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Addressing The Housing Supply Crisis In London

Abstract

Cities in various parts of the world are facing the challenge of providing sufficient homes to meet the demands of growing urban populations. Over the last decade, the housing stock in London was increased greatly as compared to other cities such as New York and Paris, both of which also had lower rates of population growth. Nevertheless, London’s housing stock grew as at a much slower rate than Tokyo, which increased by approximately 2% per annum. The main aim of the research is to address the housing supply crisis which is witnessed in London. Hence This dissertation is well crafted to enable one be able to understand the concept of housing demand in London and England as a whole. The findings of this research will be of great significance to the various parties who offer housing facilities to the Londoners as they will be able to understand the housing demand patterns. Housing being one of the greatest contributors to the growth of the economy of any city such as London, the research will be able to enlighten people on how the housing plays a very significant role in the growth of the economy of London. The findings of this dissertation can also help to come up with suggestions on how this challenges of housing affordability in London can be solved.

Table of Contents

Abstract 1

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CHAPTER 1: INTRODUCTION

Introduction 3

Research questions 4

Aims and objectives of research 4

The significance of the research 5

Dissertation Structure 5

CHAPTER 2: LITERATURE REVIEW

2.1 Housing a global challenge 7

2.2 London’ housing submarkets 8

2.3 London’s affordability crisis 9

2.4 Demand for affordable housing 13

2.5 London’s Housing shortage 16

2.6 Affordability of Housing in London Salary ratios to House prices 16

2. 7 London’s Housing Strategy 17

2.8 Government’s Housing Policy 18

2.9 Rental price to the salary ratios 19

2.10 New affordable Housing provision 19

2.11 Allocation and homelessness 19

2.12 Changes to the social tenancies 20

2.13 Case studies 21

Ebenezer Howard and the Garden City 21

New Towns and its Planning 24

Milton Keynes 27

Chapter summary 28

CHAPTER 3: RESEARCH METHODOLOGY

3.1 Introduction 29

3.2 Secondary sources 30

3.3 Case studies 32

3.4 Rationale for research methodology 34

CHAPTER 4: FINDINGS AND DISCUSSIONS 34

CHAPTER 5: CONCLUSION 36

CHAPTER 1: INTRODUCTION

1.1 Introduction

London’s economy is booming; its population is increasing, and by numerous measures, it is the greatest city in the world. However, with the remarkable success that has been achieved in London comes Challenges, one of the chief challenges is the huge rapid shortfall of the housing that most Londoners can afford (Rosbrook-Thompson, 2018, p. 435). In addressing this challenge, it is important to ensure that the continued growth of London is retained as the pre-eminent global city. Solving this challenges will not be achieved quickly and easily as it is a structural challenge that London faces. It needs a long-term plan, which will spread over a number of economic cycles, spending rounds and mayoral terms. Solving this also need a cross-party consensus on the significance of investing in housing, because there is to a greater degree in other critical sectors of provision such as education and health (Library, 2015, p. 173).

The shortage of housing escalates the rents and prices up, and there can be no doubts that London is experiencing some affordability crisis. In most cases, those in acute need are affected most, whether overcrowded or homeless. The rise in the cost of housing is also hitting the working household on middle and low incomes. The economic case for offering enough housing for those on modest incomes, who are the key drivers of the economy of London and hence the national economy. If these important workers cannot be able to afford the housing facility in the city, the impact will not only be felt in London but on the nation’s economy and competitiveness (Taunton, 2010, p. 291).

High-quality housing is fundamental for the city to function effectively. Sufficient housing is very essential for the economic growth. Economic growth will be stunted without necessary investments in suitable housing for London’s workforce. London has greatly benefited from the major improvements that have been done on its infrastructure. A home is an essential infrastructure for the achievement of a decent life; it is a basic need just like clothing and food. Modern society would not accept that human beings managed to survive without these basic nutritional wants so why there is a need to put up with the shortage or stark inequality of housing in London (Beattie, 2013, p. 562).

1.2 Research questions

The research will answer the following questions

  1. Why is housing a great challenge to many cities globally?
  2. Why is there housing affordability in London?
  3. Why is there an acute housing need in London?
  4. How can the housing affordability crisis in London address?
  5. What role does the housing play in the economy of London and England as a whole?
  6. What role did the Greenfield 1944 play to control the growth of London?

1.3 Aims and objectives of the research

The main aim of the research is to address the housing supply crisis which is witnessed in London. Specific objectives were set to assist in achieving the main aim of the research, and they include:

To understand the reasons behind the acute housing demand in London

To understand the role, the Greenfield 1944 played in control the growth of London

To evaluate the housing demand in London

To understand the housing challenges various cities, face such as New York and Paris

To evaluate the role which housing plays in the growth of the economy of London.

1.4 The significance of the research

This dissertation is well crafted to enable one to be able to understand the concept of housing demand in London and England as a whole. The findings of this research will be of great significance to the various parties who offer housing facilities to the Londoners as they will be able to understand the housing demand patterns. Housing being one of the greatest contributors to the growth of the economy of any city such as London, the research will be able to enlighten people on how the housing plays a very significant role in the growth of the economy of London. The findings of this dissertation can also help to come up with suggestions on how this challenges of housing affordability in London can be solved.

1.5 Dissertation Structure

The dissertation is structured into six chapters.

Chapter 1 which serves as the introductory chapter and encompasses such sub-chapters among them introducing asset management plans, research statement, aim objectives, research questions, the rationale of the study and research hypothesis

Chapter 2 is the Literature Review chapter. In this chapter, precedent findings related to the same topic being studied into details with critics and acknowledgements made where they are most relevant. This chapter is divided into numerous sub-topics among them an elaborate literature review in addressing the housing supply crisis in London

Chapter 3 is the Research Methodology chapter, and the chapter defines the approach that will be adopted to achieve the research aims and objectives.

