Category Archives: Affordable and Social Housing

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20 Sep 2017

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How much bigger does the housing scandal need to get before SOMEONE does SOMETHING?

“Millennials are spending three times more of their income on housing than their grandparents yet are often living in worse accommodation, says a study launched by former Conservative minister David Willetts that warns of a “housing catastrophe”.

The generation currently aged 18-36 are typically spending over a third of their post-tax income on rent or about 12% on mortgages, compared with 5%-10% of income spent by their grandparents in the 1960s and 1970s. Despite spending more, young people today are more likely to live in overcrowded and smaller spaces, and face longer journeys to work – commuting for the equivalent of three days a year more than their parents.” …

https://www.theguardian.com/society/2017/sep/20/millennials-spend-three-times-more-of-income-on-housing-than-grandparents

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20 Sep 2017

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Affordable and Social Housing

The neglect of social housing – now words but little action

Owl says: lots of sweet words, no action, no more [better] social housing … a problem but no solution.

“The Grenfell Tower fire showed that those in power had dehumanised tenants as “problems that needed to be managed”, the communities secretary said today as he announced an extensive review of social housing.

Sajid Javid said the way in which council tenants are housed in Britain needed a “top-to-bottom” rethink in the wake of the tragedy. Mr Javid said the government would be publishing a green paper in the coming months.

He pledged to make the work the most substantial report of its kind for a generation, looking at the quality and safety of social housing but also at ways to reinvent the sector and make it once again the “gold standard for accommodation”.

Referring directly to Grenfell, Mr Javid said that he believed the fire was the consequence of longstanding neglect.

“It is clear that in the months and the years before the fire, the residents of Grenfell Tower were not listened to,” he said.

“That too many people in positions of power saw tenants less as people with families and more as problems that needed to be managed.

“In one of the richest, most privileged corners of the UK, the world, even, would a fire like this have happened in a privately owned block of luxury flats?

“If you believe that the answer is no, even if you think it was simply less likely, then it’s clear that we need a fundamental rethink of social housing in this country.” …

[followed by more weasel words and rhubarb in the same vein]

Source: Times, paywall

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19 Sep 2017

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Another savage attack on government failure on affordable and social housing

Owl says: But why is everyone surprised? This is the free market in operation – what Conservatives have ALWAYS believed in. This automatically favours “survival of the fittest” which most often means the most wealthy. Nothing new there. Just get wealthy – problem solved.

Unfortunately, those low down in the pecking order seem to think that, if they vote Conservative, they will be helped to become rich. That isn’t how it works – the rich like their exclusivity and power. Sharing that power with more people isn’t in their interest as it dilutes both – less exclusive, more power-sharing = not a good idea.

Wise up everyone: if you want change in a Tory constituency or in the country, hold your nose and vote for whoever in your constituency is most likely to come second, and make them first. Change IS hard – but it is desperately needed if we are to do the right thing by all generations.

David Orr, National Housing Federation:

““… The prime minister is right that we’ve not paid social housing enough attention. After the tragic fire at Grenfell, this crisis can no longer be ignored. The government must be bold and make a break with the past by making money available to build genuinely affordable homes.

“There’s more than a billion pounds that remains unspent on Starter Homes. Let’s put this money to use and let housing associations build 20,000 of the genuinely affordable homes the nation needs.”

Orr, who is chief executive of the federation, is expected to argue for a complete shift in government policy.

Since 2010 the government has overseen a massive reduction in the provision of homes for social rent, instead focusing on “affordable” rents, which can be as much as 80% of the market value.

A report by the federation, produced to coincide with the conference, says the amount of capital committed by the government to homebuilding has fallen from £11.4bn in 2009 to £5.3bn in 2015.

In combination with this, the decision to stop public funding for social rented homes led to a decline in construction of these from 36,000 starts in 2010/11 to slightly over 3,000 the next year.

The report says the only new social rent homes now are coming either from previous funding commitments or through cross-subsidies within housing associations projects, amounting to just under 1,000 starts in 2016/17.

It says the increase in rented housing stock has instead come from the private sector, with a 57% rise in real terms over the past two decades.

The federation says private rents are on average £21 per week more expensive than their social let equivalents, meaning that over the last 20 years the annual spend on housing benefit has risen from £16.6bn to £25.1bn.

There is another cost, the report says. “Not only is it 23% more expensive to house someone in the private rented sector than social housing, but none of that money increases the supply of new homes.

“Social landlords do reinvest in new homes, building a third of all new homes last year including for social rent from their own funds, but the same does not happen in the private rented sector.”

In his speech, Orr will argue that this is an unsustainable situation. “It is absurd that we’re spending less on building social housing than we did in the 90s – there are even more people today on housing waiting lists than then, despite increasingly stringent criteria.

“We know we need more, better quality social housing. And yet, rather than putting public money into building the homes we need, we are propping up rents in a failing market. Ultimately, this is poor value for the taxpayer and has a knock-on effect on everyone struggling to rent or buy.”

John Healey, the shadow housing secretary, said: “Conservative ministers have washed their hands of any responsibility to build the homes families on ordinary incomes need. Ministers try to hide their failure to build more affordable homes by branding more homes ‘affordable’. The Conservative definition of affordable housing now includes homes close to full market rent and on sale for up to £450,000.

“Public concern about housing is around the highest level for 40 years. Millions of families are struggling with high housing costs. Faced with this, ministers have turned their back on the way they can help most – by building low-cost homes to rent and buy.” …”

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19 Sep 2017

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Times leader column attacks housing developers and the government

(see also post below)

“Anyone who has fielded rival bids for a kitchen extension is likely to be familiar with the pattern: once contracts are signed and work is under way the winning bidder finds ways to cut costs or otherwise boost profits. Committed to the project, the client’s options are to sue or surrender.

In the multibillion-pound business of updating and expanding Britain’s housing stock, the equivalent of the kitchen extension is the mixed-used development that includes affordable housing to be let or sold at below-market rates.

