Friday, 20th November 2009 Top stories this week Edinburgh Napier University wins Queen’s Award for pioneering research in noise insulation of homes.....read more House building: September Quarter 2009, England.....read more Start on site for first Code Level 6 development – Hanham Hall.....read more HBF joins coalition of property experts demanding change on Stamp Duty.....read more Bank of England: Trends in Lending.....read more Queen’s Speech 2009.....read more Quick LinksWales news Industry news Economic news Government and political news Housing market news Events Wales news Devolution of building regulations to Wales move a step closer A constitutional move has been made that brings the devolution of building regulations to Wales a step closer. An Order in Council was approved this week by Her Majesty the Queen which transfers powers to make Building Regulations for buildings in Wales to the Welsh Ministers with effect from 31st December 2011. The order laid before Parliament in July was approved by committees of both Houses of Parliament. Read more to top £30m+ Green investment in Welsh homes will boost renewables sector Environment Minister Jane Davidson and Leighton Andrews, Deputy Minister for Regeneration, has announced that the first phase of arbed*, the Assembly Government’s Strategic Energy Performance Investment programme, is to be rolled out across Strategic Regeneration Areas in Wales (*arbed means to save in Welsh). It will invest in the energy performance of Welsh homes through social housing providers with the most appropriate and most cost-effective measures provided to vulnerable households. In their opening addresses at the Wales Low Carbon Summit Ms Davidson and Mr Andrews said the arbed initiative will act as a catalyst to boost economic development and regeneration while combating climate change and eradicating fuel poverty. Over £30m has been allocated to the programme through the Welsh Assembly Government's Strategic Capital Investment Fund (SCIF) - this will be supplemented by funding from the UK Department of Energy and Climate Change, by investment by energy companies and by investment by social housing providers into the energy performance of their own stock. Read more to top Multi million pound funding package to boost Wales’ knowledge economy A £33m programme, which provides hundreds of scholarship opportunities to develop the skills needed to drive forward Wales’ knowledge economy, has been unveiled by the Welsh Assembly Government. The Knowledge Economy Skills Scholarships (KESS) programme will provide over 400 PhD and Masters places over the next five years to develop higher level skills through collaborative research projects with companies in Wales. Read more to top Wales has a stronger global position because of devolution, says Rhodri Morgan The first decade of devolution in Wales has transformed the nation’s relationship with the world and created a new confidence, First Minister Rhodri Morgan declared in one of the last speeches before he retires as Labour leader. Mr. Morgan, who steps down on 8th December, claimed that devolution had not forced the Welsh inwards but had given people the confidence to face the world as part of a global nation. He said: “Far from becoming more inward looking, devolution initially forced us as a nation to put our heads above the parapets... “For too long, our lack of confidence had emerged as a sense of suspicion of the wider world. “Our determination to defend our sense of political, social and cultural identity risked appearing to others as an inwardness and a willingness always to blame others, rather than take responsibility for our own affairs, and our own future.” Read more to top Social Housing Stock, Lettings and Vacancies, 2008-09 The latest National Statistics on Social Housing Stock, Lettings and Vacancies produced by the Welsh Assembly Government were released on this week according to the arrangements approved by the UK Statistics Authority. The statistics on Registered Social Landlord stock in Wales include data as at 31st March 2009. The key points from the latest release are: There were 232,653 social landlord dwellings, bedsits and bedspaces in Wales, which represents an increase of 3% since the end of March 2008; By 31st March 2009, the majority of social housing stock (51%) was managed by Registered Social Landlords (RSLs). This is unsurprising as RSL stock has increased by 27% over the last year; 1.9% of social housing stock was vacant. The proportion of vacant social housing stock has remained relatively stable over recent years, with stock owned by local authorities showing slightly higher vacancy levels than stock owned by Registered Social Landlords (RSLs); During 2008-09 there were 21,243 new lettings of social housing stock. Read more to top Industry news Edinburgh Napier University wins Queen’s Award for pioneering research in noise insulation of homes Ground-breaking noise insulation techniques pioneered by Edinburgh Napier University and have led to a 4-fold drop in complaints about noise from neighbours in new build homes and benefited over one million home owners. The research, that was funded by HBF and many of the country’s biggest house builders, has now has received the highest accolade that can be conferred on a higher or further education institution in the UK – the Queen’s Anniversary Prize for 2009. The prize, which will be officially awarded at Buckingham Palace in February 2010, recognises the effect that this world leading research has had on revolutionising new-home building practices and standards in England and Wales. The new innovative wall and floor constructions dramatically reduce noise transmission within new homes. It was one of the largest and most intensive research projects ever undertaken between a university and the house building industry and has seen 400,000 new homes incorporating the pioneering designs. Noise complaints, which had risen by 140% between 2001 and 2004, are