Chapter 4: Results of the findings of the study. In this chapter, the various results will be demonstrated using the various techniques that are used in the representation of results. Depending on the research methodology used, the result will either be in tabular, diagram, graphical or even modulation findings. This would be influenced by the nature of the data collection techniques adopted.

Chapter 5 is about the Discussions and Recommendations. The discussions are in line with the results that are determined in chapter 4. Each of the results will be discussed conclusively, and any shortcomings in the process of establishing the findings of the study noted as the limiting factors that may reduce the accuracy or otherwise the reliability of the results. It is in this chapter that insights into the new establishments as an improvement on the weaknesses of the literature review are discussed and extensively explored.

Chapter 6: Conclusion. This is a chapter that gives a brief summary of the findings in the thesis as a whole. It is in this chapter that recommendations for further work can as well be made should there be a need.

Chapter 7: contains all the materials that were reviewed and sources where the information in this dissertation was obtained from.

1.6 Background

The population of London has reached a new level after it grew by 135,000 between 2014 and 2015. Currently, there are more homes in London than households, in contracting to the early twentieth century, but the number of rooms per person fell between 2001 and 2011.the first time that happens in the past century (Minton, 2017, p. 547).

Private renting still remains to be the greatest tenure in London, and it is rising at an alarming rate once again and it is projected that by 2025 it will catch up with owner occupation, with the decline in the share of mortgagors accounting for the fall in the homeownership and the young age groups witnessing the rapid decline in the recent past (Division, 2013, p. 450).

The number of a residential building constructed in London in 2015 was the highest in a calendar year since 1978, but it was still far below the historic peaks. The built area of London has changed very little since the 2nd world war, and the surroundings of London have only patchy growth in the past years. The residential densities are the highest in some of the areas that are bordering London’s central business district (Garrett, 2014, p. 72).

CHAPTER 2: LITERATURE REVIEW

2.1 Housing a global challenge

Cities in various parts of the world are facing the challenge of providing sufficient homes to meet the demands of growing urban populations. Over the last decade, the housing stock in London was increased greatly as compared to other cities such as New York and Paris, both of which also had lower rates of population growth. Nevertheless, London’s housing stock grew as at a much slower rate than Tokyo, which increased by approximately 2% per annum. To achieve the same rate of growth London is required to construct approximately 60’000 residential houses each year. It is also notable that Tokyo witnessed substantial growth in owner occupation during this time. Tokyo’s rapid housing growth is due to many factors which include the integration of housing and transport development alongside a more flexible planning regime that facilitates greater development densities. The graph below shows the comparison of housing development in various cities in the world (Ortiz, 2016, p. 569).

Fig: Annualized percentage growth in population and housing stock

2.2 London’ housing submarkets

The housing market of London is very diverse and complex, and there is no homogenous housing market within any single borough boundary. It contains a range of sub-markets which are completely different, not by only price and tenure, but also the type of a renter and purchaser. There has been a rapid growth in demand in the prime market of London, and thus prices, since the depths of the last recession, with a high proportion of overseas cash investors who buy both existing and new homes (Harloe, 2012, p. 456).

The rest of the inner London has also witnessed strong growth in the prices, due to the investments overseas, but to a far lesser extent than prime central London and in part because of the strong domestic demand from both the landlords and homeowners. Lastly, the greater part of the outer London is still predominantly a traditional mortgage-led market and has hence witnessed a minimum rise in the price in the recent past, even though there has been a rapid rise in the renting in suburbs and town centers. This kind of markets overlaps, and they have a great effect on each other; even in the situation where the prime central London’s property market can be seen to be totally detached and having a displaced demand resulting from the high prices which still affects the rest of the city (Shankland, 2011, p. 79).

2.3 London’s affordability crisis

Given London’s importance to the economy of the United Kingdom and its status as a global city, it is not surprising that the property and land prices are higher than the national average. Nevertheless, the extent to which it is growing and the scale of the gap is striking. According to the research that was carried out in 2013 the average house price in London was $450,000 as compared to England’s average house price of $ 260,000. The average house price has risen with approximately twelve percent in the last 2yeras as compared with the six percent nationally. The figure below shows that the price has been growing faster in the two most expensive boroughs (Kensington and Chelsea and Westminster) followed by the rest of inner London, with the comparatively slow rise in the other parts of the outer London, which have price trends similar to other parts of the nation. The rents are also higher in the capital, with the median monthly rent for the privately rented home at $ 1,300 as compared to the national average of $595. Private sector tenants in London spend an average of 36% of them of their net income on rent.

Fig: Projected London house price indices

The average house prices in London are currently 78% higher than the United Kingdom Average house price. That is the widest gap since the one that was witnessed in the late 1960s.over this entire period, the gap has never been less than 20%. However, each house price cycle has left prices in London further away from United Kingdom prices than before (Researc, 2013, p. 63).

Greenfield 1944

Greenfield is a type of land in the city or rural areas which is undeveloped except for either landscape design use or agriculture use or left to change naturally and can be used for future urban development expansion program. It is not controlled by infrastructure or existing buildings (Jones, 2014, p. 384).

In 1944, the Town Planner Abercrombie came up with Greater London Master Plan on how to expand London in order to improve it for the inhabitant. The plan gave London an opportunity to rectify the perceived failures of haphazard and unplanned development which occurred as a result of quick industrialization for years. The plan was based on five major issues that were facing London that time: population growth, recreation, housing, transport, employment and industries (Barker, 2016, p. 349).

