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New homes alone won’t solve the housing crisis

The Shelter housing commission’s report (Cross-party call to build 3m new social homes, 8 January) stands in danger of simply racking up change-of-use inflation in land prices, putting the unearned value uplift of as much as 70% into the pockets of speculators. Unless the basic structure of housing provision in the UK is changed to restore to local authorities powers of compulsory purchase, with taxation on the land-value enhancement, this will be the unintended consequence.

The result of right-to-buy has been the sell-off of 60,000 council homes with a £3.5bn public subsidy, and 40% of that stock finding its way into the hands of private landlords, who rent it back, often to the same local authority at hugely inflated rates. A straight transfer of public wealth into private hands.

Have the report’s authors studied the 2016 research that showed unimplemented planning consents for nearly half a million homes in England and Wales? Or that in the same year, according to government data analysed by the online estate agent HouseSimple, the number of empty homes in England rose for the first time in a decade to 205,293, representing £50bn worth of vacant property stock?

Research shows that there is little evidence of a shortfall in the housing stock. The crisis we suffer from is largely the result of acute maldistribution within an economic structure which encourages maximum consumption of a scarce resource by those with the means to command the market, at the expense of the many with little or no access to capital. Land value taxation is one mechanism which would very swiftly and relatively painlessly provide a counterbalance to this vicious cycle of ever increasing disparity of wealth distribution. The Housing And Planning Act should be rescinded, restoring security of tenure to existing tenants.

The equalisation of VAT on refurbishment with the current zero rate for new housebuilding would remove a 20% incentive to demolish and redevelop. With a level playing field, an objective cost comparison could be made between proper maintenance and redevelopment, with all the social cost the latter involves.
Kate Macintosh
Winchester, Hampshire

• Before we start spending a projected £225bn on concreting over huge tracts of increasingly precious green space, how about doing more with the existing housing stock? Rent control, much longer tenancies with, obviously, an end to no-fault evictions, penal taxation of property left empty, and the compulsory purchase and improvement – or redevelopment – of substandard rental accommodation, and thus its conversion to social housing, would collectively be quicker and cheaper. Sure, all of that would soften prices, but the issue is homes, not investments, and spending power released by lower housing costs – both personal discretionary and for government in housing benefit savings – would flow into the wider economy.
John Worrall
Cromer, Norfolk

• This report is good news. But there is also an urgent need to overhaul the standard approach to the design and governance of low-cost housing so it accommodates home-based work. This is often restricted or even prohibited in social housing, which is generally currently designed to models developed in the early 20th century specifically to prevent this working practice. This is short-sighted and discriminatory – social tenants have as much right to work from home as anyone else.
Frances Holliss
Emeritus reader in architecture, London Metropolitan University

• The current social housing crisis is an artificially created problem begun by the political dogma in the 1980 Housing Act and developed into a crisis by the political ineptitude and inertia of governments of every colour over the four decades since.

For almost the whole of that period house prices have gone up faster than wages. It takes a bear of very little brain to realise that sooner or later both house purchase and rental become unaffordable, which is, of course, exactly what has happened.

The good news is that because it is an artificially created problem, we have the ability to solve it. However, the cost has been estimated to be as much as four HS2s, while the net cost might be less than one. This sounds like a rather good deal to me, since failure to get to grips with it is going to tear at the heart of our society over the next decades.
Robin Howell
Bridgwater, Somerset

Source: Yahoo Finance UK

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There’s only one way to fix the housing crisis: build more

From free marketeers on the right to proponents of central planning on the left, cries to fix Britain’s broken housing market have become deafening.

The solutions, of course, differ greatly depending on where along the political spectrum you stand.

Yesterday, for example, Shelter issued its latest call to action, proposing three million new social homes to be built over the next 20 years. The housing charity points to the high costs and levels of insecurity among renters, and makes a link between “insecure unaffordable private rentals” and the rise of homelessness across Britain.

Shelter has correctly identified two key problems: that home ownership is becoming increasingly unaffordable, and that the rental market is not set up for long-term, stable tenancies, as seen in other countries.

