Friday, 19th June 2009 Top stories this week HBF holds further meetings with the Conservative front bench team......read more John Healey: Action to help developers during downturn.....read more John Healey: Consultation announced on building regs Parts F and L.....read more BSA: Home buyer confidence increases.....read more CML: May gross lending still subdued.....read more Bank of England: Trends in lending.....read more Quick Links HBF news Government and political news Housing market news Economic news Industry news Events Graham Pye It is with great sadness that we have to report the death of Graham Pye last Friday evening while still receiving treatment following a recent operation. Graham was chairman and managing director of the Pye Group of Companies. Graham was very well known to the HBF family having served twice as a past Federation President and remaining until his recent illness a familiar and respected figure at our major conferences and member meetings. He also assisted the industry's cause for many years in Europe, serving as the President of our European trade association - the UEPC - in 2005-07. He was also a Council member of the NHBC. A funeral service for Graham will be held on Tuesday, 30th June, 2009 at 11.30 a.m. at Harris Manchester College, Mansfield Road, Oxford, OX1 3TD. The service will be followed by cremation at Oxford Crematorium, but for family and close friends only. Everyone else is welcome to stay in College where refreshments will be served. Donations can be sent to either The Association for Post-Natal Illness or The Organic Research Centre. Family flowers may be sent c/o S & R Childs Funeral Services, 69 London Road, Headington, Oxford, OX3 9AA. There will be a Memorial Service at a later date. HBF News HBF holds further meetings with the Conservative front bench team HBF held two further meetings this week with members of the Conservative front bench on housing and planning issues. On Monday HBF met Shadow Minister for Local Government, Bob Neill, to discuss issues relating to the Conservatives' further planned policy green paper on planning and regeneration. HBF raised industry wishes to see safeguards introduced into the Conservative proposals published to date to counter the business risk that might otherwise arise in a transition to any new locally based system for housing provision. It was agreed that HBF would send further views and suggestions to the Conservatives on a range of issues from pre-application processes to incentives for delivery and simplification of planning obligations arrangements. On Tuesday HBF and representatives from senior member companies met Shadow Communities Secretary Caroline Spelman and Shadow Housing Minister Grant Shapps to present the findings of HBF's work on the impact of regulation. The discussion also dealt again with the need to reduce uncertainty for business in moving to any locally-based system under which existing regional plans had been discarded. to top Further discussions with CLG on regulation HBF staff and several members also met senior CLG (Communities and Local Government) officials this week to examine in more detail the Impact of Regulation. The appraisal model developed for HBF's 7th January seminar for Government officials was used interactively to examine how variables such as margin, density and mix affect viability and land value, and to explore the impact of different regulatory scenarios. Discussions with the European Commission on the Energy Performance of Buildings Directive HBF joined its European trade association, the UEPC, for a meeting with the European Commission on the revision of the EU's Energy Performance of Buildings Directive. The negotiations on the Directive will be a priority for the incoming Swedish Presidency of the EU during the second half of this year. The meeting set out industry concerns about the deliverability and practicality of the proposals for the Directive recently adopted by the European Parliament, including its proposal that a more rigorous version of the UK's zero carbon standard be introduced as a European requirement for all new buildings from the start of 2019. HBF will continue to participate in further European discussions on this issue as the negotiations between the Member States, Commission and European Parliament intensify during the rest of the year. to top Government and political news John Healey: Action to help developers during downturn Developers will be given more time to start building and further flexibility to adapt plans, under a package of proposed new measures announced by Housing Minister John Healey this week to support the industry through the current economic climate. The backdrop to the Minister's announcement is that there has been a sharp drop-off in the number of permissions which are being taken up. So for a temporary period, a simpler and cheaper way of extending the life of planning consent is being introduced. Currently, permissions that are not used expire automatically - usually after three years. Mr Healey has also announced measures to simplify the system - making it easier to apply for planning permission in the first place. These include giving local authorities the freedom to make changes to large developments and town centres by using Local Development Orders (LDOs). The LDOs will make it easier for developers and councils to find new uses for empty shops on the high street and expand businesses and industrial estates. The Government will fund up to 12 local authorities to create LDOs, working with the Planning Advisory Service. Read more to top Greater flexibility for planning permissions: Consultation A consultation relating to the measures announced by John Healey was also published by the CLG. It invites views on the whether to introduce a mechanism for extending the time limits for implementation of existing planning permissions, and to consider how to implement the procedure for making non-material amendments under section 190 of the Planning Act 2008. It also considers changes to the procedure for applications under section 73 of the