Angus Council
Housing Need & Demand
Assessment
Steering Group Meeting
15th December 2009
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Aims of Session
1. To review outcomes of secondary
analysis (Core Outputs 1-4)
2. To validate the baseline HNADA
calculation for affordable housing
 Consider evidence from CHR
 Review calculation outcomes for each HMA
3. To outline methodology for assessing
the requirement for market housing
4. To present the outcomes of the
HNADA market housing model
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Secondary Analysis:
Core Outputs 1-4
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HNADA Core Outputs
• HNADA credible if “analysis delivers core
outputs”
• Core outputs provide:
• Housing market intelligence
• Estimated ranges of need or housing requirements
• Housing market analysis outputs
• Evidence to interpret system operation
• Informs intervention planning
• Range focus: as housing markets are
dynamic, definitive measures of need
cannot be attained
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HNADA Core Outputs
Housing Market Intelligence
(Demographic & Economic Context)
1. Estimates of current dwellings
2. Analysis of housing market trends
Range: Housing Requirement/Need
3. Total future households
4. Specific housing requirements
5. Current households in need
6. Future affordable housing requirement
7. Future market housing requirement
8. Future requirement for either market or
affordable housing
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Demographic Context
• Marginal population growth (1.8%) since 2001
• Marginal growth in number of households (5%)
 projected 7% increase over 10 years to 53,950
 single parents and single person households expected to
increase by 16% (3,440) and 18% (20,170)
• Substantial growth in older households by 2019
 75+ expected to increase by 30% (to 13,297)
 65+ to increase from 20% (21,977) to 25% (28,199) of
population
 Shift in balance of care/housing options for older people
• Need for family housing decreasing by 19%
 9,180 households falling to 7,410
• Impact on future dwelling profile required?
 Requirements from single parent/person households
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Economic Context
• Economic Performance since 2000
 Economic growth at national and global levels
 Like Scotland, Angus has enjoyed high levels of output
and employment
• Employment Rate in Angus: 2008/09
 Higher employment rate (84.3%) than Scotland (79.6%)
 Higher self-employment (10.5%) than Scotland (7.6%)
or UK (9.1%)
• Unemployment rate
 Increased by 0.3% to 4.4% (April 08-March 09)
 October 2009: 3.1% of population in receipt of JSA
• Income and Earnings
 Angus average gross weekly pay = £470.80
 Scotland average gross weekly pay = £461.80
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Economic Context
Employment Structure in Angus
 Labour market highly dependent on skilled trade
occupants (14.6%); Scotland (11.6%); UK (10.7%)
 Under represented in managerial and professionally
qualified occupations
Employment by Occupation
Angus
Scotland
UK
1
2
3
4
5
6
7
8
9
12.10%
11.80%
14.10%
11.40%
14.60%
8.40%
6.20%
7.90%
13.10%
13.30%
13.20%
14.80%
11.30%
11.60%
8.80%
7.90%
7.30%
11.50%
15.60%
13.10%
14.60%
11.40%
10.70%
8.30%
7.50%
7.00%
11.30%
Managers & senior officials
Professional occupations
Associate professional & technical
Administrative & secretarial
Skilled trades occupations
Personal service occupations
Sales & customer service occupations
Process plant & machine operatives
Elementary occupations
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Estimate of Current
Dwellings
• 53,713 residential dwellings (July ‘09)
 71% private ownership, 20% social housing, 9% private
rented sector
• 72% of private dwellings fail SHQS
• 57% of private owners own outright
• 2,751 vacant properties (5% stock)
 84% empty homes; 16% 2nd homes
• Shift in Dwelling Profile since 2001
 14% increase in dwellings
 9% decrease in Private Rented Sector? (4,902 – 4,451?)
