Friday, 31th July 2009 Top stories this week HCA: Response to Kickstart Programme shows industry’s ‘appetite and capacity’......read more New Homes Week 2009 - 6 WEEKS TO GO – get involved!.....read more NHMB: Almost 80% want national savings scheme for first-time buyers.....read more Nationwide house price index.....read more Bank of England: Lending to Individuals June 2009.....read more Government publishes Community Infrastructure Levy Principles.....read more More homes for more people: advice to Ministers on housing levels to be considered in regional plans .....read more Quick Links Industry news Housing market news Economic news Government and political news HBF news Events Industry news HCA: Response to Kickstart Programme shows industry’s ‘appetite and capacity’ The house building industry’s ‘appetite and capacity to develop’ has been demonstrated by the tremendous response to the Homes and Communities Agency’s £1bn Kickstart Programme, the Agency said this week. Up to 22,400 additional new homes could be built across England through 270 schemes shortlisted in a bid to unlock stalled housing development affected by the economic downturn. Funded by the Homes and Communities Agency (HCA) and developed in conjunction with HBF, the Kickstart Programme will speed up the delivery of much-needed new and affordable homes, maintaining momentum in housing supply. Around 8,600 of the homes will be for affordable rent or sale. The 270 shortlisted schemes, between them seeking over £900m of funding, will now be subject to a due diligence process to test assumptions and further explore risk and deliverability before the HCA confirms if it will support each scheme. The level and form of investment to support successful schemes will be announced on a rolling basis from mid August onwards. HCA Chief Executive, Sir Bob Kerslake, said: “The response to our bidding process shows the level of appetite and capacity for development which is out there in the house building sector. Despite the economic downturn, demand for new homes remains and with some help, quality schemes can be unlocked, adding to new supply very quickly. “In coming to this shortlist we’ve taken care to look at each scheme’s quality and fit with locally identified priorities. Kickstart may be housing led but ultimately it’s all about thriving communities and homes of the right type, in the right place, and for the right people are what we are looking for. “We need to move quickly, not only to help those looking for a new home, but also to keep momentum going within our important house building industry.” Stewart Baseley, Executive Chairman of the Home Builders Federation said: “This is an important announcement for the home building industry that will see work starting on sites that could not previously progress because of the wider economic crisis and collapse of mortgage availability. It will help boost jobs in house building and the supply chain, rebuild housing output and protect capacity so that the industry is better prepared for the recovery.” The 270 shortlisted schemes are promoted by a range of developers – including national and local house builders and RSLs – across every region. A total of 145 local authorities areas are covered by the shortlisted bids, with the North West region having the highest number of schemes. Nearly two thirds of the schemes are anticipated to be Code Level 3 or higher. Read more to top New Homes Week 2009 - 6 WEEKS TO GO – get involved! Industry preparations are now well underway for September’s ‘New Homes Week’ with many member companies building their Autumn marketing campaigns around it. Already, in advance of the official media announcement about New Homes Week that will be issued around four weeks beforehand, the national media including the Daily Telegraph, The Times and the The Daily Mail are looking at producing New Homes Week supplements or dedicating editorial space to the week and the promotion of the benefits of new homes. Members now need to be ensuring they are geared up for the week if they are to reap the benefits of what will be a high profile promotion for the new homes industry. Representatives from almost all HBF members have now signed up, though in some cases it seems that whilst some regions of the company are engaged, managers from another region or division are unaware of developments. With New Homes Week now only six weeks away, members need to ensure all the relevant employees in their organisation are engaged. It is central to success that there are events going on on sites up and down the country to generate some real interest in the national, regional and local media and encourage potential customers to visit members’ sites, so please start planning now. Suggestions about the type of events that could be held are in the New Homes Week members pack. A PDF version of the 16 page full colour consumer newspaper the New Homes Marketing Board (NHMB) is producing for New Homes Week will be available in the next week. The NHMB will be providing copies of this, along with promotional leaflets and marketing materials free of charge to signed up members. If members want to receive the free literature and site packs they must register for them in advance. Members will also be able to order further copies of the newspaper, that are not dated or branded New Homes Week so they are relevant for months to