Friday, 10th September 2010 Top stories this week Eric Pickles meets the major home builders.....read more Further HCA Kickstart and LANB allocations confirmed.....read more Sir Bob Kerslake appointed at Communities and Local Government.....read more Shapps reacts to Guardian report.....read more Social housing repair firm Connaught goes into administration......read more Building for Life - Record number of good housing schemes......read more National insurance holiday for new businesses in the regions begins......read more New Homes Month gets underway......read more Housing Market Intelligence – Shapps to provide keynote address......read more Quick Links HBF news Government and political news Industry news Housing market news Economic news Events HBF news Eric Pickles meets the major home builders Communities Secretary Eric Pickles met members of the HBF’s Major Home Builders Group yesterday to discuss current issues. Areas covered included localism and the new incentive for home building, mortgage finance and the case for helping first-time buyers, the regulatory costs and complexities affecting the industry and facilitating market-based affordable housing solutions. to top New Homes Month and Halifax Bank– new 2 year tracker The Halifax Bank has announced their new 2 year new build special tracker product in conjunction with the New Homes Marketing Board’s New Homes Month initiative. The product features 4.49% for new build and: BBR + 3.99% until 30/11/2012 LTV - 0 - 80% Product code FRF981 Loans available from £0 to £500k £999 Product fee Latest completion date 30/04/2011 £250 cash back ERCs - 3% till 30/11/11, 2% till 30/11/12 Read more to top Government and political news Further HCA Kickstart and LANB allocations confirmed The Homes and Communities Agency (HCA) has confirmed that well over half the 165 uncommitted Kickstart and Local Authority New Build (LANB) schemes under review have now secured funding, following further evaluation in the wake of reductions to the HCA’s budget announced in July. This equates to 44 out of a total of 74 Kickstart schemes and 61 LANB schemes out of a total of 91 schemes which were not under contract before the election purdah period began and subject to evaluation by the HCA’s local teams. This will translate into over 4,800 new homes under Kickstart and over 600 homes under LANB, securing hundreds of new jobs and apprenticeships across England. For individual schemes that did not secure Kickstart or LANB funding, there are still further opportunities for HCA funding through other routes such as NAHP or HMR, and the HCA is working with its regional teams to progress these. Housing Minister Grant Shapps said: "By taking a localist approach we’ve achieved much more than we would have done by acting in isolation. Times are tough, but we're working hard to do all that we can to support the construction industry and revive house building. "Despite the strict measures we're having to take to tackle the nation's huge budget deficit, we’ve managed to safeguard funding for more than half of the previously unsecured housing schemes. "This will mean that more than 5,000 new homes will now go ahead, supporting jobs and providing much-needed affordable housing for first time buyers and those waiting for a social home." Stewart Baseley, Executive Chairman at HBF said: "By reallocating funding in this way, the Government and HCA have demonstrated they appreciate the substantial social and economic benefits of maintaining housing supply. It is great news for prospective home owners and the house building industry alike." "Kickstart investment produces immediate benefits in terms of local job creation, apprenticeships and economic activity and this money will boost communities across the country. The paybacks are enormous. This is especially good news for the industry, coming just as New Homes Month gets underway." Read more to top Sir Bob Kerslake appointed at Communities and Local Government The Cabinet Secretary, Sir Gus O'Donnell, has announced the appointment of Sir Bob Kerslake as Permanent Secretary at the Department for Communities and Local Government. Sir Bob, currently Chief Executive of the Homes and Communities Agency, will take up the post on 1st November. The appointment has been approved by the Prime Minister and the Secretary of State. It follows Sir Peter Housden's departure from the Department in June to become Permanent Secretary to the Scottish Government. The Cabinet Secretary, Sir Gus O'Donnell, said: "I am delighted Bob has been appointed as the new Permanent Secretary at Communities and Local Government. He will bring a wealth of experience and credibility to the role, driving forward the new Government's agenda for devolution of power and autonomy to local councils and neighbourhoods." Commenting on his new role, Sir Bob Kerslake said: "I am honoured and excited by the opportunity to manage a major government department and drive forward the Government's localism agenda." Read more to top Shapps reacts to Guardian report The Guardian this week published a letter from housing minister Grant Shapps in response to an article in the Guardian (25th August 2010) about the future of house building. The letter reads: “Peter Hetherington (Opinion, 25th August) fails to see the bigger picture about what we are doing to get this country building again. “His article seems to suggest that by freeing council's from top-down regional targets we've brought house building immediately to a standstill. In fact, it was under the previous government that the number of new homes being started slumped to the lowest levels since 1924. A resounding endorsement of the bloated Regional Spatial Strategies? I