It is also correct that other government policies to fix the problem, such as the Help-to-Buy scheme, are not an effective use of taxpayer money and actually distort the market by tinkering on the demand-side.

Building more social houses, however, is only one small part of a solution that must go far further. After all, the UK is already in the top three European countries in terms of social housing stock.

It’s not the lack of building social houses that is the key problem, but the lack of building full stop. This is set to be the worst decade for UK house-building since the Second World War, continuing a downward trend that has lasted half a century.

The result is that, even with the recent slowdown in house price growth, one in three millennials will never own their own home.

Unfortunately, this is where politics comes in, with endless arguments over who should build what kind of homes where and with what funding. For too long, stringent planning restrictions have prevented building in places where people actually want to live.

This needs to change – and in some cases it finally is, with a cross-party plan to redesignate areas of the so-called green belt within 10 minutes’ walk of a station to build a million extra homes around London.

There are other things we could do, from exploring high-tech construction methods like modular homes to repurposing disused retail and warehouse space to building new commuter towns with cutting-edge transport links, as well as looking into reforming the rental sector.

However, without more building – and lots of it – the housing crisis is only going to get worse, and is set to throw a spanner in the works of any government, from any party, that hopes to improve business competitiveness, social mobility, and standards of living in the UK.

Source: City A.M.

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Coventry’s housing crisis: Not enough new homes to go round

Coventry is failing to create enough new homes to keep pace with the population growth in the city.

New figures released show a total an extra 1,095 houses and flats were made available in the city in 2017/18.

The data includes both new build homes, and those created by converting existing buildings for residential use.

The number of new homes actually fell from 1,129 in 2016/17.

It means that since 2010/11, a total of 8,478 extra houses and flats have been created in Coventry.

At the same time, the population has risen from 311,674 in mid-2010 to 360,149 in mid-2017 – the latest figure available.

That represents an increase of 48,475.

Even before this year’s population increase is factored in – the number of people living in Coventry is rising by nearly six for every one new home created.

The average household size across the UK is 2.4.

The latest data – published by the Ministry of Housing, Communities and Local Government – shows a mixed pattern across Warwickshire.

A total of 1,336 new homes were created in Stratford-upon-Avon in 2017/18, up from 1,219 the previous year.

Numbers were also up in Rugby (from 381 to 578) and Nuneaton and Bedworth (from 400 to 497).

But only 227 new homes were created in North Warwickshire in 2017/18, down from 326 in 2016/17.

Warwick also saw a drop, from 1,060 to 899.

Across England as a whole, 222,194 new homes were created in 2017/18.

That was up from 217,345 in 2016/17.

A total of 1,333,493 new homes have been made available since 2010.

At the same time, the population rose by 2,969,149 to 55,478,093.

It means one new home is being created for every 2.2 extra people living in England.

Source: Coventry Telegraph

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Fix the housing crisis and save the high street at the same time

Two “crises” have dominated the headlines in the last year. The first is the pressure on housing, the challenges of the rental market, and the soaring cost of living, especially in big cities. The second is the so-called “death of the high street”, as shopping habits change and the retail sector struggles to keep up.

Let’s start with the latter. At the end of 2017, the UK’s retail market saw occupier demand drop for the third consecutive quarter, with a reported fall in demand from prospective tenants of 22 per cent to the lowest level since 2011. As a result, the retail sector was the only area of the UK market to see an increase in availability of leasable space.

In 2018, nearly 1,000 retailers in the UK – from big names like House of Fraser and Poundworld to small independent traders – went into administration between January and September alone. In these nine months, rents have dropped, vacant commercial spaces have increased, and investor interest has massively wavered.

It is no secret that footfall on our high streets is decreasing as the e-commerce boom takes over. So instead of resisting change and trying to cling to a dying high street, we should see this as an opportunity to move forward and transform how we use empty commercial space for the benefit of the UK economy.

Which brings us back to the other major challenge facing the UK. The country needs high-quality housing now more than ever, at rents that don’t swallow two thirds of the average Londoner’s salary each month.

Research estimates that the government needs to be building 340,000 homes per year – rather than its current target of 300,000 – until 2031, to meet rising demand. Given planning restrictions on new builds and the low availability of land, if politicians actually want to make this happen they need to think outside the box.