come, direct from the printers at a reduced rate until August 14. NHMB will be taking out advertising across the media, but we are also urging members to incorporate the New Homes Week logo in their own advertising to help generate interest. Finally, a reminder that new-homes.co.uk is FREE until after New Homes Week and is the search engine site that NHMB will be looking to drive people to in their advertising and promotional literature, so make sure you are signed up! For more information and to get involved contact nhw2009@hbf.co.uk or visit www.nhw2009.co.uk to top Businesses to save up to £90m a year on non-domestic planning applications To help businesses cut their costs during the challenging economic climate, the Government has announced that over 25,000 non-domestic planning proposals a year will no longer require a full planning application. These proposals could save businesses at least £20m a year. Businesses, offices, shops, schools and other institutions will benefit from not having to pay planning application fees and administration costs for minor alterations and extensions which can currently cost up to £2,000 or wait weeks to start building. The package builds on reforms recommended by the Killian Pretty Review into the planning system last year and is out for consultation today. The government is also proposing to reduce the amount of unnecessary information that applicants submit with their planning applications which could save a further £50 to £70m a year. Read more to top Land use change statistics (England) 2008 - provisional estimates (July 2009) The latest national statistics on land use change were released this week. The statistics present the provisional figures on land use change in England. Land use change statistics (LUCS) are annual data. This release provides initial estimates for 2008 of changes in the use of previously-developed land and the average density of new dwellings. For some topics 2008 data are not yet robust and so the latest robust data available is presented. In 2008, on a provisional estimate: 79% of dwellings (including conversions) were built on previously-developed land, compared to 77% in 2007; New dwellings were built at an average density of 44 dwellings per hectare, as were dwellings in 2007. In 2007: 2% of dwellings were built within the greenbelt (unchanged since 2004) and 5% of land changing to residential use (from any use) was within the greenbelt (unchanged since 2001); 9% of dwellings were built within areas of high flood risk and 6% of land changing to residential use was within areas of high flood risk. Read more to top BCIS tender price index Q1 2009: Tenders continue to fall as workloads plummet Tender prices remained depressed as construction workloads continued to fall, according to the latest tender price index compiled by BCIS, the Building Cost Information Service of the RICS. The price of new construction work fell by 4.9% in the first quarter of this year and, compared with the same quarter a year earlier, when the index was at its peak, it has fallen a total of 6.4%. BCIS predict that tender prices could see a total fall of 14.9%, from the peak period before prices start to recover in 2011. Declining workloads continued to be the main driver for lower tender prices as contractors sought to remain competitive. New orders for construction fell 19% in the first quarter of the year, and were a massive 38% lower than the same period a year earlier. Joe Martin, Executive Director of BCIS commented: “Despite some more positive news coming from the construction industry recently, it is clear that we are a long way from being out of the woods. Workloads are still significantly down on previous levels, with the private sector still set to bear the brunt of the decline. As a result it is likely that the price of construction work is going to continue falling for some time. However some of the pressure is easing on the costs side, which will be welcome news to those contractors who had perhaps priced too competitively.” Read more to top Housing market news NHMB: Almost 80% want national savings scheme for first-time buyers Almost 80% of Britons believe the Government should encourage young first-time homebuyers to start saving regularly by establishing a national deposit savings scheme offering tax-free bonuses. The call is the key finding of a YouGov survey carried out for the New Homes Marketing Board, whose chairman, David Pretty CBE, has been championing help for first-time buyers for some years and first suggested a Government-backed savings scheme almost three years ago. Mr Pretty commented: “Even the recent substantial falls in property prices – which would normally boost affordability – have failed to help, thanks to punitive interest rates and the much larger deposits now required, the reality is that first-time buyers are now worse off than ever.” The YouGov poll showed that almost 60% of respondents believe their children will have no hope of buying a first home without very substantial cash help from their own. David Pretty said: “Irrespective of their income, first-time buyers cannot now buy without a very large deposit and, unless they are lucky enough to have parents who are in a position to help them, or have some significant savings already, most will find it a real struggle to raise the much larger minimum deposits now required, especially