Affordable housing is in critically short supply. This drives up prices in precisely the areas where buyers and the broader housing market need them to come down. It forces low-income families to live farther and farther from places of work, especially in the southeast, and it is storing up trouble for a weak Conservative government with little traction among voters aged under 40.

This is a government that has promised 1.5 million new homes by 2022. In principle almost all these homes are to be built by the private sector. In practice developers are being allowed to game the system by promising generous allocations of affordable housing only to dilute those commitments once planning permission has been granted and building is under way.

Examples of this underhand but technically legal approach are legion in cities. It has now spread to rural Britain too. The country’s biggest builders are rowing back on affordable housing commitments to the extent of 18 much-needed rural homes a day, leading to a projected shortfall of 33,000 affordable homes in the countryside as a whole by the end of this parliament.

The government should be acting to fix the problem. Instead it is making it worse, siding with developers against local councils in 17 of 23 appeals by builders seeking to cut the number of affordable housing units for which they have had to budget since 2013. Worse still, the process is shrouded in secrecy because it hinges on “viability assessments” that developers are allowed to keep confidential unless a court demands wider access.

These assessments should be open to public scrutiny as a matter of course. Sajid Javid, the communities secretary, claims to have adopted an “honest, open and consistent” approach to assessing local housing needs. It is none of these things.

In the housing plans that all local authorities are required to produce, the average requirement for affordable housing in rural areas is 68 per cent of the total. Under pressure from builders that share has fallen to 29 per cent, even as the companies post record profits. Those of the country’s three largest housebuilders have quadrupled since 2012.

Britain is a crowded island. Space for new homes is at a premium. Demand for land reliably outstrips supply. Landowners sell to high bidders who seek guaranteed generous profit margins to protect against downturns in a market that they are helping to overheat.

This is a classic market failure that might warrant state intervention in the form of publicly funded housebuilding to balance supply and demand at the lower end of the property ladder. This government has ruled that out, however, cutting public spending on social housing by 97 per cent since 2010 and on affordable housing by half in the same period.

At the same time, as the head of the National Housing Federation tells its annual conference today, housing benefit payments have risen by 51 per cent over the past two decades, to £25 billion a year, to help to cover inflated private sector rents.

If the government insists on staying out of the housebuilding business itself it must at the very least make affordable housing quotas binding, and high enough to house those unable to get on the housing ladder any other way. The alternative is a property-owning democracy that founders for want of property to own.”

Source: Times (pay wall)

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19 Sep 2017

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Accountability, Affordable and Social Housing, Barratt Homes, Developers/ Development, Planning System, Rural communications, Section 106

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Developers, magic money trees and (un)affordable housing

Government thinks 20% profit is acceptable for developers.

We all know that, as developers make their case to cut affordable homes on a development by development basis, and not on aggregate figures, they can make numbers tell any story.

Seems weird that, with this system, as so many developments don’t make enough money to fund affordable homes, their profits soar, their directors get bigger and bigger bonuses and their shareholders get higher and higher dividends.

It’s a magic money tree!

“The countryside is facing a shortfall of 33,000 affordable homes over the next five years despite builders making record profits at a time of rising rural homelessness.

Profits at Britain’s three biggest builders have quadrupled since 2012 to £2.2 billion, yet they regularly cite financial constraints when cutting affordable homes in developments. Builders miss targets for affordable homes in the countryside by 18 houses a day, research by the Campaign to Protect Rural England (CPRE) shows.

Profits at Barratt Developments, Britain’s biggest developer, increased almost sevenfold from £100 million in 2012 to £682 million last year. Meanwhile, the number of affordable homes fell from 23 per cent of the total built in 2012 to 17 per cent last year.

Developers use “viability studies” under planning laws to pressure local authorities into cutting the requirement for affordable homes. The reports are kept confidential, on commercial grounds, but documents seen by The Times show that officials from the Department for Communities and Local Government (DCLG) ruled that 20 per cent profit was a “reasonable” margin for a developer. They backed a builder’s attempt to cut the number of affordable homes at a development in Gloucestershire to safeguard that return.

Sajid Javid, the communities secretary, has said that failing to fix Britain’s “broken housing market . . . would be nothing less than an act of intergenerational betrayal”.

Research by the CPRE found that the government overruled councils fighting house builders in 17 out of 23 appeals since 2013. Matt Thomson, the CPRE’s head of planning, said developers had councils “over a barrel”. “The developers will say, ‘Either you give us the 20 per cent profit we need, otherwise we won’t build the houses’,” he said. “It’s just extortion at the end of the day.”

The charity analysed more than 60 local plans, which are council blueprints for new housing, and found that the average rural authority needed 68 per cent of new homes to be affordable. Affordable housing includes shared ownership schemes, council houses and properties owned by housing associations which are rented at no more than 80 per cent of the market rate.

In practice, the councils cut the official requirement to just 29 per cent affordable, on the ground that developers would never agree to 68 per cent. Even that has proven unachievable. Just 26 per cent of new homes in the countryside were classed as affordable over the past three years. The average rural authority is short of 46 affordable homes a year. Across 145 rural authorities in England that is a shortfall of 6,670 homes a year.

A separate report by the Institute for Public Policy Research found that 6,270 rural households became homeless in 2016, part of a 40 per cent rise in rough sleeping since 2010. The centre-left think thank partly blamed “shortages in affordable homes”.

Polly Neate, the head of Shelter, a charity for the homeless, said the crisis would only get worse “if we keep letting developers off the hook”.

The Home Builders Federation, which represents developers, said local authorities “should be realistic”. “Making projects unviable reduces overall housing supply, including the supply of more affordable housing,” Andrew Whitaker, its planning director, said.

Georgina Butler, head of affordable housing at Barratt, said the company was “absolutely committed to delivering the homes of all types that the country needs”.

A spokesman for the DCLG said almost 333,000 affordable homes had been built since 2010, more than 102,000 in rural local authorities.

A funding crisis in social housing will continue unless the government “breaks with the past” to provide financial backing for new affordable homes, the head of an influential housing sector body will say today.

Billions of pounds of taxpayers’ money could be saved by building social housing instead of channelling housing benefit to private landlords, David Orr, chief executive of the National Housing Federation, will tell the organisation’s annual conference.