The plan offered the London County City with an opportunity to plan and acts of the empty tracts of the city on the opportunity not realized from the time of the Great Fire of London. Due to rapid population increase, and limited space for constructing new houses; there were housing shortages and population density problems. Abercrombie’s plan had four rings which were as follows: Outer Country, Greenbelt, Suburban and Inner Urban. The Inner Urban Ring was restricted to any industrial development or new housing which were thought to be past the limit of tolerable factors, rebuilding damaged houses in a modern way of their former state. The Suburban section would be developed with the mix of housing and light industry to avoid inefficient dormitory environs within the region, while the Green Belt Ring was for the development of recreational spaces and parklands, with the restriction for development except the villages within. Then the Outer Country Ring would support farming with satellite towns that can help to move large populations from the congested regions of central London.

Housing crisis increased due to bombing during the Second World War Two because many houses was destroyed. As a result, it coincided with Abercrombie’s plan. But there was a law since 1580(when Elizabeth I of England) which banned building houses in a three miles wide belt around the city of London. Until 1944 the Law was in effect although it was not widely enforced. In the year 1919, the law was changed for the wide belt to be of two miles from the City of London to restrict new urban spread, beyond that upcoming development must exist. The main aim of the green belt strategy was to restrict urban spread by keeping the land open permanently. As a result, Abercrombie’s Greater London Plan sought wide belt around the city up to seeks miles. The reserved greenbelt was the core for the plan, instead of many buildings with dispersed green spaces (Dorling, 2016, p. 821).

The policy of a wide belt of six miles around the city prevented the growth of London City. This is because the policy wanted to protect the open space reserves for recreational, agricultural, aesthetic, ecological, natural resources and the management of the community. So the green belts were established to be buffer zones between rural land and urban to preserve forestry. Furthermore, there is an opinion against unsuitable development in the green belt area. However, the communities within the outskirts of London opposed the plan of expansion of the city to create room for affordable housing because of:

  • Environmental hazards such as noise, air, water and land pollution.
  • The spread of immorality such as prostitution and drug abuse
  • Spread of crime
  • Destruction of natural habitats of some animals and plants
  • Loss of recreation facilities
  • Once the land is developed, it cannot be reversed back to the original state.
  • Encouragement of suburban spread

Due to the policy of the greenbelt, the City of London was prevented from growth and expansion in the year 1944. Although the Greater London Plan was conducive to growth.

2.4 Demand for affordable housing

A house is one of the basic needs of a man. As the population is surging upwards, the demand for affordable housing is increasing day by day. More people want to own their houses because the house defines the social, economic status of the owner. The need to have a house arises from growth in population and formation of new household, congestion and when families are spending more for house rents. Housing need is thought to be vital need since one cannot fulfill important housing need minus achieving our basic need.

There is no specific definition of affordable housing, but it is mostly understood to include the social-rented housing which is usually by registered landlords and local authorities. The affordable housing can include other forms of subsidized housing including the low-cost home ownership schemes, which is usually sold or rented out at a price which is lower than the market price of that time. Some of the factors affecting the demand for affordable housing include;

a) Amount of Income

Rising income enables people to afford to spend more buy houses. During the time of economic growth, the sale price of houses increase, also the demand increases because people tend to think to buy a house is like a luxury, whenever the income rises it causes the bigger percentage rise in house demand. However, the price of the house can increase so much quicker than the earnings. Sometimes the households would want to spend the income and wealth in improving the value of their housing. So when the demand for housing is high while the supply is low, the price of the houses will increase automatically (Ryan-Collins, 2013, p. 411).

b) Demographics

The size of the family compels it to think of buying or expanding a house to accommodate them. A big family will need a house to cater for them, but areas, where the population is very low the demand for affordable housing, is very low. There are some regions whereby increased immigrants lead to housing demand. The immigrants tend to settle in areas with job or market opportunities which can skyrocket the housing prices. Where there are many skilled workers, the prices of the houses will be high. The higher the population, the higher the demand for housing (Kate, 2012, p. 300).

c) High Rents

The rise in rent in the current years has propelled the desire of many tenants to buy a home rather than renting. Consequently, for having to pay high rents has minimized the chance or the capability of saving to buy a house. The net effect on the real demand for house buying is therefore uncertain (Arrigoitia, 2013, p. 395).

d) Interest rates

The reduction in the normal interest rate increases the capability of the households to buy homes through bank loans. The mortgages have helped many families to be able to pay for a loan for up to twenty years which can be equal to the cumulative amount of rent they could have been paying per month for the given period. But when the interest rate is increased, many households will not go for a loan to finance the homestead for they fear to lose the homes if they are unable to pay back.so whenever the Central bank reduces the interest, it becomes a sigh of relief to a borrower particularly the homeowners. Even most property developers take loans to finance their housing business; therefore, when the interest rate is low, houses will be affordable to the buyers (Millins, 2015, p. 917).

e) Easy access to credit facilities

The availability of loans promotes the buying of homes in a greater number. When it is easier to get a loan, many home buyers will finance their homes from banks and other non-bank lenders. The financial deregulation promotes the demand for the housing for potential buyers through credit facilities advanced to them. Many financial regulations may make many households not to get a loan and at the end miss buying a home.

f) Speculative demand

People can buy a house which they can afford, not as a basic need but with the expectation of the price to rise in the future. This has encouraged many people to buy homes as a form of investment. Buying a home as an investment, it is the most noble idea because properties appreciate with time. This sometimes increases the demand for purchases of houses.

g) Taxation Influences

The speculative housing demand may be encouraged by some taxation reasons which makes housing investment attractive than other investments. If there are excessive exceptions for homeowners from capital gains, pension assets test and land tax; the demand will rise.

h) Land

The availability of land influences the construction of a home. The homeowner may want to buy a house, but there is no land for building. In big cities, land is a scarce commodity to get. A household may be willing to afford to buy a home but lack of land to limit the dream. The easily available land will propel affordable housing for the developers and home buyers. The land is proportional to the overall cost of funding incremental house building development and access cheap plot is very necessary for producing the advanced development in housing (Bowie, 2016, p. 237).

