Housing investment favouring South of England

A new Core Cities UK report has questioned the inconsistent funding of housing investment across the country, with investment found to be skewed in favour of the South of England.

The Core Cities UK and the Key Cities Group, representing 30 key urban centres across England, Scotland and Wales, have analysed the government’s announcement that approximately 80 per cent of allocated funds are to be channelled towards areas of ‘highest affordability pressure’, largely in the South and East of England.

The figures reveal how applying the government’s definition, using a ratio of median house prices to median workplace-based household incomes, skews the allocation of around £5.6 billion available from these programmes. Core Cities UK and the Key Cities Group have established that this definition, when applied, favours the more affluent areas of the country.

Alongside the report, the two groups have also published a colour-coded map which demonstrates in stark terms the imbalance of the funding proposal, with only three areas north of the M62 in receipt of significant investment. Only four local authority areas in the North of England – and none in the North East - qualify for priority funding.

Andy Burnham, Mayor of Greater Manchester, said: “I am still trying to give the government the benefit of the doubt on its promises of a Northern Powerhouse but this map makes it very difficult. It is simply indefensible to shovel billions of pounds of public money into the more affluent areas when all parts of England are facing a housing crisis. The fact that only three areas north of the M62 will receive any benefit at all says everything.

“Such a skewed distribution of public money is demonstrably unfair and unacceptable. It overlooks the huge economic potential of the North of England and the Midlands, as well as several Southern English cities and coastal towns, and will fuel the economy where it is already strongest. Right now, the government should be working hard to bring our country back together rather than widening its economic and social divides. We need policies that will rebalance our economy and that are fair to people everywhere. That’s why this policy cannot go unchallenged and I call on the government to think again.”

udith Blake, leader of Leeds City Council and chair of Core Cities UK, said: “It is vital there is a fair approach to government housing investment across the country that recognises the range of challenges faced and the important role for all tenures of housing in creating sustainable and inclusive neighbourhoods. Only by ensuring diversity as well as pace in housing growth will we meet the needs of all residents and truly achieve the healthy and functioning local housing markets that government wants to realise.

“The way funding for housing and infrastructure is currently being prioritised is already putting many of our major towns and cities at a disadvantage. We should be moving away from competitive and ultimately counter-productive drivers of investment such as mortgage affordability and land value uplift towards a collaborative and place-based approach where national and local governments work together to tailor cross-tenure solutions to meet local demands and opportunities. The current proposal is likely to further consolidate the economic gaps between London, the South East and the rest of the country.”