The government decided in 2010 that no further public money would be made available to finance social housing, which provides accommodation at below-market rents to those on low incomes.

Britain needs to build about 250,000 new homes a year to cope with an existing shortage and a growing population, but only 141,000 homes were built last year.

About a million families are on the housing waiting list, said the NHF, which represents housing associations and social landlords.

In a report published today, the NHF says that the government is now spending “more than ever” on housing benefit to accommodate people in private rentals instead of cheaper social homes, which cost £21 a week less per person.

The amount of housing benefit channelled to private landlords almost doubled in the last decade to £9.1 billion.

“This is poor value for the taxpayer and has a knock-on effect on everyone struggling to rent or buy,” the NHF said.”

Source: Times (pay wall)

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19 Sep 2017

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“Housing money wasted ‘propping up rents’ “

“Taxpayers’ money is being wasted on “propping up rents” in a “failing housing market”, a report says.

The National Housing Federation report highlights how money spent on housing benefit rose from £16.6bn in the mid-1990s to £25.1bn in 2015-16.

It added that since 2011, no government money has been made available to build homes in England for low paid people to rent.

The government said building more homes was its absolute priority.
A Department for Communities and Local Government (DCLG) spokesman said it was continuing to work closely with the sector.

But the report from the federation, which represents housing associations and social landlords, says housing someone in a private rented property costs £21 a week more than housing them in a social rent property, on average.

Its chief executive David Orr said this was “poor value for the taxpayer” and had “a knock-on effect, with everyone struggling to rent or buy”.
“We know we need more, better quality social housing. And yet, rather than putting public money into building the homes we need, we are propping up rents in a failing market.” …”

http://www.bbc.co.uk/news/education-41309316

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17 Sep 2017

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“Open consultation: “Planning for the right homes in the right places: consultation proposals”

Owl says: seems the decision that we need MORE and MORE housing is taken as a given – and this is more an exercise on how and where they can be shoe-horned in:

“This consultation closes at
11:45pm on 9 November 2017

Summary
Consultation on further measures set out in the housing white paper to boost housing supply in England.

“This consultation sets out a number of proposals to reform the planning system to increase the supply of new homes and increase local authority capacity to manage growth.

Proposals include:

a standard method for calculating local authorities’ housing need

how neighbourhood planning groups can have greater certainty on the level of housing need to plan for

a statement of common ground to improve how local authorities work together to meet housing and other needs across boundaries

making the use of viability assessments simpler, quicker and more transparent

increased planning application fees in those areas where local planning authorities are delivering the homes their communities need

The attached ‘Housing need consultation data table’ (see links below) sets out the housing need for each local planning authority using our proposed method, how many homes every place in the country is currently planning for, and, where available, how many homes they believe they need.

Alongside this consultation, the attached ‘Comprehensive registration programme: priority areas for land registration’ document lists those areas where Her Majesty’s Land Registry intends to prioritise the registration of ownership of all publicly held land.”

Click to access Planning_for_Homes_consultation_document.pdf

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/644783/Housing_Need_Consultation_Data_Table.xlsx

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/644786/120917_Priority_areas_for_land_registration.pdf

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16 Sep 2017

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“Government spends four times more subsidising private housing than building affordable homes” – Study shows 79 per cent of total housing budget is spent on higher-cost homes for sale

“The CIH report reveals that the number of affordable homes being built with Government money has fallen by 50 per cent since 2010, from 56,000 to 28,000.

Instead, money has been diverted to help middle- and high-income households get on the housing ladder. For example, around £5bn of loans have been given to buyers via the Help to Buy Scheme established by George Osborne in 2013.

“The CIH called for a shift in spending to help people on lower incomes afford homes.

Its chief executive, Terrie Alafat, said: “People on lower incomes are finding it increasingly difficult to make ends meet as they experience the impact of stagnant wages, rising inflation and welfare reform cuts. These factors and the shift towards ‘affordable rent’ all mean that housing is becoming increasingly unaffordable in many parts of the country.

“We know we need to build more homes to get to grips with our national housing crisis – our UK Housing Review briefing highlights that annual supply remains at least 30,000 homes short of household growth. But it’s not just about building more homes; it’s about building more affordable homes for people on lower incomes. The Government needs to take an urgent look at rebalancing the housing budget and investing more in genuinely affordable homes for rent.

“The November Budget gives the Government a golden opportunity to rebalance investment away from the private sector towards affordable housing without having to increase its overall commitment to housing.”

Critics say that, because affordable homes can cost up to 80 per cent of market value, they are not affordable for millions of people on low incomes.

However, Conservative ministers have prioritised building affordable homes over social homes.

As a result, since 2010 the number of new social homes has plummeted by 97 per cent, from almost 37,000 in 2010 to just over 1,100 last year.

The CIH called for more investment to maintain existing social homes – a need it said had been exposed by the Grenfell disaster. It said the Decent Homes Standard, which is used to measure whether a property is of an acceptable quality, has not been updated for ten years and that funding for helping landlords to maintain their properties has been scrapped.

“Essentially, investment in the existing social stock has been left for landlords to finance from rents, while government has been cutting their rental income and will continue to do so for another two years”, the report said. …”

http://www.independent.co.uk/news/uk/politics/affordable-housing-spending-private-tory-government-a7945616.html

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16 Sep 2017

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Rebellion in the shires – no affordable homes in MY backyard (acres) say Tory MPs

“Proposals to force some of the most affluent parts of England to accept up to 40 per cent more homes are bringing the prime minister into conflict with Conservative MPs.

It emerged that Theresa May successfully fought against plans for new homes in her constituency just weeks before unveiling the increase. She supported the Save Poundfield campaign to stop dozens of new homes in Cookham, a greenfield site on the Thames in Berkshire.

Berkeley, the housebuilder, withdrew its planning application without giving a reason about two weeks ago. Mrs May is believed to support another development which is not in the green belt.

The plans announced on Thursday will force several cabinet ministers’ constituencies in the southeast to accept the maximum 40 per cent increase in housing. The number of homes that must be built will rise from 250,000 to 266,000 annually from April.