think not. The reality is that dictating how many homes each council builds and by when is not only inefficient, but it can divide and cause resentment among communities. “We believe that local people should get the chance to decide about the future of their own towns and villages and drive forward the building of new and affordable homes where they are needed. Reviving a house-building market that is on its knees takes much more than pieces of paper from central government telling town halls what and when to build. That's why we've pledged to give councils substantial extra funding if they build new homes through our New Homes Bonus. This will mean that they get significant financial benefits from building the homes their communities really need. “And, at the same time, we're giving struggling rural villages the chance to secure their long-term future and build new homes that locals can actually afford to live in through the Community Right to Build. “Everyone knows we need to build more homes, but top-down targets and regional bureaucracy haven't worked - we need more carrots not sticks.” to top Local enterprise partnerships bids from across the country The Government has confirmed that it has received 56 local enterprise partnership proposals from councils and businesses across the country. Local enterprise partnerships have been proposed as a means to rewrite the economic geography of the country - unconstrained by the boundaries of Regional Development Agencies and the previous Government’s approach to regional policy. Proposals include partnerships that cut across existing regional boundaries and include universities or community groups among them. Eric Pickles MP said: "These 56 local enterprise partnership proposals are just the beginning of a new radical way of delivering prosperity and rebalancing the economy. "We are facing economic problems that need solutions from local communities. The secret to the success of local enterprise partnerships will be working on the basis of local economic geography. Gone are the artificial political regions of RDAs; this will better serve the needs of local business. "The bureaucracy of Regional Development Agencies gave local authorities little reason to engage creatively with economic issues. Local enterprise partnerships are a way of tying council and business interests together, and creating the conditions for business to thrive and prosper." Over the coming weeks Ministers will consider the proposals in detail, looking at how they will support economic growth, before providing feedback to partnerships ahead of the publication of the White Paper on sub-national economic growth and the introduction of the Localism Bill. Decentralisation Minister Greg Clark added: "The process of establishing Local Enterprise Partnerships has been led from the bottom up, giving the initiative to local areas to create partnerships which make sense to them, rather than being dictated from Whitehall. I am delighted that Local Authorities and businesses across the country have responded with such creativity." Read more to top Education Secretary Michael Gove announces review of 14-19 vocational education Education Secretary Michael Gove has announced a major independent review of vocational education for 14- to 19-year-olds, to be led by Professor Alison Wolf, of King’s College London. Mr Gove said that for too long vocational qualifications had not been properly valued and that a gap had been left in the country’s skills base as a result. Prof Wolf will look at the organisation of vocational education and its responsiveness to a changing labour market, and will consider ways to increase incentives for young people to participate. The review will also take explicit account of good practice in a selection of developed economies. Prof Wolf will examine: institutional arrangements funding mechanisms including arrangements for who bears the cost of qualifications progression from vocational education to work, higher education and higher level training the role of the third sector, private providers, employers and awarding bodies. She is due to submit a final report in spring 2011, which will include recommendations on how vocational education can be improved. Read more to top Industry news Social housing repair firm Connaught goes into administration Social housing repair firm Connaught put most of its business into administration this week, after its lenders refused to further fund the company. The FTSE 250 component said that its public sector business will be put into the hands of administrators KPMG, though its environment and compliance arms will remain in operation. The company suspended trading of its shares on Tuesday morning, and later said in an announcement to the stock market: “Following extensive discussions with the group’s secured lenders, it is now clear that sufficient support would not be extended to the group as a whole to enable it to continue trading as a going concern.” The value of Connaught shares froze at 16.65p, meaning a drop of over 90% since a surprise profit warning in June. The company blamed government spending cuts for its dire financial state at the time, though rivals Mears and Rok stressed their social housing and public property businesses remained strong. Connaught drafted in Deloitte to examine its accounting practices in July, the results of which have not been made public. The company has around £220m of debt, provided by six banks and four other creditors. Read more to top UNISON: Connaught crisis is warning sign to bring maintenance back in-house The crisis hitting social housing maintenance firm Connaught, which leaves 10,000 workers facing redundancy, is a stark