A not so humble address

Originally a column for Inside Housing.

Affordable and safe housing for all’. Who could argue with that?

Pretty much everyone, funnily enough, because this was the title of the housing part of the House of Commons debate on the humble address following the Queen’s Speech.

Catching up with last week’s debate, two things struck me really powerfully: first, just how much politics has been turned on its head; and second just how riddled with contradictions the government’s position on housing really is.

In the post-Brexit and (hopefully) post-Covid world, the more that the blanks in the empty slogan of levelling up are filled up, the clearer the first becomes.

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Building Back Better (in due course)

Building back better? Safer? Fairer? How about slower?

At first glance this is a Queen’s Speech that looks full of welcome reforms to planning and the delivery of new homes, conditions for renters and leaseholders and building safety. Scratch beneath the surface in the background briefing notes, though, and big questions remain and there are big battles to come.

Ahead of the speech, the Planning Bill was spun as ‘cruical’ to levelling up, a way to cement Conservative advances in the Midlands and North by boosting home ownership.

But that ignores the battle to come with Tory backbenchers over housebuilding in the South East.

A cynical outcome from the white paper would be to emphasise local growth as you allow councils in expensive areas to designate large parts of them for protection. This would do next to nothing to tackle affordability – or address the very real questions about the future of Section 106 – but the politics will be very tempting.

In the wake of Grenfell, the government will ‘continue to deliver on the Social Housing White Paper proposals’ and ‘legislate as soon as practicable’.

But Grenfell was almost four years ago and the social housing white paper that was published in November that took more than three years. Practicable? Grenfell United has already called it a ‘betrayal’.

Improvements will come in the proposed Building Safety Bill which is at last delivering on the improved regime promised after the fire.

However, that in itself is a delayed opportunity to address the plight of hundreds of thousands of leaseholders after ministers steadfastly resisted all amendments to the Fire Safety Bill to make it clear they should not have to pay for problems that are not their fault. The stage is set for another huge Commons battle.

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Guarantees, cladding and the housing market

Originally published on April 20 on www.insidehousing.co.uk.

The housing market is at a frenzied record high as house prices rise by more than 2 per cent in a single month.

Just the moment then for the government to step in with a scheme to guarantee 95 per cent mortgages for anyone who thinks they have to climb the ladder before it disappears out of reach.

The house prices in question are only asking prices as recorded by Rightmove but the £6,733 average increase between March and April reflects a rush to beat the end of the stamp duty holiday and demand for more space from people who have done well during the pandemic.

It’s now 13 months since the start of the pandemic and, to pick another measure, house prices are up by around £16,000 or more than 7 per cent since then, according to the Nationwide.

Prices initially fell amid the economic uncertainty but surged again on the back of the stamp duty holiday introduced by chancellor Rishi Sunak last July and then extended in March.

The overwhelming beneficiaries are people who already own homes who have been able to sell them for higher prices that now wipe out the stamp duty savings for most buyers. For all the rhetoric about helping people on to the housing ladder, few first-time buyers saved much in stamp duty and all now face having to spend considerably more in total.

The mortgage guarantee scheme, essentially a rehash of one part of Help to Buy, should help them by addressing a genuine problem with the supply of high loan-to-value mortgages.

However, lenders are cautious. The Financial Times reported on Saturday that the largest banks are refusing to lend on new builds under the scheme and that they may also charge higher rates and apply stricter affordability criteria.

From their point of view that makes sense to guard against falling prices, especially when they factor in the new-build premium that adds around 10 per cent to the cost of a new home. .

And the benefits look dubious for first-time buyers too. Based on the Nationwide index, a 95 per cent loan on home at the current average price would be £220,000 – more than the total price was when the stamp duty holiday was first announced.

None of this makes any sense and yet, in an under-supplied and under-taxed housing market fuelled by credit and low interest rates, somehow it does.

As memories fade of the housing market crash of the early 1990s and the downturn after the financial crisis, the logical next step would be a relaxation in affordability checks on mortgages to allow loans at larger income multiples, ignoring the lessons of the 2000s and the economic headwinds that could lie ahead as furlough ends.

But all of this is happening at the same time as the entire market for recently built flats remains mired in the continuing fall-out from the fire safety crisis.

Inside Housing reported on Friday on cases of leaseholders buying flats on the basis of External Wall System (EWS) form declaring that their cladding was safe only for new inspections to decide that it must be removed.

One buyer purchased a £350,000 flat rated A1 and safe in February only for the EWS to be downgraded to B2 just 34 days later. That made her flat worthless and left her facing costs for waking watch and cladding remediation.

If the EWS rating can be changed at the drop of a hat like this, why would anyone risk buying a recently built flat?

The government has grudgingly and in stages committed a total of £5.1 billion to fixing the cladding crisis so far and it has announced some welcome reforms to leasehold.

But leaseholders in buildings below 18m are only eligible for loans and help does not apply to other fire safety problems, leaving a significant chunk of the housing market in limbo.

The fact that at the same time the government has spent £5.4 billion on the stamp duty holiday says it all about where its priorities really lie.   


The problems with Johnson’s housing priorities

Originally 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.

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Facing up to the cladding crisis

Originally published on September 7 as a column for Inside Housing.

All through the cladding saga, the government has dragged its feet and resisted spending money before finally being forced to act.