Crispin Blunt, the Conservative MP for Reigate in Surrey, told The Daily Telegraph: “We need to incentivise more homes in regions and cities in need of development, whilst ensuring that those areas of the country unsuitable for large-scale housing expansion are under less obligation.”

Cabinet ministers affected include James Brokenshire, Justine Greening, and David Lidington.”

Times, paywall

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11 Sep 2017

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Extra 400,000 specialist homes needed for older people

Owl says: won’t happen. Most of them would need to be affordable or social housing and, if older people want to live near services, it has to be in towns and cities. In towns, apartments are geared to youuger people, in cities, places where older people might choose to live is now hundreds and hundreds of student housing blocks (Exeter is a good example).

Rural specialist homes are mostly bungalows, which are in such short supply they sell at a premium.

“The number of specialist homes for older people will need to increase by 400,000 in less than 20 years, a Local Government Association study has suggested.

The umbrella-body has called for a ‘residential revolution’ to provide adequate housing for the country’s growing elderly population as figures show one in five of the people in England will be over 65 in a decade.

As well as increasing the number of specialists homes for older people by 75% by 2035, the LGA also calls for sufficient funding to adapt existing housing.

This is because, the study has concluded, at least 80% of the homes we will inhabit by 2050 will have already been built.

Martin Tett, the LGA’s housing spokesman, said: “Our ageing population means that older people are an increasingly crucial part of our housing market.

“They now live in a third of all homes, and this is set to increase. Delivering quality housing that meets the needs of these older people is essential.”

On Friday council leaders pointed out that only 0.6% of over 65s live in specialised accommodation, with a form of care support such as 24/7 on-site staff.

In contrast countries like the USA or Australia have 10 times more of their over 65s living in arrangements of that kind, the LGA pointed out.

Tett said councils were using innovate ways of providing housing for older people, from building purpose built ‘right-size” homes for their needs to placing housing at the heart of efforts to integrate care.

“However, councils cannot tackle this issue alone. Support from government, which incentivises housebuilding and provides councils with the funding and resources they need, is crucial to our efforts to support positive ageing,” he said.

The LGA has also demanded more planning powers so councils can ensure developers build quality homes and infrastructure that are well designed to support positive ageing.

The government said it is committed to making sure there are more suitable housing to meet the needs of older people.

A spokesman from the Department for Communities and Local Government said: “Through the Neighbourhood Planning Act 2017, we’re strengthening planning rules so that councils have clear plans for addressing the housing requirements of older people, and our building regulations now include a standard for homes to improve accessibility in homes.”

http://www.publicfinance.co.uk/news/2017/09/extra-400000-specialist-homes-older-people-needed-says-lga

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9 Sep 2017

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Some families – mostly working – to be £50/week worse off by 2020

“Over two million poor families will be more than £50 a week worse off by the end of the decade, according to an alarming analysis of welfare cuts, crippling rent rises and looming inflation.

In a bleak assessment of the plight of the poorest families in Britain, the study commissioned by the Local Government Association found that more than 84% of those set to lose £50 a week or more are households with children, either lone parents or couples. Almost two-thirds of them are working households, despite claims from ministers that they wish to create a welfare system that encourages work.

The analysis, by the Policy in Practice consultancy, also undermines claims from ministers that moves to cut taxes and increase the wages of the poorest are compensating them for years of austerity and the rising cost of living.

While some of the seven million low-income households in Britain will be better off by 2020, the group as a whole faces an average loss of £40.62 a week by 2020 compared with the end of last year, once benefit and tax changes, wages, housing costs and inflation are all taken into account.

The report’s publication comes as Philip Hammond, the chancellor, faces intense pressure to ease years of austerity following an election result that signalled voters had reached the end of their patience with spending cuts. Nurses took to the streets in protest last week over claims they have suffered a 14% real-terms cut in their wages over the past seven years. Hammond is also under pressure to curb rising levels of student debt in the forthcoming budget.

The study finds that the introduction of the government’s flagship policy of universal credit, which combines a series of benefits into a single payment, will lead to an average income loss of £11.18 per week. It coincides with new warnings from Citizens Advice that the rollout of the system should be halted, amid claims that some of those already receiving it have found themselves in serious debt.

With charities and councils warning of rising homelessness, increasing housing costs are identified as a main cause of falling income. More than 2 million low-paid private renters face an average real-terms loss of £38.49 a week by 2020. …

For low-income private renters with three or more children, the average income loss that they face by 2020 in real terms is £67.21 a week. This compares with £30.67 for private renters without children.

The authors also say rents are rising faster in some areas than others, with housing benefit not rising to match it. The study found rents are set to rise by 20.7% in the south-west by 2020, but by just 3.5% in the north-east. The report warns that there is now a looming “affordability crisis” because cuts to housing benefit, known as local housing allowance (LHA) for private renters, mean it is no longer linked to real rents, pushing people into poverty or even homelessness. … .”

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9 Sep 2017

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Affordable and Social Housing, Developers/ Development, Knowle/Honiton/Exmouth relocation, PegasusLife

Thinking of buying a new, luxury retirement home? Think again

Buyer beware – that’s the message from the BBC Money Box Live programme today at midday. When buying a luxury retirement property a large part of your purchase price can disappear into thin air almost immediately!

“Half of new-build retirement homes sell at a loss.

Around half of new build retirement homes sold during a 10-year period were later re-sold at a loss, according to exclusive research for the BBC.
The research by the Elderly Accommodation Counsel charity found falls in value could be more than 50%.

It looked at thousands of Land Registry records for resale details of homes built between 1998 and 2012. The charity found many properties built after 2002 had underperformed the general property market.

Adam Hillier of the Elderly Accommodation Counsel (EAC), which advises people considering retirement housing, called the scale of the falls “startling”.

Steep falls

According to the research, 51% of retirement properties built and sold between 2000 and 2010, and then sold again between 2006 and 2016, suffered a loss in value. For those properties which declined in value, the average loss was 17%. For some, the falls are much steeper.

