by the Chancellor of 3.5 percent.
In addition, house prices are set to fall 10 per cent in 2009, as forecasted by the Royal Institution of Chartered Surveyors (RICS). This would bring the total decline to 25 per cent, from the peak in September 2007. Capital Economics forecasts that new-build homes will fall by up to 45 per cent from their peak 12 months ago, compared with a forecast of a 35 per cent fall for the rest of the market.
Although the predictions for the future appear gloomy, lessons should be learned from the past:
- the delivery model is broken
- there is a need for more social housing
- a higher proportion of new homes should be designated as social homes.
A recent select committee report advised the government to scale back targets for new low-cost home ownership, while addressing the shortage of mortgage finance. There is a need for mixed tenure and new partnerships.
The LGA Group is at the forefront of future developments and providing the most up-to-date support to local authorities. It is planning to establish a high-profile network involving stakeholders with an interest in housing - the National Housing Partnership (NHP). This network will comprise developers, lenders, planners, international partners. It would allow members to have a new channel of access to their partners, funders and deliverers.
It seems likely that recovery from the recession will be difficult and will require maintaining skills in the sector. But a new model needs to emerge taking into account the different needs of a mixed and aging population. It should have a focus not only on the supply but also on growth and regeneration. It needs new thinking around ownership and rental systems.
Latest case studies on council-led development
'Very Much Up For It: How councils can deliver the homes we need' is a new collection of case studies from the Local Government Association (LGA), showcasing the different ways councils are supporting housing development during the recession.
It also features some of the successful bids submitted to the HCA.
Very Much Up For It: How councils can deliver the homes we need - on the LGA website
Useful links: where to find out more
Recession support for councils - on the LGA website
IMF has predicted that Britain's GDP will contract by 4.1 per cent in 2009 - The International Monetary Fund website
Housing and the Credit Crunch: Third report of session 2008-2009 - House of Commons website
Local Government Improvement and Development strategic housing, ‘Housing hopes' article
Brown pledges to lift curbs on councils building more homes - on 'the Guardian' website
Beckett backs council-led building - on the Inside Housing website
Local authorities to deliver new homes for social rent - Homes and Communities Agency website