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Weekly News Summary

Friday, 17 November 2017

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Quick Links | News | Economics & Statistics | Planning | Skills | Events |

Top stories this week

  • Housing supply hits nine year high....read more
  • Prime Minister’s statement on house building....read more
  • BSA; First Time Buyers getting older....read more
  • NIC: New infrastructure can bring first new towns for half a century ....read more
  • CITB in major shake-up....read more

News

Housing supply hits nine year high

Official figures published yesterday show that annual net housing supply in England increased by 14.6% to 217,350 in 2016/17.

The Government’s Net Supply of Housing Statistics, showed total supply for the year to March 2017 was 227,170. Allowing for demolitions, net supply of housing (the Government’s favoured measure) for the year was 217,350 following the fourth successive increase and meaning that since 2013, net housing supply has increased by 74%.

The new build component of net supply increased 12.0% year-on-year to 183,570, taking the increase since 2013 – and the introduction of Help to Buy – to 55%.

The figures show that by the end of March 2017 there were 577,690 more homes in England than there were three years ago.
The statistics come ahead of next week’s Budget which is widely expected to have a housing focus. The industry is calling on the government to use the Budget to deliver further improvements to the policy environment to allow the industry to sustain this growth.

 The industry is calling on government to:

  • provide certainty on the future of Help to Buy post 2021
  • remove barriers for SMEs, start-ups and specialist retirement builders so they can play their part in building more homes
  • push forward proposals in the White Paper to improve the planning system and reduce delays that can add years to when builders can get on and build granted permissions

 Stewart Baseley, executive chairman of the Home Builders Federation, said: “The housing crisis built up over several decades and will take many years to fix. Today’s statistics illustrate the huge progress being made, and the rapid rate at which builders have responded to positive measures from government to deliver more and more new homes. It is no coincidence that since reform of the planning system in 2012 and the introduction of the phenomenally successful Help to Buy scheme in 2013, housing supply has increased by a massive 74%.
 “The challenge now is to expand the number of housing suppliers delivering new homes. Government needs to help create the conditions for more specialist developers and smaller firms to invest and grow their output while continuing with the positive environment that has seen larger developers drive increases in supply.”  

Read HBF’s press release in full here. 

 

Read the story featured on the Telegraph: Government celebrates building 217,000 homes this year, hitting its target for the first time



Prime Minister’s statement on house building

Prime Minister Theresa May has pledged to make it her personal mission to ‘build more homes, more quickly’. 

Ahead of the publication of the new statistics on housebuilding, Theresa May released a statement promising to deliver affordable, secure and safe housing for all, quickly, to coincide with a visit she made to a housing scheme in north London.

While the number of new homes delivered each year has been on the rise since 2010, the Prime Minister has acknowledged there is more that can be done to build the homes the country needs.

Theresa May commented:

“For decades we simply have not been building enough homes, nor have we been building them quickly enough, and we have seen prices rise.

“The number of new homes being delivered each year has been increasing since 2010, but there is more we can do. We must get back into the business of building the good quality new homes for people who need them most.

“That is why I have made it my mission to build the homes the country needs and take personal charge of the Government’s response.

“Today I am seeing the work now underway to put this right and, in coming weeks and months, my Government will be going further to ensure that we build more homes, more quickly.

“This will be a long journey and it will take time for us to fix the broken housing market - but I am determined to build a Britain fit for the future.” 

Read more



Government issues ultimatum to 15 councils ‘failing to plan’

To mark the publication of the housing numbers, Communities secretary Sajid Javid made a wide ranging speech in Bristol. He announced that the government will reclassify housing associations as private organisations, and launched a clamp down on local authorites without a local plan.

Javid said that in reclassifying housing associations as private sector organisations, the government would be “taking them out of the public sector and off the government’s balance sheet”.

Javid noted that housing associations were run like big businesses, with assets worth around £140 billion. Yet they delivered “an incredible social good, providing good quality homes for millions of people right across the country."

“Freed from the distractions of the public sector, housing associations will be able to concentrate on developing innovative ways of doing their business, which is what matters most: building more homes," he added.

As part of his speech, the communities secretary also said that the government would intervene in the work of 15 local authorities who had failed to get a local plan adopted. Javid said that he would begin the formal process of intervention as set out in the Housing White Paper. “By failing to plan, they [local authorities] have failed the people they are meant to serve,” he said. Out of more than 70 authorities without a local plan in place, these 15 were "showing particular cause for concern". 

Javid also said: “The generation crying out for help with housing is not over-entitled. They don’t want the world handed to them on a plate. They want simple fairness, moral justice, the opportunity to play by the same rules enjoyed by those who came before them.

“Without affordable, secure, safe housing we risk creating a rootless generation, drifting from one short-term tenancy to the next, never staying long enough to play a role in their community.

“We must fix the broken housing market, and we must fix it now. Tomorrow will be too late. February’s White Paper, that set out our broad vision for doing so, described the scale of the challenge and the need for action on many fronts.

“Since then we’ve been putting it into action, laying the foundations for hundreds of thousands of new homes.

“But I’m about as far from complacent as it’s possible to get.”

In a separate ministerial statement with regards to interveninig in the 15 local authorities Javid said:

‘Up-to-date plans, including local plans, are essential because they provide clarity to communities and developers about where homes should be built and where not, so that development is planned rather than the result of speculative applications. At present too few places have an up-to-date plan.

On 21 July 2015 we made a Written Ministerial Statement to the House on this same subject. At that point 82 per cent of authorities had published a Local Plan under the Planning and Compulsory Purchase Act 2004 regime. Today that figure stands at 92 per cent.

In the 13 years that have passed since the 2004 Act received Royal Assent, over 70 local planning authorities have yet to adopt a plan and of those 27 authorities still have failed to reach the publication stage. I am particularly concerned about the 15 local planning authorities that have recently either failed the duty to cooperate or failed to meet the deadlines set out in their Local Development Schemes, the public timetable that all local planning authorities are required to put in place.

I am therefore writing today to the local planning authorities of:

Basildon, Brentwood, Bolsover, Calderdale, Castle Point, Eastleigh, Liverpool, Mansfield, North East Derbyshire, Northumberland, Runnymede, St Albans, Thanet, Wirral and York.

