Standard method of calculating local housing need

[edit] Why is a standard method of calculating local housing need required ?

Governments set a national housing targets of delivering new homes in England. Planning is a devolved matter, and so each devolved government takes their own approach, as such this article focuses on England. The target is likely to be expressed in number of houses per year nationally. In the case of the labour government that came to power in 2024, this was expressed as per term or a 5 year target. In power they pledged a target of an additional 1.5 million homes in their five years term in office, or approximately 300,000 per year.

So the government sets a national housing target of delivering 300,000 new homes in England per year but it does not apply equal targets to all regions, because regions differ in terms of capacity, space, needs and so on. So it does not not set binding targets housing at the local level, but passes this to the local planning authorities (LPAs). The LPAs are required to calculate andthen meet housing need in their local area. In order to calculate the local housing targets the government sets out steps which the LPAs must follow, these are contained in the National Planning Policy Framework (NPPF) and describe what is known as standard method of calculating local housing need.

Specifically but in brief, the NPPF states that LPAs must:

• Assess local housing need when they are preparing their local plan using the ‘standard method’ provided by the government.
• Set out policies in their local plan to meet their assessed local housing need. In doing so, LPAs can consider local land constraints.
• Identify suitable sites in their local plan that can deliver at least five years’ worth of housing. This is the ‘five-year housing land supply’

[edit] What is the standard method of calculating local housing need?

The ‘standard method’ of calculating local housing need consists of three main steps. with a fourth step that was introduced in 2020 by the Conservative government, which applies to certain urban LPAs and known as urban uplift. The urban uplift applies to the UKs 20 largest cities or urban centres. It requires an increase in the figure calculated by using the standard method of calculating local housing need by a margin of 35% after applying a cap.

It is worth noting that the current labour governemnt in its recent consultation on proposed reforms to the National Planning Policy Framework and other changes to the planning system, proposed to remove the appliaction of urban uplift. It suggests that the need for specific urban adjustment or urban uplift (of 35%) is removed by distributing growth to a wider range of urban areas, working together across wider regions to accommodate needs, strengthening the Duty to Cooperate requirement, and introducing effective new mechanisms for cross-boundary strategic planning.

The ‘standard method’ of calculating local housing need consists of three main steps, outlined here:

• Baseline figure of the number of new homes needed in an area: Calculate projected household growth for the next 10years using the government’s 2014 household projections for England.
• Affordability adjustment: Adjust the baseline figure upwards in areas where house prices are more than four times higher than earnings.
• Cap: Cap the increase at 40% of the baseline or at 40% above the figure set out in the LPA’s local plan if the local plan was adopted or reviewed in the last five years.

The fourh step which currently contnues to apply, but maybe removed by the current governemntis the step relating to Urban uplift. Whereby for the LPAs whose areas contain the largest proportion of the population of one of England’s 20 largest cities or urban centres, increase the figure by 35% after applying the cap.

Currently the NPPF states that in “exceptional circumstances”, LPAs can use an alternative approach to the standard method to assess local housing need. The Planning Inspectorate assesses alternative approaches on a case-by-case basis to ensure they are justified and make realistic assumptions about demographic growth. This element of the NPPF is also under review through the consultation by the Labout government.

[edit] Related articles on Designing Buildings

• A guide to the updated National Planning Policy Framework.
• Affordable housing.
• Architectural Technology research at Robert Gordon University.
• Consultation on proposed reforms to NPPF and other changes to the planning system
• Densification.
• Detailed planning permission.
• Diversity and the housing crisis.
• Empty dwelling management orders.
• Empty housing in London - documentary.
• Gentrification.
• Home ownership.
• Housing and Planning Act 2016.
• Housing guarantees.
• Housing shortage.
• Housing tenure.
• Housing white paper 2017.
• How long does it take to get planning permission.
• How long does planning permission last.
• Interview with Labour’s Shadow Housing Minister.
• Killian Pretty Review.
• Local plan.
• Localism Act.
• Local housing need.
• Meeting the demand for housing in the UK.
• National Planning Framework.
• National planning policy framework NPPF.
• National Planning Practice Guidance.
• Neighbourhood development order.
• Neighbourhood planning.
• NPPF consultation briefing notes on terms.
• NPPF inquiry.
• Outline planning permission.
• Planning legislation.
• Planning permission.
• Planning policy replaced by the NPPF.
• Private rented sector PRS.
• Redfern review into the decline of homeownership.
• Social housing.
• Strategic Housing Land Availability Assessment.
• The future of the planning system in England.