The EAC found that for new build retirement properties sold between 2005 and 2007, and then resold between 2012 and 2014, more than four fifths fell in value. The average loss for these properties was 25%.

Mr Hillier said it was unclear why it was happening. “It’s the million dollar question, really. “I think part of it is the new build premium – especially when it comes to retirement housing,” he said. Another reason could be under-investment from developers once they have built the properties, he said.

“The traditional model was to hand over these properties to a managing agent to run them,” he said. “Does the developer have that much of an interest in investing in the property?” The trend has continued in recent years too. For new retirement properties sold between 2008 and 2010, and then resold between 2015 and 2017, nearly two thirds were sold for less than the purchase price. The average loss here was 19%.

Money Box spoke to the residents of one development – Burlington Court, in Bridlington in East Yorkshire – where prices have more than halved since it was first built around a decade ago.

According to Land Registry figures, one flat in Burlington Court, bought new in 2006 for £166,000, was resold for just £70,000 in 2014. Another two bedroom apartment bought for £140,000, in 2008, was sold last year for £58,000.

Ken, 91, bought his flat in Burlington Court for around £180,000 in 2008.
“I thought when I bought this that if I lived for another five or six years, my children would get maybe £190,000 for it,” he said. “In actual fact they’ll be lucky to get £70,000 for it, maybe even £60,000. “It’s criminal really. When I mention it other people, they say: ‘Why should you worry, you won’t be here?’ “But I do feel my son and daughter have lost out. It’s a lot of money,” he added.

Margarete, 92, paid nearly £150,000 for her flat eleven years ago. She sold a detached bungalow in York. Like most residents of Burlington Court, she says it’s a nice place to live, with a nice community of people. But Margarete says she’s always wanted to move back to Germany, where she was born. However the value of her property means that isn’t now an option.

“My friends in Germany always wanted me to go back.” “But if I get £40,000 for this flat I’d be lucky. I couldn’t afford to go back to Germany and buy a place there.”

Incentives

The largest developer of retirement homes, McCarthy and Stone, told the BBC that the numbers did not include incentives given to the original buyers, which effectively lowers the purchase price. The company also said it had worked hard to increase resale values in recent years, including extending leases, retaining management of developments, and providing sales support.
“The vast majority of our retirement apartments increase in value on resale”, McCarthy and Stone told the BBC in a statement.

“It is also important to understand that the value of specialist retirement housing is not purely financial. It improves lives, provides peace of mind, care and support and ultimately helps older people maintain their independence.

“However, we recognise that there are a small number of cases, particularly with our older properties, where resale values of some apartments haven’t performed as we would have wished. This can be down to many reasons, including the performance of some local property markets.”
McCarthy and Stone, which also built Burlington Court, said resale values in that particular development had been hit by a lack of car parking spaces and a difficult local property market.

‘Seriously wrong’

Sebastian O’Kelly, director of BetterRetirementHousing.com, said: “Dismal resale prices for retirement properties help explain why only 2% of over-65s live in designated retirement properties – far less than the US or Australia. “Something is seriously wrong with the business model that these flats fall so drastically in value.

“The retirement housing sector will not expand notably until this is addressed. That would be more effective than attempting to deny that the problem exists.”

Listen to the full report on Money Box, midday on Saturday 9 September on BBC Radio 4.”

PegasusLife one-bed properties at Knowle could start at anything from £300,000 – £400,000 at their current prices. At their development in Cheltenham, one bed apartments start at £447,950. Service charges can start in the high thousands per year.

https://www.pegasuslife.co.uk/portfolio/onebayshillrd-cheltenham?gclid=CjwKEAjwos7NBRCW0uTH59WPp1ESJADKk0J7tjhYgbZJtyWb_Yh9_aSvbzYMEUyOMeif0jANw2xGRRoCiEjw_wcB

Closer to home, Millbrook Village in Exeter comes in at a very cheap (!)£325,000 for one bedroom, but this may be because sales appear to have been somewhat slow:

http://www.millbrookvillage.co.uk/

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9 Sep 2017

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Affordable and Social Housing, Developers/ Development, Public Open Space

The answer to all our problems? Gardening, say Tory MPs

In case you think that all our MPs are interested in is Brexit, well, it’s not true. Some of them have MUCH more important things to do:

“Encouraging gardening needs to be put at the heart of Government policy making, Tory MPs have said in a report backed by Theresa May.

A 56-page report from the Conservative Environment Network said that “getting more people gardening” has to be part of a “truly holistic, cross departmental, high impact policy”.

The report, which has been sent to Cabinet ministers, said encouraging gardening should be adopted as a policy by a range of government departments including health, justice, defence, local government and education.

Gardening could help to cut childhood obesity, improve public spaces, help people deal with mental stress and provide purpose for prisoners in jails.

Tory MP Rebecca Pow – a former BBC, ITV and C4 reporter who specialised in the environment, farming and gardening – wrote in the report: “Gardens, gardening, and horticultural skills can have a striking effect on our communities.

“Getting more people gardening is a truly holistic, cross departmental, high impact policy.” …

… “To get the full benefits that the power of plants can provide our communities with, especially in urban areas, requires an interlinked approach and now is the time to sow those seeds and spread those roots for the greater good.” …

The Prime Minister said the report “raised the health benefits of green space, which are becoming ever more recognised”.

She pledged that Defra “will consider the evidence within that report and will focus on what can be done to ensure that the benefits provided by access to green space are available to all segments of society”.”

http://www.telegraph.co.uk/news/2017/09/08/put-gardening-heart-policy-making-tory-mps-tell-whitehall-theresa/

Just to point out a few things:

Many people don’t even have houses to live in, let alone gardens to tend so could we perhaps sort that out first?

