Friday, 3rd September 2010 Top stories this week Policy Exchange report – ‘How to make housing more affordable for everyone’.....read more Balls demands £6bn for affordable homes.....read more Young adults will have to wait until they reach middle age to buy first home - NHF.....read more BCC upgrades UK short-term economic prospects.....read more New Homes Month starts tomorrow!......read more Quick Links Government and political news Housing market news Industry news Economic news Events Government and political news Policy Exchange report – ‘How to make housing more affordable for everyone’ Leading think tank Policy Exchange this week published a major new report looking at how to make housing more affordable for everyone. It says that Britain’s current housing policy has failed the poorest, and is contributing to our huge deficit. It recommends reducing the rate at which rents and house prices rise by increasing the numbers of new homes built. Since the evidence shows under-supply caused by the current planning system is behind rising prices, Policy Exchange argue it is necessary to create a ‘community-controlled’ planning system which moves to a more consensual model of planning, where those actually impacted by development (not local councils) decide on whether or not to allow developments. Unless most local residents vote against it, the proposed housing development would automatically be approved. This should substantially increase the numbers and quality of new homes built. This would in turn hold down rents, house prices, Housing Benefit, and the Government’s measure of inflation, the CPI, (which will in future incorporate housing costs). Read more to top Balls demands £6bn for affordable homes Shadow education secretary Ed Balls who is campaigning for the Labour Party leadership has set out a plan for investing £6bn in new affordable homes. He said the plans would create 750,000 new jobs in the construction industry, and meet ‘an acute social need’. Mr Balls set out his ‘alternative plan on housing’ alongside former Labour housing ministers John Healey and Yvette Cooper. ‘The truth is that whilst we made progress, Labour leaders over several decades never paid enough sustained attention to housing.’ Writing on the Labour List website he said the investment in house building could be funded from a £12 billion improvement in public finances, as state borrowing for 2009/10 came in at £155 billion rather than the £167 billion predicted in the March Budget. He is also calling for VAT on repairs, maintenance, and improvements to housing to be cut to 5 per cent, rather than increased from 17.5 per cent to 20 per cent in January. He said this could be funded from part of the remaining £6 billion ‘windfall’. Read more Read Ed Balls official statement to top Channel 4 reports on increasing affordability crisis. Channel 4 News this week reported on the danger posed to housing affordability by reduced housing supply. The report focused on the need to increase house building and the threat posed to supply by NIMBYism under the new Government’s ‘localism’ agenda. Watch the report to top Grant Shapps: Bypass Whitehall and scrap outdated byelaws Local Government Minister Grant Shapps outlined plans to give councils a new power to review and revoke outdated byelaws. This means that old local rules, like those about dickey straps in Hammersmith, fish frying in Gloucester, and carpet beating in Blackpool will be a matter for these areas, rather than central government. As part of wider Government plans to hand power back to councils and communities the planned reforms will mean that councils can create new byelaws or get rid of old ones without seeking permission from Whitehall. Read more to top Housing market news Land Registry: July house prices up 0.4% since June The July data from Land Registry's House Price Index shows an annual price increase of 6.7% which takes the average property value in England and Wales to £166,798. The monthly change from June to July is an increase of 0.4%. Nine regions in England and Wales experienced increases in their average property values over the last 12 months. The region with the highest annual price change is London with an increase of 12.1%. The region with the greatest annual price fall is the North East with a movement of -1.4%. The South West experienced the greatest monthly rise with a movement of 2.2%. Wales experienced the most significant monthly price fall with a movement of -1.1%. The most up-to-date figures available show that during May 2010, the number of completed house sales in England and Wales rose by 8% to 49,412 from 45,814 in May 2009. The number of properties sold in England and Wales for over £1m increased by 67% between May 2009 and May 2010, from 255 to 426. Read more to top Hometrack - House prices slip 0.3% House prices in England and Wales fell 0.3% in August, Hometrack’s latest national housing survey has found. “The housing market is in the process of a modest re-pricing that is likely to run for the next six to 12 months,” commented Hometrack’s director of research Richard Donnell. He added that the last few months had shown clear signs of a changing underlying trend between supply and demand with the effects of the election and the abolition of Home Information Packs (HIPs) being key factors: “But while the removal of HIPs has allowed sellers to put their homes on the market at no cost, so the commitment of vendors in agreeing to sales at realistic pricing levels remains questionable.” Over the last five months, housing supply for sale has grown 14%, with demand falling 2%. In August, prices fell in nine regions. Read more to top House prices slide 0.9% - Nationwide UK house prices fell 0.9% in August, Nationwide’s house price index has revealed. The average price of a home now stands at £166,507. The drop follows a 0.5% slip in July and marks the first time since February 2009 that house prices have decreased in two consecutive months. “The three-month-on-three-month rate of change fell from 1.2% in July to 0.0% in August, suggesting