if they are already renting. Currently, the situation is so bad that deposits as large as 40% are required to get a decent interest rate from mortgage lenders.” Under Mr Pretty’s plan, savers would get up to five years to accumulate a maximum of £30,000, at which point they would receive a 25% tax-free bonus or concession, pushing the maximum possible total to £37,500. This final figure would provide a 20% deposit on a typical new home, plus Stamp Duty, legal fees and other costs. Read more to top Nationwide house price index The Nationwide house price index reported this week that: The average house price rose by 1.3% in July, from £156,442 in June to £158,871; The three month rate of change was at its highest level since February 2007; The steep fall in housing construction raised risks of longer term supply shortfalls. Commenting on the figures Martin Gahbauer, Nationwide's Chief Economist, said: “The price of a typical house rose for the third consecutive month in July, increasing by 1.3% on a seasonally adjusted basis. The 3 month on 3 month rate of change – generally a smoother indicator of the near term trend – rose from 1.0% in June to 2.6% in July, the highest level since February 2007. House prices are still 6.2% lower than 12 months ago, but this represents another sharp improvement from the 9.3% year-on-year decline in June. Even if prices were to remain unchanged for the rest of 2009, the year-on-year rate would continue to improve since prices were falling very sharply in the second half of last year. For the first seven months of 2009 as a whole, prices have risen by a cumulative 1.3%, suggesting there is now a reasonable chance that prices could end the year slightly higher than where they started. Only a few months ago, such an outcome would have appeared unthinkable.” Read more to top Land Registry house price index The latest figures from Land Registry showed a modest improvement in the monthly change in house prices in England and Wales. The June increase of 0.1% was the first time the monthly change has been positive since January 2008 but the movement does not signal a return to solid growth, but rather flattening prices. The annual drop of 14% took the average house price to £153,046. London experienced the greatest monthly rise in house prices with a movement of 2%, with an average property value of £301,859. All regions in England and Wales experienced a decrease in their average property values over the last 12 months. The region with the most significant annual price fall was the North East with a movement of -15.9%. The number of sales averaged 30,997 per month from January to April 2009 - in the same period last year, the average was 59,948. The most up-to-date figures available show that during April 2009 the number of completed house sales fell by 42% to 36,233 from 62,393 in April 2008. Read more to top Economic news Bank of England: Lending to Individuals June 2009 The Bank of England reported this week that the increase in total net lending to individuals in June (£0.4bn) was lower than both the May increase (£0.5bn) and the previous six-month average. The twelve-month growth rate continued to fall, by 0.2 percentage points to 1.2%, and the three-month annualised growth rate also fell, by 0.1 percentage points, to 0.5%. Within the total, the increase in net lending secured on dwellings (£0.3bn) was unchanged from May and below the previous six-month average. The twelve-month growth rate fell further, by 0.2 percentage points to 1.1%. The three-month annualised growth rate fell to 0.5%. Approvals for house purchase (47,584) and for remortgaging (35,011) were higher than in May and above the previous six-month average. The number of loans approved for other purposes (29,509) was higher than in May but below the previous six-month average. Consumer credit increased by a net £0.1bn, in line with the previous six month average. Credit card lending increased by a net £0.2bn and other loans and advances fell by £0.1bn. The annual growth rate of consumer credit continued to fall, to 1.9%; the three-month annualised growth rate increased by 0.1 percentage points to 0.6%. Read more to top CML comment on Bank of England June lending data The Council of Mortgage Lenders stated that while the latest figures from the Bank of England show 47,584 loans approved for house purchase in June (up from 44,169 in May and the highest level since April 2008), this was still very low on any historic comparison, with 36% fewer house purchase approvals in the first half of 2009 than the same period of 2008. The UK’s outstanding mortgage book is effectively stagnating at the moment with the adjusted net lending total of £343m in June almost unchanged from May (£331m), which was the lowest adjusted monthly figure on record. Commenting on the lending data from the Bank of England, CML Economist Paul Samter observed: “Activity is certainly more positive than at the start of the year. This is consistent with the improvement in housing market sentiment, but the outlook is still sluggish, as capacity constraints on the lending industry and continuing deterioration in the labour market will act as a brake on the pick up. “Overall, these numbers are consistent with our outlook for a gradual improvement from historic lows following the financial system turmoil last year, but for any recovery to be slow and drawn