Town and Country Planning Act 1990. The closing date for responses is 13th August. Read more John Healey: Consultation announced on building regs Parts F and L At the same time as he announced the measures to support developers, John Healey also launched the much awaited consultation on changes to the Building Regulations Parts F and L. These are proposed to deliver the first step towards zero carbon buildings which it is estimated will produce carbon savings of over 3 million tonnes a year from 2020. The consultation sets out the proposed changes to Part F and Part L. HBF will be setting up a working group to look at the proposals in this consultation and to formulate a response. The consultation closes on the 17th September 2009. Anyone wishing to participate in this group should contact dave.mitchell@hbf.co.uk Read more to top LGA: Reform housing system to build 300,000 new homes More than 300,000 new homes could be built, providing a £72.5bn boost to the economy over ten years, through root and branch reform of the housing finance system, according to a new report published this week. The Local Government Association, which represents more than 350 councils in England, has launched a new housing campaign to give councils the freedom to build scores of new affordable homes and regenerate neighbourhoods across the country. Demand for social housing is being fuelled by the recession. A survey of council leaders conducted by the LGA found that 57% of authorities are seeing more people in need of social housing and 31% expect to. The LGA predicts that five million people could be on a social housing waiting list by 2011. In 2007, councils built less than 400 new houses. "The Places You Want to Live" campaign, which was launched at the Chartered Institute of Housing annual conference in Harrogate, calls for: Councils to be able to retain rents and the proceeds of any council house sales; Councils to have the financial independence to invest in their housing stock and stimulate the local economy; Historic ‘notional debt' - which councils are currently spending £1.3bn a year servicing - to be cancelled; Councils to have the same freedom as other social housing providers to borrow money to invest in new homes; The government to stop setting tenants' rent and allow them to reflect local circumstances. Read more to top Housing market news BSA: Home buyer confidence increases Property prices will rise by an average of 1.4% over the next year according to respondents to the Building Societies Association's Property Tracker survey, as cautious optimism returns to the housing market. The survey found that respondents' average prediction for house price changes over the next year was for a 1.4% rise. This represents a fundamental change when compared to a 6.1% fall in March and a 7.1% fall forecast in June 2008. This positive message is reinforced by the survey finding that yet again, an increased proportion of people believe that now is a good time to buy. 59% of people agree or tend to agree that now is a good time to buy, compared to 54% in March and just 27% in June 2008. However, this good news is tempered by findings that a lack of job security remains the greatest barrier to property purchase. It was chosen by 61% of respondents, the same proportion as in March. With many commentators expecting unemployment to continue to rise well into next year, and with perceived restrictions on mortgage availability, it is likely that this will serve to limit any recovery in the housing market. Read more to top CML: May gross lending still subdued Gross mortgage lending totalled an estimated £10.3bn in May, a 2% decline from the £10.5bn in April and down 58% from May 2008, according to new data from the Council of Mortgage Lenders. As gross mortgage lending includes both lending for house purchase and remortgage, then even if house purchase activity is showing a slight lift it will not be fully reflected in overall gross lending when remortgaging is declining - as indicated in recent approvals data from the Bank of England. Remortgaging has fallen away in recent months in the face of attractive reversion rates and tighter lending criteria for the best deals. CML Economist Paul Samter said: "While recent signs from the housing market have been more encouraging, we do not anticipate a significant recovery in activity in the coming months. Lending volumes appear to have stabilised at extremely low levels, but the weak labour market and lenders' limited access to funding will constrain activity for some time yet. "Underneath the headline gross lending figure, it's likely that a moderate improvement in house purchase lending in May has been offset by very low remortgaging volumes as borrowers stay with existing deals." Read more to top RICS: Gap between asking and selling prices appears to be narrowing The majority of surveyors (almost 60%) reported that the gap between asking and selling price was narrowing says RICS research published this week. In contrast, last August results of the same survey revealed that the gap was widening. Across the UK, houses were selling at an average of 11% below the asking price with sellers in some regions being forced to accept as much as 26% discount off their advertised price. Commenting, Brigid O'Leary, RICS Senior Economist said: "The improvement in sentiment that has been captured in recent Housing Market Surveys is reflected in a narrowing in the gap between asking and selling prices. This is particularly interesting given that recent reports from Rightmove suggest that asking prices have been relatively stable since February. As new instructions continue to decline, a lack of supply is providing some support to house prices and that has helped to close the gap. Even so, some caution is still warranted. While the pace of the downturn may be easing, the housing market will still be challenged by an uncertain economic backdrop, the threat or rising unemployment and continued restrictions on mortgage finance." Read more to top Economic news Bank of England: Trends in lending This Bank of England monthly