And that means taking the opportunity to kill two birds with one stone, to reimagine our high streets and tackle the housing crisis at the same time.

It’s time for the government to be bold and collaborate with private firms that are willing to take risks, challenge outdated manufacturing methods, and build innovative homes in available spaces. From pre-fabricated, shared living spaces created off-site in the UK and built in unused commercial spaces, to simpler existing co-living models, there are feasible options out there that can enable the UK to rapidly fill empty spaces at low cost and at higher capacity than traditional developments.

This isn’t to say that every high street needs to be transformed into a residential asset. But the e-commerce trend isn’t going to be reversed, and it makes sense to use the space that we have.

Unlike previous attempts at collaborating with private firms, there can’t be lengthy multi-year gaps between scaling developments because the government can’t afford to take on partnerships that don’t offer quick turnarounds. That’s why empty retail units might be the most resourceful option for distributor developers at this stage.

And that’s just the start – retail is of course not the only sector suffering from an increase in vacant spaces. Hospitality and commercial offices are also seeing an upsurge with the popularity of platforms like Airbnb, flexible working, and the rise of shared workspaces.

By harnessing opportunities and innovations like these and taking the chance to challenge the status quo with clever commercial transformations, the public sector can work with private property firms to bring a higher volume of homes to our ever-growing cities – and save our high streets at the same time.

Source: City A.M.

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How finance caused today’s housing crisis

A decade of stagnant wage growth means that the gradual house price falls in some parts of the country, including London, over the past year have barely dented the affordability crisis.

The standard argument – repeated ad infinitum by politicians, policymakers and commentators – is that it’s a supply-side problem. The solution is to build more homes.

For those on the left, there is a lack of public housing due to decades of underinvestment by the state. For the right, the problem is excessively restrictive planning preventing the market from doing its job.

There are of course major supply-side housing issues in the UK. But there is an elephant in the room (or, more correctly, “house”) on the demand side: credit.

In the textbook model, banks primarily lend to firms for investment and working capital. But in the 1980 and 1990s, a fundamental “debt shift” occurred in the UK and most other advanced economies.

Banks began lending more to households to buy homes than they did to firms.

Outstanding mortgage loans in the UK has grown from just 20 per cent of GDP in 1980 to 60 per cent today, while outstanding business loans have risenfrom just 10 to 20 per cent, with almost half of the latter for commercial real estate purchase.

Regulation used to mean that commercial banks hardly engaged in domestic mortgage lending, which was confined to mutuals with conservative lending practises.

But in the 1980s, budget pressures, competition with the US, and the desire to spread home ownership saw Margaret Thatcher and the politicians who followed her liberalise the banking system.

Banks rushed into property lending. Mortgage loans have one major advantage over business loans: if they loan goes bad, you have the property as collateral.

For a while, it seemed to work: home ownership rates increased rapidly from about 55 per cent of households in 1980 in the UK to over 70 per cent by 2000.

But since the turn of the century, rates have been falling. More and more loose credit has flowed in to an inherently finite supply of desirable locations, pumping up house prices at a much faster rate than incomes.

As prices are driven up, so more financing is required for home purchase, creating a feedback cycle that eventually leads to a bust, as in the crisis of 2007-2008.

Rather than pushing against this feedback cycle, successive British governments have supported it by repeatedly reducing taxes on property, enabling windfall capital gains for those lucky enough to have bought at the right time, as well as fuelling demand with subsidies on mortgage debt and for first-time buyers.

Post-crisis, central banks have introduced stricter regulation on mortgage lending. But this has been offset by the huge quantitative easing programmes that have driven down not just short-term mortgage loan rates, but equally medium to longer rates on governments bonds.

The latter has made property much more attractive as a “safe” asset for domestic and global investors, meaning non-bank financial institutions have also joined the party. Property – in particular in big cities like London – has become the new gold.

The concerted efforts by central banks to reinvigorate asset-backed securitisation markets – a key cause of the financial crisis – has also helped amplify the housing-finance cycle.

