The state of the (housing) nation
Posted: November 1, 2022 Filed under: Bed and breakfast, Decarbonisation, Homelessness, Housing market, Levelling up, Private renting, Social housing Leave a commentOriginally written as a column for Inside Housing.
The UK Housing Review Autumn Briefing Paper is published this week and as usual provides an invaluable guide to the state of the housing nation. Here are five graphs that illustrate key points about five different parts of the housing system:
Shifting rules on rents
What everyone wants to know, of course, is what will come in place of that purple line on the right but the graph is a reminder that so-called long-term deals on social housing rents can quickly disappear. The four-year rent reduction at the end of the 2020s that ended the previous one is now set to be succeeded by an annual increase significantly below the 11.1 per cent implied by the CPI plus 1 formula.
The decision is finely balanced between cost of living considerations and housing investment, with the existence of housing benefit making it much more complex than it was in the famous case of Clay Cross 50 years ago.
The Briefing Paper quotes estimates by Savills that a 5 per cent cap on rents in England (the government’s favoured option) would cost councils £500 million and housing associations up to £1 billion. One association says that even a 7 per cent cap would mean a 21 per cent reduction in new build and there are also major concerns about the impact on investment in existing stock and on supported housing.
A cap would help tenants not on housing benefit but the major beneficiary would be the Department for Work and Pensions unless its savings are reinvested in housing.
That point was really brought home to me when I interviewed the Welsh housing minister recently. She was only too aware that the more she restricts next year’s rent increase, as might be her instinct, the more savings will go straight back to Westminster, with zero chance of them coming back to Wales.
Read the rest of this entry »Feeble progress on decarbonisation
Posted: June 30, 2022 Filed under: Decarbonisation, Energy efficiency Leave a commentOriginally written as a column for Inside Housing.
The prospect of underspent decarbonisation funding for social housing being sent back to the Treasury is worrying enough in itself – and that’s before you consider the bigger picture.
The warning from a senior civil servant at the Department for Business Energy and Industrial Strategy was delivered at the Housing 2022 conference this week as he urged landlords to bid for the upcoming second wave of the Social Housing Decarbonisation Fund (SHDF).
In the wake of alarming lack of progress by councils who received funding from the Social Housing Decarbonisation Fund Demonstrator, the fact that the money is being released in one-year tranches may be part of the problem. There are also still major concerns about skills and capacity to carry out the work.
However, at least the fund is there. The really alarming thing is that this is just about the only part of plan to decarbonise housing as a whole that is even close to on track to achieving the progress needed to achieve net zero.
A sobering report from the Climate Change Committee (CCC) published on Wednesday reveals the scale of the challenge and the lack of progress so far.
Absurdly, as CCC chair Lord Deben says in his introduction, we are still building new homes that will not meet minimum standards of energy efficiency and will require significant and expensive retrofitting. This is six years and counting after the original target for all new homes to be zero carbon.
The Future Homes Standard will not apply to new homes in England until 2025 and the CCC is ‘not confident’ that interim measures will drive sufficient change before then since they will still add to the stock of gas boilers that will need to be retrofitted.
But progress is even slower on existing homes and the vast majority of the housing stock that will exist in 2050 has already been built.
Read the rest of this entry »Mind the gaps in the net zero strategy
Posted: October 21, 2021 Filed under: Climate change, Decarbonisation, Environment, Zero carbon homes Leave a commentOriginally published as a column for Inside Housing.
In so far as it can be called a strategy, the government’s plan for heat and buildings largely relies on the private sector plus regulation to deliver its ambitious targets for net zero in housing.
What ‘new’ money there is – £800m for the Social Housing Decarbonisation Fund, £950m for Home Upgrade Grants – seems mostly to consist of allocations from sums already promised in the Conservative manifesto.