warning of the impact of the government’s public service cuts on the private sector, says UNISON. The UK’s largest public sector union fears that other private companies may also face collapse, as public spending cuts cause suppliers and contractors to lose valuable contracts and business. Dave Prentis, UNISON’s General Secretary, said: “The collapse of Connaught should be a huge wake-up call to the damage that public spending cuts are having on the private sector. It also means we need to re-think how repairs to social housing are delivered. “These services should be brought back in-house, to protect jobs and to make sure that families are not left in sub-standard housing, because of a lack of vital repair and maintenance work. “Sadly, Government public spending cuts are leading to more financial uncertainty for companies with public service contracts across the UK.” Read more to top Building for Life - Record number of good housing schemes A record 55 new housing schemes have qualified for a Building for Life standard this year, 50 per cent more than last year and the largest number in the eight years of the award. The schemes scored more than 14 out or 20 against the Building for Life criteria, the national standard for well-designed homes and neighbourhoods. It is the first time more than half of all entries (96) achieved a standard, suggesting an overall rise in housing quality. A total of 20 schemes qualified for a gold standard and 35 for a silver standard this year, compared to 12 gold standards and 24 silver standards last year. The schemes suggest that housebuilders are increasingly seizing the opportunity to play a leading role in creating successful places, as well as the construction of individual homes. The concept of placemaking can be seen across all 55 schemes, regardless of their size or location. They range from a distinctive scheme in South London with coherent private and public space to family housing at Hulton Square in Salford which provides good access to public transport and makes best use of its location near a park, primary schools and a healthcare centre. Over half of all the schemes that achieved a Building for Life are in the South West (16) or in London (17). A self build development in Bristol, Ashley Vale, is the first scheme of its kind to achieve a Building for Life standard. Wayne Hemingway, chair of Building for Life, said: ‘Building for Life has helped developers and planners talk the same language and by working together they’re creating far better places to live.’ Richard Simmons, CABE chief executive, said: ‘This suggests to me we might finally be starting to deliver good quality housing on a regular basis.’ Stewart Baseley, executive chairman at HBF, said: ‘A record number of standards reflects the industry’s commitment and shows recognition that quality is a driver of business.’ read more to top Changes to the Town & Country Planning (General Development Procedure) Order 1995 On 9th September CLG sent a letter to all Chief Planning Officers drawing attention to changes to the Town & Country Planning (General Development Procedure) Order 1995 (GDPO). A consolidated version of the Order entitled the Town & Country Planning (Development Management Procedure) (England) Order 2010 (DMPO) was laid before Parliament and will come into force on the 1st October 2010. The consolidated Order includes the original 1995 order and all amendments made to it up until 6th April 2010. The new order also includes a change that will allow, in certain circumstances, applicants with partially implemented outline planning permissions to apply for a replacement planning permission with a new time limit for the submission of the remaining reserved matters. This new provision will, in effect, grant a replacement outline planning permission for the implementation of unimplemented phases of the previous permission. All such applications will attract a fee equivalent to a new outline planning permission. Please click here for details of the changes to top Centre for Cities: new report “Beyond the Boundaries” Think tank Centre for Cities has published a report looking at the arguments for cross-boundary working for local authorities in the context of the Government’s policy to promote Local Enterprise Partnerships. The Centre for Cities has championed the idea that economic drivers such as transport and housing should be planned across real economic areas (or 'city regions') for many years. Centre for Cities’ new report, launched this week in association with IBM, assesses the rationale for cross-boundary working, looks at the economic starting position of the ten largest local enterprise partnerships, and sets out the challenges and issues that city leaders and central government will need to consider and resolve. In opening the door for more cross-boundary working, the government has put more powers for cities on the table - but in a spending squeeze, there'll be less money to go with them. To make the most of the new arrangements, the think tank says local enterprise partnerships will need real powers to shape their local economy and the financial flexibilities that will allow this to happen in practice. Please click here to download the full report to top Housing market news Halifax house price index The latest Halifax house price index, released this week, reported that: House prices increased by 0.2% in August. This was the second successive monthly increase following a 0.7% rise in July; House prices in August were 4.6% higher on an annual basis as measured by the average for the latest three months against the same period a year earlier. This was slightly below the 4.9% increase in July, continuing the recent