Policymakers and financial regulators must recognise that banks will always be able to create credit at a faster rate than new homes can be built if they are allowed to.

In the lead-up to the financial crisis, there were huge construction booms in Spain and Ireland, but prices kept going up as banks poured more credit in to the system. When it finally came, the bust was actually worse than in the UK.

To break the housing-finance cycle, demand as well as supply side policies need a rethink. Fiscal and financial policy needs to do the heavy lifting here.

First, regressive council tax should be abolished and replaced with a tax on the annual increase in the value of the land underneath a property.

Second, banks need to be gradually weaned off domestic property and return to their traditional model of business lending.

Housing’s main role should be to provide shelter for people and businesses, not a source of speculative rentier profits for banks and financial investors.

Source: City A.M.

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Build-to-rent holds promise for long-term investment

The housing crisis is a hot topic not just in the property industry but across society as a whole. A report from the House of Lords Economic Affairs Committee said that the UK government needed to boost its homebuilding target by 50% to create 300,000 new homes each year to tackle the housing crisis.

But while we all agree more homes are needed, what form they should take is less clear.

Market dynamics in particular locations will dictate what is appropriate, but we also need to consider more fundamental shifts in demand. As people live longer, a range of options tailored to older people becomes increasingly important, as does allowing family homes to be freed up.

With more people living alone, options that suit single people’s lifestyles and budgets are vital and as the millennial generation chooses a more transient lifestyle and prioritises experience over ownership, high-quality homes for private rental are also key.

Figures from the English Housing Survey last year found that almost half of 25- to 34-year-olds live in the private rented sector, up from less than a quarter in 2006. The proportion of families living in rented accommodation has also grown. Knight Frank estimates that by 2021, nearly one in four households in England will be renting.

A major contributing factor to the increase in renting is the difficulty of getting on to the property ladder. The Office for National Statistics said in April that the house-price-to-earnings ratio in the UK had hit 7.77, the highest in the official time series going back to 2002. Meanwhile, rising student debt and a preference for living in urban locations make buying a first property even more of a financial struggle.

However, it would be wrong to assume renting has become popular purely because of the difficulty of buying. Knight Frank’s research found that 21% of renters rent to be able to live in a better area; 8% do not want the responsibility of owning a home; 6% need flexibility for work; 6% are downsizers; and 5% do not want to be stuck in one location.

For too long, renting has been seen as a last resort. But renting has moved on and is no longer the murky world of damp-ridden HMOs that many in the baby-boomer generation may have experienced in their 20s.

For many younger people – some of whom will have been used to living in modern purpose-built student accommodation during their time at university – living in a build-to-rent (BTR) property, with a strong amenity offer and a focus on service, is a natural next step that fits their requirements.

“For many younger people living in a BTR property is a natural next step that fits their requirements [after university]”

The millennial generation, after all, is less focused on the long term. Traditional mortgage lenders have not yet adequately recognised the rise in freelancing and the gig economy and the ability to move anywhere around the world at short notice is worth more to many young professionals than the prospect of home ownership.

BTR shifts the focus for the homebuilding industry, which has traditionally concentrated on short-term capital values rather than long-term stable income. Developers need to adapt and recognise that real estate is increasingly about service as much as product: more than ever before, we need to understand the customer and their changing priorities.

Successful BTR schemes will combine a single-operator management structure with high-quality, sustainable, flexible building design to attract and retain tenants while offering them lease lengths to suit varying circumstances.

Source: Property Week

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Co-living and micro-homes most popular solutions to housing crisis, new FMB research reveals

Building more co-living developments and micro-homes in urban areas top the list of people’s preferred solutions to the housing crisis according to new research by the Federation of Master Builders (FMB), while building on the greenbelt is the least favoured solution.

The FMB asked 2,000 home owners across the UK if there is a housing shortage and if so, how best to address this shortage. The key results are as follows:

• Two-thirds (66%) believe that there is a shortage of housing in the UK.

• When asked for views on the most appropriate solutions to the housing shortage, the most commonly cited were as follows:

1) Build more co-living developments (33%);
2) Build more micro-homes in urban areas (31%);
3) Build more granny flats (31%);
4) Extend permitted development rights (27%);
5) Encourage more multi-generational living (24%);
6) Excavate or convert more basements underneath existing properties (18%); and
7) Build on the greenbelt (17%).

