A weekly news summary covering all aspects of the housebuilding industry. Available to members only.
HBF News
HBF moves Birmingham Office
HBF is moving its Birmingham office. The new details from June are:
Home Builders Federation
First Floor
Oakfield House
Small Heath Business Park
Talbot Way
Birmingham
B10 OHJ
Telephone: 0121 260 1554 / 0121 260 1555
HBF Newsletter
The latest HBF Newsletter is available online:
HBF Graduate Conference
HBF’s Graduate Conference will be held at Nottingham Trent University on 12 July. The day is open to young graduates working for member companies, will run from 9:00 to 16:30 and feature HBF and external speakers. We are writing separately to careers and skills contacts about the event. Details can be downloaded by clicking here:
Political News
Cooper and Osbourne at BPF Conference
Housing and Planning Minister Yvette Cooper and Shadow Chancellor George Osbourne offered differing policies on how to solve the housing crisis in speeches to the British Property Federation Symposium this week.
Mr Osbourne said that the Conservatives oppose the Government’s proposed Planning-gain Supplement (PGS) and “will look to change it once we are in Government”. Mr Osbourne backed a rise in the level of house building and recognised the need to increase the supply of land available for development to reach this goal. In terms of delivering the increase, Mr Osbourne believes “we should see how local communities, not central Government, can be directly compensated for planning gains that lead to a loss of amenity or additional strain on local infrastructure”, and said “we have asked the Quality of Life Policy Group to investigate how we can deliver a planning system that works with local communities not against them”. The Shadow Chancellor also commented that “we should build homes where people want to live but expect developers to meet some of the burden on local roads and public services”.(Link to George Osbourne's Speech)
Ms Cooper placed more emphasis on the need for more affordable housing, expecting it to be the biggest issue in the “politics of property over the next 20 years”. The Minister gave further backing to the proposed PGS as well as “backing the Milton Keynes tariff approach and promoting its take up in other growth areas as well”. Ms Cooper also took a shot at the Opposition: “If the Conservatives want to get serious about addressing housing needs they should back proposals for 200,000 new homes a year. If they really care about overcrowding they should stop calling for cuts in new housing in the south east and east of England. And if they really want to get serious about affordable housing they need to stop calling for cuts in the housing budgets too.” (Link to Minister's Speech)
Debate over HIPs continues
An Early Day Motion, with Shadow Secretary of State for the DCLG Caroline Spelman amongst its backers, raised concern over the Government’s plans to introduce Home Information Packs (HIPs) next year. The EDM read: “That this House expresses concern over the introduction of home information packs from 2007; notes that industry experts have advised that home information packs will add up to £1,000 to the cost of buying an average home and duplicate the ongoing need for a valuation or structural survey; believes that they will discourage potential sellers from putting their homes on the market; notes that smaller solicitors and estate agents may be adversely affected; observes that the Government will benefit from a potential £110 million VAT windfall from the packs and that the Home Condition Register could be used to conduct a council tax revaluation by stealth; questions the lack of a proper dry run and whether sufficient home inspectors will be properly trained by 2007; and calls on the Chancellor of the Exchequer to push for their implementation to be delayed or cancelled in order to protect the stability of the housing market.” (Dehavilland)
Nick Salmon of SPLINTA (Seller's Pack Law is Not the Answer) said: "There is no doubt that the Opposition is going to fight HIPs tooth and nail. The Conservatives have already pledged to scrap HIPs when next elected and now they are ramping up the pressure via the Early Day Motion. This is in addition to the bill to abolish HIP's which will receive its Second Reading later this year. Anyone who thinks Home Information Packs are a certainty should think again. SPLINTA supporters from all over the country are already pressing their local MP's to sign up to the Motion. The general public would be wise to do the same to help head off HIP's, which is an expensive disaster in the making." (SPLINTA)
HBF Comment: HBF met the Director General of the Association of Home Information Pack Providers (AHIPP) this week. AHIPP gave a more upbeat assessment of progress while recognising there was an element of political risk. It was notable that AHIPP are undertaking a very extensive political contact programme to in their words “dispel misconceptions”. HIPS are due to be trialled in 10 to 12 locations around the country this autumn. HBF is working on an up to date briefing note for members on HIPs.
