New homes Marketing Board Quarterly Briefing- Spring 2001
The New Homes marketing Board was established in 1982. Its members consist of most private sector house builders registered with the National House Building Council, as well as materials producers, suppliers and building societies.
The Board creates a clear identity for Brand New Homes and promotes to media and public their numerous benefits compared to the sceond hand market
New Homes Marketing Board Quarterly Briefing May 2001
Welcome to the re-launched NHMB Quarterly Brief. Its aims are simple – to give you a clearer picture of how the market is performing, how it will perform in the future and to let you know about the latest developments in house building.
Conflicting reports from the various surveys and reports published regularly from banks, building societies and economists have not helped form a solid opinion of how the housing market is likely to perform over the coming year.
Optimism remains generally high that the market will see steady and sustainable growth over the coming 12 months, although stockmarket wobbles, which 13 years ago were followed by the housing crash 18 months later will, for some, provoke a rather worrying sense of déjà vu.
Despite this, we are continually assured that the economic conditions – certainly with regards to interest rates and unemployment figures are a world away from the late 1980s.
Estate agents are certainly not voicing any such fears, even if, secretly, they are having any doubts. The NAEA announced “ Spring is in the air” in its latest press release. Chief Executive Hugh Dunsmore-Hardy announced: “There seems to be a growing confidence in the housing market among consumers – possibly fuelled by hopes that lower interest rates in the US will be followed by a lowering of mortgage and interest rates in the UK. House prices are not rising as fast as they were a year ago but are more in line with wage increases and any fears of a boom and bust scenario with large falls in house prices have evaporated.”
Bradford and Bingley paints a similar picture but is less optimistic about growth levels. “We don’t expect to see significant property price increases this year but the primary drivers of the housing market remain strong.” Perhaps they too see the economy as ensuring the market is not ready for a plunge and yet remain cautious that the long run of rapid growth seen over the past three years must, like the stockmarket, either makes a soft landing or is forced to crash land in the not too distant future. The report also warns of a growing trend of fussiness among prospective purchasers – those wanting to find their ideal home before deciding to put their existing one on the market. Such talk should be music to the ears of developers offering part exchange schemes.
If the market does to grow, then it will surely be as a result of further interest rates cuts towards the middle of the year, warns the RICS.
Closer to home – new homes that is – prospects remain bright. The latest HBF survey shows the economic conditions look very good, with low interest rates, low unemployment, falling inflation and buoyant consumer confidence. Assuming this state of affairs is not derailed by the faltering US economy, earlier predictions of only a very slow rate of increase in house prices look rather too cautious.
Private housing starts are the only real fly in the ointment. Starts fell slightly in 2000 and forecasters predict no significant change over the next two years. Developers reported a small increase in reservations in January. Almost half the house builders surveyed in January reported an increase in net new home prices against only four per cent registering a decline. Sales incentives also increased but the rate at which they are being introduced is declining.
Most developers believe 2001 will see more sales than last year – with clear indication that Scotland and the North will be the biggest winners.
Overall, 55 per cent of developers expect higher sales than in 2000 and just 10 per cent expect a reduction. This by itself should give us all plenty of confidence about the year ahead.
What’s Happening? – An Update On Current NHMB Projects:
Economy
Halifax/ HBF Survey:
The research in 2001 will focus on three main areas:
To gauge consumer response to ‘Tomorrow’s Brand New Home’:
How acceptable are innovative construction methods?:
Is there a demand for greater thermal/ sound insulation, accessibility, and flexibility in home design?
How do consumers living outside established high density areas respond to the introduction of town houses and restricted off street parking?
To investigate the importance of brand awareness and positive brand values in the marketing of new homes:
What role does branding play at present?
What potential does brand reputation offer house builders in the future in their relationships with customers and other stakeholders?
What role does customer care play in creating brand image?
To update the core housing market measures on moving intentions and preferences for buying brand new versus older properties.
The Report is expected to be published on 20 June 2001. A launch strategy is being prepared for this.
HRF Research
The Housing Research Foundation will launch the long-awaited research report, The Economic Role of New Housing, at a conference around the third week of May. This is a very important, objective pioneering study carried out by top academics and will for the first time link the effect of housing on the economy.
Society
A. IPPR Research
The IPPR research into the housing choices of people on moderate incomes is also underway, and is due to report after the General Election, probably in late June, depending on Ministerial diaries.
Although this project was intended to be co-funded, in fact IPPR were unable to secure a joint sponsor and the project has proceeded on a scaled down basis with HBF/ NHMB as sole supporter.
IPPR will own the research and the HBF/ NHMB is currently arranging a launch strategy with them.
Environment
A. GreenLeaf Awards
These awards will take place on Thursday 17th May at the offices of the Daily Mail. The events will be run in a more professional manner than in the past and following the awards a meeting will be held to discuss how an even higher standard can be achieved in the future
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B. Design Panel
The Government agency responsible for design policy, the Commission for Architecture and the Built Environment (CABE), has asked to become a partner in the HBF`s forthcoming initiative on design. This is perhaps the first time that the Government has applied to join an HBF initiative, rather than vice versa.