Commenting on the research, Brian Berry, Chief Executive of the FMB, said: “Even the vast majority of those who are lucky enough to own their own home recognise that there’s a housing shortage. When asked about solutions to this problem, the most popular remedy was to construct more co-living developments, which are becoming more and more popular in major cities right across the globe. Building more micro-homes in urban areas was the second most commonly cited solution to the UK housing crisis. Both of these approaches would increase density in urban areas where demand is particularly high. The creation of more granny flats was the third most popular solution, which would see more elderly people moving out of their properties and living alongside children or grandchildren in self-contained home extensions. This would free up much-needed family homes, which are being under-used by older people living on their own. Perhaps unsurprisingly, home owners, who are clearly already on the property ladder, see building on the greenbelt as the least desirable option.”

Berry concluded: “While these solutions are food for thought, if we want to solve the housing crisis, we need to reduce barriers to small, local building firms. Recent research from the Federation of Master Builders shows that the lack of small sites and difficulties hiring skilled tradespeople are limiting the amount of homes these firms can build. Removing barriers to SME house builders matters as in the late 1980s, two-thirds of all new homes were built by small local house builders and this was a time when house building was in step with demand. Currently SME house builders build less than one quarter of all new homes and as this proportion has declined, so too has the capacity of our industry to deliver the homes we need. Reviving the fortunes of SME builders undoubtedly has a key role to play in delivering the Government’s target of 300,000 new homes a year in England alone, and is key to solving the housing crisis once and for all.”

Source: Politics Home

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Theresa May vows stamp duty hike on foreign-owned properties in bid to tackle housing crisis

Theresa May has unveiled plans for a new levy to be paid by those buying British homes from abroad as part of a wider bid to tackle Britain’s housing crisis.

The Prime Minister kicked off the Tory conference today by insisting it should not be “as easy” for foreign investors to pick off the UK’s housing stock as those who live and work there.

The rise of up to 3% in stamp duty will be paid by individuals and companies not paying tax in the UK, with the cash raised to go towards boosting the government’s rough sleeping strategy.

The PM will reignite her pledge for a “British dream” with a series of policy announcements that will try to divert focus away from heightened party splits on Brexit.

“At Conservative conference last year, I said I would dedicate my premiership to restoring the British Dream, that life should be better for each new generation, and that means fixing our broken housing market,” she said ahead of the four-day event in Birmingham.

“Britain will always be open to people who want to live, work and build a life here.

“But it cannot be right that it is as easy for individuals who don’t live in the UK, as well as foreign based companies, to buy homes as hard working British residents.”

“For too many people the dream of home ownership has become all too distant and the indignity of rough sleeping remains all too real.”

A Tory spokesperson said the rise in stamp duty, which will apply on top of existing rates, will “help make UK homes more affordable for British residents and those paying taxes in the country as they build a new life here”.

‘THE FESTIVAL’

Meanwhile the PM has unveiled plans for a festival to take place in 2022 that will celebrate the country’s culture, sports and innovation.

The move to celebrate the “precious union” of the UK – known as The Festival – is expected to echo the Great Exhibition of 1851 and the 1951 Festival of Britain.

Ministers have so far earmarked £120m for he proposal.

The event will come just months ahead of the next scheduled general election and will coincide with the year of the Queen’s platinum jubilee and the Commonwealth Games in Birmingham.

Mrs May said: “Almost 70 years ago the Festival of Britain stood as a symbol of change. Britain once again stands on the cusp of a new future as an outward facing global trading nation.

“And, just as millions of Britons celebrated their nation’s great achievements in 1951, we want to showcase what makes our country great today.

“We want to capture that spirit for a new generation, celebrate our nation’s diversity and talent and mark this moment of national renewal with a once-in-a-generation celebration.”

‘BACK CHEQUERS’

Mrs May’s plans came alongside a call for warring MPs to stop “playing politics” and back Chequers.