Public open spaces and parks are being concreted over by developers (including Clinton Devon Estates land grab of the Budleigh Hospital Garden)

Most new builds have gardens the size of pocket handkerchiefs full of builders rubble
(Cranbrook is a good example where gardens are six concrete paving slabs and a narrow strip of green)

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7 Sep 2017

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Affordable and Social Housing, Austerity cuts, Coastal communities, Economy

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Deprived seaside towns: residents have their say

“Analysis by Social Market Foundation found that UK communities living by the coast have higher rates of unemployment compared to inland area. In 85% of Britain’s 98 coastal local authorities in 2016 people were paid less than the national average, with those living by the seaside earning £3,600 less. We asked readers to tell us about the areas they live in and how things have changed over the years. …

[Great Yarmouth]
… Then there are the road networks, in particular the infamous A47 Acle Straight which needs work to stop the consistent traffic problems. MP Brandon Lewis is rarely here or shows any interest unless there is an election. All new housing is unaffordable to buy and rent is high everywhere; a lot of people live in cramped, unsafe properties. The excuses change, but everything stays the same and has done for many years. …

… A former mayor of Copeland described Millom as “a place of despair”. Redundancies in local industries (for example, Vickers shipyard which was made defunct in 2007) have led to more unemployment. Local shops have closed as larger nationwide stores such as Tesco have opened. Some local transport links have been shut down and already infrequent local buses have reduced their services. The train service is bad, with trains being regularly cancelled at short notice, and the roads are narrow and poorly maintained. This all increases the isolation communities and individuals feel.

Two bank branches have closed, as well as several pubs and the job centre. The local food bank has more demand and fewer donations. A family member and a school friend of mine committed suicide. Another two school friends have died from complications from alcohol dependency. Then there are holiday homes in the Lake District which price locals out of house purchases. People are hopeless and depressed. The situation will deteriorate without some form of intervention.”

https://www.theguardian.com/society/2017/sep/07/poor-health-is-commonplace-readers-on-living-in-seaside-towns

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6 Sep 2017

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Accountability, Affordable and Social Housing, Austerity cuts, Devolution, Economy, Local Enterprise Partnership

”Devolution deadlock’ putting economic growth across England at risk’

A Local Government Association document draws attention to the failure of LEPs and the need to base devolution on English counties not artificially created areas that have little synergy and where control is ceded to unrepresentative interests and lack of scrutiny and accountability:

“Mark Hawthorne, chairman of the LGA’s People and Places Board, said councils wanted to use greater powers to build more homes, secure the infrastructure essential for economic growth, improve roads, close skill gaps and increase access to fast broadband but feared opportunities were being missed because devolution has “stalled”.

He added: “To reignite the devolution process, the government needs to engage in a debate about appropriate governance arrangements with local areas.

“This is fundamental to ensure that the momentum around devolving powers to local areas is not lost and the billions of pounds worth of economic growth, hundreds of thousands of jobs and homes on offer through non-metropolitan devolution deals is not lost with it.”

The LGA wants the government to publish its annual devolution report, setting out progress on negotiating deals, when parliament returns this week.

Under the Cities & Local Government Devolution Act, the secretary of state is expected to provide annual reports to parliament setting out the progress on devolution across England – this year’s report has yet to be published.

Concern has been sparked as no new deals have been announced for 18 months although the election of six combined authority mayors earlier this year was hailed as a significant milestone for devolution in England. …”

https://www.local.gov.uk/about/news/devolution-deadlock-putting-economic-growth-across-england-risk

The ‘ Growing Places’ report referred to above is here:

https://www.local.gov.uk/growing-places-building-local-public-services-future

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6 Sep 2017

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Affordable and Social Housing, Developers/ Development, Economy, Redrow

Help-to-buy helps developers much more than buyers

Owl says: But isn’t that what this government and our council wants?

“Housebuilder Redrow says it’s looking forward to working with government to consider the future of the help-to-buy subsidy scheme beyond 2021. You bet it is. Since former chancellor George Osborne in 2013 committed to helping homebuyers purchase new properties with a deposit of only 5%, Redrow has reported record profits every year.

The latest annual numbers – and a share price that has improved threefold since 2013 – shows how wonderful life has become for big housebuilders. You’d almost think Redrow was producing high-tech consumer gadgets. Operating margins are running at 19% and return on capital employed has hit 26%. About 40% of its private sales are to help-to-buy purchases, which is typical for the sector.

After an improvement of a quarter in pre-tax profits to £315m, the company hiked its dividend by 70% and said there’s plenty left in the tank. Profits will rise to about £430m by 2020 and the dividend can be almost doubled again “subject to market conditions remaining unchanged”.

The obvious question is why on earth the government, having spent £4.6bn already, would wish to continue with help to buy after 2021. Yes, the scheme has allowed some people to buy homes who would not otherwise have been able to do so, but the clearest beneficiaries of the stimulus to prices have been housebuilders’ shareholders and executives.

Back in 2013, one justification was the limp state of the mortgage market. That no longer applies. The banks are well-capitalised, high loan-to-value mortgages have returned and the Bank of England these days frets about too much lending, not too little.

Osborne’s other argument was that more demand for houses would increase supply. The numbers suggest modest success, even if some of the increase would have happened anyway. But the point now is that withdrawing help to buy overnight wouldn’t obviously cause the housebuilders to down tools for fear that non-subsidised houses would sell for slightly less. A return of capital of 26% is splendid but it is still worth getting out of bed for 15%.

Before ministers commit to renewing help to buy on the same terms, they should recall the warning by Lord King, former governor of the Bank of England, in 2014: “This scheme is a little too close for comfort to a general scheme to guarantee mortgages. We had a very healthy mortgage market with competing lenders attracting borrowers before the crisis, and we need to get back to that healthy mortgage market … We mustn’t let this scheme turn into a permanent scheme.”

Ditching help to buy outright in 2021 may be undesirable since there is a fair case that first-time buyers still deserve a leg-up. But, as even wiser housebuilders concede, too many houses qualify for help to buy. Current ceilings are set at £600,000 and 20% of the value of mortgage. Both figures could usefully be cut in half before the scheme becomes an addiction.”

https://www.theguardian.com/business/nils-pratley-on-finance/2017/sep/05/help-to-buy-scheme-buyers-builders-subsidy

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5 Sep 2017

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Accountability, Affordable and Social Housing, Developers/ Development

“Mayor refuses plans with ‘unacceptable’ levels of affordable housing”

Of course it’s not in the Tory South West but in Labour London!