at their lowest level in eight years in England and Wales for new housing due to the innovations emerging from the research. Stewart Baseley, Executive Chairman of the Home Builders Federation said in response to the announcement; “The success of this industry-funded scheme, and the benefits it has bought to hundreds of thousands of new home owners, as well as house builders, powerfully demonstrates the innovatory advantages of the industry working together to develop its own solutions rather than having regulation imposed. This experience has given us a template for the future in terms of developing and mainstreaming means of providing good quality homes in the most efficient way, so delivering an improved product for our customers as affordably as possible.” Read more to top House building: September Quarter 2009, England The latest national statistics on house building in England were released under the auspices of the UK Statistics Authority this week. They report on the period July to September 2009 and update those previously released on 28th October 2009. Key points from the latest release are: There were an estimated 25,820 seasonally adjusted housing starts in England in the September quarter 2009, up 18% on the previous quarter and 16% higher than the September quarter 2008. This is the third successive quarterly rise in seasonally adjusted housing starts; Private enterprise housing starts (seasonally adjusted) were 21% higher than in the June quarter 2009, and 20% higher than in the September quarter 2008; Annual housing starts figures for England totalled 83,080 in the 12 months to September 2009, down 35% compared with the 12 months to September 2008 and 55% below their 2005-06 peak; Housing completions in England were down by four per cent to an estimated 29,050 (seasonally adjusted) in the September quarter 2009 compared to the previous quarter. Compared with the September quarter 2008, completions were down by 12%; Private enterprise housing completions (seasonally adjusted) were 8% lower in the September quarter 2009 than the June quarter 2009, and 18% lower than in the September quarter 2008; Annual housing completions in England totalled 122,800 in the 12 months to September 2009, down by 21% compared with the 12 months to September 2008. Read more to top Five year land supply for housing in England as at April 2009 This release of Official Statistics is the first in an annual series summarising Local Planning Authorities' reported assessment of the '5 year land supply' for housing. This release reports on the land supply for the 5 years from April 2009. The statistics include: The number of and proportion of authorities which reported having identified at least a sufficient supply of sites for their housing requirements for 5 years from April 2009; Each local planning authority's reported proportion of the '5 year housing requirements' that can be accommodated on available, suitable and achievable sites. As at April 2009: 86% of all Local Planning Authorities reported to have identified sufficient sites to supply 100% or more of their housing requirement for the next 5 years; The North East, North West, West Midlands and London had the highest proportions of Local Planning Authorities (91% each) reporting at least a sufficient supply of land for housing requirements over the next 5 years; The East Midlands and the South West had the lowest proportion of Local Planning Authorities (78%) reporting at least a sufficient supply of land for housing requirements over the next 5 years. Read more to top Start on site for first Code Level 6 development – Hanham Hall Work officially commenced this week on England’s first large-scale zero carbon development at Hanham Hall near Bristol. Start on site was marked by the arrival of key construction workers along with portable site offices and construction equipment. This follows completion of the formal contractual commitments and planning permissions between the Homes and Communities Agency (HCA), the national housing and regeneration agency for England; and Barratt Developments PLC; and South Gloucestershire Council. Mark Clare, Chief Executive of Barratt Developments PLC, said: “We are delighted to be starting work on the first zero carbon community at Hanham Hall. There is no doubt that there will need to be significant changes in the way that homes are constructed to meet higher environmental standards. This project places us at the forefront of that important agenda.” Following the launch, John Slaughter, HBF Director of External Affairs, commented on the challenges involved in seeking to build to zero carbon standards in an interview on Radio Five Live’s drive-time programme on Thursday 19th November. Read more Listen again (piece starts at 2:23) to top JRF research shows Government will fail to meet its target for delivering new homes New research launched this week by the Joseph Rowntree Foundation shows the Government is unlikely to meet its target of three million new homes by 2020. In order to reach this number, the Government has a target to build 240,000 homes every year – a rate not achieved at any point since the early 1990s. The Housing and neighbourhoods monitor, produced for the JRF by a team of researchers from Manchester University, Glasgow University and Ulster University, analyses key housing and neighbourhood trends across the UK. The report highlights the following areas of concern: There are shortages in housing in many parts of the country particularly in southern Wales, large parts of southern and central England and Northern Ireland; Inequality between areas is a major concern. For example: house prices in South East and South West England are ten times average household incomes in many neighbourhoods; Housing supply and affordability will continue to be a problem due to the economic downturn and a projected increase in household numbers. Read more to top Regional strategy Bill gets Royal Assent The Local Democracy, Economic