In an interview with The Sunday Times ahead of the conference, the PM took a swing at senior figures such as Boris Johnson – who launched a fresh attack on Mrs May as Tory conference got underway – by calling on them to back the “only proposal on the table at the moment”.

“My message to the Conservative Party is going to be that people voted to leave the EU. I believe it’s a matter of trust in politicians that we deliver on that vote for people,” she said.

“We’re the party that always puts country first and puts the national interest first. And that’s what I want us to be doing.

“The only proposal on the table at the moment that delivers that is the Chequers plan.”

Source: Politics Home

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Sustainable housing, the UK’s second biggest problem?

With the battle to deliver the government’s ambitious housing target of 300,000 new homes per year – and with consideration of environmental impacts, climate resilience and net gains even for biodiversity – ongoing, EA’s latest event provided a forum for those delivering solutions to share the latest ideas with those charged with policy-making for, planning and building the dwellings of the future.

Housing delivery in the UK is presently lagging some way behind the official target, with 235k energy performance certificates lodged for new builds for the year ending June 2018. “Behind closed doors we have been told by various government departments that, Brexit aside, housing is the single biggest political issue that will face this country over the next 20 years,” Ross Polkinghorne, partner at law firm Burges Salmon, told delegates gathered at the Building Sustainable Towns & Cities conference and exhibition in central London last week.

There are a number of factors inhibiting the delivery of housing targets, with regional programme manager for the One Public Estate Michael O’Doherty pointing to the need for supporting infrastructure – such as roads – to be delivered, as well as materials shortages and lack of skilled workers in the construction industry. “The UK simply does not have the capacity and skills in the traditional construction sector to build homes at the rate required,” he said. The planning system has also been widely cited as a further barrier to increasing housing supply.

In a bid to make the market more development friendly, the government has implemented a number of funding, policy and programme-based changes. Another speaker, acting head of the housing infrastructure fund (HIF) at Homes England Kate Taylor, explained that initiatives such as the £5bn HIF offer funding to support infrastructure for new housing, aiding the allocation of sites and sparking wider private sector investment.

She also highlighted the £3bn home building fund which supports housing development and associated infrastructure delivery, stating that “our loan sizes can vary [between £250k to £200m] meaning we can look at a wide range of projects”. To date the scheme has contributed to the delivery of over 110,000 homes across the UK, with Taylor noting “we work across the country and don’t just focus on London and the South East”.

Delegates also heard how the One Public Estate initiative is working across the public sector to foster a more strategic approach to managing land and other assets. It is hoped by 2020 the programme will have helped release land for a further 25,000 homes.

NPPF and biodiversity

2018 has seen some important policy and regulatory developments which will help frame housing delivery going forward, most notably the publication of the much anticipated revised National Planning Policy Framework (NPPF) (D+I 26-Jul-18). The revamped NPPF’s ‘presumption in favour of sustainable development’ encompasses economic, social and environmental objectives, including a goal to improve biodiversity. Strengthening requirements for biodiversity net gain in national planning policy was a key commitment underlined at the start of the year in the government’s 25 Year Environment Plan (EA 16-Jan-18), with the revised NPPF stating that the planning system should achieve net gains for biodiversity.

Lindsay Roome of Defra’s Natural Environment Directorate reported that biodiversity net gain (BDNG) is already being targeted by a number of developers including Barratts, Berkley and Redrow, while several local authorities including Warwickshire County Council and Lichfield District Council also boasting strong net gain policies. “We’ve had developers telling us they are seeing the benefits of this approach as they can sell their homes for more,” she added.

In a bid to help make BDNG more quantifiable and accessible, Roome explained to conference attendees how a refined metric has been developed which uses the quantity, distinctiveness and condition of existing biodiversity features on a site prior to development to calculate biodiversity units. These units are then compared with the amount calculated post-development to identify if a gain has been achieved.

But the 25 YEP does not stop at biodiversity net gains and has set a long-term aim for new developments to deliver environmental net gains more broadly. Natural capital improvements such as flood protection, improved air quality and recreational space will be expected. So it may not be long before specialist consultants from fields such as water, waste and air quality see increased demand in natural capital accounting.

