Housebuilding assumptions about to be tested again

Originally written as a column for Inside Housing.

Is what’s good for housebuilders still what’s good for housebuilding?

That headline was the assumption that underpinned policy through the 2010s: first in the elimination of ‘red tape’ and then in the creation of Help to Buy. But it’s one that has been severely shaken by the building safety and leasehold scandals.

But two announcements made in the last week could provide some important signals about how things will play out in future.

The relaxation of the rules on nutrient neutrality seems at first glance confirmation of the traditional assumption: housebuilders have long lobbied against what is effectively a block on the construction of new homes in many river catchment areas and now they seem to have got what they wanted.

And in this case they have a point: this is a real issue that affects housing associations and local authorities prevented from building affordable homes as well as developers developing homes for sale.

But the issue with polluted rivers and seas is equally real and it very much remains to be seen whether what is being spun as ‘using our Brexit freedoms’ can address both.

Visit the Wye Valley, for example, and you will find no new homes being built on the grounds they will add to nitrate pollution but around 20 million chickens being raised in enormous sheds that are a much bigger source of it.

This looks to be more about agriculture and the state of the water industry than it is about housebuilding, even though it’s hard to hear Michael Gove arguing that ‘the way EU rules are being applied has held us back’ without wondering why in that case virtually every other EU country builds more homes per head than we do.

The second announcement potentially has even profound implications for the future of housebuilding and housebuilders.

The Competition and Markets Authority (CMA) launched a housebuilding market study six months ago but on the Friday before the bank holiday it published an update that reveals the issues that will be its main focus.

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Mind the gaps in the net zero strategy

Originally 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.

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A new mindset on decarbonisation

Originally posted on August 9 on my blog for Inside Housing.

Decarbonisation is set to be one of the biggest housing issues of the next decade but the debate about how to do it and how to pay for it is only just getting started.

If the need for dramatic action has long been clear, so too has a tendency to put off doing anything meaningful – witness the way that England’s ambition to make all new homes zero carbon by 2016 was watered down and then dropped by the self-styled ‘greenest government ever’.

But as extreme weather and Extinction Rebellion bring the climate emergency to the top of the agenda the issue is back with a vengeance.

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From One Planet to Dr Earth

Part 2 of my blog on what housing could expect from a multi-party government looks at what the Greens and UKIP are saying.

I suspect many Inside Housing readers would welcome a Green housing minister committed to implementing its manifesto pledges to ‘provide 500,000 social homes for rent over the five-year parliament, control excessive rents and achieve house price stability’.

The manifesto is the only one from the English parties already represented at Westminster that offers a genuine alternative to the current system. While many will question its feasibility, few would quarrel with its principle of ‘making property investment and speculation less attractive and increasing housing supply’. Among the policies on offer are the removal of borrowing caps on councils, the end of the right to buy at a discount, more rights to homeless people, five-year private tenancies with rent increases limited to CPI, removal of tax relief for buy to let landlords and preparations for a land value tax.

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Paying the bill

Blink and you may have missed it but significant housing legislation you may never have heard of passed its final stages in the Commons on Monday night.

Scant discussion in the housing press (including by me) of the Deregulation Bill is perhaps understandable when you consider that it is huge and it covers everything from the right to buy to outer space*. Several of the clauses involving housing were also not in the original Bill and have been added later.

However, here’s what will become law in England this summer as a result of Monday’s votes (there are other minor changes I don’t have room for):

  • The qualifying period for the right to buy will be reduced from five years to three
  • Local authorities will no longer be able to impose standards for new homes that go beyond the building regulations (mainly on energy efficiency)
  • Legislation banning short-term lets of homes in London will be repealed
  • The secretary of state will no longer have the power to require local authorities to produce housing strategies.

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Zero sums

Ministers once promised that Britain would lead the world on zero carbon homes. Do we now just lead the world in hot air?

The 2016 target for all new homes to be zero carbon seemed genuinely revolutionary when Gordon Brown and housing minister Yvette Cooper first announced it in 2006. Questions about practicalities and costs were brushed aside as they argued that the target would spark the mass adoption of new technologies, drive down costs and even open up vast new export markets for British firms. As Cooper put it at the time:

‘In 10 years, all new homes should be built at a zero carbon rating. No other country has set that sort of timetable or ambition but I believe that we need to do it to drive the environmental technologies of the future and ensure that we are building the homes of the future.’

Eight years, and six housing ministers, later and today’s Queen’s Speech promises that ‘legislation will allow for the creation of an allowable solutions scheme to enable all new homes to be built to a zero carbon standard’.  So far, so good. The Liberal Democrats even reached back to the days of Brown and Cooper with their claim on Monday of ‘Britain to lead world on zero carbon homes’. Read the rest of this entry »