Development and Construction Bill has received Royal Assent. The Act creates: The responsibility for developing a single regional strategy, which will provide a blueprint for housing, transport and economic development; A new requirement for councils to undertake an economic assessment of their area to contribute to the development of the regional strategy; New powers to create ‘Economic Prosperity Boards’ to promote economic development and regeneration across council borders, within the overall framework of the regional strategy; The creation of Multi Area Agreements (MAAs) with statutory duties to provide a further option for local authorities to work together on economic development by allowing MAAs to be put on a similar statutory footing to Local Area Agreements; A requirement for councils to respond to local petitions on the issues that are of most importance to their local communities. Read more to top National Housing and Planning Advice Unit new interim Chair announced Communities and Local Government have announced that Dr Peter Williams will be taking up the position as interim Chair of the Board of the National Housing and Planning Advice Unit (NHPAU). Peter Williams has a wealth of experience in housing and mortgage markets and has been a key member of the Board of the NHPAU since its creation. He will be taking over from Steve Nickell who, as Chair of the NHPAU, established the Unit as an authoritative and valuable source of independent, expert and evidence-based advice on housing requirements. Peter Williams is well known to the HBF from his time at the Council of Mortgage Lenders. Read more to top TCPA unveils new eco-town guidance The Town and Country Planning Association (TCPA) have published new guidance, endorsed by Government, on achieving the right housing offer in eco-towns. TCPA Chief Executive Gideon Amos said: “Aspiring to live in an eco-town will come from decent homes in good quality environments that combine the best features of town and country. We want to see attractive and excellent homes that will appeal to all as much for their utility, location and setting as for their green credentials. Providing homes of choice in eco-towns will be crucial to raising aspirations for the planning of all new development.” The Eco-towns Housing Worksheet ‘creating low carbon homes for people in eco-towns’ highlights that a holistic approach is essential so that people will chose to live in an eco-town because of all the benefits on offer, from access to infrastructure planning, and from equity to land values, and not just for the eco-features. Read more to top Economic news HBF joins coalition of property experts demanding change on Stamp Duty HBF has joined other industry bodies in supporting the high profile 1808 Coalition, set up by the National Association of Estate Agents (NAEA) and the Association of Residential Lettings Agents (ARLA) to campaign for the Government to modernise Stamp Duty. 1808 Coalition partners are: Home Builders Federation (HBF) Association of Mortgage Intermediaries (AMI) Association of Residential Lettings Agents (ARLA) Building Societies Association (BSA) Council of Mortgage Lenders (CML) National Association of Estate Agents (NAEA) National Landlords Association (NLA) The Coalition is named after the year in which a Stamp Duty tax was first introduced and this week launch generated significant national media coverage. As well as campaigning for reform of Stamp Duty, the Coalition is seeking an extension of the current Stamp Duty “holiday” for properties lower than £175.000 which is due to expire at the start of 2010. In a recent survey by the NAEA, 91% of estate agents surveyed felt that it should be extended. 86 per cent of those surveyed also felt that the tax is unfair. John Stewart, HBF’s Director of Economic Affairs, said: “It is imperative that the first signs of market stabilisation that have emerged in recent months, and which have allowed home builders to begin tentatively opening new sites and expanding output and employment, are nurtured. The Government’s stimulus measures for housing, including the raised stamp duty threshold, have played a significant part in this stabilisation and it is vital that they are not removed at this still fragile stage, either in total or in part.” Read more to top 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 latest edition reported that the flow of total net mortgage lending slowed in September to £0.9bn though the annual rate of lending growth remained broadly unchanged. Mortgage approvals for house purchase increased in October, according to data from the major UK lenders. The rise in gross lending for house purchase includes an increase in lending to first-time buyers as well as to home movers, according to data from the Council of Mortgage Lenders (CML). The gradual increase in gross mortgage lending for house purchase by the major UK lenders in recent months reflects the recovery in the number of mortgage approvals for house purchase since the beginning of the year. In the Lending Panel data for October, the major UK lenders reported that approvals for house purchase rose to around 61,000, from some 56,000 in September. The Royal Institution of Chartered Surveyors’ (RICS) new buyer enquiries balance continued to rise in October pointing to a further increase in demand for mortgages for house purchase. However, the volume of housing transactions remained low by historical standards. Total net consumer credit flows remained negative in September. Gross credit card lending has remained weak in recent months alongside subdued spending on credit cards. In September, effective rates on credit cards and overdrafts remained broadly flat, though the rate on personal loans increased. The major UK lenders expected consumer credit to remain weak over coming months reflecting further tightening in both credit availability and demand. Read more to top CML: Gross mortgage lending up 5% in October October