By Damiano Rea. Managing director, Heaton Property Ltd.
Newcastle City Council has decided that the root cause of noise complaints and anti-social behaviour in Heaton, Sandyford, Jesmond and South Gosforth is multi-occupancy houses with the finger of blame being pointed straight at students. The knee-jerk reaction from our Council was to impose Article 4 Directions, meaning any development requires planning permission. Despite significant opposition including concerns from both Universities, Article 4 got a green light. The Council and residents associations shared a rosy view of six bedroom Victorian houses suddenly being filled with happy families. Problem solved? Well, not really.
As with any blanket legislation this move is ‘a hammer to crack a walnut’ and could have the opposite effect to that desired by the Council by depressing house prices, blocking investment and leading to benefit culture neighbourhoods. Already we have seen Â£80,000 wiped off the value of one property in Sandyford. The four bedroom flat now requires planning permission to rent it to a group of unrelated people. Investors won't consider it as the planners have indicated they would be against change of use and in a depressed housing market there aren't many families looking to buy places like this. The family owners have suffered by a law that was supposed to protect their area and their interests.
A growing trend is for young professionals to come together and rent a larger property. This is evidenced by the growth of our Pro-Share Plus scheme which allows young professionals to get to know their new house mates before signing a rental agreement. These are not rowdy students, rather they are career professionals and just the sort of people the Council want to stay in a neighbourhood when they start a family. Students are already moving out of Article 4 areas into their shiny new accommodation blocks.
There is no easy solution to inner city regeneration but one thing is for sure. Draconian regulation presents more problems than solutions. Newcastle Council needs to work with landlords and investors to raise the quality of our housing stock, thus enhancing areas that have suffered from cheap, multi-occupancy conversions in the past. If these issues are not addressed the net result will be depressed house prices, a lack of investment and a sharp rise in low-rent, benefit culture properties.