A weekly news summary covering all aspects of the house building industry from Pierre Williams.
HBF Weekly News Summary July 28, 2003
Brownfield Presumption in Favour of Housing
The government is to allow councils to override their own development plans to favour new housing on derelict commercial sites. The Office of the Deputy Prime Minister wants to overcome some local councils refusal to de-allocate employment land saying that two-thirds of house builders identified this problem as the most significant barrier to maximising housing development on brownfield sites. (Guardian, trade press)
But Affordable Housing Thresholds to Increase
Housing Minister Keith Hill has proposed lowering the threshold for affordable housing. The proposal is for affordable housing to be included in new developments of more than 15 homes or half a hectare down from the current 25 homes or sites of one hectare or more. Local authorities would also be able to identify sites solely for affordable housing where this would contribute to the attainment of mixed communities. (trade press)
High-Density Drive a Gamble
The Governments ongoing drive to increase housing densities regardless of customer preference, risks a repetition of past housing policy failures, says HBF.
With the number of detached home completions falling by half during the last three years and a doubling of flats over the same period, Pierre Williams for HBF says an essential balance between high and low density development is being lost. Failing to heed homebuyers wants does not bode well for the future. (BBC R4 World Tonight)
Prices Stall but Market Shows Signs of Recovery
House prices stagnated for the second successive month but signs are emerging that the market is picking up with a four per cent rise in sales in June, according to the latest survey. Average prices are unchanged at 135,200 and, encouragingly, the Hometrack survey also showed that prices in London were stable and showed only a very small decrease in the south east. However, average sales times over just over five weeks and 11 viewings per sale are still high. (All media)
First Time Buyers Stay Away
The salary of the aspiring first time buyer is just 64% higher than it was in 1996, resulting in a greater number of them having to wait for their salaries to catch up with house prices, says Ernst and Young. It says this growing imbalance of price to earnings for FTBs, plus the need for them to provide bigger deposits when buying, is a major threat to the housing market. (FT)
Alliance & Leicester Curbs South East Mortgages
The Alliance and Leicester has revealed it has tightened up mortgage lending in the south east where it has the greatest concern over house prices. The bank said single-digit house price inflation for the country was masking falling prices in the south east. The company will now only lend up to 90% on properties valued up to 150,000 and no more than 75% on prices over 350,000. (Express)
Further Rate Cuts Expected
Interest rates are set to slide further to a low of 2.75%, a new survey of economists has predicted. November is being touted as the likely time for the next cut as the Bank of England responds to slowing economic growth during the second quarter despite booming retail sales in June. (All media)
Browns Tax Rises Cause Fall in Living Standards
New figures reveal Britons have suffered a big drop in living standards thanks to the Chancellors tax rises. The value of average pay dropped 1.3% in the year to April and the situation is likely to worsen as Brown is expected to raise taxes by a further 10bn to cover a big hole in public finances. (All media)
Housing Grant Allocation Direct to Developers
The Government is set to pave the way for social housing grant to go directly to developers as well as housing associations, to boost the amount of social housing being built. The HBF has been pressing for housebuilders to have direct access to the cash to make best use of it. But many housing associations are alarmed at the proposals, claiming only they can provide housing and housing management that best serves the interest of local communities. (Guardian)
East London Line Extension Approved
The government has given the official go-ahead for the extension of the East London Line that is likely to prove a real boost to the fortunes of a large area of the south east of the Capital. The extension will link Hackney with West Croydon and Clapham Junction. The Strategic Rail Authority will be putting out a tender for private contractor bids by the end of the year. (Regeneration & Renewal)
Pierre Williams
House Builders Federation
July 28, 2003
pierre.williams@hbf.co.uk