Intelligence: 23 March 2017New Release of Welsh Household Projections

The 2014-based Welsh local authority household projections have been published by StatsWales. These provide an indication of future housing need, with the latest release indicating a need for less housing in Wales than the previous 2011-based series they replace.

This latest 2014-based series projects growth of 139,300 households in Wales over the 25-year period 2014 to 2039 (equivalent to 5,570 per annum, +10%) – a decrease compared to growth of c190,000 (7,600 pa, +15%) projected by the 2011-based series and a further decrease from growth projected by the 2008-based series of c323,000 households (12,900 pa, +25%) over a 25-year period.

However, the picture varies across Wales. Housing need over a 25-year period increases in six of the 22 Welsh local authorities (27%) with higher absolute household growth projected by the 2014-based series compared to the 2011-based series. Housing need reduces in the remaining 73% of authorities. 

Our interactive map presents the difference in projected growth in year 2035 between the 2011 and 2014-based series in each Welsh local authority. Those authorities coloured pink are projected to see a higher household projection in 2035 according to the 2014-based series than compared to the 2011-based series. Those authorities coloured blue are projected to see a lower household projection in 2035.

[click here to see enlarged map]

Despite the 2014-based series projecting lower household growth in comparison to the previous 2011-based series, the 2014-based series projects all Welsh local authorities, with the exception of Powys (-2%), to see household growth over the next 25 years.  Cardiff is projected to see the highest household growth (+32%) followed by Swansea (+17%).

The Drivers of household growth

Lower household growth projected by the 2014-based series is largely explained by a reduction in projected population growth

The 2014-based household projections are underpinned by the 2014-based Welsh population projections which project the population of Wales to increase by just 5% over the period 2014-2039.  The previous 2011-based population projections projected higher population growth at 9% over a 25-year period (2011-2036) and the earlier 2008-based series projected higher population growth still of 13% (2008-2033).

Furthermore, the 2014-based series projects average household size to fall from 2.29 persons per household to 2.17. Whilst comparable to the previous 2011-based series, the 2014-based series assumes larger households than the 2008-based series as shown in the chart below. This latest data reflects a continued pattern of reduced household formation influenced by the recession which has limited people’s ability to enter the housing market as a result of worsening affordability.  

The implication of lower household growth

The Welsh Government states that housing and regeneration are central to improving the lives of the people of Wales, with housing identified as the bedrock of communities, driving the demand for local services, shops and facilities. If Welsh local authorities plan for newly arising housing need on the basis of the latest 2014-based household projections, future economic growth will be jeopardised, contrary to the Welsh Government’s vision for a strong economy that will enable businesses to create jobs and continue economic growth. 

Underpinning the 2014-based household projections is the assumption that the key working age population (aged 16-64 years) of Wales is projected to decline by 6% over the 25-year period 2014-2039.  Decline is projected in all but 4 of the 22 Welsh local authorities.  A diminishing resident labour supply will restrict economic growth.

Therefore whilst this latest release indicates a need for less housing across Wales than the previous 2011-based series they supersede, slavishly adhering to these updated figures will be at the cost of economic growth. In reality the true level of housing need in Welsh local authorities will inevitably be higher than indicated by the 2014-based household projections.  Planning Policy Wales states that these projections need to form part of an LDP’s evidence base and in April 2014 the then Minister for Housing and Regeneration reaffirmed how projections should be used, stating that they “should form the starting point for assessing housing requirements”. Therefore alternative assumptions relating to migration and economic growth should be tested, as set out in PPW and as is common practice amongst the Welsh local authorities when preparing their Local Development Plans, to enable the Welsh Government’s priority of providing a quality home for all and its target of delivering 20,000 affordable homes over the current term.  

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Household Projections, Wales, GIS, Development Economics