These letters will start the formal process of intervention we set out in the Housing White Paper. We set out that we will prioritise intervention where: 

  • the least progress in plan-making has been made
  • policies in plans had not been kept up to date
  • there was higher housing pressure; and
  • intervention would have the greatest impact in accelerating Local Plan production 

Read more



NHF response to the reclassification of housing associations

David Orr, Chief Executive at the National Housing Federation, said:

"We strongly support the ONS’ decision today, endorsed by the Secretary of State, to reclassify housing associations as private bodies. This is welcome recognition of their position as independent social businesses with a shared social purpose of building a quality home that everyone can afford.

"Housing associations already represent excellent value for the taxpayer – for every £1 Government puts in, housing associations put £6 of their own.

"In the last year, the sector started building almost 50,000 new homes – an increase of 13% on 2015/16. This change will allow them to build on their strong track record and secure the long-term finance needed to build even more affordable homes."



Stop utility companies delaying housebuilding, HFI urges Hammond

The Housing and Finance Institute (HFI) has called upon the Chancellor of the Exchequer, Philip Hammond to use the forthcoming budget on 22 November to institute measures to force utility companies to ensure that new homes are connected on time. The recommendation is part of an eight point plan to speed up housebuilding, which also includes a recommendation to announce a new housing innovation fund. 



Watchdog calls for Government to improve housing statistics

While Thursday’s publication of the Government’s Annual Net Supply of Housing Statistics provides the most authoritative reflection of recent housing supply, including new build completions. However, this regularly contrasts with the Government’s quarterly ‘Housebuilding Statistics’ which show far lower levels of completions. This failing and potential ‘own goal’ has been highlighted on many occasions by the HBF, most notably in September 2016 with the publication of the ‘Ghost Towns’ report which pointed out that the figures ‘lose’ a town the size of Stevenage each year. 

As a result of the pressure, following a review by the Office for Statistics Regulation which HBF made several contributions to, the OSR is now ‘encouraging’ DCLG to improve and clarify the figures it publishes. 

The review stated:

“Users are still presented with two different measures of ‘new build completions’. Many users – covering all sectors – raised this issue. They spoke of concern at the two measures presenting a different picture and many specifically spoke of an ‘undercount’ in the quarterly new build completions statistics.

“Ideally, users would like the coverage of the quarterly statistics to be improved so they more closely match the more comprehensive annual figures.”

 “Because of the high-profile nature of statistics on housebuilding and the clear user need for accurate and timely figures for their operational needs, we would encourage DCLG to continue prioritising this work and to engage with users about how best it can present transparent information to address concerns.”

Read more



Grenfell Tower Inquiry: Inquiry appoints assessors

The Grenfell Tower Inquiry has appointed expert witnesses and assessors. The three newly appointed assessors will assist the chair of the inquiry. There are seven expert witnesses Dr Barbara Lane, leader of fire safety engineering at Arup; Colin Todd, a fire safety consultant at CS Todd and Associates; Professor Edwin Galea of the University of Greenwich; Professor José L Torero of the University of Maryland, USA; Professor Luke Bisby of the University of Edinburgh; Professor Niamh Nic Daeid of the University of Dundee; and Steve McGuirk, former chief fire officer of Greater Manchester.



London Fire Brigade: Post Grenfell Fire Safety skills crisis exposed by Brigade

In a press release the London Fire Brigade has said there will be an increase in serious building fires unless the construction industry starts to take fire safety more seriously. The release states:

“The responsibility for ensuring buildings are constructed with proper fire safety measures sits with the construction industry and yet a general lack of competence means that dangerous decisions are being made about buildings' design or construction.

“We do not have any legal power to approve a building's design

“Although we do not have any legal power to approve a building's design nor has any role in checking how it has been constructed, our fire safety experts often face serious flaws when they inspect buildings including:

• Significant construction defects – such as flawed compartmentation between flats which can allow fire and smoke to spread throughout buildings.
• Critical fire safety systems – such as mechanical smoke ventilation- that either were not installed as per the original design, were poorly designed, or are not functional.
• People in control of buildings not understanding or even knowing what fire safety measures are in place, let alone how best to maintain them.

“We've made recommendations to improve how the fire safety industry operates in a submission to Dame Judith Hackitt's Independent Review into building regulation and fire safety, commissioned following the Grenfell fire.” 

The release summarises the Brigade’s recommendations:

“A loophole to be closed that means that some very technical fire safety elements can be designed without the involvement of a competent fire safety professional for example escape routes Currently, what can and sometimes does happen, is that the designs are developed by those without sound knowledge of fire safety principles who are often neither qualified or suitably experienced in fire safety design. 

  • Formal qualifications or accreditation for those who install life saving systems like smoke ventilation and fire detection and alarms.
  • Clearer definition of who is responsible for what under fire safety legislation.
  • A clamp down on companies who act as a building control body as well as offering fire engineering design advice without clear separation between the two roles. Worse still, some of these companies advertise how quickly they can get designs through the building control process, promoting speed over proper scrutiny. There is a need for approving authorities to maintain their independence and impartiality within the process.
  • A robust independent on site inspection program that ensures the fire safety elements of a building’s design are translated into the finished construction.” 

Read more 

HBF issued the following statement in response; ‘New build homes are designed and built to extremely exacting standards . The standards and inspections regime ensures homes built today are significantly more resistant to fire than those built previously and so safer for residents. In the wake of Grenfell the industry is working closely with government and stakeholders to examine all the processes around fire safety in buildings. We are committed to working with all parties to ensure any potential improvements to anything with regards to how we design and build new homes  are identified and implemented.’



DCLG: 50 years of the English Housing Survey

2017 is the 50th anniversary of the first national housing survey, the National House Condition Survey conducted in England and Wales in 1967. 

To mark this anniversary, DCLG has published a report comparing 1967 and 2017 in terms of housing policy, housing and the methodology used in the national housing survey. The report can be read here. 

DCLG is also reissuing the National House Condition Survey 1967 which can be read here



NHF: Affordable housing saving rural services

The NHF has published a report illustrating how building affordable homes in rural areas can help to maintain vital services for local communities. The report can be read here. 

Services such as schools and pubs are the pillars of rural community life. NHF say these services are increasingly at risk of closing where rural areas have suffered from lack of investment in new affordable homes. Without this investment, it is difficult for families to grow and remain in the same area, and more difficult for people to move to these areas, putting the long-term sustainability of local businesses at risk.