gross mortgage lending was an estimated £13.5bn, a 5% rise from £12.9bn in September but down 27% on £18.5bn in October 2008, according to the Council of Mortgage Lenders. This latest monthly change represents typical seasonal activity between September and October - the average monthly rise over the last decade for this period has been 5%. The CML believe the annual comparison figures should start to improve a little in the coming months as underlying lending volumes dropped sharply in the latter part of 2008 and early 2009. The October outcome is in line with the CML’s updated forecast for gross lending of around £141bn for 2009 as a whole. Some seasonal slowdown is expected over the remainder of this year. In the CML market commentary, CML economist Paul Samter observes: “There has been a significant change in the type of lending taking place from the start of the year. House purchase activity has picked up significantly. In contrast, remortgaging has dropped to decade-low levels as many borrowers have little incentive to refinance when they move onto low reversion rates, and others find themselves unable to do so due to equity constraints. “The coming months are likely to be dominated by seasonal factors rather than underlying change.” Read more to top Government and political news Queen’s Speech 2009 The Queen outlined the Government’s priorities for the coming Parliamentary year in the Queen’s Speech following the official state opening of Parliament this week. The Queen said: “My Government’s overriding priority is to ensure sustained growth to deliver a fair and prosperous economy for families and businesses, as the British economy recovers from the global economic downturn. Through active employment and training programmes, restructuring the financial sector, strengthening the national infrastructure and providing responsible investment, my Government will foster growth and employment... “My Government will continue to reform and strengthen regulation of the financial services industry to ensure greater protection for savers and taxpayers. Legislation will be brought forward to enhance the governance of the financial sector and to control the system of rewards. “As the economic recovery is established, my Government will reduce the budget deficit and ensure that national debt is on a sustainable path. Legislation will be brought forward to halve the deficit.” Read more to top Opposition reactions to the Queen's Speech The Conservative and Liberal Democrat leaders both criticised the Government’s legislative programme. David Cameron commented that the Prime Minister was more pre-occupied with self-survival than legislating on the measures the country needs. He said Labour had "run out of money, run out of time, run out of ideas". He added that against a background of a country facing "the most difficult circumstances for a generation" the Government had set out "a Queen's Speech which is just a Labour press release on Palace parchment". In his contribution to the debate on the Queen’s Speech, Liberal Democrat Leader Nick Clegg said: “After 12 long years, in which this Government has passed nearly 500 different laws, along with countless thousands of statutory instruments, it is right to stop and ask the question: what is this Queen’s Speech really for? “When backed into a corner, when unsure of what to do, this government always reaches for its pen and starts drafting a new law..... when people desperately need help, the government should legislate less and focus on getting things done.” to top ....and raise housing In the Debate on the Address, David Cameron and the Liberal Democrats both also criticised the Queen’s Speech for failing to include measures on housing. David Cameron said, “He promised 3 million new homes - that was his big boast when he became leader - but house building in England today is at its lowest level since 1947. We have seen the budget for affordable housing quadruple, but the number of new social homes built in Britain has been cut in half.” For the Liberal Democrats, Simon Hughes said, “There was not a single word about housing…..the number of people waiting for social housing is higher than it has been in any decade since the 1940s, there was nothing to show the sort of the commitment that people would have expected from a Labour Government to deal with the massive housing crisis that is being experienced in every constituency in Britain” In response to these criticisms, the Prime minister said, “That is because we announced in July new measures to put £1.2 billion into social housing and building new houses. We gave local authorities power to build houses again, and at the same time we said that we would build new social housing for people in this country to rent. I have to tell the hon. Gentleman that in first 10 years we modernised 2 million houses, repairing and refurbishing them for the new generation. Now we have to build new houses, and we have committed ourselves to doing so. That is in the statement that was made in July to move the housing programme forward.” to top John Healey: Government Kickstart cash getting Britain's house builders building again Housing Minister John Healey this week put the first spade into the ground of the first Kickstart project. Mr Healey saw workers at the Yarn Street development in Leeds who are on site following Government Kickstart cash. This is the first of over 150 projects which will get off the ground shortly, with almost 100 across the country gearing up to start work by the end of the year. The 281-home Yarn Street development had lain at a standstill for over a year and a half and would likely have remained so without Government help. As a result of almost £4m cash under Kickstart around 70 workers are back on the site - some of whom have been rehired having previously been laid off. Read more to top Political compromise reached on the revision of the Energy Performance of Buildings Directive Following a further round of