2.5 London’s Housing shortage

The problem of insufficient affordable housing in London is widely recognized. It is a matter of the fact that the number of new homes that are being built are not sufficient to meet the needs of the growing population. According to the report by London housing commission, London requires approximately 50,000 new homes to be constructed each year, yet the current construction rate is falling short; From the research that was carried out approximately 25,000 homes were constructed in 2015.It is very evident by the rate at which the house rents and prices are rising that there is a housing crisis in London. Due to that, there are very high levels of homelessness and overcrowding that is witnessed in London.

The house prices and rents have risen, while the wages have not kept up. According to the research that was carried out by the National Housing Federation, an average home in London costs approximately $526,000 which is 16 times the average salary of the residents of London who usually receives $ 33,000 annually. Due to that the first time buyers to be more precise now requires higher incomes and larger deposits to be able to buy their first home. Therefore, across England the proportion of households privately renting is growing at an alarming rate while the owner occupation (Spiers, 2018, p. 78).

2.6 Affordability of Housing in London Salary ratios to House prices

One way through which the housing affordability is determined is by comparing the cost of housing directly with the income of the occupants of a given region. The Office for National Statics has generated a measure which compares the median house prices in all the local authorities to the median annual salary of a full-time worker.

This is not the perfect measure, the gross annual salary does not include the deductions or the additional incomes sources, and in most cases, it does not account for the fact that many people live on multiple salaries. Nevertheless, it does offer a way of comparing each local authority to another. The table below shows the salary to house price ratio for London. Of all the local authorities in England.

2. 7 London’s Housing Strategy

The Mayor of London has strategic oversight of regeneration, economic development and Housing in London. The housing strategy which was adopted in 2014, clearly sets out policies that are intended to meet the housing needs of London, This document includes the plans on how to build a minimum of 42,000 new homes annually across all the tenures and for improving the housing opportunities of all residents who are working in London.

Sadiq Khan, the new mayor of London, made it very clear in his manifesto that is first priority is to solve the housing crisis, which will involve constructing more homes for the residents of London each year, and setting out a target of 50% affordable homes which most of Londoners perceived to be ambiguous.

2.8 Government’s Housing Policy

It is the responsibility of the Greater London Authority to allocate funds for the construction of affordable homes. The area that is outside London this responsibility is conducted by the Communities and Homes Agency.

Proper measures that are intended to enhance home possession and drive up the supply of houses was featured greatly in the conservative party manifesto 2015.

The government set out five clear points in the

2.9 Rental price to the salary ratios

The Office of National Statics has also produced a measure comparing media monthly private rents to the median monthly salary. The rental price to the salary ratio has disadvantages as the that of the house price to the salary ratio; it also offers ways for comparing one local authority to another.

2.10 New affordable Housing provision

The graph below illustrates the number of new homes that are affordable in the greater London by type. The homes include the social rented housing. Intermediate affordable housing and the affordable rented housing. The figures in the graph include the new builds and the acquisitions.

2.11 Allocation and homelessness

Localism act 2011 offers local authorities much freedom to set local policies concerning who will qualify to be on the waiting list for the social housing in their region. For instance, they have the freedom to decide to prevent people who have no need for the social housing from joining the waiting list. The authorities will also be required to ensure that social homes are allocated to the most vulnerable in the society who have the highest demand for the social housing.

Sections 145-147 of the localism act 2011 introduces a great number of changes to the allocation of social housing through the amendments of point 6 of the housing act 1996.The local authorities are given powers by the changes to establish which class of people are not qualified to be allocated social houses. The changes also take out the tenants out of the scope of point 6 of the housing act 1996, with the exception of those tenants who must give reasonable preference for the allocation.

A news 166A in the Housing Act 1996 wants each local housing authority to have a scheme for determining priorities for those tenants who are qualified for the allocation of social housing and for the necessary procedures to be followed in the allocation process. There are a lot of publications that have made regarding this social housing allocation in England.

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There are also variations to the local authority’s responsibilities to the homeless.\These changes are mainly affected by the amendments to the point 7 of the housing act 1996.Section 148 of the Localism Act 2011 gives powers to the local authorities in Wales or England fully to discharge the major homeless duty in order to secure accommodation having an offer of the suitable accommodation from a private landlord, without necessarily requiring the agreement of the tenant. tenancies must be for a minimum fixed term of 12 months. In the amended section 193 of the Housing Act 1996, the major homelessness duty, will recur, regardless of if the tenant applicant has a priority need for accommodation, in the situations where the tenant becomes unintentionally homeless once again within a span of two years of accepting a private sector offer and the re-applies for the accommodation.