 Social housing decrease: from 25% (11,552) of dwellings
in 2001 to 20% (10,866) in 2009
 Private sector increase from 75% (35,393) to 80%
(42,848)
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Housing Market Trends
2003-08
Access to finance/low cost of borrowing
Fuelled mobility in market
 20% growth in market turnover between 2003 and 2007
 5.4% sales turnover in 2007 (2,330)
High levels of inward migration
 Only 65% of sales to Angus residents between 2005-2007
 Purchasers from Dundee have a major influence on HMAs
Fuelled house price inflation (2003/07)
 Increase in weighted average house prices = 84%
Housing affordability issues evident
 52% can’t afford LQ, 72% can’t afford WA
In 2009 housing market is constrained
2008: Volume of sales fell by 30%
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Housing Market Trends
2003-08
Median House Price Inflation
 Angus: 84% increase
Comparative Price Increases
Aberdeen City: 114%
£200,000
Aberdeenshire: 123%
£160,000
£140,000
Aberdeen City
Dundee City: 90%
£120,000
Aberdeenshire
£100,000
Angus
Fife: 71%
Perth & Kinross: 69%
£180,000
£80,000
Dundee City
£60,000
Fif e
£40,000
Perth & Kinross
£20,000
£0
2003 2004 2005 2006 2007 2008
2008 Angus inflation = 3%
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Estimate of Future
Households
Over Next 10 Years…
• 7% increase in number of households, 364
households per annum
• Projected increase in households aged 65+
• Decrease in households aged 16–24 (-2%)
• Increase in households aged 25-29 (27%)
 Increase in typical first time buyer group
 Current market restrictions likely to impact most
heavily on FTB’s given level of deposit required
and restricted lending multiples relative to income
 May influence demand expressed for social or
private rented housing options
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Groups with Specific
Requirements
• 18% increase in older people (55+)
by 2019 (28,590)
 50% increase in households aged 85+
• 36% of older people have disability or
LLTI (14,812)
 1% have mental health problems
 10% frail due to old age
 10% have a long term illness
 12% have mobility/physical disabilities
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Groups with Specific
Requirements
• 20% households have LLTI/disability
 6,113 of overall households have household
member with a physical disability
 4,867 have a limiting long term illness
• Subjective requirement for special forms of
housing expressed by 2,493 households
• Recent increases in migrant workers (855%
2002-08) has fuelled housing need
 Impact of economic recession?
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Need for Special Forms of
Housing
• HNADA survey “Do you or anyone in your
households have an unmet need for
special forms of housing”
• 5% of respondents said they did have a
an unmet need = 2,493 households
• Of the 2,493 households:
 25% were single people (615)
 26% were couples (639)
 17% were 3+ adult households (430)
 27% were households with children (680)
 5% were single parents (130)
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Need for Special Forms
of Housing
Of the 2,493 households:
•
•
•
•
•
50% require ground floor accommodation
32% require specialist care housing
3% require wheelchair accommodation
6% require sheltered accommodation
8% require other special forms of housing
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Need for Special Forms
of Housing
• Of the 50% who require ground floor accommodation
 46% were aged between 45-59
 31% were aged 60+
 17% were aged 30-44
• Of the 32% who require specialist care housing
 41% are aged between 30-44
 35% are aged between 45-59
 17% are aged 60+
• Of the 6% who require sheltered accommodation
 75% are aged 75+
 25% are aged between 65-74
• Of the 3% who require wheelchair accommodation
 57% are aged between 45 and 49
 43% are aged 75+
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Need for Special Forms
of Housing
• Of the 50% who require ground floor accommodation
 44% own their property outright
 24% have a loan or mortgage
 21% rent from a housing association
• Of the 32% who require specialist care housing
 48% have a loan or mortgage
 26% own their property outright
 15% are living in social housing
• Of the 6% who require sheltered accommodation
 50% rent from Angus Council
 31% own their property outright
 19% are in other forms of accommodation
• Of the 3% who require wheelchair accommodation
 58% have a loan or mortgage
 42% rent from Angus Council
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Baseline Housing Need
Calculation for
Affordable Housing
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Affordable Housing
Need Calculation
Current Need
X (a quota)
Plus
Newly Arising
Need
Minus
Supply of
Affordable
Housing
Net Shortfall/
Surplus
Equals
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Affordable Housing
Need Calculation
Current Need: Unsuitable Housing
•
•
•
•
•
•
Homeless or with insecure tenure: 175
Concealed Households: 219
Overcrowding: 779
Special Needs: 3,194
Poor Condition: 428
Harassment: 127
Current Need = 4,922
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Affordable Housing
Need Calculation
Total Current Need – Eliminate:
• ‘In situ solutions’:
 Provision of aids/adaptations/support = 680
 Net ‘Special Need’ figure = 2,514
• Net ‘Current Need’ figure = 4,242
Then eliminate
• % can meet need in private housing market
 52% households can meet market entry price
Net Current Need = 2,206
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Affordable Housing
Need Calculation
Newly Arising Need
• New household formation: 840
 Eliminate new formers who can afford to meet
market entry level prices = 269 (32%)
• Existing households falling into
need: 724
