Originally posted on July 12 on my blog for Inside Housing.
As far back as I can remember, every government has promised to tackle abuses of our outdated system of leasehold.
Between 1979 and 1997, the Conservative governments of Margaret Thatcher and John Major legislated four times on leasehold reform.
The Labour government of Tony Blair promised ‘a comprehensive package of leasehold reforms’ in 2000 and introduced the alternative system of commonhold in 2002.
Piecemeal reforms improved things a bit for leaseholders but commonhold has still only been used on 50 developments at an optimistic estimate – in contrast to the expansion of similar tenures like strata title and condominiums across the rest of the world.
Little wonder when leasehold offers so many advantages to be profitably exploited by landowners, housebuilders and freeholders.
Now, in the wake of the twin scandals of cladding and leasehold, all that could – finally – be about to change.
Originally posted as a blog for Inside Housing on June 19 – updated June 21.
Beneath the surface of a Conservative leadership battle dominated by Brexit and Boris Johnson there is a battle of ideas about the future direction of Conservative housing policy.
Put at its simplest, the battle is about whether to continue in the pragmatic direction signalled by Theresa May since 2016 or go back to the more ideological one taken by David Cameron before then.
But scratch a little deeper there are more fundamental debates going on about how far to go in fixing a housing market that most Tories agree has turned into an electoral liability for them.
Key questions such as how far the government should go in borrowing to invest in new homes and intervening in the private rented sector and the land market are back on the Conservative agenda.
Originally posted on June 13 on my blog for Inside Housing.
Whatever you love it or hate it, Thursday’s report from the National Audit Office (NAO) will probably not do much to change your mind about Help to Buy.
If you think that the equity loan scheme first launched in 2013 has boosted housebuilding and helped more people to buy their first home, you will find evidence to support that view: new-build property sales increased from 61,000 a year in 2012/13 to 104,000 in 2017/18; and around 81% of people using the scheme have been first-time buyers.
If you think the scheme has mainly benefited housebuilders and the benefits for buyers have been more limited, you’ll find backing for that too: 63% of borrowers could have afforded to buy anyway; many of them have used the scheme to buy a bigger house than they could previously have afforded; and 10% of buyers had incomes higher than the £80,000 (£90,000 in London) limit for eligibility for shared ownership.
The report does reject one common allegation made against Help to Buy by estimating that homes sold under the scheme have cost just 1% more than similar new-build homes. Previous estimates ranging from 5% to 20% have not compared similar properties, says the NAO.
However, that is just part of a much bigger new-build premium (the difference between prices of new and second-hand homes) and the NAO seems to accept the high figure of a premium of 15-20% as a given rather than the product of market conditions that Help to Buy helped to create.
Originally posted on insidehousing.co.uk on May 14.
The entry into the UK market of an overseas company that last year built almost as many homes as Barratt, Taylor Wimpey and Persimmon combined is by any standards a big deal.
That’s even before you add what looks like a major step forward for modular building in the UK and one of the most eye-catching individual investments yet by the self-styled disruptors at Homes England.
The £90m deal involves Sekisui House, the biggest housebuilder in Japan, taking a 35% equity stake in Urban Splash’s modular House business. The Manchester-based developer will retain 60% with Noel McKee, one of its existing investors and founder of We Buy Any Car, taking what’s described as an incremental 5% stake
Homes England will take a 5% stake worth just over £3m in the company and will also be providing a £27m loan from its £4.5bn Home Building Fund.
Sekisui House built almost 44,000 new homes last year, almost 5% of all those built in Japan, where new build numbers and demolitions alike are much higher than in the UK.
Originally published on March 19 as a blog for Inside Housing.
The leasehold scandal will have far-reaching implications for housing that will be felt well beyond the major housebuilders with whom it began.
A report published by the all-party Housing, Communities and Local Government Committee on Tuesday takes as its starting point the doubling ground rents and onerous contract terms faced by buyers of new homes who it says were treated ‘not as homeowners or customers but as a source of steady profit’.
And it also highlights the issue of leaseholders facing huge bills to remove and replace combustible cladding raised in its work on fire safety.
But this report goes well beyond those recent high-profile problems with leasehold and poses some fundamental questions about a tenure that only exists in England and Wales – and they are ones that will require answers by social landlords as well as private sector housebuilders and freeholders.