2.12 Changes to the social tenancies

Other very significant provisions in the Localism Act 2011 was to allow local housing authorities to offer what is referred to as ‘flexible tenancies’ in place of the permanent tenancies. a flexible tenancy must be of a fixed term of a minimum of two years, and in practice, they may be offered for a longer period of time than this. The landlord must give notice to the tenant which will be a flexible tenancy. In this situation, the landlord has the power to recover possession on one or grounds in section two of the Housing Act 1985 and the tenants also have the powers to end the tenancy .At the end of the term, the landlord has the freedom to give a notice which shows that there will be no further flexible tenancy that will be granted and that the possession is needed or the landlord can provide a further secure tenancy .The reasons for a decision not be given in the notice and the

2.13 Case studies

The emergency of New Towns as a result of garden cities

Letch worth and Welwyn were the first Garden cities at the beginning of the twentieth century; the British new towns are now a well-known part of planning history. The British New towns are of historical significance as a result of planning and relevance.

The development of the new towns is a concept, traced to the garden cities formulation idea through Sir Ebenezer Howard, to the Government program of new towns that emerged after the Second World War. There are some lessons of experience which can be learned from the idea of Ebenezer Howard by the Current urban planners and communities living in the urban areas. It will be learned whether Howard’s plan of garden City and emergency of new towns did achieve the vision of the government of spreading new town or not. Associated with that is whether the new town and gardens cities were and are effective places in which to work and live. For a long period during which the idea was given very little priority, but the new towns were a result of that regional planning- is again important. Through the garden city, many towns emerged and nowadays are some of the leading towns in the United Kingdom. So as the garden cities started expanding, they resulted in new towns.

Ebenezer Howard and the Garden City

The garden cities were the real-world expression of a modest but excellent idea Imagined by Ebenezer Howard who was an inventor and a shorthand clerk. His idea was that a garden city could house thirty-two thousand people on an area of six thousand square acres, designed in a concentric manner with open spaces, six radial boulevards and public parks, thirty-seven meters wide, ranging from the center. They were feedback to the social and environmental legacy of the British industrial revolution, the effects of an era of industrialization, and fast growth, and the deprived, morbid housing circumstances that followed it.

They had as their backgrounds the ‘prototypical’ people of Saltaire near Bradford (1850-1872), New Lanark in Scotland (c1800-1810), near Birkenhead (1888), and outside Birmingham (1879-95) and Port Sunlight. The idea of Howard was much far-reaching, giving a generally planned relocation of industry and people outside the cities. His argument was that the garden cities which were fresh settlements with nearby agricultural farmlands were to bring together excellent features of countryside and town while circumventing the shortcomings of both.

The main features of the garden city can be given as follows:

1. Well planned distribution of people and industries to towns which have enough size to give the variety of occupations, services, and culture level required by a secure wide range of current society.

2. Town size limit to about thirty thousand people, in order that their residents may live close shops, work, and other vital facilities and to be located in a walking distance of the near the countryside. Another new garden is to be built when the first ones were to reach the population limit.

3. Layout space to provide schools, houses with private gardens, and pleasant parks and Parkways, and other functional units.

4. A close country or town relationship with a strong demarcation of the town boundary and a wide area surrounding it permanently kept for agriculture, to provide farmers with a market for their produce and admission to the rural for residents.

5. Initial planning of the town outline involving useful zoning and roads, quality control of buildings, the laying of extreme densities, and design while allowing for individual variety, skillful landscape design and planting.

6. The formation of surrounding areas as social and development entities.

7. Unified land possession with the total region, involving the zone of agriculture, under trust ownership or quasi-public, to enable control planning leasehold agreements and seizing land importance for the society.

8. Progressive co-operative and municipal initiative without leaving out distinct general freedom in trade and industry.

In 1899, the Garden Cities Association was established to promote the garden city idea. In the year 1903, a site was selected, the company was First Garden City Limited and Letch worth Garden City was conceived. Raymond Unwin and Barry Parker as architect planner were hired for the project. By implementing Howard’s theoretical concept, they accomplished the physical realization of the style of the garden city who were influenced by William Morris, John Ruskin and the Arts and Crafts Movement.

Upset by the Government’s failure to adopt the garden city as a way for rebuilding after the First World War, He led the movement to form another garden city. The advertisement for Welwyn Garden City exalted its features as The New Town for Industry and Residence, that was to be set within Hertfordshire Highlands; in a series of cartoons, it sought to entice industrialists and residents. Nowadays the percentage is nearly the same. Nevertheless, many a business were fascinated to the town, and it is extremely more than just a traveler’s settlement. With its fascinating architectural design and its reasonable public houses and public reserved spaces, the garden city gives a considerably enticing environment. It was a place in high demand to live. Like Letch worth, forming it was really a great struggle. The Synchronizing of the housing erection, the attraction of industrialists and the public services provision, to create town building from scratch, was a hard task for the after-war development organizations. It was a small proportion of people who achieved it, to the level that the first buildings were occupied at the end of 1920 was a victory of determination over chance. However, growth was fairly slow. The new town was the government plan that overtook the garden city idea by 1950, while the population of Welwyn remained at only eighteen thousand people. The difficulty for the agents of extra garden cities was that a limited number of people tried to be listening. Industry and people were relocating out of the big cities, but not in an organized manner. The effect was uncoordinated spread involving small developments which begun to sprawl from the old dense urban areas.

New Towns and its Planning

Nevertheless, there was the change due to the publication of a series of incredibly effective information from 1940 to 1947. They are some of the instances like distribution of industries, the exploitation of countryside land and betterment and compensation, which laid the foundations for the Town and Country Planning Act in 1947and the current systems of planning. The related New Towns Act of 1946 paved the way for the start of a new town housing program which continues to date. Sir Peter Hall shows the plan was working. The first patch of new towns was constructed in a ring within thirty-five to sixty kilometers from London. Proposed by Patrick

Abercrombie’s Greater London Plan of 1944, but not constantly constructed in the anticipated regions identified in that plan, it was a major decentralization program for people from the central areas of the London to an outer zone outside a newly demarcated green belt.