Think back to the way ministers resisted any kind of fund for replacement of Grenfell-style ACM cladding, then insisted private building owners should pay, then denied the need for any help for non-ACM cladding and you see a pattern repeating itself.

It took the government almost a year after Grenfell to announce a £400m fund for the removal of ACM on social housing blocks, almost two years to find £200m for private blocks and almost three years to announce the £1bn Building Safety Fund for the removal of non-ACM cladding.

All this while the cladding scandal continued to escalate, dragging in more and more blocks and more and more residents and eventually wrecking the whole market in recently built flats.

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Doing the right thing on fire safety

Originally posted as a column for Inside Housing on June 18.

In the 36 months since Grenfell ministers have repeatedly appealed to others to ‘do the right thing’ and pay for the replacement of dangerous cladding on high-rise homes.

Ministers have resisted doing anything themselves but the pressure has always told eventually.

After 11 months, a £400 million fund was announced for social housing blocks with aluminium composite material (ACM) cladding. After 23 months, another £200 million was found for private blocks with ACM. After 32 months, the £1 billion Building Safety Fund was announced in the Spring Budget this year to cover hundreds more high-rise blocks with non-ACM but still dangerous cladding

Three years on from the fire, work has only been completed on a third of the ACM blocks – 149 out of 457 – according to the latest government statistics.  Of the remaining 307, work had not even started on 140.

The minister responsible for building safety (the fifth since Grenfell) told the Housing Communities and Local Government (HCLG) committee that there are another 11,300 buildings with other types of dangerous cladding and that 1,700 of them are classed as high risk.

Even as the funding has been grudgingly announced, so the estimated cost of fixing the problem has risen. Add the costs of other internal and external fire safety measures that go well beyond the clading, and the HCLG committee puts the total cost at £15 billion.

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Three years on from Grenfell, where does the buck stop on fire safety?

This Sunday is the third anniversary of the Grenfell Tower fire. There are still 2,000 high-risk residential buildings out there with dangerous cladding.

Let that sink in for a second because it’s easy to let time obscure the scale of the problem if you’ve followed the twists and turns of the cladding saga since 2017 from afar.

Not so easy if you are one of the tens of thousands of people living in thousands of flats in those buildings. In a survey released by the UK Cladding Action Group on Thursday, 23 per cent of residents said they had felt suicidal or a desire to self-harm as a result.

This morning (Friday) the all-party Housing, Communities and Local Government Committee describes the situation as ‘deeply shocking and completely unacceptable’ in a report that lacerates the government’s slow and inadequate response. The committee has a Conservative majority but is doing an increasingly impressive job of holding ministers to account. Read the rest of this entry »


Time running out for temporary fixes

Originally posted on May 28 as a column for Inside Housing.

What then? It’s the question that’s been left hanging in most of the housing elements of the government’s response to the Coronavirus and much more besides.

There was a partial answer on what happens to thousands of temporarily accommodated rough sleepers as the Ministry for Housing, Communities and Local Government (MHCLG) accelerated funding to make 3,300 housing units available over the next 12 months.

There was an answer of sorts for leaseholders living in unsafe buildings as MHCLG opened registrations for its new £1 billion Building Safety Fund that extends help to other forms of dangerous cladding as well as Aluminium Composite Material (ACM).

And there was a welcome one for millions of home owners with mortgages as the Treasury extended the chance to apply for a payment holiday by another three months and Financial Conduct Authority guidance made clear that banks should not start of continue repossession proceedings until the end of October given the uncertainty faced by customers and government advice on social distancing and self-isolation.

But there is still no answer for millions of social and private renters asking what will happen when the moratorium on evictions ends on June 25.

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Cladding questions have not gone away

Originally published on April 30 as a column for Inside Housing.

The first parliamentary questions on housing since the Coronavirus lockdown saw pleas for construction and housebuilding sites to get back to work.

But this was anything but a return to normal as a socially distanced and virtual House of Commons saw scrutiny of ministers truncated by the parliamentary timetable and technical gremlins.

Though questions about the costs of Covid-19 for local government took top billing, Tuesday afternoon’s Ministry of Housing Communities and Local Government (MHCLG) questions only underlined the fact that the top housing issue before the outbreak has not gone away.

Six short weeks ago there was some good news for victims of the cladding scandal as the Budget extended government help beyond Grenfell-style ACM cladding to cover other materials such as High Pressure Laminate (HPL).

Full details of the £1 billion fund are expected in May but there are still big questions about how it will operate.

And in the meantime the plight of residents has got worse as bills escalate for insurance premiums and for waking watches in blocks where work to replace the cladding has been halted by the lockdown. These interim measures are not covered by the fund.

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Budget boost leaves housing gaps

Originally published on March 11 as a blog for Inside Housing.

This is a Budget that does not live up to its own hype and has some glaring omissions but still brings some good news for housing.

There are three big positives: a £12.2bn Affordable Homes Programme (AHP) over the five years from 2021/22; an additional £1bn for a Building Safety Fund to remove dangerous cladding; and £650m to help rough sleepers into permanent accommodation.

Add the reversal of an interest rate hike for borrowing for new council homes, extra funding for housing infrastructure, £1.2bn in consequentials that other UK nations can invest in new homes and an extension of Shared Accommodation Rate exemptions to young rough sleepers and other vulnerable groups, and this looks like one of the best Budgets for housing in the last 10 years.

However, that’s not setting the bar especially high, and you don’t have to look very far below the surface before the questions start to mount up.

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