The exception seems to be £450m for a Boiler Upgrade Scheme that will fund 90,000 replacement heat pumps over the next three years, with the government arguing that this will prime the market for its ‘ambition’ of 600,000 a year for the next three years.
But that mismatch only highlights the contrast with Labour’s pledge of £60bn investment over the next 10 years and the Climate Change Committee’s estimate that it will cost a total of £250bn to decarbonise housing by 2050.
There is an even bigger gap between the strategy’s rhetoric about net zero and the reality that bringing as many homes as possible up to EPC band C by 2035 will involve costly retrofits. Around 60 per cent of existing homes are below EPC C.
And there are still big questions about whether new technologies will work, how decarbonisation will be delivered and how the targets and standards will be enforced.
Read the rest of this entry »Falling short on climate change
Posted: July 2, 2021 Filed under: Climate change, Decarbonisation, Housebuilding Leave a commentOriginally published as a column for Inside Housing.
With just four months to go until the COP26 UN Climate Change Conference in Glasgow, the government is long on ‘historic’ targets but woefully short on credible policies to implement them.
That was the verdict from the government’s own adviser last week in reports that identify housing as a key sector where action fails to match the lofty and legally binding target of achieving net zero by 2050.
The Committee on Climate Change says a ‘step change’ is required but it is hard to discern any comprehensive strategy in climate plans announced in the last 12 months and statements of ambition have been undermined by delays to essential legislation and plans to decarbonise buildings.
The Ministry for Housing, Communities and Local Government (MHCLG) is accused of falling short on ensuring that building standards are fit for purpose and properly enforced and overseen ‘almost none of the necessary progress in upgrading the building stock’.
Meanwhile the Planning Bill misses ‘the powerful opportunity to ensure that developments and infrastructure are compliant with Net Zero and appropriately resilient to climate change’.
Delivery rates on key retrofit measures have ‘continued to stagnate’. On the vital issue of how homes are heated, the number of heat pumps installed in new and existing homes rose from 33,000 in 2019 to 36,000 in 3020. The CCC says 900,000 installations a year are needed by 2028.
We are even falling short in new homes. Heat pumps were installed in just 5 per cent of them in 2020 against a requirement for 20 per cent by this year.
Read the rest of this entry »The problems with Johnson’s housing priorities
Posted: October 6, 2020 Filed under: Decarbonisation, Fire safety, Mortgages, Stamp duty Leave a commentOriginally written as a column for Inside Housing on October 6.
You are prime minister. You have £5.8 billion to spend on housing. What do you do?
Before you answer there is a catch. You are a Tory prime minister. So this has to be all about home ownership.
This is not about the Affordable Homes Programme either – although the modest increase in that is tilted towards home ownership too.
You may have guessed by now that this is about decisions already taken by Boris Johnson’s chancellor Rishi Sunak, decisions that are looking worse and worse the more time goes on.
That thought was prompted by the only ‘new’ idea that I’ve seen emerging from the Conservative Party conference: a plan to create ‘Generation Buy’ by encouraging low-deposit mortgages to help young people on to the housing ladder.
The idea revealed by Mr Johnson in a Telegraph interview on Saturday is not especially new – essentially it’s a rehash of the mortgage guarantee part of Help to Buy and it harks back to the days when Gordon Brown wanted to encourage long-term, fixed-rate mortgages – and it seems to be inspired by a report published by the Centre for Policy Studies last month.
Read the rest of this entry »Sunak fails to look beyond the short term
Posted: July 8, 2020 Filed under: Coronavirus, Decarbonisation, Housing market, Stamp duty | Tags: Rishi Sunak Leave a commentOriginally published as a column for Inside Housing on July 8.
This was a Summer Statement that was all about protecting jobs and getting money into the economy as quickly as possible.
Judged in those terms, while it does not go as far as some had advocated, the two big housing measures in chancellor Rishi Sunak’s Plan for Jobs look carefully calibrated to achieve both.
