UKCW 2018

NEC BIRMINGHAM   09-11 OCTOBER 2018

Housing white paper

The government has today unveiled the much-delayed Housing White Paper to “fix the broken housing market”. Here is a handy section by section guide to the document.

The government has moved away from its “ownership at all costs” mantra of the Cameron administration. Plans focus on getting homes built faster, with higher density where possible and ensuring developers build within two years and not the current three, the government have placed greater onus on rented accommodation.

Unveiling the White Paper, communities secretary, Sajid Javid, said: “Walk down your local high street today and there’s one sight you’re almost certain to see.Young people, faces pressed against the estate agent’s window, trying and failing to find a home they can afford. With prices continuing to sky rocket, if we don’t act now, a whole generation could be left behind. We need to do better, and that means tackling the failures at every point in the system.The housing market in this country is broken and the solution means building many more houses in the places that people want to live.Today we are setting out ambitious proposals to help fix the housing market so that more ordinary working people from across the country can have the security of a decent place to live. The only way to halt the decline in affordability and help more people onto the housing ladder is to build more homes. Let’s get Britain building.”

The White Paper hopes to “tackle the high cost of renting at the heart of its plan to fix the broken housing market”. There are also plans to give councils more powers to build homes as well as introducing a Lifetime ISA from April 2017. The document is now out for consultation and will be closed on the 2nd May 2017.

PRS tenancies

The White Paper explicitly sets out it wants to “ensure more longer-term tenancies are available in private rented schemes”. However, it was only in the speech in the Commons by Sajid Javid that the three year minimum guarantee was confirmed.

The document says this only applies to new build homes and not those who are in existing private rented sector accommodation.The government will work with the British Property Federation and the National Housing Federation to “ensure these longer-tenancies become widely available”. The change comes as the average couple pay around half their earnings on rent and the proportion of people living in the PRS has doubled since the millennium. Latest stats also show 2.2 million households with under average incomes spend more than a third of their income on housing.

Speaking at the weekend, Sajid Javid, communities secretary, said: “We are determined to make housing more affordable and secure for ordinary working families and have a rental market that offers much more choice. We understand people are living longer in private rented accommodation which is why we are fixing this broken housing market so all types of home are more affordable.These measures will help renters have the security they need to be able to plan for the future while we ensure this is a country that works for everyone.”

Affordable rent

Not much new on the affordable rent front but just a reaffirmed commitment to build more of them, as unveiled in the Autumn Statement. The £1.4bn fund that was announced, plus an opening up of the Affordable Homes Programme to include Affordable Rent, was given further backing in the White Paper. But there was the promise of a consultation to allow developers to offer more affordable rent alongside other forms of affordable housing. Building on this, the government have announced changes to the word ‘affordable’.

Homes and Communities Agency

The regulator has been under rafts of changes and here is the latest one... from summer it will be renamed to be called Homes England. The move is to reflect better the new role the organisation will have, after it was announced it would be breaking up from the regulation. For all the latest news on the Homes and Communities Agency, click here.

Planning

Government have reiterated that the lack of up to date Local Plans is harming the rate of housebuilding. The White Paper will look to force local areas to produce a “realistic” plan and review it every five years. Interestingly, councils will be “expected to use land more efficiently” by building homes at higher density where there is a shortage of land and where there are good transport links. There will be powers to help councils build more homes too, although the detail is yet to emerge as to how this will be done.

Both CLG Committee chair, Clive Betts and Lord Kerslake have said the government should lift the HRA borrowing cap. The White Paper will look to make it easier for councils to issue completion notices, slashing the timescales required by developers to build after planning permission is granted to within two years, instead of the current three. The document also looks amending planning rules to allow councils to plan for more long-term Build to Rent schemes. The government is also looking for “greater transparency and information from developers” in relation to the pace of new home delivery, so councils can consider this in their local plans. This is hoped to cut the discrepancy between planning permissions granted and new homes completed.

New players entering the building game

The government are hoping to help more SME builders and others into the housebuilding market by utilising the £3bn Home Building Fund introduced at the Conservative Party Conference. The fund will also be used to provide loans to custom builders, offsite construction and essential infrastructure. The government are looking to diversify the market after pointing out that currently 10 companies build around 60% of new homes.

Ownership

Well, it wasn’t going to be a government announcement without some sort of commitment to ownership! The latest scheme is the introduction of the Lifetime ISA. The government are aiming for 200,000 more home owners by the end of the parliament and this Lifetime ISA will help achieve that by giving young tenants flexibility when saving for the long term. The ISA will give them a 25% bonus on top of £4,000 savings a year. This money can then be put toward a first home or can be withdrawn once they reach the age of 60.

There is a change is tact for Starter Homes too, with the White Paper stating they will be like Shared Ownership, only available to households that need them most, with an income of less than £80,000 (£90,000 in London). The government say this shift in the White Paper means they can now focus on a wider range of affordable housing. There will no longer be a requirement to build 20% Starter Homes on a site, instead being part of the 10% minimum affordable housing products needed for a site. The White Paper does say that Starter Homes would be allowed on rural exception sites, if they fit with local need.

Empty Homes

Not usually something too spoken about in the housing sector but the fact is there remains over 200,000 empty properties in the country. The White Paper talks about “efficient use of existing stock” and says local authorities have the power to tackle empty homes. On top of this, they also have the incentive, says the White Paper, as they earn the same financial reward through the New Homes Bonus as building a new one. There is also the flexibility to impose a council tax premium of up to 50% on properties empty and substantially unfurnished for more than two years.

Leaseholders

The White Paper will seek to “promote fairness and transparency for the growing number of leaseholders.” The government say some buyers are not aware that buying a leasehold house can be more expensive than a freehold house in the long run, with ground rents potentially increasing significantly over the lease period.The White Paper sets out that there will be a consultation on a range of measures to “tackle all unfair and unreasonable abuses of leasehold.”

Green belt back down

Heavily touted before the White Paper, it now seems there has been a row back on the green belt. Led by Conservative MP Andrew Mitchell, it has been a tough battle from their own side on getting MPs to agree that building on the green belt was necessary.

Barwell admitted there would be no change to the policy, which only allows building on the green belt in exceptional circumstances. The White Paper confirms this position. The housing minister said: “The green belt is 13% of the land. We can solve this crisis without having to take huge tracts out of the green belt. We are not going to weaken the protections; we have a clear manifesto promise and there is no need to take huge tracts of land out of the green belt to solve our housing crisis.They can take land out of the green belt in exceptional circumstances but they should have looked at every other alternative first.”

There was a boost for campaigners looking to protect ancient woodland, which they say is under threat from housing developments.

The Sector Responds:

A DCLG spokesman said: “Ancient woodland is a cherished part of our countryside and we already have legal protections for these irreplaceable habitats. We’re clear that building on ancient woodland should be avoided and so will be strengthening the rules to increase the protection for these areas in the forthcoming Housing White Paper.”

In response, the CLA says it is ‘disappointed’ with a ‘city-centred’ strategy showing a ‘lack of consideration’ for the specific housing needs of rural communities. CLA president Ross Murray said: “Rural areas need homes too. It is disappointing that ministers have focused so completely on the need to build homes in and around our towns and cities. This leaves big questions about how we will meet the specific housing needs of young and old people in our villages and leaves a question over how the government will deliver on its commitment to delivering growth across all parts of the country.”

Source: 24 Housing 

We will be discussing the Housing White Paper in detail this October at UK Construction Week. Tell us what you think about the new housing strategy and how we can feedback to the government as a unified industry voice.

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