downward trend and compares with a high of 6.9% in May; Prices in July were marginally lower (-0.5%) than at the end of 2009. The current average house price of £167,953 is 9% above its April 2009 low, but remains 16% below its August 2007 peak; Housing market activity was broadly stable. Bank of England industry-wide figures show that the number of mortgages approved to finance house purchase in the three months to July – a leading indicator of completed house sales – were slightly higher (1%) than in the previous quarter, on a seasonally adjusted basis. The number of approvals has been remarkably stable this year, keeping within a range of 46,000-50,000 per month. In total, the number of approvals during January to July was 9% higher than in the same period last year; The combination of lower house prices compared with mid 2007 and interest rate reductions has created a significant improvement in affordability for those buyers wanting to take their first steps onto the property ladder. Indeed, the proportion of a potential new first-time buyer's disposable earnings devoted to mortgage payments has almost halved from a peak of 50% in mid 2007 to 28% - below the 34% average over the past 25 years. Improving home affordability has helped to boost the number of first-time buyers, which was 28% higher in the first half of 2010 compared with the same period last year – 94,600 against 74,000 - according to the latest CML figures Commenting, Martin Ellis, Housing Economist, said: "House prices increased by 0.2% in August. This, together with July's rise, has reversed much of the modest decline in the three preceding months. Prices are now at a very similar level to that at the end of last year. Activity has also been largely static since the start of the year. These developments suggest that the market is broadly stable with house price inflation having cooled since last year when supply shortages helped to push up prices. “The improved economy, strengthening labour market and low interest rates are all supporting housing demand. We expect that UK house prices will remain static overall in 2010." Read more to top NAEA: August activity drops but longer trends remain positive The housing market slowed in August, following the traditional cyclical pattern, according to the National Association of Estate Agents (NAEA). The association’s monthly market report also revealed that longer-term trends remained broadly positive and said the market was in a strong position year-on-year. Michael Jones, President of the NAEA, said: “Year on year, it does not appear that there has been a drop off in activity. However the next couple of months will be telling. The market appears relatively flat at the moment which we expect during the holiday month of August. We would expect some indication during September and October as to which way it is likely to go, before we get the traditional pre-Christmas slow-down.” The number of people registering with agents to look for property fell on average from 292 in July to 250 in August. The number of sales made by the average branch also dipped slightly, from eight in July to seven in August. The percentage of sales made to first time buyers dropped from 26% to 21% from July to August. Over the longer-term however the market remained in a similar position to 12 months previously. A particular positive was the fact that the supply of housing appears to have recovered. The average agent had 69 properties on its books, up very slightly from 68 the month before. Read more to top Economic news Bank of England: Maintains Bank Rate at 0.5% and the size of the Asset Purchase Programme at £200bn The Bank of England’s Monetary Policy Committee voted to maintain the official Bank Rate paid on commercial bank reserves at 0.5%. The Committee also voted to maintain the stock of asset purchases financed by the issuance of central bank reserves at £200bn. The minutes of the meeting will be published at 9.30am on Wednesday 22nd September. to top National insurance holiday for new businesses in the regions begins The new regional National Insurance Contributions (NICs) holiday for new businesses has come into effect. New business set up outside London, the South East and East of England will be eligible for a holiday worth up to £5,000 for up to the first ten employees they hire in their first year of business. This means a maximum saving on their national insurance payments of up to £50,000. The scheme will run for three years. It is estimated that 400,000 new businesses will benefit by having a lower tax bill from employing new staff. New businesses established since the announcement in the Budget on the 22nd June, and which meet the qualifying criteria, will also be eligible to apply. The regional NICs holiday, announced in the June Budget, will encourage the creation of private sector jobs in regions reliant on public sector employment by reducing the cost to new business of employing staff. Exchequer Secretary to the Treasury, David Gauke: “We need to rebalance our economy which has become over reliant on public spending and jobs provided by the public sector. “The NICs holiday for new businesses in addition to cuts in corporation tax will provide a valuable boost to start up businesses and help foster the private sector led recovery that will drive growth in the UK over the coming years” Read more to top Chancellor announces Robert Chote as preferred Chair of the Office for Budget Responsibility The Chancellor yesterday announced Robert Chote as his preferred candidate for the Chair of the Office for Budget Responsibility (OBR). In a letter to the Chair of the Treasury Select Committee (TSC), the Chancellor reaffirmed the