“City Hall’s new viability experts scrutinise affordable housing offer

Stance signals Sadiq’s firm approach on affordable housing

The Mayor of London, Sadiq Khan, today rejected plans which would have lowered the proportion of affordable housing on the site of the former New Scotland Yard building, as his tougher approach to tackling the capital’s housing crisis starts to take effect.

The site at 8-10 Broadway in Westminster was sold by the previous Mayor who then allowed planning permission to be granted for a development offering a £10m payment and only 10 affordable homes – just four per cent of all units – on 27 April 2016, days before the Mayoral election. The site was home to the Met Police for half a century until the force relocated earlier this year.

The developer, BL Developments, then sought to increase the total number of homes by 27, from 268 to 295, with no increase in the number of affordable units or payment in lieu, meaning the level of affordable housing fell further still to only three per cent.

Shortly after becoming Mayor, Sadiq instructed City Hall’s planners to recruit a team of viability experts to scrutinise the level of affordable housing in all planning applications referred to him. The first time City Hall has had this in house expertise. Scrutiny of the application to increase the number of homes at 8-10 Broadway found its offer of no extra affordable homes nor any payment in lieu would mean it failed to deliver the maximum amount of affordable housing viable.

Sadiq’s decision comes just a few weeks after he strongly criticised Wandsworth Council for allowing the developers of Battersea Power Station to slash the amount of affordable housing by 40 per cent, from 636 homes to just 386 – or only nine per cent of the 4,239 homes across the scheme. The Mayor had no formal power to intervene under current planning regulations, but wrote to the Council to object to the decision in the strongest terms.

The Mayor of London, Sadiq Khan, said: “A shortage of affordable homes is at the heart of the housing crisis in our city. The scheme put forward for this site is simply unacceptable: it fails to provide the maximum amount of affordable housing that could be delivered on this landmark site, and follows a previous application in which the affordable housing provision agreed by the previous Mayor was already appallingly low. It beggars belief that the initial application was approved under the previous Mayor with a paltry four per cent affordable housing, just days before the Mayoral election.

“This is a site which has only recently been transferred from public ownership and sits within one of the most expensive areas of the country. Having carefully considered the evidence available to me, I have decided to refuse permission for this amended application. …”

https://www.london.gov.uk/press-releases/mayoral/mayor-refuses-plans-lacking-affordable-housing

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5 Sep 2017

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Affordable and Social Housing, Cranbrook, Developers/ Development, EDDC

“Nimbys risk denying my generation an affordable home” – and gushing praise for Cranbrook

Gushing praise for Cranbrook – by someone who appears never to have lived there and seems to have relocated from Devon to London.

It reads to Owl to read like a (not-very-good) essay submitted for the digital journalism course the author has gone to London to study, rather than a well-researched article. Not a quality piece of Guardian journalism or a persuasive testament to the town, with quotes from one resident and the town clerk!

“I’ve been priced out of my home city, but Cranbrook, a new town in Devon with cheaper housing, faces prejudice that could deter newcomers

You’ll be easily forgiven if you haven’t heard of Cranbrook, because five years ago this east Devon town was the fields that cornered the historical city of Exeter. Creating this new town has been one of the few attempts to address a national homelessness crisis, now affecting more than 50,000 households across England. Cranbrook is the first new settlement to be developed in Devon since the middle ages.

I grew up in Exeter, watching it blossom from a modest city into a vibrant hub. I’m proud to say that I have come from the liberal bastion of the south-west: it was one of only three constituencies in the region to vote remain, and has long been a Labour stronghold. However, nimbyism has intensified over fears around an “invasion of outsiders”, and of local services becoming overburdened. Cranbrook has felt the brunt of this, with locals demanding that more housing is built – but “not in my backyard”.

The new town has even been branded as a magnet for unruly northerners and the crime capital of the south-west, renamed by some as “Crimebrook”, even though this is not borne out by police statistics. I remember such hostility circulating even before the first brick had been laid. Listeners to The Archers will be all too familiar with this depressing scenario: one current storyline includes growing opposition in Ambridge against the Bridge Farm housing development. Only Emma and Ed Grundy are in favour, it seems. How else can they hope to get a step on the housing ladder?

These nimbys, in real life, deepen the sense of otherness towards not only outsiders, but also to locals like myself who have been priced out of Exeter. The first phase of Cranbrook consisted of 1,120 homes, 40% of which were for social and affordable housing. Of the social housing available, 65% went to applicants with a local connection to east Devon, the other 35% going to local people in Exeter. The town has also received a £20m government investment, which has increased the development of social houses to 500 a year, accelerating Cranbrook’s ambition of expanding to 8,000 homes within the next decade or so.

Drawn to its location and lower house prices, Jacqui Issacs relocated her family to Cranbrook from Oxfordshire three years ago. “I find a much better sense of community here than I ever did in an established village,” she says. A report released earlier this year by the Devon & Cornwall police on the top crime hotspots within the county placed two of Exeter’s streets third and fourth, with one of Cranbrook’s streets ranked seventh. Issacs remarks: “I have never lived somewhere with so much within walking distance – the shops, the country park, pub and so on.”

Unlike the feudal Disneyland of Prince Charles’s Poundbury in nearby Dorset, Cranbrook has no experimental aesthetic. Nimbys see the town as soulless, but it just needs to be lived in a bit more: Issacs is looking forward to “having our own high street one day”. As the town clerk, Janine Gardner, says, Cranbrook is “not to be seen merely as an extension of the nearby Exeter”. The 3,000 Cranbrook residents already have their own doctors, schools, shops and leisure centre. And the town is uniquely youthful, with a high percentage of 24 to 35-year-olds, who can propel such developments.

I now live in the multicultural mecca of London, and feel that Cranbrook could provide a much-needed point of diversity if given the chance. While it is important for the town to build valuable bridges with Exeter, outsiders should be welcomed as enhancing the existing cultural fabric, not unpicking it.

With average house prices almost seven times people’s incomes, becoming a homeowner, especially for people of my generation, is increasingly a fantasy, even in Devon. Cranbrook is an opportunity not only to find a house, but also for us to make a home.