talks this week between the European Council, the European Parliament and the European Commission, a political compromise has been reached on revision of the Energy Performance of Buildings Directive. It is understood the compromise centres on an agreement that from 2020 every new building constructed in Europe should need “nearly zero” energy for heating, cooling and lighting purposes. This would mean that by the end of 2020 EU Member States must ensure that all newly-constructed buildings have a "very high energy performance” and their energy needs must be covered to a very significant extent from renewable sources, including energy produced on-site or nearby. We also understand the Council took on board the Parliament's proposals to require Member States to draw up national plans for increasing the number of nearly zero energy buildings. Member States would also, by mid-2011, need to make a list of financial and other incentives for the transition, such as technical assistance, subsidies, loan schemes and low interest loans. Existing buildings will have to improve their energy performance after major renovations, if this would be technically, functionally and economically feasible. HBF will be seeking to clarify further the details of the compromise which is due to be approved at the meeting of the Energy Council on 7 December. In our recent contacts with the UK Government on the revision of the Directive, CLG has said the Government would not be content with an outcome that cut across the national zero carbon policy and the summary details of this week’s compromise suggest that this objective has probably been achieved. to top Housing market news Rightmove house price index The Rightmove house price index, published this week, reported that: Three months of price falls are expected as new sellers drop asking prices by £3,744 (-1.6%); Low stock and improvement in mortgage availability have failed to buck the seasonal price-fall trend; The year-on-year house price increase of 1.6% is the largest since May 2008 (+2.2%), with 7 out of 10 regions now in positive territory as recovery spreads north; There has been no rush to beat the stamp duty deadline as lenders’ high deposit requirements make the incentive almost irrelevant. Miles Shipside, Commercial Director of Rightmove commented: “Many would-be sellers are still unwilling or unable to come to market, and with the number of new build properties running at half of the levels required to satisfy anticipated demand, aspiring home-movers are set for a frustrating time for years to come. Norman Tebbit once urged people to get on their bikes and look for work, but it’s much more difficult for homeowners to take up jobs in other parts of the country if they have insufficient equity in their current property to get a new mortgage at a competitive interest rate. “The shortage of stock is worse in the south than it is in the north, leading to greater upwards pressure on prices due to higher numbers of willing and able buyers who have fewer properties to choose from. Recoveries tend to start in the south, and with mortgage lenders favouring buyers with larger deposits and greater job security, it is no surprise that the trend has been repeated this time round. With parts of the north of the country also clawing their way back to a year-on-year price standstill, we recorded an average annual national rise of £3,461. That would have looked pretty far-fetched a year ago”. Read more to top RICS: Lagging regions to be hit by stamp duty return The Royal Institution of Chartered Surveyors (RICS) has published further research from their October Housing Market Survey. The research states that a return to the previous bands for stamp duty, when the current holiday is due to end on the 31st December 2009, could have a detrimental effect on the recovery of the housing market in regions that are already lagging behind. More surveyors in the West and East Midlands, Wales and Scotland reported that they believe that they will see a drop in activity in 2010 following the end of the stamp duty holiday for properties priced between £125k and £175k at the end of the year. Tellingly more surveyors in Wales and the East Midlands were still seeing price falls rather than rises in the last housing market survey. Meanwhile in the West Midlands, only 3% more surveyors saw prices rising in October. Overall, however, the majority of Chartered Surveyors are not expecting the end of the stamp duty holiday to have a distorting effect on the housing market despite the benefit it has provided first-time buyers. Those working in London and the South East strongly agree with the view that it is not forcing more houses onto the market now, and will not lead to a drop in activity once the old threshold is re-introduced. However, this may reflect the fact that the holiday has had limited impact in these regions as the average house price is well above that of the stamp duty threshold. Read more to top Events Consumer code briefings A series of briefings is now underway on the proposed Consumer Code for home builders, which will be introduced in April 2010 in response to issues raised in the OFT market study into the home-building industry that was published in September 2008. The events will take place on: Leeds - 25th November Royal Armouries Bristol - 30th November Holiday Inn Filton These initial, senior-level briefings are for chief executives and managing directors. The presentations will introduce the requirements of the Code and will examine the potential impact on your business. Places are limited and will be allocated on a first come, first served basis. Details of these FREE briefings and a copy of the Code itself are available on the Consumer Code website at www.newhomesconsumercode.com to top For other HBF events visit the website http://www.hbf.co.uk/index.php?id=eventsandmeetingsFor HBM events visit http://www.hbmedia.co.uk/ to top Rosie Hinchliffe View Previous Weekly News Summary