According to Roome, the Environment Agency, Defra and Natural England are also collaborating on producing a metric – similar to the biodiversity metric – covering a broader range of environmental features and factors. This they hope will make calculating environmental net gain possible for non-specialists, with Roome stating: “We are trying to get the balance right between making something which is easy to use, for local planners, etc…but that is also accurate enough.”

However, with EA having canvassed opinion from those attending the conference who work on the front-line of housing delivery – both within and alongside developers – the consensus appears to be that this is unlikely to completely replace the need for external experts as developers typically prefer to involve an independent consultant where environmental assessments are concerned.

Moving away from the minimum approach

A number of delegates on the day also noted the continued reluctance of many public sector and some private sector organisations to deliver beyond the minimum environmental requirements, which is a barrier to the uptake of the best practicable environmental solutions. With this in mind, Froome outlined how her team is exploring another 25 YEP commitment – to action a consultation into whether BDNGs should be mandated.

“We are currently looking at what the government could do in this space,” she said, “providing consistency and a level playing field to ensure that at an aggregate level we can have net gain overall through development.”

If mandated any organisations still dragging their heels when it comes to BDNG will be forced to step up their efforts. Given the attrition of in-house environmental planning expertise within local authorities as a consequence of the austerity era, this all seems to suggest the market for specialist biodiversity services has the potential to grow and broaden quite significantly.

Homes of the future

Another factor which could considerably alter the state of play in the sustainable housing field is the rise of modular and panelised fabrication techniques. With the ability to be largely constructed off-site these homes offer the advantage of relatively speedy assembly times, thereby reducing costs and environmental impacts such as air quality and noise, as well as regulating demand on the UK’s construction workforce.

Until recently many lenders were reluctant to make mortgages available for this type of build creating a major barrier to delivery. But as director of UK research at property management and development group JLL, Nick Whitten, noted this is no longer the case: “It’s now assumed that at least the top 20 biggest lenders in the UK are now comfortable lending against these [offsite] homes”. Such developments also offer benefits in terms of reducing waste and arguably utilise more sustainable building techniques. So, with the issue of finance largely overcome it seems reasonable to expect prefabricated building methods to soon become the norm.

The issue of climate resilience also featured repeatedly during the course of the day with many speakers underlining the need to better prepare housing and infrastructure for the increasingly variable and extreme weather. Ramboll infrastructure and regeneration director Chris Fry looked at some of the rapidly emerging design approaches to improving climate adaptation through the digital revolution.

According to Fry, the Internet of Things and next-generation sensors could facilitate self-maintaining sustainable drainage systems (SuDS) and blue green infrastructure as well as adaptive (robotic) flood defence systems. But he also noted: “Although there are some opportunities for big disruptive changes, in established cities with finite budgets incremental innovation is more likely.”

Source: Environment Analyst

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The full story on nation’s housing crisis

There is a conventional story about the housing crisis – one you’ve probably heard trotted out time and again by prime ministers and journalists for years.

It runs as follows: We build too few homes. We have built too few homes for decades. And, as a result, we have a housing crisis: too many people chasing too few homes. The solution is to build more homes.

That, in a nutshell, is how government housing policy functions at the moment. But what if it’s simply wrong?
What if the problem facing the UK housing market isn’t a simple lack of homes, one that can be solved by the silver bullet of new housing stock? What if our politicians, trapped in their metropolitan bubble, have been misreading what’s really going on?

Having covered the housing market for a decade and a half, I’ve often wondered about this. I’ve read with interest alternative thesis about what’s really going on. Some, for instance Oxford Economics analyst Ian Mulheirn, have claimed that the real problem is not supply but credit – that cheap money has made it easier to buy homes and has pushed up prices all around the country.

Others, for instance Oxford University professor Danny Dorling, have claimed that the real problem is not supply but distribution: that there are enough homes but they are unevenly spread between the population.

The problem with these explanations – compelling as they are – is that while they seem to apply in part, they do not tell the full story. Clearly there are parts of the country where there are not enough homes. There are parts where there is a supply problem – and parts where those competing explanations seem more valid.