This report finds that over the last five years, schools, post offices and pubs have been closing on a regular basis. With one in five English households living in rural areas, and housing, on average, being less affordable in rural areas than in urban areas, it is vital to continue to breathe life into these communities.

have a strong track record of working with communities in rural areas to deliver homes they need. Last year, Housing associations built 3,030 homes in rural areas of England, and started building 3,769. 



Major new CIH project will help to shape the future of social housing

A major new project by the Chartered Institute of Housing aims to help shape the future of social housing.

Rethinking social housing, launched this week, will combine original research and engagement with the sector, tenants, politicians and the public to explore fundamental questions about the future of social housing.

The project aims to:

• Stimulate a wide-ranging debate about the future of social housing

• Make the case for social housing

• Understand and challenge perceptions of social housing

• Influence and shape the direction of future housing policy and feed directly into the government's housing green paper.

The sponsors of the project are Sovereign, Home Group, Peabody, InCommunities, Optivo, PA Housing, Riverside Group and South Liverpool Homes.

Read more



BMF response to Public Accounts Committee warning

Responding to a warning from the Public Accounts Committee that it could be 'catastrophic' if a viable customs system was not in place at the time of Brexit, John Newcomb, Chief Executive of the Builders Merchants Federation said:

"We welcome the Public Accounts Committee highlighting the very severe concerns business has about the ability of our Customs' system to deliver in a post-Brexit environment.

"We agree that a failure to sort out the Customs Declaration Service in time would be catastrophic for the building materials industry.

"Builders merchants are already facing significant material price rises due to currency fluctuations and, from our engagement with government so far, we have concerns that proper consideration is not being given to other obstacles that may hamper trade.

"For essential building material supplies, such as timber, a failure from the Government to deliver a viable customs system could mean very severe delays, extra costs, administrative burdens and shortages that threaten the building of new homes that we so desperately needed".



uSwitch: Cost of running a household rises £500 to £17,000 a year

Running a home today costs £16,896 a year – an increase of £468 since 2016 – according to new research from  uSwitch.com , the price comparison and switching service, with essential bills rising by 2.9% in a year. Key findings are that: 

  • Essential bills cost families £1,408 a month – rising by 2.9% in a year, more than double the rise in household income (1.2%)
  • Bills (£16,896) now account for more than half (52%) of household income (£32,247)
  • Increases in car insurance (10%), energy (8%) and petrol (3%) have driven annual bills up by £468 compared to 2016
  • One in ten say they have no money left at the end of the month after paying all essential household bills
  • With inflation at 3.0% all eyes will be on next week's budget hoping for some relief to help keep spiralling bills under control.

In the last twelve months, the research says car insurance premiums have shot up by 10%, energy bills have risen by 8% and filling up a car with petrol now costs 3% more. The combined increase in bills across the board leaves consumers having to find an extra £468 per year, further squeezing household finances.

This rise in the cost of running a home comes as wages continue to stagnate. Recent ONS findings revealed that average annual household income has increased by £387 in the last year, which is not enough to cover the additional cost of essential household bills.

Read more



NLGN Report: A changemaking vision for local government

The New Local Government Network has published a report, A changemaking vision for local government. The report suggests that “years of austerity, combined with rising demand, are challenging the traditional structures and practices of local government”. The essay contends that the reform of local government should focus on function over form and on social impact “above all else”. The NLGN recommends that three values should drive the changemaking approach to local government reform: Creativity, Self-Determination and Collaboration. 



FMB: Two-thirds of NIMBYs concerned about house prices, new FMB research reveals

Two-thirds of NIMBYs admit to being frustrated that the next generation can’t afford to buy their own home, according to the latest research by the Federation of Master Builders (FMB).

Key results from the FMB’s UK-wide research into NIMBYs include: 

  • Nearly two-thirds (60%) of home owners who are concerned about new houses or flats being built in their community also admit to feeling frustrated that the next generation can’t afford to buy a property in the local area;
  • One-third of UK home owners are concerned about houses or flats being built in their community having a negative impact on where they live;
  • Half (49%) of people feel frustrated their children, grandchildren or great grandchildren cannot afford to buy a property in the same area as them;
  • Home owners in the London are most likely to take an anti-development approach to new homes being built in their community yet are also more likely to bemoan the inability of the next generation to buy a property nearby. 

Read more



Economics & Statistics

BSA; First Time Buyers getting older

Speaking at the BSA Annual Lunch, BSA Chairman, Jonathan Westhoff, gave an update on sector action for older borrowers on the second anniversary of the first BSA report: 

  • Almost 60,000¹ mortgages were written in the first 6 months of 2017 which will mature when the borrower is 65 or older, a 45% increase on the same time in 2015.
  • The number of new mortgages that will mature when the borrower is between 79 and 84 has risen 162%¹ between the first half of 2015² and the same time in 2017.   

In addition, during the first half of 2017, 43%¹ of new mortgages from building societies had a term longer than 25 years.  Many building societies (34) will now lend to borrowers who will be 80 years old or more at the end of their mortgage term, up from 18 in 2015.

Commenting, Jonathan Westhoff said: 

“The peak of this demographic trend is yet to come.  The traditional first time buyer market we recognise is steadily shifting up the age range, with first time borrowing stretching beyond 65.   Others choose to borrow to help their family, secured on the equity it has been their good fortune to see grow. Recent recognition by the FCA of retirement interest-only mortgages was welcome.  A number of societies offer these mortgages, giving older borrowers a useful alternative.”

On the wider housing crisis: 

  • A lack of housing supply remains the root cause of the crisis.
  • Allowing Local Authorities more flexibility to build is essential and we hope to see this delivered in the Budget.
  • It is time for a more nuanced debate on the use of Green Belt land for house building. 

On Brexit, Jonathan Westhoff said: “Building societies are UK domestic players.  We are staying right here and will continue to do what we do best in society – providing a home for savings and savings for a home.”

The full speech can be viewed here

Read more



NIESR:UK’s obsession with housing wealth could be making the country poorer

Favourable public policy treatment of home ownership means mortgages are crowding out other forms of long term savings and investment, with potentially significant repercussions for individual pension savings but also for the UK economy as a whole, new National Institute of Economic and Social Research research for the Association of British Insurers reveals.

The full report can be viewed here:

In a two part study for the Association of British Insurers researchers began by analysing the savings behaviour of households with a mortgage, using the British Household Panel Survey. They observed an economically and statistically significant decline in those households' saving rate which, other things being equal, translated in a 15 pc lower private pension income at retirement. This might be one reason why UK households hold a larger share of their wealth in the form of housing that in many other advanced economies.