publication presents the Bank's assessment of the latest trends in lending to the UK economy. The research states that all lenders showed that gross mortgage lending fell further in April, the weakest flow since December 2000. The major UK lenders, who have accounted for some 80% of total gross lending flows over the past year, reported a further weakening in May. The major UK lenders have attributed part of that decline to falls in standard variable mortgage rates (SVRs), relative to other mortgage rates. Many shorter-term mortgage deals revert to SVRs on maturity, so the relative decline in SVRs has reduced the incentive for borrowers to refinance expiring mortgage deals. Falls in house prices are also likely to have contributed to low remortgaging activity as some households will no longer have sufficient equity to qualify for a new mortgage with another lender at a more competitive interest rate. But, looking at lending for house purchase specifically, gross lending by the major UK lenders has risen slightly since the start of the year. Lending Panel data show that mortgage applications have risen over recent months, and approval rates have edged higher. Approvals for house purchase have therefore increased, and rose slightly further in May in the Lending Panel data, though from historically low levels Read more to top CBI forecast: Still no real recovery until 2010 The UK economy is stabilising, with the worst of the quarterly falls in GDP behind us, but it will take until the beginning of next year before we see a return to growth, the CBI said this week The CBI expects modest growth to resume during the first three months of 2010, with the pace of growth gradually picking up during next year. It predicts that UK GDP, supported by low interest rates and quantitative easing, should flatten out during the second half of 2009, with quarter-on-quarter figures of -0.1% and 0% in Q3 and Q4, and modest quarter-on-quarter growth of 0.1% and 0.3% in Q1 and Q2 of 2010. Richard Lambert, CBI Director-General said: "The world recession has deepened, so it is not surprising that the UK economy has continued to suffer. However, the harshest period of the recession looks to be behind us, the economy is stabilising and this should continue during the second half of this year. "The return to growth is likely to be a slow and gradual one; difficult credit conditions are still affecting business behaviour. For positive growth to return, lenders need to feel more confident so that credit can start flowing again." The CBI expects that, by the end of the recession, the economy will have shrunk by a cumulative 4.8% - not as severe as the 5.9% seen in the early 1980s - after five consecutive quarters of falling GDP. The CBI expects there to be very slight growth from the start of 2010, with the pace picking up slowly, such that trend growth rates are restored only by the end of the year. For 2010 as a whole, this profile yields an average annual GDP growth of a modest 0.7%. This follows a fall this year in GDP of 3.9%. Read more ONS: Underlying retail growth slows in May The Office of National Statistics reported this week that the volume of retail sales in May 2009 was 1.6% less than in May 2008. It should be noted, however, that in May 2008 there was an unusually large value which will impact on single year-on-year comparisons. Total sales volume in the three months to May was 0.6% higher than the same period a year ago. This is the lowest growth, along with last month and January 1996, since December 1995. Sales volume decreased by 0.2% for predominantly food stores. Sales volume in the three months March to May increased by 0.3%. Three-monthly growth in sales volume increased by 1.2% for predominantly food stores. Sales volume in predominantly non-food stores decreased by 0.4%. Read more Minutes of the MPC meeting 3rd and 4th June 2009 The Bank of England published the minutes of the Monetary Policy Committee meeting held 3rd and 4th June at which it was decided to maintain the Bank Rate at 0.5% and that the Bank should continue with the programme, as announced following its 7th May meeting, of asset purchases totalling £125bn financed by the creation of central bank reserves. Read more to top Industry news Construction Industry Joint Council: No agreement in pay negotiations Talks between employers and unions over a new pay agreement for workers employed under the CIJC Working Rule Agreement have concluded without agreement. Both sides have agreed to resume pay negotiations later this year. Alan Ritchie, General Secretary of construction union UCATT, said: "The unions believe that the construction industry is showing early signs of recovery. It is extremely disappointing that the employers have not felt able to recommend a pay increase at this moment. It is anticipated that a respite in the negotiations will allow the employers to better assess the economic situation. The union side anticipates receiving an improved offer later this year." Gerry Lean, Director of Industrial Relations at the Construction Confederation, said: "These negotiations have been going on for some time and, as usual, are being conducted in a spirit of good will by both parties. Unfortunately the disastrous economic conditions our industry is currently experiencing do not allow employers to increase pay rates at this time. Employers believe the decision to resume negotiations in the autumn against economic conditions prevailing at the time to be a sensible move." CLG: Improving consumer information in the Home Information Pack - summary "Improving Consumer Information in the Home Information Pack", published on 29th July 2008 by CLG put forward two separate proposals, aimed at improving consumer information in the Home Information Pack (HIP). Each of the two proposals had five specific related questions on which views were sought. Overall, responses were broadly positive in relation to both the Property Information Questionnaire (PIQ) and the proposal to simplify the leasehold requirements in the HIP. A summary of the responses to the proposals has been