that house prices have stagnated over the summer,” commented Nationwide’s chief economist Martin Gahbauer. “Unless house prices bounce back strongly in September, the rate of change will turn negative next month.” Gahbauer explained that with the increase of sellers to the market, buyers had been handed more bargaining power to drive down asking prices. But he added: “Given that the price increases of the last year had gotten ahead of the recovery in the wider economy, the current correction is not an unhealthy development.” to top Halifax - Detached house prices rise by £91 a day over the past year Halifax has indicated that during the last year family homes price rises surpass those of all other properties. According to new research by Halifax, based on its own house price data, owners of detached properties have on average seen the value of their home increase by £91 a day over the past year with the average price rising by 13% from £266,060 in 2009 Quarter 2 to £299,295 in 2010 Quarter 2. Prices for all other property types rose by 8-9% over the period. Semi-detached homeowners are, however, the biggest property winners over the past decade. Semi-detached properties recorded the largest average price increase (111%) since 2000; marginally higher than for terraced properties (110%) and bungalows (109%). Flats were the only property type not to double in value over the last ten years with an 81% average increase. Read more to top NHF predict four more years of negative equity for homeowners who bought at the peak The National Housing Federation this week said that homeowners who bought at the peak of the market peak may face four more years of negative equity based on commissioned economic research. According to the NHF research the average buyer paid £216,800 for a home in 2007 and may have to wait until 2014 before prices recover enough to make their homes worth more than they paid. David Orr National Housing Federation chief executive said; “Proposed caps on housing benefit payments could also put nearly a million people on low incomes at risk of losing their home.” Read more to top Young adults will have to wait until they reach middle age to buy first home NHF’s research separately found that the average 21-year-old will have to wait until they reach middle age before they can afford to get a foot on the property ladder – and in some parts of the country could be in their 50s. Single young adults will finally be given the keys to their own place when they hit 43 – providing they have not had children and have successfully saved up a large proportion of their income over the previous two decades, the research found. The situation is forecast to be even grimmer for those hoping to get a home in London, with a warning that they will have to save up until they’re 52 years old to afford a mortgage. Read more to top Industry news Housebuilders to be given more flexibility over zero carbon pledge – Guardian. The Guardian this week reported that a greater degree of flexibility is to be afforded to house builders over how they meet a government commitment to make all new homes zero carbon by 2016. It said that previous proposals stipulated that 70 per cent of the carbon reductions necessary to meet this target would be made through energy-saving measures and on-site renewable energy sources. The rest would be delivered through a scheme whereby housebuilders would contribute £4,500 per house into a community fund for renewable energy projects or energy-efficiency measures. However, according to the Guardian, housebuilders have complained that this will lead to a 20 per cent premium being put on the cost of new homes - something buyers will be unwilling to pay. The paper reports that the Communities and Local Government department is willing to accept a greater degree of carbon offsetting incorporated into the proposals instead. "We need to set a realistic benchmark for carbon emissions in building regulations which also takes account of costs," commented housing minister Grant Shapps. Read more to top Construction Skills - Cut the Carbon’ campaign in October 2010 ConstructionSkills is launching a ‘Cut the Carbon’ campaign in October 2010 in partnership with the Federation of Master Builders (FMB) and the National Specialist Contractors Council (NSCC). This campaign is helping small and medium-sized (SME) contractors in particular to prepare for a low-carbon future. To ensure the Cut the Carbon campaign supports SME contractors and the wider construction industry in the most effective way, CS are conducting some research to gauge views on the ‘Low Carbon Agenda’. This will help to demonstrate to contractors what their clients need from them. Read more to top New research aims to make our homes smarter and more energy efficient Over a dozen new research and development projects now underway will aim to show how smart meters can be integrated with communications technology to make homes more energy-efficient, and consumers more energy-aware. Thirteen major new projects are to receive support from the Technology Strategy Board which, in partnership with the Department for Business, Innovation and Skills (BIS), will invest £3.8 million in the innovative research and development. The projects will integrate 'smart' meters with communications technology to make a 'smart' system that will have an impact on the demand for energy in the home. Iain Gray, the Technology Strategy Board's Chief Executive, said "The technology for smart meters - which give us real-time information about how much energy we are using - already exists. The next step is for these smart meters to form part of smart home systems, where appliances are integrated, giving us much more control over energy usage.” Read more to top HSE - New Safety Advice Issued on Electric Gates Installers, designers, maintenance firms and manufacturers of electric gates, are being urged to seriously consider new safety advice issued by the Health and Safety Executive this week, following the recent deaths of two children involving these gates. HSE's