The £3.8 billion cut in stamp duty (increasing the nil rate from £125,000 to £500,000) is calculated to boost transactions, generate jobs and drive additional spending estimated at around 5 per cent of the house value.
And the Treasury reckons that the £2 billion Green Homes Grant (funding two thirds of the cost of energy efficiency work up to £5,000 for owners and landlords and all of the cost up to £10,000 to low income owners) could support over 100,000 green jobs as well as cutting carbon emissions and fuel bills.
But it’s not hard to find holes in the Summer Statement where other housing responses could and should have been: the statement does nothing more for affordable housing, it fails to fill holes in the safety net and, as Generation Rent points out, vouchers to eat out are not much use if you cannot afford to stay in.
And though the two measures that are there should boost the economy in the short term the longer-term benefits of both look uncertain at best even when you judge them in isolation and in their own terms.
Johnson sinks to the occasion
Posted: July 1, 2020 Filed under: Affordable housing, Coronavirus, Decarbonisation, Permitted development, Planning | Tags: Boris Johnson Leave a commentOriginally published on July 1 as a column for Inside Housing.
It was less ‘build, build, build’ than ‘blah, blah, blah’, less New Deal than reheated old announcements.
Boris Johnson’s big speech on Tuesday, plus accompanying announcements on housing and planning, were billed as the start of the recovery after Coronavirus.
They arrived to a chorus of calls for greater investment, Homes for Heroes and a warning from Shelter and Savills that output of new homes will fall by 85,000 this year because of the pandemic, with just 4,300 for social rent.
In that context, the prime minister sank to the occasion and even managed to imply that the Affordable Homes Programme will be cut.
Where the Budget in March had promised £12.2 billion over the next five years, Johnson said it will now run over eight. Taken at face value that means a cut of 38 per cent from £2.4 billion a year to £1.5 billion.
That would be roughly the same annual commitment as in the current AHP and would represent a slap in the face for everyone who has campaigned for or needs an affordable home.
Not so, fast, though. No 10 soon clarified that when he said eight years he was actually talking about the three-year time lag for homes to be built after the end of the programme. Social Housing was given the slightly different line that the extra three years applies only to the £2 bn strategic partnerships announced in September 2018.
10 things about 2019 – part two
Posted: December 31, 2019 Filed under: Decarbonisation, Housebuilding, Permitted development, Temporary accommodation, Welfare reform Leave a commentOriginally published on December 27 on my blog for Inside Housing.
The second part of my look back at 2019 runs from welfare homelessness to decarbonisation via housebuilding and permitted development.
5) ‘The systematic immiseration of millions’
The election result means that universal credit, the benefit cap, the bedroom tax and all the other welfare ‘reforms’ of the last decade are set to continue into the 2020s.
Chancellor Sajid Javid told us in the September spending round that austerity is over but the only hard evidence of this was an extra £40m for discretionary housing payments and previous cuts are still baked in to the system.
The election had delayed a full spending review until 2020 but better news came in November as the Conservative manifesto confirmed an end to the four-year freeze in most working age benefits, including the local housing allowance.
It remains to be seen, though, whether the government will restore the broken link with rents. It’s also worth noting that Esther McVey, the self-styled architect of Blue Collar Conservatism, called for part of housing benefit to be diverted into Help to Buy during her brief tilt at the Tory leadership.
I blogged about the deeper impacts on the housing system in a post from the Housing Studies Association conference in May that highlighted research on the ‘housing trilemma’ facing social landlords between their social mission, business imperatives and the impacts on tenants.
And the same month brought a damning external review from the United Nations Special Rapporteur on Extreme Poverty that warned of ‘the systematic immiseration of millions’.
Professor Philip Alston noted ‘a striking and complete disconnect’ between the picture painted by ministers and what he had heard and seen from people across the UK.
As for the chief architect of it all, the year finished with the decade summed up in four words: Sir Iain Duncan Smith.
Jules Birch 