Design is a crucial part of the Government`s agenda. Minister Nick Raynsford MP told Parliament last year, "People want the tide to turn on dreary and soulless house building. No one wants more of the indifferent collections of little boxes that were allowed to spread across our countryside like a rash." Despite improvements in housing design in recent years, this perception, however unfair, remains a significant factor in the poor image of the industry.
As part of the image programme, the HBF has joined up with the Civic Trust to tackle this issue head on. We want to shape the agenda on design, not be dragged along by other people`s prejudices. We are developing a series of joint initiatives which will help the industry promote its design successes more effectively, and to demonstrate its willingness to improve design in ways which are practical and commercially realistic.
Leading architect and urban designer Terry Farrell has agreed to chair a Design Panel which will act as a sounding board for the industry on design issues. The Panel is currently being set up. It will not preach at, or judge, the industry, but instead will help and inform by highlighting good practice and identifying new opportunities. An online database illustrating good examples of design will also be created.
Over the spring and summer, the HBF will be asking members to support this programme by supplying information about their developments, both current and also in the last few years, which can be used as evidence of the industry`s commitment to high quality design.
In view of the fact that significant progress is anticipated on this project in the period leading up to the Committee meeting, a report on progress will be tabled for the meeting.
Training & recruitment
Labour and skills shortages are a significant strategic issue across a wide range of disciplines. As a response to industry concerns about skills shortages a strategy was produced in 2000 by the HBF. The strategy in 2001 consists of the following elements:
A. Employment Survey. HBF is undertaking the first comprehensive review of employment in the industry. This includes a detailed survey of developers and sub-contractors as well as in-depth interviews with key industry stakeholders and the results are due in April. A brief presentation on the results will be provided at the meeting.
B. Promotion of Industry in schools. Material for house building schools programme. This project is at a very early stage. The aim is for HBF/NHMB to develop educational materials aimed primarily at schools and colleges:
- to facilitate site visits by schools (Key Stages 2-3)
- to support role model house builder visits to schools and colleges; and
- to feed into the National Curriculum (Key Stages 2-3)
NHMB are in discussions with the CITB to find an educational consultant and production companies specialising in educational resources that are able to advise on:
- the medium, form and content required for a video/CD ROM/DVD to support the National Curriculum.
- how the material can be promoted and used in schools and colleges.
C. Graduate Recruitment
There is a need to improve the flow of good quality graduates into the industry. The Role Model House Builders programme will facilitate career presentations to undergraduates who might consider house building as a career.
HBF, in partnership with the Housing Forum and Change the Face of Construction, has submitted a bid to the DETR to support a house building ‘Roadshow’ to visit a number of universities this autumn.
D. Liaison with CITB
There is considerable demand for more support from the CITB to improve the industry’s image as a modern professional industry.
A Real Opportunity For You To Tackle The Industry Skills Shortage
National Construction Week 2001
Annual Celebration of Construction to Focus on Youth Recruitment
National Construction Week (www.ncw.org.uk) will take place between 15-21 October 2001, and will be jointly led by the Construction Industry Board (CIB) and the Construction Industry Training Board (CITB).
This year there is a change in focus. National Construction Week 2001 will focus squarely on youth - with hundreds of events and projects across the UK geared towards 14-19 year olds. All partners will be reinforcing their year-round work to encourage the best, brightest and most highly motivated young people to explore the opportunities, excitement and creativity of today’s construction industry.
The core target audience for NCW 2001 may be teenagers, but, the National Construction Week team will also be working closely with organisations addressing issues surrounding graduate recruitment and retention.
NCW 2001 Senior Project Manager Paul Bower said:
“ We are inviting the industry to play an active part in the whole campaign from now until October 21st. Our key objective of motivating young people is in line with the one of the industry’s top priorities - the recruitment of a highly skilled competitive workforce. It is a practical campaign with achievable objectives. We have done everything possible to ensure that participation is straightforward and cost effective. The National Construction Week website is now live at www.ncw.org.uk. As well as general information and events listings, construction industry partners can download the NCW 2001 logo for use on press releases, letterheads and their own websites. If a contractor organises an event such as work placement, site visit or charity fundraiser they can register their event on-line and the details will be loaded onto the website within minutes. In this way industry partners can benefit from taking part in a huge UK wide campaign which has the support of major industry and government figures.
Alternatively if a company does not wish to organise an event but can offer opportunities such as work placements or a speaker to talk to young people about their work they can post their offer on the site via the News and Views section. The website is an ideal vehicle for brokering practical partnerships. Later in the year we also hope to be able to offer NCW 2001 merchandise on-line. It really could not be easier to participate”
If you would like to participate in National Construction Week visit the website on www.ncw.org.uk or e-mail Senior Project Manager Paul Bower on paul.bower@citb.co.uk