Then researchers used the National Institute's own Global Econometric Model (NiGEM) to calculate for the first time the potential cost to the economy of households holding such an unusually large share of their wealth in unproductive housing assets. They did so by simulating the macroeconomic consequences of alternative business investment scenarios.

  • One scenario assumes that the composition of investment between business and housing becomes more similar to other OECD advanced countries, with business investment increasing from 66% to 80% by 2028. With total private investment held constant, this would see productivity become 2.3% higher and GDP £55 billion higher in 2028 than it would have been otherwise. GDP growth is predicted to be 1.9% rather than 1.7% and an additional 160,000 jobs would be created. 
  • In a second scenario, in which total private investment is also increased from 14.2% to 16.8% in 2028, again  more in line with other advanced economies, UK productivity is 3.8% higher than it would have been otherwise, GDP is £90 billion higher and GDP growth is predicted to be 2.1% rather than 1.7%., generating an additional 220,000 jobs. 



FT: Mortgage costs would offset stamp duty cut, says study

The FT have reported that a stamp duty cut for first-time buyers in the Budget would leave untouched the “major hurdle” of mortgage affordability assessments, according to research exposing the high demands of lenders’ stress tests. Borrowers have benefited from historically low interest rates, but mortgage regulations oblige lenders to judge whether customers could still afford repayments if rates were 3 percentage points above their current standard variable rate. Richard Donnell, research director at Hometrack, a housing market research group, said the costs of servicing the average mortgage were now cheaper than renting. But in high-priced markets such as London, “the cost of a mortgage at the stress rate of 7 per cent would require a renter to be able to afford housing costs that are 60 per cent higher than the cost of renting”. Calculating a median rent for a “typical” property incorporating data for different types of homes, Mr Donnell compared the figure with monthly payments for the average first-time buyer mortgage, using data on interest rates and loan-to-value ratios from industry body UK Finance. In London, the average monthly rent of £1,630 exceeds the £1,500 average first-time buyer’s monthly mortgage repayments, suggesting home ownership is cheaper in terms of big ongoing costs. Average mortgage interest rates are currently 2.4 per cent. Yet to pass the 7 per cent stress test, buyers must show they could afford monthly payments of £2,615 — or £985 more than the monthly cost of renting. “This creates a major hurdle for first-time buyers trying to access the housing market in London,” Mr Donnell said.

The differential is less onerous outside London, but remains substantial as a proportion of total costs. Average rent of £600 a month is higher than the £490 monthly cost of servicing a typical first-time buyer mortgage. But passing the 7 per cent stress test obliges the borrower to show they can repay £860 a month — or 43 per cent more than their rental costs. The research also shows a substantial rise in first-time buyer deposits since lenders tightened affordability requirements in the wake of the financial crisis. The average deposit outside London is around £24,000, rising to £72,000 in the capital. The Help to Buy scheme has eased the deposit problem, with the government lending 20 per cent of the cost of a newbuild home. Further action was promised this week when Theresa May, prime minister, declared it “her mission” to fix the UK housing market, proposing ways to boost the construction of new homes.

Read more



UK Finance: Prospect of rate rise boosted remortgaging in September

On a non-seasonally adjusted basis, UK Finance data shows that total mortgage lending declined in September but remained higher than in the same month last year:

  • First-time buyers borrowed £5.1 billion, down 11 per cent on the previous month but four per cent higher than in September 2016.  This equated to 31,100 loans, down 10 per cent month-on-month and one per cent year-on-year.
  • Home movers borrowed £6.9 billion, down 18 per cent on August but six per cent higher year-on-year.  This equated to 32,200 loans, down 17 per cent month-on-month but three per cent higher than a year ago.
  • Home-owner remortgage activity totalled £6.4 billion, the same amount as in August but 16 per cent higher than a year ago.  The number of remortgage loans totalled 35,900, three per cent lower month-on-month but 13 per cent higher than a year ago.
  • Gross buy-to-let lending totalled £2.9 billion, down nine per cent on August but four per cent higher than in September 2016.  That equated to 18,900 mortgages, down eight per cent month-on-month but up four per cent year-on-year.

On a non-seasonally adjusted basis, UK Finance data shows that mortgage lending in the third quarter rose:

  • Home buyers borrowed £38.2 billion, up 11 per cent on the second quarter of the year and 12 per cent on the third quarter of 2016.  This equated to 199,600 loans, up nine per cent on the second quarter and seven per cent on the same period last year.
  • Within this, first-time buyers borrowed £15.7 billion, up five per cent on the last quarter and nine per cent on the third quarter of 2016.  They took out 95,800 mortgages, up four per cent quarter-on-quarter and five per cent year-on year.
  • Home movers borrowed £22.4 billion, up 14 per cent on the second quarter and year-on-year.  This equated to 103,800 loans, up 13 per cent quarter-on-quarter and nine per cent compared to a year ago.
  • Home-owner remortgage activity totalled £19.5 billion, up 14 per cent by value on the second quarter and 11 per cent on a year ago.  The number of remortgage loans totalled 110,000, up 12 per cent quarter-on-quarter and 10 per cent on a year ago.
  • Gross buy-to-let lending totalled £9.3 billion, up 11 per cent on the second quarter and four per cent on the second quarter of 2016.  This equated to 60,000 mortgages, up eight per cent on the previous quarter and six per cent year-on-year.

Read more



Four in ten workers had no pay rise in the last year, MSE poll finds

Four in ten (41%) workers haven't had a pay rise in the last year, with those on the lowest salaries least likely to have had one, according to a poll by MoneySavingExpert.com.

Only a quarter had a pay rise matching or exceeding current inflation.

Discounting those who said they didn't know, some 8,851 people were asked whether they'd had a pay rise, or had awarded themselves one if self-employed. The site also asked whether any increase they'd seen was less than, in line with or more than current inflation. The Consumer Prices Index (CPI), a key measure of how fast UK prices are rising, is currently at a five-and-a-half year high of 3%.

