Western steel

There is a serious under supply of housing in the West Midlands where housebuilding has fallen by 50 per cent in recent years. But despite a difficult economic backdrop, several partnerships in the region are pushing ahead with major developments to meet the growing demand

Home to over 2.6 million people, the West Midlands is one of the country’s most heavily urbanised regions. Its constituent metropolitan boroughs from Wolverhampton in the west through Dudley, Walsall, Sandwell, Birmingham and Solihull to Coventry in the east have grown through centuries of
industry and commerce and the region remains one of the UK’s key manufacturing heartlands.

The wider West Midlands region, which covers a total of 33 local authorities and has a population of around 5.3 million, contrasts the conurbation of Birmingham, the Black Country, Solihull and Coventry with the more rural, even remote areas of Shropshire and Herefordshire.

Between 2008 and 2033, the number of households across the West Midlands is projected to grow from 2.24 million to 2.7 million. That equates to annual growth of around 18,000 households or a total expansion of 20 per cent.

It is one of only two regions, the other being the North East, where annual household growth is expected to average less than 20,000 between 2008 and 2033.

The main driver of the projected rise in households will be population growth, due to issues such as longer life expectancy and net migration. This is expected to account for 68 per cent of the increase in the West Midlands, slightly below the figure for England of 72 per cent.

Changes in age structure will drive 22 per cent of regional growth, two percentage points above the national figure.

Household formation will account for another 21 per cent. For England as a whole, new household formation will make up 16 per cent of growth.

Changes in marital status will restrict expansion by ten per cent, double the projected national rate. All this means the West Midlands will need thousands of new homes over the coming years.

However, new research by the Home Builders Federation (HBF) illustrates the scale of the challenge in meeting demand.It found that house building in the region has tumbled by 50 per cent in the past six years from 15,660 starts in 2005-06 to just 7,790 starts in 2010-11.

Furthermore, average house prices more than doubled from £67,000 to £147,000 – nearly six times average incomes – in the decade to 2010. As a result, waiting lists for social housing surged by 64 per cent from 96,037 families in 2000 to 157,052 last year.

HBF executive chairman, Stewart Baseley, said: “The West Midlands is suffering from a serious undersupply of housing. It is crucial that more homes are built, particularly for younger families and firsttime buyers.”

Nevertheless, despite public spending cuts and wider economic uncertainty constraining development across the country, several partnerships in the West Midlands are pushing ahead to meet the growing demand for modern, affordable properties.

In March, an alliance of the Homes and Communities Agency (HCA), Keepmoat Homes, Wolverhampton City Council, the Bromford Group and All Saints and Blakenhall Community Development Partnership managed to kick-start the Blakenhall Gardens regeneration project, which had been stalled for two years due to difficult market conditions.

The HCA worked with the council, Wolverhampton’s New Deal for Communities area and Keepmoat to bring in funding for initial infrastructure work, which then allowed Keepmoat to start on site.

Blakenhall Gardens will deliver 102 new homes, 21 of which will be available exclusively for rent by local families. It will also create10 new shops and a public open space.

Speaking at the launch of the first phase, Richard Moore, land and partnerships manager for Keepmoat, said: “This is a significant moment for the Blakenhall area, as the Blakenhall Gardens development will have a huge impact on the local community that will be felt by generations to come.”

Elsewhere, a partnership approach is set to support a “new era” of house building in Sandwell.

In May, the borough council unveiled a framework agreement with nine organisations that will act as its designated developers for the next five years. The deal is expected to boost delivery and cut costs as the local authority will no longer have to invest time and money marketing each available plot of land on the open market.

However, its partners will still engage in “minicompetition” for sites and residents will retain their say in the final appointments and subsequent planning. The nine partners are: Kier; Keepmoat; Galliford Try with Waterloo Housing Association; Barratt; Black Country Housing Group; Housing 21 with Thomas Vale; Compendium Group (Riverside & Lovell); Bromford Housing Group; and Accord Housing Association with Trident and Nehemiah.

Unveiling the deal, Sandwell Council’s cabinet member for housing, Simon Hackett, said: “There are many sites throughout the borough ripe for regeneration. We want to build 700 affordable homes to rent, part-buy or buy in Sandwell every year.

“By forming this partnership with housing organisations, we can benefit the borough in the long term by bringing major projects about more cheaply and more quickly.”

In Coventry, another partnership involving the HCA is delivering an ambitious regeneration scheme intended to create a “new place of pride” for the city. The £360 million Spirit Quarters development centres on the Wood End and Deedmore areas, which are being rejuvenated alongside the neighbouring Manor Farm and Henley Green.

The project aims to deliver 3,328 homes to Community Trust and a developer consortium comprising Bovis Homes, Keepmoat and Westbury Partnerships. T he HCA has also provided substantial financial backing.

Work on the first 154 homes started in June 2010. These properties, which include 21 homes for affordable rent, should be completed by September 2012.

In August, the development partners announced another £21 million had been secured for the second phase of work, which will deliver 230 properties by 2014. Of these, 144 homes will be for private sale, 60 will be for affordable rent, 20 will be shared ownership units and six will be made available for low-cost home ownership.

Kevin Roach, project director for S pirit Quarters and head of regeneration at WM Housing Group, said: “Partners and the local community have all workedextremely hard together to reach this exciting stage in the regeneration and with investment provided by the HCA and Coventry City Council, we can continue to bring so many people new homes.

“Although the development is taking place at a slower pace than originally planned, it is still encouraging to see Spirit Quarters continue in these difficult financial times.”

Perhaps even more encouragingly, Spirit Quarters is not the only large-scale housing scheme that is forging ahead in the West Midlands.

In June, the HCA announced that it would invest more than £286 million across the Midlands to deliver 13,500 properties over the next four years as part of its national Affordable Homes Programme.

It was confirmed last month that as part of this programme, Matrix Housing Partnership had secured £30 million to support the development of 1,500 properties in the West Midlands.

Matrix, which is led by the Accord Group, represents six housing associations – Ashram, Black Country Housing Group, Caldmore, Rooftop, Trident and Trent & Dove – plus Watmos Community Homes.

It will use the money to partly fund a number of schemes, including the Eastern Gateway project in West Bromwich.

This mixed-use development will create 70 sustainable homes for rent and sale, plus a landmark office and retail building to support the social and economic regeneration of West Bromwich town centre.

Elsewhere, Matrix will invest in projects in Redditch, Birmingham, Coventry, Dudley, Walsall and Wolverhampton.

Alan Yates, group director of regeneration for Accord, said: “This house building programme is clearly very important.

“We’re trying to reach a broad range of people - we’ve got shared ownership, which is a good product for first-time buyers – and we’ve got family housing. Plus our programme covers both the urban areas and rural areas.

“So we’ve gone for a real mix and it’s one of the strengths of our partnership that we do address housing needs across the board.”

“House building is an excellent way of stimulating the regional economy because a lot of people working on these sites live locally.”

But in what is, to say the least, a difficult financial environment, what is the outlook for the medium term?

“I think we have to be prepared for the fact that in four years’ time at the end of this programme, there may not be any grants at all so the next steps for us are looking at ways we can build houses without grants,” says Yates.

That will mean more partnerships, but also seeking out completely new sources of funding, such as overseas investors and pension funds.

“One of our main objectives is to continue to provide new housing,” says Yates. “And we’re determined to do that.”