As featured on today’s Spotlight lunchtime news:
https://www.facebook.com/groups/BovisVictimsGroup/
including a number of homebuyers in Devon.
Closed group – membership by request.
Category Archives: Developers/ Development
Redrow profits up for third year in a row, revenue up 20% to £1.38 billion
” … FTSE 250 housebuilder Redrow continues to shrug off fears of a post-Brexit slowdown, looking forward to ‘another excellent year’ in 2017 after clocking up its third straight year of record results in the 12 months to June 30.
Redrow is the FTSE 250’s top riser this morning, with shares up 6.45 per cent or 24.80p to 409.10p.
The Flintshire-based firm reported a 23 per cent surge in pre-tax profits to £250 million for the year to June 30 after revenues rose 20 per cent to £1.38 billion, with average selling prices of homes up 7 per cent to £288,600.
Redrow said it had £807million worth of private orders at the start of the financial year, up 54 per year-on-year.
Steve Morgan, Redrow’s chief executive, told the BBC today he had ‘not seen any blip whatsoever’ from Britain’s Brexit vote.
Chris Millington, an analyst at Numis, said: ‘Redrow’s full year results are marginally ahead of Numis’ estimates and we are leaving our forecasts for 2017 unchanged.
‘The company has seen strong trading post the EU Referendum and the private forward order book stands 54% up yoy, which gives a good underpinning to 2017. Whilst Redrow’s shares have recovered much of the reduction seen post Brexit and now only trade c.10% below 23/06, they still look good value.’ ”
How developers avoid social housing – employ a specialist company
On a depressing note, see the following, a company based in Sevenoaks:
http://www.affordablehousing106.com/casestudies.html
“Affordable housing 106” is anything but helping the affordable housing situation in this country.
This case study page boasts about recent victories for clients, including:
– negotiating down from 50% to 25% the proportion of affordable housing for a project in South London: while the local Council wanted a 70/30 split between rent and shared ownership, the company facilitated 100% shared ownership tenure;
– facilitated commuted sum in lieu of affordable housing for a proposed care home development in the South East
– negotiated a Deed of Variation for an existing 106 Agreement in East London, whereby the owner/developer secured ownership/management of the affordable housing units.
Of course we have a similar company in Exeter:
To take but one local example from their case studies:
“Acting as both principals and in collaboration with Somerfield Food Stores in connection with a planning application to redevelop a 50 dwelling brown field site. Torridge District Council Planning officers sought a Section 106 agreement providing 20% affordable housing. Using a viability appraisal we were able to negotiate a reduction to 12%, saving circa £150,000.”
Presumably the families of employees of these companies have no need of sich housing themselves – lucky people.
Estate agent or developer?
Interesting advertisement in a recent Midweek Herald. Estate agent Greenslade Taylor Hunt is seeking assist in to influencing the draft East Devon Villages Plan by persuading landowners in turn to “to influence planning policy in the villages of East Devon”.
And if landowners don’t want to ‘influence’ planning by turning land into housing estates themselves, GTH will facilitate interaction with a house builder to help to get planning permission.
Seems that it is no longer enough to be an estate agent you have to be a “land and planning specialist” too.
And begs the question: what if an estate agent (or land and planning agent) is assisting with selling a house that he or she knows is next to a possible development site being handled by the same firm? Will they declare an interest?
Government to offer developers £3 billion to build more houses
And now watch for our large housebuilders spinning off smaller companies.
At a time when housebuilders are announcing bigger and bigger profits and fewer and fewer housing starts, this is said to be the government’s solution:
“The British government is set to announce a 3 billion pound house building fund to provide developers with cheap loans to boost the sector following the vote to leave the European Union, the Sunday Telegraph newspaper reported.
Finance minister Philip Hammond, who has talked of the need for a “fiscal reset”, is due to set out the government’s fiscal response to the June 23 vote in an autumn budget statement, although no date has yet been set for it.
The fund is expected to combine several existing schemes, including a 525 million pound builders fund and a 1 billion pound large sites infrastructure programme, but will also include new money to encourage developers to build new homes, the newspaper said, citing government sources.
It said the fund would be targeted at small and medium-sized developers, offering cheap loans or financial guarantees. It also reported the fund would be designed to reduce red tape which has hampered previous schemes.” …
Bet that doesn’t include affordable or sicial housing for Labour supporters.
“Hinkley Point deal out of date and too expensive, says energy chief “
The head of energy giant ScottishPower has waded into the row over Hinkley Point, insisting that the controversial subsidy deal for EDF’s proposed nuclear plant should be renegotiated because it is too expensive.
Keith Anderson, the firm’s chief corporate officer, said the deal, provisionally agreed by the Government in 2013 following lengthy negotiations, no longer made sense in the light of lower gas and offshore wind costs.
