Last edited 03 Jan 2021

Strategic housing market assessments


[edit] Introduction

Local planning authorities are required to produce a strategic housing market assessment (SHMA) under the National Planning Policy Framework (NPPF). This should assess the full housing needs within the area and the future scale and mix of housing requirements.

The assessment is part of the first stage in the development of a Local Plan for an area. Local plans set out a framework for the future development of an area on a 15-year horizon. They define; the priorities for an area, strategic policies, the framework for neighbourhood plans, land allocations, infrastructure requirements, housing needs, requirements for safeguarding the environment, measures for adapting to climate change and so on.

[edit] Objective

The local housing demand of the local area should be catered for considering the scale and mix of housing required for the duration of the plan period.

The primary objective of the strategic housing market assessment is to:

The general housing market area should be assessed and by doing so, this may identify other smaller areas which have specific features or require further, more detailed assessment to allow an accurate picture of local need to be identified.

[edit] Housing market area

A housing market area is considered to be the geographical area that is set out by the housing demand and preferred housing types. Housing market areas may overlap. It is possible to define the areas using the following information:

Sources of information for undertaking the above analysis might include:

In order to estimate the overall housing need, the projections published by the Department for Communities and Local Government can be used. The projections may require some local adjustments to reflect local conditions. In addition, other market indicators should be considered including land prices, house prices, affordability, development rates, overcrowding and rents.

The assessment should be undertaken approximately every five years with regular updates to take account of short-term changes.

NB The London Plan, published by the Mayor of London in March 2016, suggests that a Strategic Housing Market Assessment (SHMA) is: ‘An assessment of housing need and demand which informs the London Plan and borough local development documents as set out in Planning Policy Statement 3: Housing (PPS3).’

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[edit] External references

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