Friday, 17th July 2009 Top stories this week Confirmation of additional funding for Kickstart......read more The definition of zero carbon homes.....read more Housing Minister: Green light given on eco-town sites while planning policy on climate change and renewable energy to be reviewed.....read more Liberal Democrats: 100 out of work builders for every job.....read more RICS UK housing market survey, June 2009.....read more Government admits planning targets missed.....read more Quick Links Government and political news Economic news Housing market news Industry news HBF news Events Government and political news Confirmation of additional funding for Kickstart As part of a package of measures announced today on housing, Housing Minister John Healey confirmed that the increased budget for Kickstart - the Government fund to unlock stalled developments announced in the Budget – would be £1bn, more than double the figure initially announced. Healey said that there have been more than 300 bids from developers for money which are currently being assessed by the Homes and Communities Agency. The successful projects will be announced later this month. The announcement also included plans for further funding to deliver more affordable homes including for Local Authorities under the housing private finance initiative (pfi). Read more to top The definition of zero carbon homes Following the publication of the Government’s UK Low Carbon Transition Plan on Wednesday, Housing Minister John Healey MP made a written statement to parliament yesterday on the definition of zero carbon homes and the progress of the eco-towns initiative. The statement confirms that the Government will require a zero carbon standard to be met for new homes from 2016. The standard will comprise a three part “hierarchy”, prioritising first building fabric efficiency, followed by a required level of on-site renewable energy provision (to a level delivering in combination with fabric efficiency an improvement of 70% on 2006 Part L requirments) and then allowable off-site solutions. The statement responds to a number of points HBF has made to Government, including the need to consider zero carbon in the light of the wider impact of regulation on housing delivery – while indicating “the priority the Government attaches to tackling climate change over other potential demands on land values”. The statement also says that the Government is “setting up a specialist task group, reporting ..... in the autumn to examine the energy efficiency metrics and standards which will realise our ambition of the highest practical energy efficiency level realisable in all dwelling types. Following the task group's report, I intend to announce decisions on a clear new standard by the end of this year.” The CLG has also published an impact assessment with regards to the proposed definition of zero carbon homes which details the various options available to each zero carbon, with an analysis and explanation of evidence for each, along with cost implications. We will be circulating a briefing note to members on the statement and related developments. Read Mr Healey’s statement in full Download a copy of the UK low carbon transition plan Download a copy of the definition of zero carbon homes impact assessment to top HBF: Zero carbon homes - progress made, much still to do In its press statement on the announcement on the definition, HBF said it was important the Government had recognised the point HBF has frequently made that there are major technical, cost and consumer challenges involved and the acceptance that zero carbon cannot in most cases be delivered solely on the site of new developments was a step in the right direction. HBF Executive Chairman, Stewart Baseley, commented: "We will continue to work with the Government, but in pursuing the ambition set out in today's document the Government must support the industry wherever necessary on research funding, mitigating cost and other commercial issues. It must also be prepared to take into account the lessons we are bound to learn along the way in rolling out the policy. Unless these issues are taken on board we will not succeed in pursuing zero carbon while also meeting the equally important need to increase the supply of new homes. "Companies are still working on how to achieve the proposed changes in building regulations on energy efficiency in 2010 and 2013 which are equivalent to the energy requirements of Levels 3 and 4 of the Code for Sustainable Homes respectively. The Government's ambition for a 70% improvement on current standards delivered on-site using renewable energy technology from 2016 would be a further major step beyond that. “ Read more to top Summary of responses to consultation on definition of zero carbon homes and non-domestic buildings The summary of responses to the Government’s consultation paper on "The Definition of Zero Carbon Homes and Non-Domestic Buildings", published in December 2008, was published by CLG this week. Read more to top Housing Minister: Green light given on eco-town sites while planning policy on climate change and renewable energy to be reviewed John Healey’s statement yesterday also announced the four sites for proposed eco-towns that have passed the Government's standards to go through to the next planning phase, full public consultation and local planning approval. The successful eco-town sites will “...pioneer innovative design and infrastructure for greener living”. They are Whitehill-Bordon in Hampshire, St Austell (China Clay) in Cornwall, Rackheath in Norfolk and North West Bicester in Oxfordshire. John Healey said: "Planning is at the heart of delivering our ambitious