 Change in household circumstances including
annual flow of homeless households
Newly Arising Estimate = 1,295
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Affordable Housing
Need Calculation
Affordable Housing Supply
• Affordable housing relets: 1,075
• Committed new affordable supply: 50
• Turnover net of units taken out of
management: 0 demolitions
• Annual Supply Estimate = 1,125
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Affordable Housing
Need Calculation
Interim Calculation Estimate
• Current need = 4,922
 Net current need = 2,206
 Net annual current need = 221 (10 years)
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•
•
•
•
Annual newly arising need = 1,295
Annual total need = 1,516
Annual affordable supply = 1,125
Estimated shortfall = -391
10 year Est. shortfall = -3,910
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Calculation for
Affordable Housing:
CHR Validation
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Calculating the
Requirement for
Market Housing
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Market Housing
Requirement Methodology
Current Need for
Market Housing
Newly Arising Need
for Market Housing
Annual Internal Demand
Annual Inward Migration
Total Need & Demand for
Market Housing
Affordability Analysis
Market Entry
Level
Mid-Market
Properties
Upper End of
Market
Match Need & Demand to Supply
Market Supply
Market Entry
Level
Mid-Market
Properties
Upper End of
Market
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Calculation Inputs
Current Need: Market Housing
 North HMA: 56% CAN afford = 729
 South HMA: 39% CAN afford = 490
 East HMA: 52% CAN afford = 417
 West HMA: 47% CAN afford = 415
Angus Gross Current Need = 2,051
Angus Annual Current Need = 205
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Calculation Inputs
Newly Forming Households
 North HMA: 49% CAN afford = 40
 South HMA: 38% CAN afford = 100
 East HMA: 33% CAN afford = 66
 West HMA: 42% CAN afford = 124
Angus Annual Need = 330
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Calculation Inputs
Annual Demand Assumptions
• Total Demand ‘Very Likely to
move’ in next year = 1.85%
 North HMA = 240
 South HMA = 250
 East HMA = 266
 West HMA = 238
• Angus ‘Like to Move’ = 994
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Calculation Inputs
Demand: In Migration (2007)
 North HMA = 279
 South HMA = 289
 East HMA = 190
 West HMA = 227
Angus In Migration = 985
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Calculation Inputs
Total Annual Need & Demand Yr 1
Current Need for
Market Housing
=
Newly Arising Need
for Market Housing
=
330 per annum
Annual Internal Demand
=
994 per annum
Annual Inward Migration
(2008 Sales)
=
985 per annum
205 per annum
Total Annual Demand = 2,514
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Calculation Inputs
Total Annual Need & Demand Yr 1
Current Need for
Market Housing
=
Newly Arising Need
for Market Housing
=
330 per annum
Aspirational Demand
=
1,418 per annum
Annual Inward Migration
(2008 Sales)
=
985 per annum
205 per annum
Total Annual Demand = 2,938
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Calculation Inputs
Total Need & Demand
• Split into quartiles based on
affordability assessment
• 3.5 X’s income lending multiple
Area
North
South
East
West
q1
q2
q3-4
Total
41%
39%
40%
41%
39%
26%
34%
35%
20%
35%
25%
24%
100%
100%
100%
100%
Angus
40%
34%
26%
100%
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Calculation Inputs
Market Housing Supply (2007)
Area
North
South
East
West
Angus
q1
q2
q3-4
Total
181
127
148
139
181
117
145
139
360
242
293
278
722
486
586
556
595
582
1,173
2,350
 Sales Volume 2007 = 2,350
 Modelling Assumption :
• Sales in Year 1 – 3 reduced by 30%
• Volume of sales incrementally increase from Yr 4
to year 10 by approx. 6% per annum
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Market Housing
Requirement Yr 1
Quartile 1: Shortfall
•
•
•
•
North HMA: -136
South HMA: -180
East HMA: -129
West HMA: -163
Angus shortfall = -609
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Market Housing
Requirement
Quartile 1: Year 1,5,10
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Market Housing
Requirement Yr 1
Quartile 2: Shortfall/Surplus
• North HMA: -124
• South HMA: -100
• East HMA: -96
• West HMA: -129
Angus shortfall = -450
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Market Housing
Requirement
Quartile 2: Year 1,5,10
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Market Housing
Requirement Yr 1
Quartile 3+: Shortfall/Surplus
• North HMA: 113
• South HMA: -82
• East HMA: 54
• West HMA: 34
Angus surplus = +119
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Market Housing
Requirement
Quartile 3-4: Year 1,5,10 Surplus
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Market Housing
Requirement
Clear Shortfalls in Housing Q1&2
• Relates to properties below £130,000
• Total Shortfall Year 1: 609
• Shortfall over 10 Years: 2,568
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Market Housing
Requirement
Surpluses in Housing Q3&4
• Relates to properties above £130,000
• Total Surplus Year 1: 119
• Surplus in East, North & West HMA’s: 201
• Shortfalls in South HMA: 82
• Cumulative Surplus (10 Years): 695
Total Shortfalls (All Quartiles)
 Year 1 = -939
 Year 5 = -745
 Year 10 = -146
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Market Housing
Requirement
Year
Annual Market
Housing Shortfall
1
2
3
4
5
6
7
8
9
10
939
939
939
845
745
639
526
407
281
146
Cumulative
Market Housing
Shortfall
939
1,879
2,818
3,663
4,408
5,047
5,573
5,980
6,261
6,407
• Cumulative
Shortfall of Market
Housing: 6,400
• New Build Delivery
Assumption: 2,640
(2007: 290 sales
per annum)
• Housing Land
Requirement circa
9,000?
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