By Dr Tom Archer, independent research consultant and a research fellow at Sheffield Hallam University.
Few would deny the growth of Community Led Housing (CLH) in England in recent years. When I first started in this field over 15 years ago there was a sense that this niche sector was emerging from the cold. An important legacy was left by previous ebbs and flows of CLH, but new ideas and initiatives were coming forward. These took the values of co-operation and property stewardship and melded them into new forms to remedy the housing imbroglio of the 21st century.
Fifteen years on, much has changed. Through this period, I’ve conducted numerous studies and evaluations which, when traced-through, reveal the remarkable changes that have taken place in the development of this sector. From new forms of funding and finance, to systems of support and advice, through to community organising, advocacy and new policy instruments at a local and national level, significant momentum has been built. The Community Housing Fund marked a watershed moment as government realised that CLH could play a key role in delivering affordable homes, and in a way which put communities at its heart.
Analysing the pipeline of community led housing
The lack of decision on the CHF in the spring budget was therefore a blow. Back in February 2020 I was asked, on behalf of the National CLT Network, to analyse a rapidly improving dataset on the number and nature of homes being planned by CLH groups. This revealed a large potential pipeline (about 23,000 homes), a sub-sample of which we used to estimate the grant requirements for the sector up to 2025. This forecast the need for between £31m-£57m of revenue funding and between £115m-£172m of capital funding through an extended CHF.
Events, notably a global pandemic, rather took over and the fund was not continued. With the impending autumn has come the opportunity to influence government’s departmental spending plans. Acknowledging the potential impact of the pandemic on planned CLH schemes, we have revisited our analysis to provide a picture sensitised to the new COVID-19 world.
Predicting future housing supply is no easy feat as housing development is subject to so many uncertainties and unknowns. One only need look at the fierce debates about the gap between residential planning permissions and new housing starts to understand that none of this is perfectly linear, or well-correlated.
Delays but projects carrying on
COVID-19 has added a huge variable to this. To understand the effect of the outbreak we decided to speak to number of Enabler Hubs who, collectively, were supporting over 150 CLH schemes nationwide. The message that came back was surprising. There were few signs that ongoing CLH projects had been aborted in light of the COVID-19 outbreak. However, there were clearer signals that project timescales were being hit. A double whammy of the pandemic and the non-extension of the CHF (both in March 2020) had hit groups at an early stage particularly hard. On the positive, many projects at a later stage had continued to make good progress.
Whilst scheme delays were evident, so was significant pent-up demand for funding from those that had missed the CHF deadline. Groups at the early stages of development — e.g. those starting to engage locally about their plans, identifying sites and developing scheme proposals – are clearly constrained by a lack of revenue funding. As numerous projects experience slower progress, this will have a knock-on effect in terms of capital funding requirements. Fewer projects are likely to get to the point of applying for such funding by 2025, than was thought pre-pandemic.
Support needed for a lasting legacy
Using these insights we have revised our models of future grant requirements. We suggest a future CHF could see demand for between £29-£53m of revenue funding, depending on the nature of projects for which our data is incomplete. To reflect delays among groups at early stages of development our CHF-based model has adjusted the anticipated capital requirements of groups from £116-£172m, to £100-£146m, with an additional £8m for local authorities.
Despite these reductions, this funding has the potential to deliver over 10,000 new units of affordable housing in the coming years. This is possible if the right funding and support are put in place for the long term, and if some of the wider uncertainties and limitations related to the pandemic are gradually reduced.
When we invest in CLH for the long term it delivers the kind of value that we, as a society, want. Recent research by Capital Economics certainly provides a clear picture of this. But if we are hesitant about looking forward for the answers, then perhaps we should look back. Between the early 1970s and early 1990s the Canadian government developed a variety of grant and other financial instruments to support the development of co-operative housing. In the first 5 years of the programme, nearly 7000 new housing units were developed. In its peak phase, 1979-1985, 38,000 units were developed, followed by a further 14,000 in 1986-91. Many of these co-ops continue to this day, delivering high levels of permanently affordable homes which are controlled by residents.
This is the type of legacy we can create if we value it enough. We now know the value created by CLH and some of the important financial and social benefits it offers. The question is how much of it can we create?
Download the full Updated Pipeline Study 2020 by Dr Tom Archer.
Photo by Adi Goldstein on Unsplash.