The greenbelt was to stop any further external growth of London while acting as a prized recreational tract for Londoners. Outside it, the plan had provided for the rebuilding for around a million people of these past four hundred thousand would be housed in eight emerging new towns, while the other six hundred thousand would go to expanding small country urban mostly within fifty to eighty kilometers from London. The slums and blighted areas up gradation of inner London were to be re-developed to enough open space specification, and this was in planning decentralization program. These early new towns demonstrated as very debated, and they were mostly opposed greatly by native people. Most of the other new towns were constructed in this after the war. They had a variety of functions.

The year 1947 saw the Glenrothes designation, in Scotland, to be a town mostly for coal miners as well as their household; new extra industries had to be brought in once the coal mines shut. A steelworks town, Corby was designed in 1950 to give it an appropriate town Centre as well as substitute forms of employment; in 1955, Cumbernauld was built to provide for more outward relocation from Glasgow.

The second series of new towns were selected in the between1961 to 970. They came up mainly, due to the effects of regional planning studies. Hence, in England, the region of north-west (through Skelmersdale, Warrington, run corn and Central Lancashire) also the Midlands (within Red ditch and Telford) got their leading new towns, two more (Livingston and Irvine) were designated in south of Newcastle, and Central Scotland the new town of Washington was designated in 1964. The real reason was to provide for the overspread population.

The new towns of the south-east were to provide housing to the population of three million and a half between1961 to 1981. This need had come about through a fusion of the normal growth population of the region, retirement migration and migration from abroad to the south coast. The endorsed approach involved three new towns positioned at a more distance from London than the first eight, to reduce pressures away from the Scotland Central capital.

Of the three projects, those Northampton and Peter bought were about city extension schemes instead of an entirely new town. Only Milton Keynes was with the largest population target among all the new towns which was a green field new town. The climate in the 1970s and 1980s for the new towns changed them radically. Worsened by the results of the oil crisis in the year 1973, the national economy started to fall, and the menace of mass-unemployment started again. The new towns were not permanently resistant. Corby lost its steelworks and in Skelmersdale two plants shut with biggest job losses. In the main, nonetheless, the New Towns had attained marvelous employment diversification, and they were able to withstand the storm. Political choices, although, were to have another radical effect. For instance, Margaret Thatcher’s started a new Government introduced some main changes in a new

Town’s development. This controlling corporations in development were to stop constructing houses for rent and, but, the private building was promoted. Firms were to construct their own plants and offices or otherwise, projecting developers were to work for them. The result was to change these previously public sector controlled towns into dwellings where the market would have a so much say

By 1990, new towns in Britain housed more than two million people, and more about seven hundred thousand new homes had been constructed. Majority of them are on growing. They have attracted new firms from both local and abroad and resulting in creation of new job opportunities for hundreds of thousands. Those are strong, statistical accomplishments, however, by dispersal, they have given a provision for a conduit for the planned relocation of jobs and homes away from main cities. Scattering would have occurred in any case due to the desire of the rise to seek a conducive environment, either in smaller towns or suburbs and villages. However, the effect of that tendency has frequently been the cause of fall of all of the places with insufficient capacity to take further growth.

Milton Keynes

It is one of the evolved into a new town with a significant population and housing. It is roughly fifty-year-old. The town was designated as a result of the act of parliament of the year 1967, which approved the building of a new community residence which can be inhabited with a population of two hundred and fifty thousand by covering an area eight thousand, eight hundred and fifty within farmland and villages of Buckinghamshire. It was among the third generation of new towns which were developed as a result of the decentralization program. It was located halfway from London and Birmingham. It was built mainly to ease the housing shortage in London City due to the overcrowded population. It was meant to attract for opportunities and freedom of decision. The area was to be developed mainly rural with farmlands.

The government appointed Lord Campbell to the implementation of the Milton Keynes Master Plan through the Milton Keynes Development Corporation. The goals of the master plan were to be executed as follows:

• Access and ease movement

• Proper communication

• To make an attractive city

• To establish balance and variety

• Chance and freedom of choice

• Public participation and awareness

• Effective and creative use of resources

The corporation was ready and zealous to avoid the past mistakes during the construction of new towns and garden cities in the construction of the team made up features of grid roads which run through districts, the pedestrian and cyclist ways, parklands, lakes and intensive planting which are recognized nowadays. The central was intended to be a shopping and a business district that is alternative to Local centers with majority Grid squares. The devolved city plan deviated from the traditional English, new towns and included a variety of industry and house diversification style and tenures within the city. The Radical grid plan was influenced by Melvin Webber who was the California Urban planner. Milton Keynes Development Corporation formed using the biggest and maximally inspired new towns in Britain: definitely, its objective was to construct a new city that can accommodate two hundred thousand people. In the original plan concept aimed for the construction of a city with forests, they were to be planted as construction was ongoing. In the year 2006, the urban region had about twenty million tree period of decades, and by providing the capacity and infrastructure to match. The building of the town achieved its goals for the government and the private sector, and then the corporation was disbanded in 1992.

Chapter summary

The housing market of London is very diverse and complex, and there is no homogenous housing market within any single borough boundary. It contains a range of sub-markets which are completely different, not by only price and tenure, but also the type of a renter and purchaser. There has been a rapid growth in demand in the prime market of London, and thus prices, since the depths of the last recession, with a high proportion of overseas cash investors who buy both existing and new homes.

Greenfield is a type of land in the city or rural areas which is undeveloped except for either landscape design use or agriculture use or left to change naturally and can be used for future urban development expansion program. It is not controlled by infrastructure or existing buildings.