Director of Field Operations, David Ashton, said: "Electric or automatic gates are designed to stop if someone gets in the way, and installers and those maintaining these gates have a real duty to ensure this happens. "They must take their responsibilities seriously to make sure that anti-crushing, shearing and trapping safety protection devices are correctly set and maintained." Read more to top Economic news Monetary policy after the fall – paper by Charles Bean In a paper presented at the Jackson Hole Economic Policy Symposium, Charles Bean – Deputy Governor of the Bank of England and member of the Monetary Policy Committee (MPC) – discusses the lessons learned from the financial crisis for the future conduct of monetary policy. He begins by describing the pre-crisis consensus over the appropriate macroeconomic policy framework. Following the crisis, he says it is natural to ask what the events of the past three years tell us about the suitability of that policy framework. Charles Bean states: “Monetary policy makers would ... be remiss if they did not re-examine their own decisions in the lead-up to the crisis and strive to learn the lessons for the future conduct of policy.” Read more to top BCC upgrades UK short-term economic prospects The British Chambers of Commerce (BCC) has published its latest Economic Forecast and raises its expectations for UK GDP growth to 1.7% for this year, and to 2.2% for 2011. Despite the more positive short-term view, the business group also predicts that the pace of growth will slow sharply over the medium-term as the Coalition Government’s tough deficit-reduction measures kick in. While the BCC commends the Coalition’s commitment to slash Britain’s huge budget deficit by focusing on curbing public spending, the organisation argues that the cuts must be coupled with a successful growth strategy, which ensures the economy’s productive potential is supported. BCC Chief Economist, David Kern, added: "UK GDP was very strong in the second quarter of 2010 and the pace of growth will remain satisfactory in the second half of this year. Activity will be supported in the short-term by the cumulative impact of the huge injections of stimulus during the recession, the earlier sharp falls in sterling, and the rebuilding of stocks. However, we expect a sharp slowdown in the pace of growth to start in the first quarter of 2011, as VAT increases to 20% and tough spending cuts are implemented.” Read more Read report in full to top Economic recovery in Scotland set to slow at the end of 2010 The recovery underway in the Scottish economy is set to slow at the end of Q3, after hitting a peak in July, according to the Bank of Scotland Index of Leading Indicators The latest data subsequently points to a slowdown in economic growth in the final quarter of the year. A key driver of economic growth remains low interbank lending rates which, despite creeping up in recent months, remain at historically low levels, and will help incentivise investment. New order levels are also rising, which continues to increase capacity pressures, notably in the manufacturing sector. This is borne out in firms demand for staff, which has improved in each of the past eight months. However, the latest data flow highlights looming headwinds facing the recovery. Historically low interest rates are yet to stimulate new housebuilding activity and consumers remain markedly pessimistic with regards to current economic conditions. Inevitably, consumers are reluctant to purchase big ticket items, highlighted by declining new car sales in June and July. Weakening business sentiment is also dampening the outlook for the economic recovery over the remainder of the year. Official data from the Scottish Government pointed to a 7.7% year-on-year decline in new housing starts in Q1. This was mildly sharper than the 7.5% annual fall in housing starts during the final quarter of 2009. Read more to top Events New Homes Month starts tomorrow! New Homes Month 2010 is now imminent! The campaign, will kick off tomorrow with a supplement in the Daily Telegraph and events on sites across the Country. It is being run by the New Homes Marketing Board (NHMB) and aims to highlight the benefits of new homes and drive potential customers to site. The NHMB is overseeing a media campaign that should generate positive media coverage in the local, regional and national media. Already articles are starting to appear and it is hoped the campaign will match last year’s success in generating hundreds of articles across the country. To find out how to get involved contact nhm2010@hbf.co.uk to top North West Social dinner – just one week to go! There is just one week to go until the return of the North West Social dinner. This event, which has not taken place for the past two years, will see hundreds of industry representatives gather in Manchester for an evening that includes a three course meal, live music and dancing. It takes place on Friday 10th September at the Midland Hotel in Manchester. Everyone is welcome at an event that attracts members from across the North and Midlands. Always a lively and fun event, regular attendees are booking keenly for what will be a fun filled industry evening. Please click here to find out more to top Housing Market Intelligence 2010 – 12th October, Savoy Place, London This year’s Housing Market Intelligence 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. This year the event is expected to 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 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 – Just a week left on early booking 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 on the night of Thursday 28th October at the Millennium London Mayfair Hotel. To book your table at the Housebuilder Awards and take advantage of the early booking discount, 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 For more details please click here or email events@house-builder.co.uk for a booking form. to top HBF Technical Conference, Birmingham 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