… as the Minister hits back over criticism
The Government countered criticism of HIPs, warning that estate agents and other professionals might get left behind and encouraged the industry to sign up to the HIP dry run. Yvette Cooper said: “The level of positive interest and involvement we are receiving so early on in the HIP initiative should worry those who are dragging their feet. Miss this moment and they risk being left behind by a fast changing market.” (DCLG Press Release)
The DCLG also published a report that estimated that the number of Home Inspectors that will be required to produce Home Condition Reports, which are a necessary part of HIPs, will be between 5000 and 7500. (Full DCLG Report)
Corporate News
Ian Napier to leave Taylor Woodrow
Taylor Woodrow announced that Chief Executive Iain Napier is to step down from his role next spring and will leave the company to become Chairman of Imperial Tobacco. Mr Napier joined Taylor Woodrow in 2002. Chairman Norman Askew commented: “Over what will be 5 years since Iain joined as Chief Executive in February 2002, he has been responsible for steering Taylor Woodrow successfully through a period of significant change and considerable growth, establishing the Group’s position as one of the UK’s leading homebuilders with a portfolio of successful homes businesses in the UK, North America and Spain. Working within a generous timeframe, the Board has now commenced its search for a successor, which will cover internal and external candidates.” (Taylor Woodrow Press Release)
Housing Market
Biggest increase in prices over last decade in Truro
Truro has seen the largest increase in residential property prices over the last decade. Research by Halifax looking into residential property prices per square metre (psm) shows that prices in Truro rose by 262% from £518 psm in 1996 to £1,876 psm in the first quarter of 2006.
The gap between London and the rest of the country has risen quite considerably. In 1996, London prices were just 0.3% higher than in the second ranked city of St Albans. By 2006 residential property cost £3,582 psm in London (up 252% over 10 years), compared to £2,741psm in the current second ranked city of Oxford, which is just ahead of St Albans (£2,716 psm). (Halifax Press Release)
Other News
Share of new homes built on brownfield land continues to rise
The share of new homes built on previously developed land in England rose to a provisional 73% in 2005, according to the DCLG’s Land Use Change Statistics. This share rose sharply in the early part of the decade, from 59% in 1999, and is slightly higher than the 2004 figure of 72%. This is comfortably higher than the Government’s target for 60% of new homes to be built on previously developed land by 2008.
The density at which new homes are being built also continued to rise in 2005. The average density at which new homes were built in 2005 rose to a provisional 42 dwelling per hectare (dph), up from 40 dph in 2004 and considerably higher than the 25 dph seen in the second half of the 1990s. (2005 Land Use Change Statistics)
… as the opposition claims more is being built on back gardens
The Conservatives accused ministers of deceiving the public, with more new homes being built in back gardens. Based on figures obtained from the DCLG, the Conservatives claimed that “garden grabbing” accounts for 15% of new homes. Quoted in the Times, Tunbridge Wells MP Greg Clark claimed: “Most people assume that when the Government talks about building on brownfield sites it means ex-industrial land, like disused factories and railway sidings. They have no idea that much of it is actually beautiful, green, environmentally important gardens.” (The Times)
Developers treated “like something the cat brought in”
In an interview to the Times (22 May), outgoing member of the Monetary Policy Committee, Stephen Nickell, commented on how the planning system is thwarting the building of new homes. Mr Nickell also said: “If you tell someone you are a housebuilder, it’s like something the cat brought in, which is ridiculous given what’s happening to the price of houses and how people cannot find places to live in”. (The Times)
Homes in Reading most polluting in the country
Homes in Reading produce the highest level of Carbon Dioxide emissions out of 23 of the UK’s largest cities, according to a study by British Gas. Dwellings in Reading produce an average of 6,189 Kg of CO2 per year, which is the equivalent amount of pollution as flying 13,000 miles. Hull was the least polluting city, with homes producing an average of 4,395 Kg of CO2 per year.
Uttlesford, named as the best place to live in England and Wales in 2001 by the Sunday Times, had the highest level of emissions of any Local Authority area, 30% more than Reading, at 8,092 Kg of CO2 per dwelling per year.
Ben Tuxworth, Director of the Forum for the Future Strategy, said: “This report comes as a wake up call to those who think reducing domestic CO2 emissions is a luxury for the wealthy. Downward pressure on prices seems to mean that it's only the less affluent users that bother to save energy. If the rich are using over three times as much energy as the poor, we need to incentivise them to clean up their act." (British Gas Report)
Consultation/Key Publication Dates
Code for Sustainable Homes Implementation Autumn
Home Information Packs (HIPs) Consultation Closed 31 December
HIPs – 10 to 12 planned trials Autumn 2006
HIPs Introduction 1 June 2007
Housing and Regeneration Consultation Closed 19 May
HBF Events
HBF Graduates Conference 12 July
For all full list of HBF events please visit the HB Media website click here
Paul Samter
Senior Analyst - Economic and Policy Affairs
Home Builders Federation
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