The poll's key findings, calculated from those who said whether they had or hadn't had a pay rise were:

  • Overall 59% said they'd had a pay rise in the past year.  But only 24% said their wage had risen in line with or by more than current inflation.
  • For those that had had no pay rise, it wasn't simply a case of being new in their role.  89% of those who hadn't had a pay rise said they had been in their job for longer than a year.
  • Those on the lowest salaries were generally much less likely to have had a pay rise.  Just 39% of those earning less than £11,500 had had a pay rise in the past year, compared to 59% of those earning more than £65,001. Only 13% of those earning under £11,500 saw a rise in line with or by more than current inflation.



Halifax joins forces with Google to help crack puzzling property terms

Halifax is the first bank in the UK to team up with Google to help homebuyers understand perplexing property jargon. The new Halifax Jargon Buster website provides relatable, entertaining and easy to understand analogies to help explain common property terms, including ‘stamp duty’, ‘gazumping’ and ‘valuation’. It also provides a dictionary definition and videos. As part of this innovative campaign, consumers can access the Jargon Buster dictionary using Google Assistant on mobile devices and Google Home, by saying “Ok Google, let me speak to the Halifax Jargon Buster”. This means that users at any stage of the homebuying process can search for the mortgage term they are unsure about, and get a response with an analogy. Tim Male, Head of Innovation and Communications at Halifax, said: “Buying a home is usually the biggest financial commitment we make in a lifetime, and we know that mortgage and property market terms can feel difficult to grasp - with many people turning to Google for help. “As part of our commitment to the mortgage market which includes lending £10bn to firsttime buyers in 2017, this felt like the perfect opportunity to join forces with Google to help people navigate the home buying process more confidently and get a step closer to their dream home.” David Black, Managing Director, Finance & Services, Google UK, said: “We are excited to partner with The Halifax to provide the jargon buster through the Google Assistant, supporting consumers as they make their way through the sometimes confusing process of buying a home. Using our Actions on Google technology, Halifax can provide first time buyers with home-buying information that's entertaining and easy to understand.” 

Read more  



ONS: Index of private housing rental prices (IPHRP) in Great Britain: Oct 2017

The latest monthly edition of the experimental price index of prices paid for renting property from private landlords has been published. 

The Main points were: 

  • Private rental prices paid by tenants in Great Britain rose by 1.5% in the 12 months to October 2017; this is down from 1.6% in September 2017.
  • In England, private rental prices grew by 1.5%, Wales also saw growth of 1.5% while Scotland saw rental prices increase by 0.4% in the 12 months to October 2017.
  • London private rental prices grew by 0.8% in the 12 months to October 2017, that is, 0.7 percentage points below the Great Britain 12-month growth rate.  

Read more 



ONS: Construction output price indices (OPIs): UK, July to Sept 2017

The main points were:  

  • The Construction Output Price Index (OPI) for all construction rose 2.0% in the year to September 2017, falling from an increase of 2.3% in the year to August 2017.
  • Prices increased in the year to September 2017 for all work types within new work, and repair and maintenance, for the third consecutive month. 
  • The OPI for all new work was up 2.2% in the year to September 2017, down from an increase of 2.4% in the year to August 2017; housing showed the largest movement, an increase of 3.7%.
  • The OPI for all repair and maintenance increased 1.6% in the year to September 2017, down from an increase of 1.7% to August 2017; the housing repair and maintenance sector showed the largest increase, up 1.7% over the period.  

Read more 



HM Land Registry: UK House Price Index for September 2017

The HM Land Registry has published the UK House Price Index, which shows that house price changes for September. The data shows an annual price increase of 5.4% which takes the average property value in the UK to £226,367.  House prices have risen by 0.4% since August 2017.

 The data for England shows: 

  • an annual price increase of 5.7% which takes the average property value to £243,945
  • house prices have risen by 0.6% since August 2017 

The regional data indicates that: 

  • the North West experienced the greatest increase in average property price over the last 12 months, with a movement of 7.3%
  • the North West also experienced the greatest monthly price growth with an increase of 2.1%
  • London saw the lowest annual price growth with an increase of 2.5%
  • London also saw the only monthly price fall of 0.2%  

Read more



Rightmove House Price Index: November

The Right Move House Price Index shows that new-to-the-market sellers have reduced the asking price of property this month, by 0.8% (-£2,392). The data also shows that 37% of properties already on the market have reduced their asking price since first listing.



Planning

NIC: New infrastructure can bring first new towns for half a century

A ground-breaking new deal between Whitehall and local leaders in one of the most economically-important parts of the country could add hundreds of billions of pounds to the national economy each year and lead to the first new towns in the UK for half a century, Lord Adonis said today.

The chairman of the National Infrastructure Commission urged Ministers, and council leaders across the arc covering Oxford, Milton Keynes, Bedford, Northampton and Cambridge, to “seize the opportunity” and harness the area’s economic potential.

To do this, he encouraged them to work together to deliver new and improved infrastructure, helping to unlock opportunities to deliver one million new homes and jobs by 2050, including the country’s first new towns in 50 years – tackling the area’s housing shortage, improving local transport connections and creating new jobs.

He highlighted that these measures can be taken while at the same time protecting and enhancing the natural environment of the area, and without making changes to existing Green Belt protections.

Currently the area generates £90billion per year towards the national economy. But by taking these steps this could increase to over £250billion a year – an increase of over £160billion a year.

Chairman of the National Infrastructure Commission Lord Adonis said:

“The arc spanning Cambridge, Milton Keynes and Oxford attracts the brightest and best from some of the most cutting edge industries. But the area also suffers from a lack of available homes and an infrastructure network that is feeling the strain – pricing local people out of the market, making it difficult for businesses to recruit staff, and threatening the future competitiveness of one of the most successful parts of the country.

“A ground-breaking deal between ministers and local leaders could transform the area, helping to double the rate of housebuilding and deliver the first new towns this country has seen for half a century. With this one of the most economically important parts of the UK, it could add billions of pounds a year to the national economy.

“I urge local leaders to seize this opportunity and work together with Government, both for the benefit of their residents and of the country as a whole – all by delivering a million new homes and jobs by 2050, investing in improved road and rail links and protecting the area’s natural environment.” 

Commissioner Professor Sadie Morgan said:

“Today’s report is a once-in-a-generation chance to create great new places to live and work, creating liveable communities and safeguarding the future of one of the most economically important regions in the country.

“By planning improvements to infrastructure across the arc, we can unlock as many as one million homes by 2050 while at the same time preserving the natural environment that residents value and enjoy.” 

Read NIC release in full: 

Read HBF Briefing here.;

 

List of responses to report here.