But thus far there has been no comprehensive effort to try to map those various issues facing the housing market, and to show how much they apply to different parts of the country. So that’s what we’ve done today. In conjunction with Neal Hudson from Residential Analysts, we’ve built the first set of maps highlighting which parts of the country are facing which particular issues.

And we’ve determined that actually the UK is facing not a single nationwide housing crisis – but five starkly different crises which are more or less intense in different areas of the UK.

The crises – or perhaps “pressures” might be a better word – are as follows:

1. The supply crisis – the conventional explanation of the housing crisis, with too few homes. This is certainly an issue in London and the South East, which account for pretty much the entire top 20 of affected areas around the UK. The only exception is Slough, which is both close to London and on the green belt. There are other key areas which face lack of supply: Oxford, Manchester and Luton, for instance.

2. The demand crisis. In many parts of the UK the problem isn’t a lack of supply but a lack of demand for housing. Because people have moved out of these areas, many homes are left empty and derelict. This is an issue faced in particular by areas with low income and employment levels – especially communities where the dominant industry has shut down. So in our top 20 areas affected by the demand crisis you’ll find old mining towns in Wales and Scotland. There are places like Derry City and Strabane, Redcar and Cleveland, Blackpool and Blaenau Gwent. These are parts of the country where, in order for the housing market to become functional, the local economy needs to recover, taking wages and employment with it.

3. A distributional crisis – which one might also call an underoccupation crisis. This goes back to Prof Dorling’s thesis. In many parts of the country there are more than enough homes for everyone. The problem is those homes are unevenly spread between old, well-off people living in houses with lots of spare bedrooms and those forced to rent because they cannot afford to buy a property. But, again, this issue is concentrated in particular areas with elderly and wealthy residents: places like Rutland and Stratford-upon-Avon. Again, building more homes isn’t necessarily the answer here (though it might help a bit). A better solution is to find ways to encourage those in big homes to downsize.

4. A housing quality crisis. For some parts of the country, the problem isn’t the number of homes out there but their quality. So alongside the other three crises is a housing quality crisis. This particularly affects old towns with period properties that have been left to decay over time. So while there are many new, smart apartment blocks in cities like Liverpool, there are also streets and neighbourhoods with poor quality homes. This issue is particularly acute in the private rental sector. The solution here is not so much to add to the housing stock, as to find ways to encourage landlords and owners to renovate their existing houses.

5. The cost/credit crisis. This crisis goes back to the thesis propounded by Mr Mulheirn – that what’s driving house prices is not the supply of homes but the amounts of cash being funnelled into the economy, thanks to low interest rates. If you’re after a single nationwide crisis, this dynamic is perhaps closest to it – it is far more widespread than crisis number 1, for instance. Even (Taiwan OTC: 6436.TWO – news) so, it is most extreme in places like London and its commuter towns. In a place like Southend-on-Sea, high house prices make it harder for younger first-time buyers to get on the ladder. Indeed, because it is harder than it was before the financial crisis to get a mortgage, this credit issue has exacerbated the gap between haves and have-nots.

So there you have it, five different crises, all with their own idiosyncratic solutions, all affecting different areas of the country in different intensities. Some parts of the UK are fortunate – they come very low down in our rankings of all five crises: Lisburn and Castlereagh in Northern Ireland is a good example: it is far down on the list for all these problems. And yet central Belfast, next door, suffers serious lack of demand, relatively poor housing quality and is mid-table when it comes to the impact of cost and availability of credit.

The City of Westminster faces serious supply and credit pressures – and has pockets of poor housing quality. Compare that to somewhere like Selby in Yorkshire, which comes low down in all our measures. It is a complex story with no single conclusion.

The analysis underlines that the government has been oversimplifying its analysis of the crisis and, in so doing, may be reaching for the wrong solutions. Indeed, new research from the Office for National Statistics earlier this week suggested that because the number of new households being created in the UK is rising at a much slower rate than expected, the need for new homes is even less than was assumed at the time of the government’s latest white paper on housing.

The lesson is that instead of trying to seek out a catch-all solution, government should be tailoring its solutions for local areas – examining the pressures before trying to prescribe the response.

Source: Yahoo News UK