In 1944, the Town Planner Abercrombie came up with Greater London Master Plan on how to expand London in order to improve it for the inhabitant. The plan gave London an opportunity to rectify the perceived failures of haphazard and unplanned development which occurred as a result of quick industrialization for years. The plan was based on five major issues that were facing London that time: population growth, recreation, housing, transport, employment and industries.

The Mayor of London has strategic oversight of regeneration, economic development and Housing in London. The housing strategy which was adopted in 2014, clearly sets out policies that are intended to meet the housing needs of London, This document includes the plans on how to build a minimum of 42,000 new homes annually across all the tenures and for improving the housing opportunities of all residents who are working in London.

CHAPTER 3: RESEARCH METHODOLOGY

3.1 Introduction

Research methodology is characterized as a deliberate methodology that guarantees the analyst to assemble appropriate data or to embrace examination relating to his subject by utilizing diverse research strategies. The aim of the proposed research is to address the housing supply crisis which is witnessed in London. The objectives were set in order to assist in achieving the main aim of the study. Due to that, it was essential to have an overview of the housing supply crisis in London

It was of great importance to understand the main features of the topic of research. Hence the qualitative research method together with the literature review and quantitative approaches were employed for the research. This research methodology is appropriate to carry out this research because the literature reviews offer information that is detailed about the housing supply crisis in London

This research methodology gives an overview of the preceding researches that have been carried out in the field and at the same time gives a short description about the housing supply crisis in London. In short, the literature review that was conducted assists to find the research gap for the research topic.

Some of the methods that were applied during research include:

3.2 Secondary sources

By conducting the literature review, the author could pass the knowledge on the topic of research, and it would include the main features of a topic. This research approach is of great importance in achieving the objectives and aims of the research. This research approach is also very helpful in attaining all the objectives and aims of the research such as to have a summary housing supply crisis in London.

The main reason behind the selection of this research methodology is to give detailed knowledge about housing supply crisis in London. This research methodology also gives the knowledge about the various scholars and who had previously carried research on the topic. The literature review that was carried out gave the detailed knowledge on housing supply crisis in London.

Advantages of secondary sources

The use of secondary sources to acquire the required information for the research had the following advantages;

  1. Easy to access

It is easy to access the secondary sources. One needs to visit libraries or archives to get the information regarding the housing supply crisis in London.

Low cost to acquire the secondary materials.

The application of the secondary data allows the researcher to carry out research at a lower or no cost. Hence the information obtained from the secondary sources is much cheaper than the researcher carrying out the research by themselves.

  1. Clarification of the Research Questions

The use of the secondary sources in research helps to clarify the research questions. The secondary sources are usually used before the main research to assist in clarifying the research questions

  1. Data obtained from the secondary sources may answer some of the research questions

The use of secondary sources of data in research helps to align the focus of the large-scale primary research. In the process of obtaining data from the secondary sources, the research may find out that the information they were looking for during the research is already contained in the secondary sources.

  1. The secondary sources may show the various challenges that are likely to be encountered during the research

In most cases, the authors of the secondary sources they include how the research was carried out and how the information was collected. This may include steps on how the data was collected and the various challenges that were encountered.

Disadvantages of secondary sources

Even though the secondary sources have many advantages they have some drawbacks such as;

  1. Some of the secondary sources may contain poor quality data.

Most of the originators of the secondary sources are largely self-governed and controlled by the marketers. Hence, the secondary data to be used must undergo serious scrutiny because most of the secondary sources are questionable.

  1. The secondary sources are not specific to the researcher’s needs

In most cases, the secondary data is presented in a way that cannot meet the needs of the researcher. hence the researcher needs to depend on the secondary sources having data presented in a way that meets her/his demands.

  1. Secondary sources contain incomplete information.
  2. The secondary sources are not timely.

3.3 Case studies

Various case studies will be studied to get a deeper understanding of the housing supply crisis in London. By studies, various cities in the world which face similar housing crisis as London can help greatly in understanding the whole concept and to come up with recommendations on how the issues of housing supply crisis in London can be solved. There are no doubts that case studies are one of the most valuable and significant technique of research for all the fields and industries. Nevertheless, along with their disadvantages.

Advantages of case studies

There are many advantages that are attributed to the use of case studies in the research some of the advantages include.

  1. Case studies involve intensive studies

Case studies involve intensive study of a given unit or topic. It involves exploration and investigation of an event thoroughly and deeply. With case studies, the research is able to get very detailed of a given concept.

  1. Case studies help in developing new research

Case is one of the best ways for the researchers to come up with new research. Case studies can be completed, and in the cases where there are valuable findings, they can lead to new and more advanced research in the field.

  1. Case studies have the ability to give new insight

Case studies give insight into concepts and phenomena which cannot be learned in any other way. This unique advantage gives the researchers to learn in better ways perceptions and motions.

Disadvantages of case studies

Even though the case studies have many advantages, there are also drawbacks that are associated with it such as;

Inability to replicate

Many of the case studies cannot be replicated. In most of the situations, there is always a point of various form one event, phenomena or concept to another which makes it very challenging to use the case studies in the research.

3.4 Rationale for research methodology

The research proposed is intended on utilizing a case study investigation as a suitable system to carry out the research. Case study technique encourages a researcher to keenly examine the information relating to a particular setting that is a specific topographical territory chose as a topic of study. Additionally, a case study investigation strategy allows a researcher to pick up top to bottom information and illustrate the aspects of a proposed research topic. For the given research project, it is suitable as the investigation for the housing supply crisis in London. Further, the case studies are set to determine the up to date natural experience. By considering the above aspects, the research proposed undertakes the case study as the research strategy, which permits THE researcher to accommodate this advanced practice on a building confined to a specific topographical area.

