California's Builder's Remedy could offer valuable lessons for tackling England's long-standing housing crisis.
California and England may be half the world away from each other, but their housing crises are strikingly familiar. Both have failed to build enough homes to meet demand for decades due to highly restrictive planning systems and are facing desperate housing shortages as a result.
However, California has recently started enforcing a law that has sat on the books since the 1990s and is starting to get more homes built in some of its least-affordable cities. The ‘Builder’s Remedy’, as it is known, has a lot of lessons for reformers trying to tackle the housing crisis in England.
The Builder’s Remedy is a simple idea. If a Californian city does not have an up-to-date local plan and misses multiple deadlines to get it into line with state law, the Builder’s Remedy automatically kicks in and removes the discretionary power granted by the city’s inflexible zoning code to block new homes, provided that new developments contain 20 per cent or more subsidised, affordable housing. Although technically the Builder’s Remedy has been part of state law since the 1990s, only recently have pro-housing reformers in the state capital Sacramento tightened the law and stepped up enforcement.
The effects of the Builder’s Remedy are remarkable. For example, Santa Monica, near Los Angeles, was this month the first city to miss its deadline of planning for 8,900 homes and be subject to the law. In the few days before the city then hurriedly passed a compliant local plan, developers were able to use the Builder’s Remedy to get planning permission for more than 4,500 homes – roughly as many as the city allowed to be built in total between 2000 and 2020.
The new proposals include a 15-storey building, the tallest ever built in Santa Monica, which the city is now powerless to block. Similar projects proposing thousands of new homes are also underway down the coast in Redondo Beach, and by next year may be present in hundreds of jurisdictions across California, including San Francisco, San Jose, and Beverley Hills.
The Builder’s Remedy offers three direct lessons for planning reformers in England.
First, the most important aspect of the Builder’s Remedy is the incentive it provides to Californian cities to get their local plans in order, because it applies automatically and strips any local discretion out of the system. Urban growth should be shaped by town planning to solve public good problems while allowing new housing to be built to meet demand. Californian local authorities that instead used the planning system to block and stall new homes for years are now finding that they need to use the Californian planning system for its intended purpose, or face losing control over their cities’ growth.
England faces a similar problem. In March 2022, only 42 per cent of English local authorities had up-to-date local plans, with some places like York not having adopted new ones since the 1950s.
Similar penalties against English local authorities for failing to get their local plan in order are either weaker than the Builder’s Remedy – such as the Housing Delivery Test’s presumption of sustainable development – and/or imposed on a discretionary basis by Ministers, rather than automatically as with the Builder’s Remedy. For example, only one council since 2015 has been put on special measures by the Government for planning failures – Uttlesford.
Second, the impact of state law in drafting and then enforcing the Builder’s Remedy in California shows the different responsibilities of local and national government within the English planning system.
Separating the roles of national government as a “referee” of the planning system, with local authorities as “players”, is crucial for securing good housing outcomes as it means that councils attempting to block housing can be held to account for the costs they impose on national home-building targets, while still giving flexibility for places to plan their own patches. The fact that these roles are currently rather muddled in England shows exactly why the proposed reforms in Clause 83/84 of the Levelling Up Bill (currently going through Parliament) that would clarify them are so important.
Third, the massive housing supply increase in cities where the Builder’s Remedy now applies is strong evidence that inflexible zoning is responsible for a lack of new homes in California and the wider US. As both England’s and California’s housing shortages are so similar, it suggests the planning system is a barrier in English cities too.
Public discourse on planning reform in England can often have too much focus on the impact of hypotheticals or marginal reforms, but the evidence from real-world Builder’s Remedy cases shows that removing arbitrary restrictions on new homes results in an immediate and substantial supply response. In England bold and comprehensive planning reform, which replaces discretionary rationing of housing with rule-based decision-making, will increase construction, improve affordability, and boost both growth and equality.
In the absence of wider planning reform, introducing stronger enforcement mechanisms similar to the Builder’s Remedy to use against councils that plan to block rather than build homes should be on the table in England. Planning reformers and pro-housing groups in England would be wise to pay attention to California over the next few months to see how the Builder’s Remedy can work in practice.
Leave a comment
Be the first to add a comment.