Hastings’ house-building struggles

In a recent article HOT detailed difficulties met by the council in achieving its self-imposed target for affordable housing. However, it is not just affordable housing which the council is struggling to deliver, but housing in general. Text by Nick Terdre, research and graphics by Russell Hall.

Hastings’ recent record of house-building is poor enough to put it among the one third of local authorities subject to sanctions under the provisions of the government’s Housing Delivery Test. In the three years to 2021/22, it delivered only 366 homes out of a government-set target of 1,148, equivalent to 32%.

This was a worse performance than in the previous three-year period, 2018/19-2020/21, when it delivered 375 homes, or 42% of the target of 903.

Figures for 2022/23 are not yet available, but they are for net additional dwellings, which differ only slightly from the housing delivery test numbers; these show that with a mere 116 net completions, Hastings’ delivery in the three years to 2022/23 looks set to fall again, to 344.

House-building in Hastings went well in the early years of the century, with 300+ homes built in eight of the first 11 years. Since then it has never exceeded 200, and has twice dropped below 100.

Other East Sussex local authorities are also faring badly: in the three years to 2021/22, Eastbourne delivered only 32% of its target, Rother 42% and Wealden 78%. Only Lewes exceeded its target, with 106%. Hastings and Eastbourne recorded the fourth and fifth worst performances among 287 English local authorities.

Sixteen out of 25 local authorities in Sussex and Kent failed the government's housing delivery test for the three years to 2021/22, but none by as much as Eastbourne and Hastings.

The councils falling short are subject to varying levels of sanction depending on the extent of their shortfall. In the event of achieving less than 95% of its target, a council must produce an action plan identifying the causes of under-delivery and measures proposed to remedy the situation.

In addition, where less than 85% has been achieved, land identified in the Local Plan for future housing development must be brought forward to increase immediate availability by 20% - what is called a 20% buffer.

And if less than 75% has been achieved, the presumption of sustainable development is exercised in determining planning applications, tilting the balance towards approval.

HBC has already responded to all these requirements. An action plan was published in September 2021. One of the key components is the new Local Plan, which is currently dogged by substantial delays. Whereas the action plan envisaged the new plan being adopted by end 2023, this is now not expected until spring 2026.

The action plan also gives high priority to the council’s target of delivering 500 affordable homes by 2026/27. However, although the council maintains it is on track to achieve this target, as discussed in the previous article there are reasons for questioning this expectation.

As the action plan notes, one problem faced by Hastings is the lack of sites with the potential for large-scale house-building. There are few greenfield sites and few large brownfield sites. The largest current developments are Bellway’s Porter’s Grove on the site of the former St Leonards Academy, with 210 houses, Foreman Homes’ 208 dwellings at Holmshurst St Mary, Danescroft’s 151 houses on the former Ashdown House site, the 140 units making up Eversfield Rise (on the Harrow Lane playing fields) and the 152 dwellings planned by County Gate and Sunley for the former bathing pool site in West St Leonards.

But while Porter’s Grove, Holmhurst St Mary and the Ashdown House development are proceeding, Eversfield Rise has come to an abrupt halt with the collapse of developer Ilke Homes and there has been no recent indication of a project taking off on the West St Leonards site.

Gemselect concluded its purchase from Sea Space of the contaminated former Broomgrove power station site in Ore Valley, where it was talking of building 75 houses, in 2021 but has yet to show signs of submitting an application.

Town Deal funding

There are hopes that some housing will be generated through the Town Deal funding - £24.3m match-funded by another £85m. Nothing has yet materialised however. The Hastings Station Gateway scheme, which called for 167 dwellings in the town centre, has evolved, the council told HOT.

The focus now is “to produce a Strategic Regeneration & Investment Framework (SRIF) that will sit alongside the council’s Local Plan to identify key areas for investment opportunities for employment, housing and planning. This work will closely align with the £10m ‘Public Realm and Green Connections project’ to transform the town centre into a ‘garden town,’" a spokesperson said.

The initial work, funded by Homes England, is being carried out by a consultant team comprising Lambert Smith Hampton and Tibbald.

Homes England is closely involved in HBC’s efforts to identify house-building opportunities. Council leader Paul Barnett is looking to raise £100m, with contributions from various sources, through this collaboration, which he described as an “exciting new partnership with Homes England to deliver the next stage of town centre transformation.”

Meanwhile a modest project, Town Living, is under way, whereby the council is seeking a registered provider to partner in the delivery of around 12 affordable homes in the town centre. This will be financed with £1m of Town Deal funds reallocated from the cancelled Wellington Square housing redevelopment.

Recently announced Levelling Up funding of £1.1bn for 55 towns, including Hastings and Bexhill, could also provide investment for housing. Both towns have been allocated £20m to be drawn down over 10 years.

Meanwhile HBC has £12m earmarked in its budget for the potential acquisition of up to 50 dwellings to use as temporary accommodation for homeless families, thus reducing the cost to the council of using privately owned accommodation. Half would be spent in the current year and half in 2024/25.

Developers

In October MP Sally-Ann Hart criticised the council’s house-building record on the BBC Politics South East programme. However, she failed to make clear that this is a matter over which the council has limited control.

Although planning permission usually includes the condition that work has to begin within three years, a developer need only do a token amount - a bit of digging, laying a few pipes - to make it valid in perpetuity. It may then decide that its ultimate aim - profit, rather than building houses - is best served by land-banking the site for future sale.

A notorious local example is the site to the rear of East Sussex College which has lain idle since planning permission for 103 residential units was granted in 2006, even though the affordable housing requirement was struck off in 2017.

While the government, through the mechanism of the housing delivery test, is tough on councils, it has yet to require developers to front up. There have been no moves to put an end to land-banking, and the government recommends (in para 018 of its guidance on viability) that developers should get a 15-20% return on their investment, a level much higher than is considered realistic for other sectors.

No place for Cil

HBC has also - perversely, in the view of many - declined to make use of the Community Infrastructure Levy (Cil), a power granted to local planning authorities to raise funds from developers for building the infrastructure made necessary by new housing estates.

Instead, HBC negotiates Section 106 agreements for developer contributions for affordable housing and infrastructure for every individual development. Such agreements yield less than a Cil assessment would, and unlike Cil funds, are subject to viability assessment, and hence are liable to be reduced on review. Hastings and Adur are the only councils in Sussex not to adopt Cil.

HBC’s refusal to adopt Cil was grounded in fears that it would compromise affordable housing targets. However, an assessment in 2013 suggested that the policy should be reviewed if house prices rose by 10%. By April 2014 prices had increased by over 10%, and today they are almost double the level in August 2013, but the policy was again rejected in January 2021 as part of the preparation of the new Local Plan.

In 2013 HBC suggested that a 10% increase in house prices could open the way to adopting the Community Infrastructure Levy, but although prices have virtually doubled since then, the council continues to find reasons to reject it.

England shortfall

In England as a whole, the government is failing to meet its own house-building targets. In 2022/23 a total of 234,400 net additional dwellings, including 212,570 new-build homes, were added to the housing stock, virtually unchanged on the previous year.

Since 2019/20 net additional dwellings have run at just under 250,000 a year, well short of the government’s 300,000 a year target by the mid-2020s.

This is also the level aimed at by Labour - Keir Starmer has promised to build 1.5m homes over the course of the next five-year Parliament if Labour comes to power, though he also pledged there would be, “No more land-bankers sitting comfortably on brownfield sites while rents in their community rise.”

 

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