SGHM

The Standard Method calculates minimum local housing need by taking:

1. A baseline of 0.8 % of existing housing stock (i.e., the number of homes there already), then

2. An upward adjustment based on the affordability ratio (median house prices ÷ median earnings) averaged over recent years. In areas where that ratio is high, the formula boosts the need figure proportionally.

It does not anticipate future demand based on economic growth using forward-looking population and job projections

Instead it infers demand indirectly from affordability. The formula cannot distinguish between:

1. Job-led growth pressure (e.g. Manchester, parts of Newcastle)

2. Second home led price inflation (e.g. Cornwall, parts of rural England)

3. Low-wage stagnation (e.g. Northumberland, some rural authorities)

It treats all three as: “build more houses”

the Sustainable Growth method

Make jobs and population the primary drivers of need, not price ratios

Use forward‑looking employment and population projections to form the baseline, with a transparent jobs to households conversion elasticity. Affordability becomes a bounded calibration (±10%)—not the engine of the number—so amenity‑price hotspots don’t get “overbuilt” targets and growing cities aren’t under‑called until prices spike

Plan at the Combined Authority/corridor scale 

Start with Travel‑to‑Work‑Area (TTWA)/rail corridor geographies and use ONS BRES-based net job growth and evidenced local employment pipelines to raise (or lower) the household baseline

Distribute to sustainably serviced locations

Allocate to high public transport connectivity locations (e.g., 800–1,000 m around stations) using accessibility and service frequency, via a transparent jobs-to-households elasticity. This ensures that station-area allocations reflect the scale and location of job-led demand, not just accessibility and capacity

Build in rail accessibility weighting and minimum station‑area densities

Weight the distribution by a Rail Accessibility Index (frequency, even‑interval pattern, travel time to hub, step‑free/active travel access), and then apply minimum net densities of ≥40 dph (≥50 dph at well‑connected stations) in accordance with NPPF section L3. That ensures numbers land where people can live without being car dependent

Correct for second‑home / short‑let distortion with tenure & policy tools

In amenity‑led hotspots, treat high prices as a tenure/access issue, not as a cue to inflate the quantity target. Require a principal‑residence policy and affordable/intermediate quotas in around stations, instead of cranking up total units that risk being captured by second‑home demand

Safeguard rural areas with weak economies

Apply a “rural realism” cap where job growth is flat and rail accessibility is low: meet needs via small exception sites near stations/village centres but avoid car‑dependent sprawl

Future Proof

Apply a Two Gear system based on current rail service levels and future services as Metroisation programmes roll out to accommodate future growth.

• Gear‑1 applies using existing service levels 

• Gear‑2 applies on adoption of a Corridor Metroisation Plan (GBR/Mayoral agreement, funding and milestones), after which affected stations’ RAI is recalculated and their apportionment increases at the next review