CPRE: Government failing to protect England’s celebrated landscapes

A new report published by the Campaign to Protect Rural England (CPRE) states there has been an 82% increase in new housing units given planning permission in England's 34 AONBs in the past five years, despite repeated commitments by the Government to 'maintain national protections for AONBs for the benefit of future generations'. This represents almost 15,500 housing units since 2012, while the number of housing planning applications has more than doubled in that time.

The report is available here:

CPRE calls on the Government to:

  • Amend the National Planning Policy Framework (NPPF) to state a presumption against proposals for large housing developments in AONBs. It should be made clear, as it is for Green Belt, that demand for housing or the lack of a five-year supply is unlikely to justify large housing developments in AONBs.
  • Include targets in the promised 25-year Environment Plan to ensure that development does not damage landscape quality. This would emphasise the importance of AONBs to the health, wellbeing and prosperity of the nation and set out how they will be better protected.
  • Give all AONBs the statutory right to be consulted for major development proposals in their area, so that their advice is fully considered when determining a planning application.
  • Reform the New Homes Bonus scheme for local authorities so that it no longer encourages large-scale housebuilding in AONBs.
  • Publish annual statistics on the rate of development and other changes of land use in AONBs, as is already done for Green Belts. 

Read more



Huffington Post: “Developers Face Compulsory Purchase Order Plan As No.10 Mulls Radical Moves To Boost Housebuilding”

The Huffington Post has reported that the Prime Minister, Theresa May, is considering allowing councils to trigger compulsory purchase orders on unused land, in a bid to tackle the housing crisis. It says the policy would be aimed at brownfield sites and would be deployed alongside “use it or lose it” planning powers. The Post says this “would provide an alternative to Chancellor Philip Hammond’s own preference for reducing protections to Green Belt land.”



Khan demands more powers to boost housebuilding

Sadiq Khan has demanded more power for local authorities in London in the upcoming Budget in order to boost housebuilding.

The mayor of London has sought to put pressure on the chancellor Philip Hammond to devolve more financing and development powers to London.

In a statement from City Hall, the mayor called on the chancellor to make a provision in the Budget for “devolution of new powers to London such as greater control over public land and allowing councils to borrow and invest in homes”.

He also asked to be given “full control over London’s skills and further education system.”

Mr Khan said the government needed to directly fund more housebuilding and infrastructure investment and that taking action was imperative given the potential impact of Brexit on London’s housing shortage.

“Homebuilders are increasingly worried that Brexit could make London’s housing crisis even worse,” he said.

“They are already feeling the impact of the government’s pursuit of a hard Brexit with an increasing skills shortage that is having a knock-on effect on the number of homes being built.

“The bad news is that this will only get worse unless we give EU nationals a cast-iron guarantee that they will have the right to remain post-Brexit.

“I fear the consequences of losing these 100,000 skilled workers would be catastrophic to London’s plans to build the genuinely affordable homes to buy and rent Londoners so desperately need.

“Ministers need to take emergency action and give me the powers and resources I need to lead a new building programme to properly tackle the housing crisis.”

Mr Khan recently set a target of building 66,000 houses a year in London, which would represent a 37,000 increase on the 29,000 delivered in 2016.

To help meet this target, he called on the government to provide £2.7bn a year in funding – more than five times the current level.

Meanwhile the chancellor is also under pressure to announce more infrastructure investment in what will be the first Budget since June’s snap general election.

Speaking last week, Civil Engineering Contractors Association director of external affairs Marie-Claude Hemmings said: “Uncertainty continues to act as a drag on the ability of the construction industry more generally to boost the economy.

“Ahead of the Autumn Budget, we are calling on the UK government to commit to the projects outlined in the National Infrastructure Delivery Plan, to secure the foundations of a strong economy, drive productivity, and deliver post-Brexit growth.”

Read more



Liverpool City Region Combined Authority: Metro Mayor shares vision for future and delivers 10 big pledges

Liverpool City Region Metro Mayor, Steve Rotheram has set out his ambitious vision for the future underscored by ten major new policy pledges. Describing the devolution process as a journey not a destination, he said that the Leaders of the region's six districts had not created a Combined Authority merely to access relatively modest additional resources, but to deliver transformational change.

Setting out the need for a step change in ambition and economic performance, he announced the appointment of highly respected industry leader, Brent Cheshire, until recently UK Chair of Dong Energy, as the man who will spearhead plans to harness the power of the River Mersey. His initial task over the next 12 months will be to establish the core business case for the multi-billion renewable energy project.

Amongst a series of other radical policy pledges, the Metro Mayor announced:

  • Plans to create a unified and properly resourced agency to capitalise on Liverpool's positive global brand, marketing the City Region internationally and providing  one front door  for all those seeking to invest and do business here.
  • A pledge to deliver a skills revolution by lobbying the Government so that the underspend from the National Apprenticeship Levy  will be spent locally to roll-out degree-level apprenticeships and create a single UCAS-style  city region-wide portal for apprentices.
  • A major initiative to tackle the City Region housing shortage by building 25,000 new homes before 2022 in the right places and with a variety of types and tenures to ensure everyone has access to a decent and affordable home.
  • Tackle homelessness by working with Government to fund a trail-blazing Housing First approach to make sure new homes are made available to those in greatest need as quickly as possible end the scandal of rough sleeping in Liverpool City Region.
  • Adopt a brownfield first approach to new housing development by publishing the first ever City Region Brown Field Register, and lobbying the Chancellor to give the area a Stamp-Duty holiday with funds being recycled into remediating brownfield, making them available for new homes.
  • Backing up the £460 million investment in new rolling stock for Merseyrail by exploring how devolution powers and bus regulation can be best used to create a fully integrated public transport system for a dynamic and growing City Region.
  • Make access to public transport more streamlined and customer-friendly by rebranding and remodelling the current Walrus card to make the City Region a UK exemplar for smart ticketing and new payment technologies.
  • Making cross-river transport and movement easier and more affordable by delivering on an election pledge to create a more affordable Fast Tag for Mersey Tunnel users, and announcing the commissioning of the design for a new state of the art Mersey Ferry.
  • Setting out the City Region's future devolution ambitions and begin discussion about how the City Region might to integrate Fire and Rescue, Waste Disposal and powers of the Police and Crime Commissioner into a future Combines Authority Structure..