climate change targets. The scale of the challenge is now clear, as is the imperative to plan and design for a low carbon economy. We will therefore review and combine the climate change and renewable energy PPSs, consulting in detail on proposals by the end of 2009." The final part of the Minister’s statement announced that the Government is to review and combine the existing Planning Policy Statements on climate change and renewable energy, with a consultation on proposals later this year. Read more to top Government review into the default retirement age The Government has revealed its review into the default retirement age will be brought forward as a response to the country's changing demographics and the economic environment. The Department for Work and Pensions had previously said the compulsory retirement age of 65 – which was introduced in 2006 through the Employment Equality Regulation – would be reviewed in 2011. The Minister for Pensions and the Ageing Society, Angela Eagle, said: "It is time to look again at [the default retirement age]. We want to give older people flexible retirement options. The government is responding to the changed economic landscape. "The different circumstances today – for businesses, and for individuals coming up to retirement – suggest that an earlier review is appropriate. As Britain's demographics change, it is sensible that we have the debate on what works for business and individuals. The retirement laws need to reflect modern social and economic circumstances." Read more to top Economic news Liberal Democrats: 100 out of work builders for every job There are over 100 builders out of work for every construction job being advertised in Jobcentres in Britain, research by the Liberal Democrats has stated. The information was released following a Parliamentary Question which showed that almost a quarter of a million people in the construction industry are claiming Jobseeker's Allowance. Commenting, Liberal Democrat Shadow Housing Minister Sarah Teather said: "If this crash in house-building continues, many of our construction workers are going to leave the sector. But with a housing shortage and 1.8m families waiting for social housing we simply can't afford to lose our builders. "Unfortunately Gordon Brown's proposals for new homes won't fix the jobs shortage in the construction industry as he continues to rob Peter to pay Paul by raiding existing housing budgets to pay for the new homes announcement. "We need new funding if we are going to provide the good quality social housing families so desperately need, and jobs for out of work builders.” to top CML: Swap rates are not the only influence on mortgage pricing The Council of Mortgage Lenders has commented this week that some recent coverage of fixed-rate mortgage pricing does not fully take into account the complex array of influences on lenders' pricing strategies at present. The CML explains that: Swap rates are commonly cited as "the cost to lenders of fixed rate funds", but the real picture is more complex. The recent decline in swap rates is not necessarily a clear indication that the cost of raising fixed term funding has fallen; A swap rate is the notional cost of exchanging a Libor-level floating income stream for a fixed stream. But simply looking at the swap rate does not account for the fact that not all lenders will be able to raise funds at interbank rates (Libor), especially in the current environment; It is relevant to take account of the cost of the underlying variable rate funding, as well as the swap rate. And some funding is raised directly at a fixed rate (two year commercial bank rate, for example), where recent spreads against a two year fixed mortgage rate have narrowed markedly, telling a very different story to swap rates; Lenders are facing a range of higher costs, including the costs of showing increasing forbearance to more borrowers, the increased costs of holding more liquid assets and more capital as required by the FSA, the relatively higher funding costs incurred as a result of the competition for savings business, scarce and expensive wholesale funding, the high cost of funds that the authorities made available through the Credit Guarantee Scheme, and the reduced returns to lenders necessarily arising from a very low interest rate environment. Read more to top Housing market news RICS UK housing market survey, June 2009 RICS’ UK housing market survey reported this week that price expectations rose for the first time since May 2007, supported by low levels of stocks on surveyors’ books and increasing buyer enquiries. The net balance of surveyors expecting price increases rose for the first time since May 2007. 6% more Chartered Surveyors expected house prices to rise than fall over the next three months compared to a negative reading of 11% in May. The rise in optimism has been driven by the continuing up-turn in buyer enquiries and falling levels of fresh supply. The number of Chartered Surveyors reporting an increase in new enquiries rose again in June, with a net balance of 67% reporting a rise rather than a fall, the eighth consecutive monthly gain and the highest figure since the series began in April 1999. The level of stocks on surveyors’ books continued to provide some support for property prices while new instructions remained marginally in negative territory. In fact the amount of properties on surveyors’ books has declined by around one third over the past year. Consequently, the net balance of surveyors reporting a fall in house prices rose from a negative balance of 43.8 to 18.1%, the highest reading since September 2007. The survey also contained more definitive signs that the