published this week. Read more to top Fresh challenges to South East Plan Two councils have launched legal challenges over the Government's requirement to build thousands of homes on green belt land in their areas in the South East Plan. Guildford Borough Council and South Oxfordshire District Council have served legal papers to the High Court. The decisions by the councils come just days before the six week time limit ran out for challenges to the plan, which was finalised by the Government in early May, closed. Guildford is issuing a legal challenge on the grounds that the plan's requirement for a green belt review to the north east of Guildford town has not been subject to a full environment appraisal. It also argues that the requirement for the building of 2,000 houses on this site has not been justified. Lead councillor for environment Jenny Wicks added: "We recognise that there should be more houses in Guildford, but not to this extent. Our residents voiced their concerns in their thousands to government last year but unfortunately the plan was not changed to take account of them." Read more Finance experts to advise HCA on private investment in housing A new advisory group with a wide ranging remit to look at future sources of private finance for housing has been established by the Homes and Communities Agency. The Housing Finance Group, made up of industry experts and chaired by Nigel Hugill, the recent Executive Chairman of Lend Lease, will look at the future sources of private investment in new and existing housing. It will encompass both affordable and private housing. Speaking at the Chartered Institute of Housing's annual conference, Sir Bob Kerslake, Chief Executive of the Homes and Communities Agency said: "Making the best use of private finance and, importantly, identifying new sources of investment, is crucial if we are to maintain activity and industry capacity throughout the downturn and beyond. The underlying need for producing new housing and improving existing stock hasn't gone away, and I am delighted that the HCA will be able to call on individuals of this calibre to help us inform finance options in meeting that demand. "Their focus will be housing specific but their findings and recommendations will have a knock-on effect on regeneration, which is intrinsically linked, and on individual neighbourhoods and residents across the country." Read more to top Events Delivering energy provision in sustainable development Davies Arnold Cooper LLP & the Home Builders Federation (HBF) are holding a seminar on delivering energy provision in sustainable development on the morning of 14 July in London. The seminar will include a Question and Answer session with a leading panel of experts. The seminar will cover essential guidance and will include the following: Regulation - zero carbon consultation, what is coming on the horizon? Delivery - what works and on what scale? Legal What are the challenges in blending energy delivery and housing? Delivery: limitations of the property law system, how to extract maximum value Consumer choice: implications of Citiworks The ESCO and Consultants' perspective - what developers need to know Please click here for further information and booking details New homes week 2009 The New Homes Marketing Board has announced that it is proposing to hold ‘New Homes Week 2009' between 12th and 20th September. Like the previous New Homes Weeks in 2005 and 2006, which proved extremely successful, the objective of the week will be to promote the new homes market by highlighting the benefits of new build homes, which will hopefully result in increased visitor levels to sites and thus drive sales. It is imperative that the New Homes Marketing Board and the Home Builders Federation assist its members in every possible way to drive sales in such challenging trading conditions. Last year it was felt that the environment was just too turbulent to justify such a campaign, and whilst clearly a challenging environment remains, increased consumer interest dictates that every option should be explored to convert that interest in to reservations. The campaign will be driven predominantly through the local media, and the NHMB will be developing stories around set themes for each day of the week to generate public interest. As well as developing an overarching strategy, NHMB will be looking to link up with members on a local and regional level, and to support them to develop their own initiatives/ events throughout the week. In order that members are fully aware of the proposals it is requested that the relevant member of staff emails new-homes@hbf.co.uk and further details will be sent out shortly. to top HBF Annual Planning Conference 2009 - Staverton Park, Daventry Planning viability 15th September 2009 In the current economic crisis much has been discussed about fiscal policy and incentives but what of planning policy in these challenging times? Is it business as usual or is the current model broken? The 2009 HBF Planning conference will seek to address this and more. Click here for booking details, or contact kellie.kent@house-builder.co.uk. Housing Market Intelligence Conference - Savoy Place, London Tuesday 13th October 2009 The industry's leading business strategy and planning conference and launch of the seventh annual Housing Market Intelligence Report. A booking form will shortly be available but for further information please click here or contact the events team on 020 7960 1646 The Housebuilding Innovation Awards - Millennium London Mayfair Thursday 5th November 2009 The industry's most sought after and prestigious awards will this year be presented at a glittering black tie event on Thursday 5th November. The shortlist will be announced on Wednesday 1st July and tickets will shortly be available to book. For further information please click here or contact the events team on 020 7960 1646 to top For other HBF events visit the website http://www.hbf.co.uk/index.php?id=eventsandmeetings For HBM events visit http://www.hbmedia.co.uk/ to top Rosie Hinchliffe View Previous Weekly News Summary