Steve Rotheram said;

"The simple argument for devolution is that local people who are locally accountable know better than Whitehall what our area needs, but it is also about recognising that in an increasingly competitive and changing world, six districts with a population of 1.5 million can be more successful and stronger together." 

Read more



Telford & Wrekin Local Plan found sound subject to modifications

The Inspector’s Final Report dated 6th November 2017 published this week found the Telford & Wrekin Local Plan sound subject to some Main Modifications (MM). The housing requirement was increased from 15,555 dwellings to a minimum of 17,280 dwellings for the plan period 2011 – 2031 based on a higher Objectively Assessed Housing Need (OAHN). The OAHN increased because economic growth forecast inputs were changed to lower the anticipated rise in double jobbing and reduce the economic participation rates of workers aged over 65 years. 

The Inspector also considered that the Council should recognise the potential of the District to meet some unmet housing needs from the Greater Birmingham & Black Country (GB&BC) Housing Market Area (HMA). MM1 requires that at this time the Council does not rule out the potential apportionment of some of the Local Plan’s housing requirement (arises from in-migration) towards meeting the needs of the GB&BC HMA and continues to consider this matter as evidence emerges. 

The site selection process was considered flawed as it was neither robust or transparent in particular there was no basis to explicitly favour land in public ownership over that in private ownership when selecting sites for allocation in a Local Plan. Therefore four housing sites (H1, H7, H8 & H13) were deleted. As a consequence there will be insufficient Housing Land Supply (HLS) to meet the housing requirement so the Council is committed to prepare a Site Allocations Plan but no specific timetable is set out. There will be a 5 Years HLS using 5% buffer on adoption. The approach to prioritising previously developed land together with other criteria to define sustainable development as set out in Policy SP4 are removed as inconsistent with national policy. 

On sites of 11+ dwellings affordable housing provision of 25% in Telford and 35% elsewhere is sought subject to viability on a site by site basis. A number of proposed transport requirements for residential developments required further clarification as not fully viability tested. The reference to Lifetime Homes was deleted but the requirement for the nationally described space standard is retained with the proviso that the viability of development is not threatened. The requirement for rainwater harvesting / grey water recycling changed to encouragement only. 



Appeals

Secretary of State allows re-determined appeal 

An appeal for 200 dwellings in Lydney, Forest of Dean, Gloucestershire was allowed. The appeal was re-determined by the SoS following a successful high court challenge quashing a previous Secretary of State’s refusal of permission. The Council was unable to demonstrate a five year supply of land for housing and, since the supply was also less than three years, both the local plan and the neighbourhood plan were considered to be out of date. An innovative “local approach” to housing delivery as part of the planning agreement would, concluded the SoS, assist in delivering dwellings in an area that had a history of under delivery through traditional delivery mechanisms. 

Appellant: Allaston Developments Ltd

 

Costs awarded against developer 

In dismissing an appeal for 380 dwellings in Pocklington, East Riding of Yorkshire, the inspector awarded costs against the appellant for pursuing a claim that the Council was unable to demonstrate a five year supply of land for housing. The land supply position had been recently clarified in both a local plan inquiry and a recent appeal decision and it was up to the appellants to demonstrate what had changed since those decisions were made. Case law of the St Modwens court decision established the difference between deliverability and delivery making it clear that sites need only to be capable of delivery rather than a certainty that they will be developed. The appellants were aware of this distinction and the case law yet pursued their appeal on this basis. 

The inspector concluded that the Council was able to demonstrate a five year supply of land and, while there were some benefits arising from the proposed development the proposals conflicted with an adopted spatial strategy. 

Appellant: Gladman Developments Ltd

 

Effect on AoNB outweighs shortfall 

An appeal for 15 dwellings for over 65s in Wembury, South Hams, Devon was dismissed. Although the Council was unable to demonstrate a five year supply of land for housing the inspector concluded that the effect on the Area of Outstanding Natural Beauty outweighed the need for additional housing. The need for older persons’ dwellings fell within the overall need for housing but there was no evidence for a specific need in the settlement itself. 

Appellant: Blue Cedar Homes Ltd

 

Development not “major” in AoNB 

A development for 30 dwellings in Chipping Campden, Cotswold was allowed. The inspector concluded that the size of the scheme did not constitute a “major development” in the AoNB. The Council was unable to demonstrate a five year supply of land for housing and the provision of 50% affordable housing was much needed in the area. 

Appellant: WR Haines (Leasow Farms) Ltd

  

Affordable housing contribution reduced 

An appeal to reduce the amount of affordable housing delivered on a scheme of 37 dwellings in Barlby, Selby, North Yorkshire was allowed. The previous permission had included an obligation to provide 40% affordable housing. However, a subsequent application supported by a viability assessment suggested that contributions above 6% would render the site unviable. The Council relied on the evidence of the District Valuation Service (DVS) who, following discussions with the appellant, suggested that 17% affordable housing was viable. However, the inspector preferred the evidence of the appellant and agreed that, due to the risks involved with development, a return of 20% on GDV was appropriate across all tenures. Legal fees had been omitted by the DVS but were agreed as a legitimate cost and contingency was agreed by the inspector at 5% across all costs.  

Appellant: Daniel Garth Homes

 

Delayed delivery contrary to spatial strategy 

A development for 400 dwellings in Barthomley, Crewe, Cheshire East was dismissed. Although the inspector agreed with the appellant that, despite having recently adopted a local plan, there were questions regarding the delivery of some of the sites relied upon to meet the five year housing supply. However, the delivery of only 100 of the 400 dwellings in the five year period meant that, overall, the development would be contrary to the spatial strategy of the plan in the long term in the light of seeking to make up a small shortfall in supply in the short term. 

Appellant: Renew Land Developments Ltd

 

Lack of evidence of traffic impact leads to costs award 

In allowing an appeal for 49 affordable dwellings in Powick, Malvern Hills, Worcestershire the inspector made an award of partial costs against the Council. The main reason for refusal was the effect of the development on traffic movements but there was no evidence to substantiate what was merely perceptions by Councillors who had overturned officers’ recommendations for approval.

Appellant: Fortis Living

 

Development size reduced to meet policy threshold 

In allowing an appeal in Alderholt, East Dorset the inspector limited the development from the originally proposed 60 dwellings to 45 dwellings in order to comply with an adopted local plan policy and SPD regarding the impact of development on European protected heathland. The Council was unable to demonstrate a five year supply of housing land and the development would contribute to addressing that shortfall. 