rebound in enquiries was feeding thorough into increased transactions. Sales rose again but from very depressed levels. The average numbers of properties sold over the past three months rose to 12.7, up from 11.7. Newly agreed sales, measured on a net balance basis, increased sharply, reaching the highest level since August 1999. Commenting, RICS spokesperson Jeremy Leaf said: “Although the market is showing signs of improvement, it is unlikely that there will be a sustained recovery while mortgage lenders remain risk adverse. A lack of supply on the market is providing a platform for modest price increases. While supply remains tight, the market is likely to show tentative signs of recovery but instructions are starting to increase in some regions and will dampen any serious improvement while economic conditions remain uncertain.” Read more to top CLG: House price index - May 2009 The latest UK house price index statistics produced by Communities and Local Government were released this week. The latest statistics release includes data based on mortgage completions during the month of May 2009. The key points from the release are: UK house prices were 12.5% lower than in May 2008; The mix-adjusted average house price in the UK stood at £188,991 in May 2009 (not seasonally adjusted); UK house prices fell by 0.4% in the quarter ending May 2009. This compares with a fall of 4.8% for the quarter ending February 2009; Annual average house prices fell in England (-12.8%), Wales (-8.8%), Scotland (-6.9%) and Northern Ireland (-23.2%); Annual average house prices paid by first time buyers in May 2009 were 14.8% lower than a year ago. By comparison average house prices paid by former owner occupiers were 11.6% lower. Read more to top NAEA: Sales remain high The National Association of Estate Agents (NAEA) reported this week that the average agent continued to make strong sales, despite having fewer properties available for sale resulting in slightly fewer people searching for a new home than in May. Agents also reported that buyers were increasingly prepared to pay what a seller asked for a property – after the difference between asking and selling prices shrank to just 1.9%– down from a 6.3% difference in May. NAEA President Gary Smith said: “The housing market is in a far stronger position than it was 12 months ago. After several months of continuous improvement the market stabilised in June, ahead of an expected seasonal dip throughout the summer. “The Government should scrap Home Information Packs and must pressure banks to ensure lending is available. We know that there is demand for property and that our professional agents are successfully finding buyers for their clients’ properties.” The average estate agent had 290 house hunters registered in June, down from 299 in May. They had 64 properties for sale, down from 69 in May and a high of 100 in December 2008. However agents continued to make sales, with the average professional agent selling 10 homes in June for the third month in a row, double the amount sold during the worst of the market downturn in August 2008. Last week an independent survey commissioned by the NAEA found that almost a quarter of people – 22.5% – were unable to find a mortgage that they qualify for anywhere in the market. And 56% of those polled believed that a combination of relaxed restrictions and lower deposit requirements would increase the chance of them buying a property. Read more to top Industry news Government admits planning targets missed Targets for the proportion of local authorities that have prepared development plan documents could be missed, Government officials have admitted. The annual report of the Department of Communities and Local Government said the aim of 80% of councils having their DPDs in place by 2011 will be very challenging. Only 10% of local authorities had finalised their DPDs at the beginning of April this year, the report said. Seven out of eight regional spatial strategies were supposed to be ready by April this year, but only five were completed, according to the report. The RSS document for the South East has now been finalised and the one for the South West will be completed in due course, with the document for the West Midlands always scheduled to take longer. Other CLG targets missed included the 13-week deadline for major planning applications, as only 71% was achieved against the benchmark of 80%. There was no reduction in appeals of planning decisions, and in fact the figure rose from 3.5% of applications in 2007-08 to 4.3% in 2008-09. Read more to top Housing and the credit crunch: follow-up The Treasury's Asset-backed Guarantee Scheme (ABS)—the key means by which the Government aims to get the mortgage markets moving again—seems not to be working, says the Communities and Local Government Select Committee in a report published this week. If the Government is to meet its housing targets, further steps must be taken to ensure that house builders can sell the homes they build, say MPs in their latest report on housing and the credit crunch. Following up on a previous report published earlier this year, the Committee took new evidence recently from HBF and mortgage lenders. Launching the Committee's conclusions Dr Phyllis Starkey MP, Chair of the Committee, said: "The Committee strongly supports the Government's retention of its house building targets, despite the credit crunch, because they continue to reflect known needs - as confirmed by recent research by the National Housing and Planning Advice Unit. But house builders simply will not build homes which they cannot sell.” The report also underscores the importance of retaining skills and capacity in the