I have just had the delight of reading the Governments white paper “Fixing our broken housing market”. It is a very aesthetically-pleasing document and overall, it’s an easy read.
That's the good news.
The bad news is that we have heard it all before from previous governments. This document is Theresa May’s attempt to address the issue. Unfortunately, there is absolutely no innovation or significant developments in policy or funding without which, nothing is going to change. There is little mention of any significant financial commitment but there is a lot of information about the perceived problems within the sector - an under-supply of homes, a skills shortage, lack of access to finance, a slow planning system and lack of access to land.
Our housing sector is simple. We have some incredibly successful private housebuilding organisations in the UK. They access land, obtain planning and sell their product. Generally, they make around 20% margin and a good return to their shareholders. They also pay 20% corporation tax to the Government on their £600 million profit. I am in no way criticising these businesses at all. They are very successful and make a great return to their shareholders. Why would they or why should they do anything differently.
In the public sector, the Government reduced grants and rent meaning it is very difficult for housing associations to make developments to work commercially. This is particularly an issue in the North where rents are low.
Planning is another key issue. The process is cumbersome and slow. We have lengthy consultation periods because everyone wants to have their say. Nobody wants development in their back yard. On top of this, there is a lack of planners in local government, as there are far better paid or more attractive roles in the private sector.
We have the ‘same old same old’ when it comes to construction skills. How many times have we heard there is a skills shortage. Well here is the thing - there always will be because who wants to be laying bricks in the UK in the deep dark winter. If you are leaving school would you not want to follow a dream and work for a company like Facebook or Google?
We then have the new one on this report and that is modern methods of construction. Isn't that a great idea! We have had this discussion so many times but there is absolutely no incentive and housebuilders and developers would rather build traditionally, despite what is in this report.
You can probably tell by now that I am a little frustrated.
This is an area I am really passionate about. So much so that we put our money where our mouth is and developed Spacehus – a 3-bed house, built in 4 weeks and no energy bills, costing just £80,000. We built a pilot of four houses to prove that it could be done. We even have an innovative all-inclusive rent system where all bills are covered by a single monthly payment. We have now had families in the properties for two years and they love them.
Unfortunately, the Government reduced rent increases which put the entire social housing sector into turmoil. It is only now it is getting back on its feet.
So what would I do? I acknowledge that it isn’t an easy one to solve and that there is no silver bullet. However, I think the steps taken to date are just not bold enough. So here are a few of my own personal thoughts.
These are just some ideas off the top of my head. I haven’t had months of consultation or the time to think up new ideas.
However, I know nothing will be achieved by this report. The Homes and Communities agency will change its name to Homes England. I’m sure the rebrand will cost thousands, and whilst I like the name it wouldn't have been my priority and I’m not sure that in the long run, it will deliver us any more homes!
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