Appellant: Gladman Developments Ltd

 

Deferred affordable housing payments acceptable 

A development of 24 dwellings in Sunbury-on-Thames, Spelthorne, Surrey was allowed. The Council was unable to demonstrate a five year supply of land for housing and, although the proposed scheme had more impact on the character of the area than previous consent this was outweighed by the need for additional dwellings. The Council’s requirement for half of the off-site contributions towards affordable housing were triggered at first occupation with the remainder at 50% occupation. This was considered acceptable by the inspector. 

Appellant: Crest Nicholson South

 

Spatial strategy upheld 

Despite the Council being unable to demonstrate a five year supply of land for housing a development for 259 dwellings in Willand, Mid Devon was dismissed. The site was allocated for 42 dwellings but the proposed development was out of scale with this allocation and was not consistent with the spatial strategy set out in the plan, to direct major developments to three main towns. The scale of development was not consistent with the settlement facilities and would reduce social cohesion. 

Appellant: Gallagher Estates

 

Lack of supply leads to permission 

A development of 25 dwellings in Great Bentley, Tendring, Essex was allowed. The Council was unable to demonstrate a five year supply of land for housing and, although the development would result in the loss of the best and most versatile agricultural land, the loss was modest in scale in an area with a high proportion of such land. 

Appellant: Hills Building Group



Skills

CITB in major shake-up

CITB chief executive Sarah Beale said there will be “tough calls to make” and “big changes” for the CITB’s staff in its reform plans, but added that the organisation would support colleagues through the changes.

Ms Beale and CITB management briefed staff today on its plans for the next three years, which include streamlining the workforce, outsourcing many of its operations and moving from its 50-year-old Bircham Newton base in Norfolk.

“I understand this strategy will bring about big changes to employees at CITB and we will be supporting our colleagues as much as possible throughout this process,” Ms Beale said.

“These are tough calls to make, but needed if we are to meet the future demands and make the greatest impact to construction.” 

The changes were laid out as part of the CITB’s Vision 2020: The Future CITB strategy, which it said would create a simpler, more streamlined organisation.

The CITB, which employs around 1,322 staff, would not confirm if this would directly result in job cuts, or how many jobs could potentially go.

However, Unite called the restructuring a “hammer blow” and claimed it will put hundreds of jobs at risk. 

As part of its changes, CITB has revealed plans to outsource many of its back office and customer service functions by the end of next year.

The areas to be outsourced include its finance, procurement, legal, HR, marketing and estates and facilities management teams.

It also vowed to move away from directly delivering training through its National Construction College and move from its Bircham Newton headquarters to a new base in Peterborough. It is understood the CITB is looking to find a new manager for the NCN.

Ms Beale added: “We have worked hard to develop robust, well thought-out plans which meet our industry’s needs whilst building a solid foundation for CITB’s future.

“The proposals outlined today will be phased in over the next three years, and with our customers always in mind it’s business as usual.”

However Unite regional co-ordinating officer Mark Robinson said: “These proposals essentially would slash, trash and privatise the CITB.

“The likelihood of finding a training provider willing and capable to take on the National Construction College function of the Bircham Newton site and other NCC sites across the country is difficult to ascertain and puts hundreds of jobs at serious risk.”

Mark Reynolds, Mace’s chief executive and skills lead for the Construction Leadership Council, said: “We’re very pleased to see the CITB’s modernisation plans come to fruition. If it can deliver the far-reaching proposals laid out in today’s announcement I think it will be a hugely positive step for the industry as a whole.

”I look forward to working closely with Sarah and the team as they build a more engaged, responsive and accountable CITB.”

Read more 

See CITB Release



RICS: Skills shortages biting construction sector once more

Workloads in UK construction and infrastructure continued to rise in Q3 2017, according to the latest RICS UK Construction and Infrastructure Market Survey, with 22% more respondents seeing a rise in workloads of the quarter, with a steady pace of growth. 

However, while activity remains steady, comments left by respondents continue to highlight Brexit-related uncertainties as weighing on investment decisions and the lack of sufficiently skilled workers also remains an obstacle for many businesses.

View and download the full survey

Survey in brief

  • Workloads in UK Construction and Infrastructure continue to rise moderately in Q3 
  • Rail & energy set to be the fastest growing sectors in infrastructure over the next twelve months 
  • Skills shortages impacting the industry once more – 62% now citing this as impacting growth 

Read more



Home Building Skills Pledge update

To date, 68 home building companies have signed up to the Home Building Skills Partnership’s Skills Pledge.

If your company is among them, please spread the word, especially among your supply chain and sub-contractors, and encourage them to sign up.

If your company isn’t yet on board, you can find out more by visiting http://www.hbf.co.uk/policy-activities/home-building-skills-partnership/skillspledge/

There are several ways that HBF members can promote their commitment to the home building skills agenda through the Skills Pledge, including;

  • Telling their local press that they’ve signed up by using our template press release
  • Following @HomeBuildSkills on twitter, using the hashtag #homebuildingskillspledge to promote involvement
  • Following the HBF on LinkedIn and sharing posts about the Skills Pledge
  • Promote on their web page and display the Skills Partnership logo, and link to http://www.hbf.co.uk/policy-activities/home-building-skills-partnership/skillspledge/
  • Promoting on internal company channels such as newsletters, meetings and briefings
  • Print and display the certificate in company offices, sites, and on websites
  • Taking copies of the Skills Pledge flier to events and featuring on digital channels above. 
  • Including a line in email signatures about the Home Building Skills Pledge and include the Skills Partnership logo

For further information about the Home Building Skills Partnership’s achievements to date and how the Skills Pledge will underpin its activity moving forward, download this flier

For copies of the template press release, the Skills Partnership logo and brand guidelines, the Skills Pledge flier (PDF or print) or the certificate please email skillspartnership@hbf.co.uk



Events

HBF Ball 2017 – 2 Weeks to go!

1 December 2017 

London Hilton on Park Lane  

HBF is delighted to announce that the HBF Ball 2017 will once again take place at the prestigious 5-star London Hilton on Park Lane.

The event is a fantastic opportunity for people from across the industry to get together and let their hair down.

The event commences with a champagne reception at 7.30pm, followed by a three course meal and live entertainment and dancing until 2am.

Tables of 10 & 12 are available.

For full details and to book please click here

Please contact the events team with any questions on events@house-builder.co.uk 

Sponsored by H+H and Ibstock