out.” Read more to top CBI Distributive Trades Survey The CBI's latest Distributive Trades Survey showed that sales volumes in the retail sector fell in the year to June, now having declined at a similar pace for the third month running. However, the fall in sales this month was not as severe as the heavy declines seen between July 2008 and March 2009. A faster fall in sales volumes is predicted in August. The survey revealed that, when asked about year-on-year sales volumes in the year to July, 32% of respondents said that volumes had increased, while 47% said they were down. The resulting balance of -15% was better than expected (-21%), although a slightly heavier fall is predicted in August (-23%). Sales were said to be poor for the time of year by a balance of 32% of retailers, which was worse than expected and more severe than in June (-15%). A net 27% expects sales to remain below seasonal norms in August. The three month moving average of sales volumes, which smoothes out monthly peaks and troughs, remained negative (a balance of -16%), and is expected to worsen in August (-21%). The volume of orders placed upon suppliers fell again, with a balance of 13% of retailers reporting a drop in July, and a balance of 17% foreseeing a decline in August Read more to top Government and political news Government publishes Community Infrastructure Levy principles On 30 July CLG published the long awaited draft regulations for the Community Infrastructure Levy (CIL). The regulations are accompanied by a 164 page discussion paper explaining the principles of CIL and setting out a number of areas where further discussion with the development industry is still necessary to agree a practical and equitable level of CIL being set by local planning authorities. Although the associated press release from CLG focused on the statement that CIL will be discretionary this should be read in the context of the provisions for scaling back the limits of S106 which, we believe, will, in practice, lead to few authorities being able to not implement the CIL provisions. HBF will be providing a full briefing note in due course. Read more to top Government responds further to Killian Pretty Review The Government’s latest response to the Killian Pretty Review recommendations are set out in 3 consultation papers published on 30 July. Of greatest interest to HBF members is the reopening of the discussion over how to ensure that information provided as part of a planning application is both relevant and necessary. Please click here to download a copy of “Streamlining information requirements for planning applications” The two other consultation documents propose the introduction of permitted development rights for non domestic property and proposals to change the public advertisement of planning applications. Please click here to download a copy of “Improving permitted development” and “Publicity for planning applications” to top Government to review Planning Policy Statements As part of their package of announcements on planning on Thursday, CLG also announced a comprehensive review of 13 of the 26 existing planning policy statements (PPS) in an attempt to make them clearer, shorter and more user friendly. PPS3 regarding housing, has, of course, been recently revised (Nov 2006) and it is not intended to revisit this in the current review. Please click here for further details, including the timetable for the review process to top More homes for more people: advice to Ministers on housing levels to be considered in regional plans The June 2007 Green Paper, “Homes for the Future: More affordable, more sustainable”, commissioned the National Housing and Planning Advice Unit (NHPAU) to provide the Government with advice about the level of housing provision that should be tested by regional planning bodies in producing regional spatial strategies. The NHPAU accordingly produced its first advice on housing numbers last June. The period since then has been a challenging one for housing markets and NHPAU have therefore updated their advice, taking account of all the latest evidence. The central message is simple: the recession will have little impact on the number of homes that we need to build over the next 20 years. The NHPAU is advising that the bottom of the range figures should increase by an average of 3% to an annual average requirement of 237,800 extra homes a year from 2008 to 2031 for England as a whole and that top of the range figures should increase by 5% to a national average requirement of 290,500 extra homes. There are somewhat larger increases proposed for some regions, most of which are due to updated trend data and improved modelling by the Office for National Statistics. Read more to top HBF news Discussions with the Conservatives HBF held further informal discussions with Conservative Shadow Planning Minister, Bob Neill, this week on issues relevant to the Party’s forthcoming policy green paper on planning and regeneration. to top Events The Housebuilding Innovation Awards – 5th 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. Click here for full details 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 5th November 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 to download entry forms and a prospectus. 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. to top 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