The proposed research will be conducted with a qualitative approach. In a quantitative approach, the authentic information is gathered from research executed previously executed beforehand from the auxiliary sources. In a qualitative approach, the exploration will attempt to examine on perspectives, encounters and suppositions of the people. In this manner, for the given proposed research that is an investigation of the housing supply crisis in London. For a particular case study building, qualitative and quantitative approaches will be appropriate for the research proposed.

CHAPTER 4: FINDINGS AND DISCUSSIONS

After the in-depth literature review and case studies analysis on the housing supply crisis in London, various findings were made. On the reasons behind the crisis and how the various local authorities’ organs are contributing to the housing supply crisis in London. Some of the root cause of the crisis include;

Population increase.

The population of London has reached a new level after it grew by 135,000 between 2014 and 2015. Currently, there are more homes in London than households, in contracting to the early twentieth century, but the number of rooms per person fell between 2001 and 2011.the first time that happens in the past century.

The booming economy of London.

The economy of London is booming which has attracted many workforces to work in the industries within London. London Currently being the most prestigious city in the universe as also attracted many foreigners who have come to put up their business and other offices, with that they contribute to the increase in the population. With the remarkable success that has been achieved in London comes Challenges, one of the chief challenges is the huge rapid shortfall of the housing that most Londoners can afford. In addressing this challenge, it is important to ensure that the continued growth of London is retained as the pre-eminent global city.

The nature of London’s housing market

The housing market of London is very diverse and complex and there is no homogenous housing market within any single borough boundary. It contains a range of sub-markets which are completely different, not by only price and tenure, but also the type of a renter and purchaser. There has been a rapid growth in demand in the prime market of London, and thus prices, since the depths of the last recession, with a high proportion of overseas cash investors who buy both existing and new homes.

The rest of the inner London has also witnessed strong growth in the prices, due to the investments overseas, but to a far lesser extent than prime central London and in part because of the strong domestic demand from both the landlords and homeowners.

The status of London

Given London’s importance to the economy of the United Kingdom and its status as a global city, it is not surprising that the property and land prices are higher than the national average. Nevertheless, the extent to which it is growing and the scale of the gap is striking. According to the research that was carried out in 2013 the average house price in London was $450,000 as compared to England’s average house price of $ 260,000. The average house price has risen with approximately twelve percent in the last 2yeras as compared with the six percent nationally. The figure below shows that the price has been growing faster in the two most expensive boroughs (Kensington and Chelsea and Westminster) followed by the rest of inner London, with the comparatively slow rise in the other parts of the outer London, which have price trends similar to other parts of the nation.

CHAPTER 5: CONCLUSION

In conclusion, London’s economy is booming; its population is increasing, and by numerous measures, it is the greatest city in the world. However, with the remarkable success that has been achieved in London comes Challenges, one of the chief challenges is the huge rapid shortfall of the housing that most Londoners can afford. In addressing this challenge, it is important to ensure that the continued growth of London is retained as the pre-eminent global city. Solving this challenges will not be achieved quickly and easily as it is a structural challenge that London faces. It needs a long-term plan, which will spread over a number of economic cycles, spending rounds and mayoral terms. Solving this also need a cross-party consensus on the significance of investing in housing, because there is to a greater degree in other critical sectors of provision such as education and health.

The main aim of the research is to address the housing supply crisis which is witnessed in London. Hence This dissertation is well crafted to enable one be able to understand the concept of housing demand in London and England as a whole. The findings of this research will be of great significance to the various parties who offer housing facilities to the Londoners as they will be able to understand the housing demand patterns. Housing being one of the greatest contributors to the growth of the economy of any city such as London, the research will be able to enlighten people on how the housing plays a very significant role in the growth of the economy of London. The findings of this dissertation can also help to come up with suggestions on how this challenges of housing affordability in London can be solved.

Various methods were used to gather information regarding the housing supply crisis in London such as the use of secondary sources, whereby different types of books, journals and other publications that contain information regarding the topic of research were reviewed. Case studies analysis were also used in the research whereby various cities which face the similar housing crisis as London were analyzed in order to understand the whole concept of the housing crisis in London.

One way through which the housing affordability is determined is by comparing the cost of housing directly with the income of the occupants of a given region. The Office for National Statics has generated a measure which compares the median house prices in all the local authorities to the median annual salary of a full-time worker. This is not the perfect measure, the gross annual salary does not include the deductions or the additional incomes sources, and in most cases, it does not account for the fact that many people live on multiple salaries. Nevertheless, it does offer a way of comparing each local authority to another.

The housing market of London is very diverse and complex, and there is no homogenous housing market within any single borough boundary. It contains a range of sub-markets which are completely different, not by only price and tenure, but also the type of a renter and purchaser. There has been a rapid growth in demand in the prime market of London, and thus prices, since the depths of the last recession, with a high proportion of overseas cash investors who buy both existing and new homes.

The rest of the inner London has also witnessed strong growth in the prices, due to the investments overseas, but to a far lesser extent than prime central London and in part because of the strong domestic demand from both the landlords and homeowners. Lastly, the greater part of the outer London is still predominantly a traditional mortgage-led market and has hence witnessed a minimum rise in the price in the recent past, even though there has been a rapid rise in the renting in suburbs and town centers. This kind of markets overlaps, and they have a great effect on each other; even in the situation where the prime central London’s property market can be seen to be totally detached and having a displaced demand resulting from the high prices which still affects the rest of the city.

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