Rome wasn’t built in a day, and Cranbrook has only just put down its foundations: the nimbys just need to give it the time to build itself up.

• Jessica Cole, 23, an English graduate, will study digital journalism at City University”

https://www.theguardian.com/society/2017/sep/05/nimbys-risk-denying-my-generation-affordable-home

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5 Sep 2017

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Affordable and Social Housing, Austerity cuts, Developers/ Development, Redrow

Those “poor” developers get richer

“[Redrow’s] Pre-tax profits rose 26 per cent to £315m in the year to the end of June, Redrow said today, against revenues of £1.66bn, up 20 per cent on last year’s figures.

Legal completions – the number of homes bought – rose 15 per cent to 6,416, while its order book rose 14 per cent to £1.1bn. Average selling price increased seven per cent to £309,800.

Meanwhile, its number of outlets increase three per cent to 132, while it added 5,419 plots to its land bank.

So good was its performance, it has raised guidance to turnover of £2.2bn by 2020, while pre-tax profit is expected to hit £430m. Dividend will rise to 32p per share.

Today it hiked its dividend by 70 per cent to 17p. Shares rose 5.8 per cent to 655.9p in the first minutes of trading.”

http://www.cityam.com/271378/redrow-has-hiked-its-dividend-70-per-cent-after-profits

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4 Sep 2017

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Accountability, Affordable and Social Housing, Developers/ Development, Planning System

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Javid thinks forcing councils to accept more development will solve the housing crisis!

Owl says: we don’t need MORE high-cost housing in expensive areas where they desired and bought by those who can afford them – we need low-cost houses where they are needed by those who can’t currently afford to buy them.

“Theresa May is being urged to face down a potential backlash from backbench Conservatives and sign off proposals aimed at forcing councils to unleash a building boom to tackle Britain’s housing crisis.

The Department for Communities and Local Government has confirmed to the Guardian that it will publish details by the end of this month of how local authorities should assess the need for housing.

The plans, part of a package of housing measures, will be closely watched as a test of the prime minister’s appetite for enacting controversial domestic reforms.

They were slated for publication in July, and a press release drafted, but the launch was delayed at the last minute amid concerns some MPs could face criticism from constituents concerned about over-development.

The communities secretary, Sajid Javid, who has the backing of reformers in the Conservative party, would like to see housebuilding boosted significantly, particularly in high-cost areas, to halt the rapid increase in property prices that is leaving many people unable to afford a home.

In the housing white paper published in February, entitled Fixing Our Broken Housing Market, the government said: “Some local authorities can duck potentially difficult decisions, because they are free to come up with their own methodology for calculating ‘objectively assessed need’. So, we are going to consult on a new standard methodology for calculating ‘objectively assessed need’, and encourage councils to plan on this basis.”

Javid hopes by adopting an expansive approach, which includes data about the local housing market, he can kickstart redevelopment in areas where prices are rising fastest.

May’s resolve to tackle the problem may have been strengthened by the party’s poor showing among young people at the general election in June. A recent YouGov poll suggested that just 4% of 18-24-year-olds trust the Conservatives to deal with the issue of housing – against 44% for Labour.

Number 10 policymakers have been taking soundings from thinktanks and policy experts about proposals that might help to win back young voters.

According to official figures, homeowners could expect to pay about 7.6 times their annual earnings to buy a house in England and Wales in 2016, up from 3.6 times earnings in 1997.

The housing need test is one of a package of measures radical Conservatives believe will be necessary to tackle the challenge.

The Scottish Conservative leader, Ruth Davidson, in a speech focusing on housing policy in Scotland, said on Friday: “It is a bedrock of Conservative belief that we should encourage a property-owning democracy.

“Yet, increasingly, we now have something more akin to a property-owning oligarchy. Made up of lucky, mainly older, people who – by dint of having scaled the housing ladder – are now the ones who now control the country’s economic purse strings.”

George Freeman, chair of the Conservative policy forum, has also warned that young people risk rejecting capitalism if they have no chance of owning a home.

But Javid and and his allies are likely to find themselves pitched against Tory MPs and councillors wary of “planning blight”.

Andrew Mitchell, the former development secretary, publicly clashed with Javid over plans for a housing development in his Sutton Coldfield constituency.

May signalled on her trip to Japan that she wants to press ahead with domestic reform, as well as complete the Brexit negotiations.

She pointed to her Downing Street speech last year, in which she pledged to right, “burning injustices”, including the fact that “if you’re young, you’ll find it harder than ever before to own your own home”.

But watered-down corporate governance reforms published last week raised questions about whether May’s minority government will be willing to take on vested interests.

Housing campaigners urged the prime minister to be bold. Gill Payne, the executive director of public mpact at the National Housing Federation, said: “Getting this right will be a show of the strength of government’s commitment to building the homes the nation needs. Getting a consistent and accurate picture of housing need is really important – it cements into the local plan the number of homes that need to be delivered.”

She added: “Robust methodology will give a consistent and undisputable approach across the country.”

Polly Neate, the chief executive of Shelter, said: “We hope these changes will help to simplify and join up the way councils across the country assess housing need in their areas, and it’s vital that the new proposals work to deliver as many affordable homes as possible.

She added that Javid should tighten up the planning regime, to allow local authorities to exert more control over what can be built, where, rather than relying on the market to deliver.

“It’s important to remember that developers can still often build whatever they like, regardless of whether it meets what the council says is needed or not. The government must now take action to change this, by giving councils more power to get housing built that will meet the needs of their community.”

Successive governments have sought to make property ownership more affordable. Ambitious building targets have rarely been met, and George Osborne’s focus on subsidising mortgages through the help-to-buy scheme was criticised for fuelling the boom.

Housebuilding slumped after the financial crash from more than 215,000 homes a year in 2007-8 to 133,000 in 2012-13. It has since recovered, but has not regained its pre-crisis level.”

https://www.theguardian.com/politics/2017/sep/03/theresa-may-urged-to-force-councils-to-build-more-homes