house building sector, to avoid repeating the problems of the last recession after which it took ten years to rebuild capacity in the construction industry. The Committee calls on Government to monitor the situation closely and assess whether more must be done to maintain that capacity. Lastly, the report questions the direction of an effective long term housing policy for the UK, particularly with regard to the balance of housing tenure and the presumption that owner occupation must increase. Read more Download a copy of the report to top Planning Policy Statement: Eco-towns Alongside the announcement of the proposed four eco-towns in Norfolk, Oxfordshire, Hampshire and Cornwall the Government published a further supplement to PPS1 setting out the standards that the developments will have to meet. Based on the work undertaken by the TCPA over the last year the new PPS can be found by clicking here to top HBF news HBF attends first seminar of the Wales Low/Zero Carbon Hub The HBF and members met with the Wales Low/Zero Carbon Hub on Wednesday 15th July to discuss barriers to Low/Zero Carbon Building. The seminar brought together various sectors and organisations in Wales to discuss and identify potential barriers to achieving carbon reduction across all sectors of the built environment. In terms of new housing, we identified cost as a significant factor to be researched by the Hub. We secured a commitment from the Hub to hold a separate seminar for HBF members to discuss the cost implications of increasing the sustainability standards in new homes across Wales. This seminar will be arranged before October 2009 and invites will be sent out in the near future. to top HBF C4 news John Stewart, HBF Director of Economic Affairs this week appeared on Channel 4 news defending the HomeBuy Direct scheme. He appeared alongside Sir Bob Kerslake to rebuff the report that was critical of the fact that only 200 people had so far signed up for the scheme, despite the fact it has only been running for a few months and there are thousands of people in the pipeline. Watch again to top Events The Housebuilding Innovation Awards – 5 November – book your table now!! Bookings are now being taken for tables at the prestigious HBF/Housebuilder magazine Housebuilding Innovation Awards. The shortlist for the Awards was unveiled earlier this month, and reveals the outstanding innovative achievements the industry has made in the past year. For full details go to http://www.house-builder.co.uk/awards/ The Awards, which are supported by the Government, have become among the most sought after in the industry as they recognise excellence in innovation in all aspects of the housebuilding business. The culmination of the Awards is the announcement of the housebuilding firms deemed to be the overall Innovators of the Year –previous winners have included Redrow, Barratt, Explore Living and Midas. The winners will be announced at a glittering black tie awards ceremony on Thursday November 5 at the Millennium London Mayfair Hotel. For further information please contact the events team on 020 7960 1646 or visit www.house-builder.co.uk to top The What House? Awards – Grosvenor House Hotel 20th November The What House? Awards, in their 28th year, are among the most prestigious and longest established in the new homes industry and all house builders, large and small, are invited to enter. Deadline: 31st July. "Winning a What House? Award will prove an even greater achievement in such a severe economic downturn, showing sustained quality of product, despite market conditions and widespread industry redundancies. It is time to crawl from the wreckage and shout about your new homes and re-engage returning buyers with your brand. An Award is a fantastic sales and marketing opportunity for companies to tell the public they build the best new homes in Britain," said Rupert Bates, Editorial Director of the What House? Awards and Show House magazine. The Awards reward housebuilders and developers across 23 categories. There are four new Housing Association categories this year, recognising the hugely important role the sector has in kick-starting the market by delivering thousands of affordable homes through various initiatives. The Awards will be presented at a gala luncheon at the Grosvenor House Hotel, London on Friday 20th November. For ticket information please contact Derek Smith (ds@globespanmedia.com or 020 7002 8300). Please click here www.whathouse.co.uk/awards to download entry forms and a prospectus. to top New Homes Week 2009 – get involved! Preparations are now well underway for New Homes Week 2009 that will take place between12th 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 to consumers by highlighting the benefits of new build homes, which will hopefully result in increased visitor levels to sites and thus drive sales. The New Homes Marketing Board and HBF will be producing a range of literature and marketing materials – including a 16 page colour glossy newspaper - and is encouraging members to get involved and organise events on their sites across the country. For more information and to get involved contact nhw2009@hbf.co.uk 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. Confirmed speakers include: John Healey MP, Housing Minister – invited Grant Shapps MP, Shadow Housing Minister Sir Bob Kerslake, Homes & Communities Agency Stewart Baseley, HBF Michael Coogan, Council of Mortgage Lenders John Stewart, HBF Imtiaz Farookhi, NHBC A booking form will shortly be available but for further information please contact the events team on 020 7960 1646 or visit www.house-builder.co.uk 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