commitment he made in July to provide the Committee with the power to veto the appointment of the Chair of the OBR. As such, Mr Chote’s appointment will be subject to a pre-appointment hearing before the TSC. The Chancellor said: “Robert Chote’s experience and suitability to become the first chair of the permanent OBR is beyond doubt. As Director of the Institute for Fiscal Studies, he has been one of the most credible independent voices on the public finances, taxation and public spending. I hope that the Treasury Select Committee will approve this appointment so that he can lead the OBR in its important work over the next 5 years.” Robert Chote said: “The creation of the OBR is a great opportunity to ensure that the tax and spending decisions of this and future governments are informed by demonstrably rigorous and independent analysis of the outlook for the public finances and the economy. “If my appointment is confirmed, I will ensure that the OBR draws on the fullest possible range of information and expertise, from within government and without, and that we will make and present our judgements without fear or favour.” Read more to top Events New Homes Month gets underway New Homes Month 2010 got underway last Saturday with a New Home Buyer supplement in the Daily Telegraph. A range of other national and regional newspapers and radio stations have also been covering the campaign which hopefully will see increased site visitor levels across the country. The campaign is being run by the New Homes Marketing Board (NHMB) and aims to highlight the benefits of new homes. To find out how to get involved contact nhm2010@hbf.co.uk to top Housing Market Intelligence – Shapps to provide keynote address Grant Shapps has this week confirmed that he will provide the keynote address at this year's Housing Market Intelligence conference. The conference and annual report launch will be held on Tuesday 12th October at Savoy Place in London. Now in its eighth year, Housing Market Intelligence has become the leading strategic conference for the house building industry. Other speakers confirmed so far include Persimmon chairman John White, Andrew Whitaker (HBF – planning), John Stewart (HBF – economics) and Michael Coogan, director general of the Council of Mortgage Lenders (CML). The event will sum up the new political climate nearly six months after the election, as well as providing analysis and insight into the market, the economy, the sustainability agenda, mortgages and all the key issues for house builders and associated companies. Please click here for the full agenda, to download a booking form and to book online or contact events@house-builder.co.uk to top HBF Planning Conference – 16th September 2010, Hilton Hotel, Bristol – LAST WEEK TO BOOK! HBF’s Planning Conference this year will be looking at how the industry can ‘make localism work’’. Delegates will be considering; Will the industry be able to deliver new houses under localism? What are the new tools needed? If we are redesigning the planning system will we also be brave enough to redesign the current planning obligations process? How can we put S106 agreements back into the box now that local authorities expect so much? There will be a range of speakers from central and local government, the industry and its advisors. Please click here to see the full agenda, download a booking form and to book online or contact events@house-builder.co.uk with any questions. to top Housebuilder Awards 2010 – Last day for the early booking discount! Today is the last opportunity to take advantage of the early booking discount for this year's Housebuilder awards. The awards, that this year will be hosted by Huw Edwards, presenter of the BBC’s flagship news at 10 programme take place on October 28th. To see the full shortlist for this year’s Housebuilder Awards please visit http://www.house-builder.co.uk/awards/ Now in its sixth year - the prestigious awards bring together the best of innovation and excellence in the house building industry. The awards are the highlight of the house building calendar, celebrating the very best of the industry and recognising the achievements of those leading the way in innovation. This year the winners will be announced at a glamorous black tie event at the Millennium London Mayfair Hotel. To book your table at the Housebuilder Awards, please visit http://www.house-builder.co.uk/awards/ to top HBF Ball – Friday 10th December, London. The HBF Ball will this year take place on Friday 10th December. Traditionally the social highlight of the industry’s year it will take place at the Marriott Grosvenor Square, London. Starting with a fantastic reception, the evening includes a three course meal, live music and dancing till 2am. It’s the perfect way to start your Christmas celebrations and the ideal time to catch up with industry colleagues. We are pleased to announce that our supported charity for this year’s Ball is Habitat for Humanity The HBF Ball is kindly co sponsored by H+H and Ibstock Brick. For more details please click here or email events@house-builder.co.uk for a booking form. to top HBF Technical Conference, Birmingham – 2009 prices held until 1st October! Tuesday 9th November Redefining the regulatory maze. This year’s HBF Technical Conference will this year look at the regulatory burden facing the industry. Discussing the forthcoming changes in the building regulations, the Code for Sustainable Homes and the Flood and Water Management Act. Please click here to book online or download a booking form. Call 020 7960 1646 with any queries. to top For other HBF events visit the website For HBM events visit to top Rosie Hinchliffe View Previous Weekly News Summary
