'Clearance' a necessary part of housing renewal but the compensation shortfall is problematic

Aspects of the Government’s Housing Market Renewal Pathfinder scheme to renew failing housing markets could be improved according to a new report commissioned by the Joseph Rowntree Foundation. The Sheffield Hallam University research found the Pathfinder scheme, which operates across nine areas in the Midlands and North of England, needs to provide better financial and social support to residents affected by demolition.

The researchers acknowledged the need for demolition and renewal as part of the Government's drive to restructure weak housing markets but wanted the resulting implications to be addressed more adequately. Due to be launched at the Regeneration and Renewal Low Demand Housing conference next week (20 September), the summary report found an average shortfall of £35,000 between the cost of buying a new home and compensation received by home-owners.

Individual owner households and local communities had legitimate concerns when their homes were designated for demolition and they were forced to relocate. According to the researchers, these concerns need to be managed sensitively, efficiently and consistently across the nine Pathfinder areas. They found the Pathfinders had developed some pioneering ways of providing support to affected residents, such as financial assistance packages to lower-income owner-occupiers. But emerging good practice needed to be consolidated and disseminated more widely across the nine areas.

In order to help residents through the often emotional and challenging experience of demolition and relocation, Pathfinders needed to increase engagement with and gain support from partners. Central Government and financial institutions were cited as key partners that needed to be involved in this.

The researchers suggest Pathfinders and their partner agencies need to:

• involve communities fully throughout clearance, relocation and redevelopment decision-making processes;
• develop tailored financial support for affected households, especially owner-occupiers living in low-value homes;
• support vulnerable households during and after relocation and receive additional Government support for this;
• boost sustainable forms of home-ownership and consider the role of other tenures in facilitating housing market renewal.

Author John Flint said:

“Central Government must reaffirm its support for the aims and mechanisms of housing market renewal and demonstrate a continuing commitment to the programme. This could be achieved by offering support to develop relocation equity loans and other financial assistance packages. In addition, they should recognise that housing market renewal funding alone is not enough to address the increasing affordability gap for owner-occupiers in demolition areas.

“The Government should also consider how the scale and timing of its Pathfinder programme can affect the delivery of essential support packages to affected residents. This is a particular issue when residents feel pressed into making quick decisions around relocation – which is especially difficult when people have strong attachments to their homes.”

The researchers also found that with the scale of demolition likely to increase in the future, revenue support from the Government will need to be increased to meet the cost of relocation support activities.

Notes to Editors:

• The report will be launched on 20 September 2006 at Regeneration & Renewal’s one-day conference, Sustainable Low Demand Housing Solutions, to be held at The Centennial Conference Centre, Birmingham. More information is available at www.lowdemandhousingconference.com.
• The study has been carried out by researchers from the Centre for Regional Economic and Social Research (CRESR) at Sheffield Hallam University.
• The cited average shortfall between the cost of buying a new home and compensation received by home-owners is based on data from each of the Pathfinders.

Issued by Nasreen Memon, JRF Head of Media Relations, 020 7278 9665 | 01904 615958 | nasreen.memon@jrf.org.uk