Will Letwin be worth the wait?
Posted: March 13, 2018 Filed under: Affordable housing, Housebuilding, Land | Tags: Letwin review Leave a commentOriginally published on March 13 on my blog for Inside Housing.
So, with unintentional irony, the inquiry into why it takes so long to get new homes built is itself taking longer than expected.
For all the advance speculation and ministerial statements in the last few days, the Letwin Review of build-out rates was not published alongside today’s Spring Statement.
Instead the former Conservative Cabinet minister published a four-page letter offering housing secretary Sajid Javid an interim update on the work of the inquiry focusing on what is happening on large sites operated by large housebuilders.
A ‘draft analysis’ will follow by the end of June offering a description of the problem and its causes but final recommendations will only be made in time for the Budget in November.
In truth, expectations that Letwin would be able to offer instant solutions within a few months were always likely to be dashed – not that this stopped ministers from pre-empting it with warnings to housebuilders to ‘do their duty’ in the planning announcements last week.
Perhaps significantly, the draft update has only one mention of the supposedly crucial issue of ‘land banks’, the nefarious practice by which housebuilders allegedly hoard land with planning permission until they can make the most money.
However, Letwin rejects most of their usual excuses too – everything from shortages of labour, materials and capital to problems with transport infrastructure, utility connections and constrained logistics on site.
He argues instead that the ‘fundamental driver of build out rates once detailed planning permission is granted for large sites appears to be the “absorption rate”.’
This is ‘the rate at which newly constructed homes can be sold into (or are believed to be sold successfully into) the local market without materially disturbing the market price’.
New name, new ministers, new start?
Posted: January 23, 2018 Filed under: Council housing, Grenfell Tower, Homelessness, Land | Tags: Dominic Raab, MHCLG Leave a commentOriginally posted on my blog for Inside Housing on January 23.
It’s got a new name and new ministers but how much has really changed at the Ministry for Housing, Communities and Local Government?
Yesterday’s MCHLG questions marked the first time that Sajid Javid and his new team have faced MPs since the reshuffle earlier this month.
Judging from the secretary of state’s first few responses, the answer seemed to be not much.
His exchanges with his Labour shadow John Healey over the painfully slow progress on replacing unsafe tower block cladding have already been widely reported.
On the latest figures, 312 buildings have been tested and 299 have been failed but cladding has been taken down and replaced on just three.
‘How has it come to this?’ asked Healey. ‘Seven months on from Grenfell, only one in four families who are Grenfell survivors has a new permanent home. The Government still cannot confirm how many other tower blocks across the country are unsafe. Ministers still refuse to help to fund essential fire safety work when they know that blocks are dangerous.’
The real Budget agenda is clear
Posted: November 22, 2017 Filed under: Affordable housing, Budget, Council housing, Land, Local housing allowance, Universal credit | Tags: Philip Hammond Leave a commentPhilip Hammond’s Budget contains some big numbers and ambitious promises on housing but you don’t have to delve very far to find the real priorities.
Contrast, for example, what’s happening with housing, tax and welfare, two different measures that were heavily predicted and one that was desperately needed.
Stamp duty is being cut, but the chancellor has gone further than the expected holiday by abolishing it completely for first-time buyers of homes worth up to £300,000 or the first £300,000 of homes worth up to £500,000. The cut applies from now and will cost £3bn by the end of 2022/23.
Problems with universal credit are being addressed with measures including the scrapping of the seven-day waiting period, making advances easier to get and allowing continued payment of housing benefit for two weeks after a universal credit claim. The total cost is £1.5bn by 2022/23 and there is another delay to the rollout.
The universal credit changes are welcome but will still leave claimants potentially facing destitution and people in work thousands of pounds a year worse off than they would have been under the previous system.
A look ahead to the Budget part one: the land question
Posted: November 13, 2017 Filed under: Budget, Compulsory purchase, Land, Section 106 | Tags: Churchill, Civitas, Joseph Chamberlain Leave a commentOriginally published as a column for Inside Housing on November 13.
More than ever before, this year’s Budget looks like a watershed moment for housing.
Philip Hammond is under mounting pressure from all sides to do something big and bold and break with the failed policies of the past.
The calls for something radical are coming from more than just the usual suspects and are for more than just a cheque with lots of zeros.
Conservative MPs know that they cling to power (just) thanks to the votes of elderly home owners. Brexit may dominate everything but many of them realise that beneath the surface housing is one of the key issues poisoning their relationship with the under-45s.
They understand that cynical policies like Help to Buy are no longer enough, that the party is running out of time and that it has to look at policies that were previously unthinkable.
Yet conventional wisdom says that we’ve heard all this before, that Hammond’s caution and the Treasury’s orthodoxy will turn thinking that was big and bold into outcomes that are tame and timid on November 22.
After the announcements in the last few weeks of an extra £10bn for Help to Buy, another £2bn for social housing and the u-turn on the LHA cap for social and supported housing, how much is left for the chancellor to say (or spend)?
However, another view says that the housing question has such serious social, economic and political implications that the answers cannot be put off any longer. See this blog by Toby Lloyd for a good round-up of some possibilities.
In a series of columns ahead of the Budget, I’ll be looking at some of the crucial questions concerning investment, tax and welfare and, to kick things off, land. Will the Budget be big and bold – or tame and timid?
Housing in the Conservative manifesto
Posted: May 18, 2017 Filed under: Compulsory purchase, Council housing, Homelessness, Housebuilding, Housing First | Tags: Conservatives 1 CommentOriginally posted on May 18 on my blog for Inside Housing.
This is a Conservative manifesto with only two firm targets on housing but lots of interesting hints about future direction and some intriguing omissions.
The first target is to halve rough sleeping by 2022 and eliminate it completely by 2027 by implementing the Homelessness Reduction Act and piloting a Housing First approach.
The 2022 target may seem bold but it would mean that rough sleeping would still be significantly higher than it was in 2010 when the coalition came to power.
The one for 2027 is incredibly ambitious and would mean matching Finland’s incredible record on homelessness within ten years.
Sajid Javid obviously returned fired up from his visit to Helsinki but you wonder if he took on board just how comprehensive and well-funded the Finnish version of Housing First needed to be to work.
The second target is ‘meet our 2015 commitment to deliver a million homes by the end of 2020 and we will deliver half a million more by the end of 2022’.
The first bit is unambitious and should be achievable, especially as the end point has been shifted from May 2020 (the original end of the parliament) to December 2020.
As the National Audit Office pointed out in January, that would actually mean that fewer new homes will be built over the next three years than were achieved last year. This is on the basis of the net additional supply of homes rather than just housebuilding completions.
The second bit is a different matter. A quick look at the net supply figures shows that there have only been three years in the last 25 when we have exceeded 200,000.
The price of everything and the value of nothing
Posted: April 27, 2017 Filed under: Land, Local government, Privatisation | Tags: Annington Homes, free schools, MoD Leave a commentOriginally posted on April 27 on my blog for Inside Housing.
Sometimes a conjunction of different news stories shines a new light on things and makes the obvious more obvious.
That’s exactly what happened this week when two excellent long read features on housing and a select committee report made me see familiar issues in a slightly different way.
The first was in Tuesday’s Guardian, an investigation by Holly Watt into the scandal of the privatisation of Ministry of Defence housing.
The big picture is that in 1996 the MoD sold its housing stock for military personnel to Annington Homes for £1.67bn and then rented them back at a big discount to market rates for 25 years.
That may have made short-term financial sense but the long term is a different matter altogether. The homes are now worth £6.7bn and the 25-year discount runs out in 2021. After that there is nothing to stop Annington charging full market rents.
Jules Birch 