“It looks like a contract that was written five years ago on a business case that was probably pulled together 10 years ago. It looks out of line with what’s going on in the market now,” he said. …”
http://www.telegraph.co.uk/business/2016/09/03/hinkley-point-deal-out-of-date-and-too-expensive-says-energy-chi/
The article raises very serious concerns about the business sense of our Local Enterprise Partnership, which seems blind to the economic realities of the Hinkley C project.
We know, of course, that many members of our LEP have enormous direct and indirect investment in the project and presumably need it to continue to allow their own interests to thrive.
But is it in OUR interest to allow them to trouser likely profits from such an unbalanced deal?
They will say that they are doing this for our benefit, of course – more jobs, more houses, etc. But with Brexit we now look towards having fewer people coming to this country from the EU (though exceptions would doubtless be made for French and Chinese workers) and much higher import costs if we do not have free trade in the EU. Plus the business case for renewables is strengthening all the time, especially as battery storage research and implementation has made enormous progress.
Our LEP members know all this but only last week its CEO was telling us how hard he and his members are battling to keep the project going:
http://us4.campaign-archive2.com/?u=4e59660292bd6b4a5c7d7b8a7&id=a36a037523&e=fa5cdb1f1
We have to ask: who are they battling for – and why?
The great scandal of LEPs now lies before us: small (very small) groups of business people who look to their own interests before those of the residents where they live. Often in secret and with minimal or no scrutiny. And who pursue their own interests even when they put them at odds with the majority of people in the areas they purportedly represent.
Our East Devon Business Forum seems to have been a practice run for our Local Enterprise partnership, and we all know how that ended – also coincidentally in the Daily Telegraph:
“‘Rabbit hutch’ homes should be consigned to the past, say architects”
“Barratt and Persimmon singled out as worst offenders in survey of new homes on 100 developments”
More than half of family homes under construction by private housebuilders in the UK are too small, architects have said.
The typical new three-bedroom home is missing space equivalent to a bathroom while many are missing as much as a double bedroom when judged against minimum reasonable space standards launched by the government in October.
Homes outside London are the worst affected by what the Royal Institute of British Architects (RIBA) attacked as “rabbit hutch” homes after it measured a sample of new homes on 100 developments.
RIBA singled out two of the leading housebuilders as the worst offenders. From a sample of new three-bedroom homes surveyed, it found Barratt homes were on average 6.7sq metres smaller than minimum space standards and Persimmon homes were on average 10.8sq m too small – about the size of a double bedroom.
“Tiny rabbit-hutch new-builds should be a thing of the past,” said RIBA president Jane Duncan. “But, sadly, our research shows that, for many people, a new home means living somewhere that’s been built well below the minimum space standard needed for a comfortable home. The government must take action to ensure a fairer minimum space standard is applied to all new homes across the country …”
Councils need to keep proper records of contractual decisions
East Devon District Council does like its private, non-note-taking meetings …
“A judge has issued a warning to contractual authorities that might be tempted to minimise the amount of paperwork they keep particularly where they fear that a high profile procurement exercise might be challenged. Helen Prandy reports.
In finding in EnergySolutions EU Limited v Nuclear Decommissioning Authority [2016] EWHC 1988 (TCC) that a contracting authority had made “conscious decisions” in relation to sparse record keeping a High Court judge noted that serious consideration appeared to have been given to restricting the keeping of contemporaneous records of evaluation because it was known that these would be disclosable in litigation.
The court took the view that if the evaluation process is performed in accordance with the obligations under the Regulations then they would present no danger to the Authority because they would constitute an ‘audit trail of the decision making’.
He also went on to find that a proposed destruction of notes relating to the evaluation was extremely worrying given the express obligations of transparency on public authorities under the Regulations.
In the absence of adequate contemporaneous documents a court is forced to rely on the recollection of witnesses. Documents may be embarrassing but the memory of witnesses is extremely unreliable and is just as likely to lead to an ‘embarrassing’ revelation. In this most recent case the witness most closely involved with the evaluation admitted on cross examination that he did not accept that inconsistency in evaluation of bids might amount to unequal treatment.
The judge found the almost complete absence of documents relating to a critical dialogue phase of the procurement and a reliance solely on the memory of witnesses to “verge on the incredible”.
The case arose under the 2006 Regulations and there is a requirement now under Regulation 84(8) of the 2015 Regulations to keep “sufficient documentation to justify decisions taken in all stages of the procurement procedure…” and to do so for a period of at least 3 years from the date of the award.
This case is not the first where a deliberate failure to keep documents has created problems for a contracting authority. However tempting it might be it is always far better to have a clear audit trail of reasons for evaluation decisions at every stage, including moderation, and for that audit trail to be in writing.”
“Developers deliberately restricting housing supply to keep prices high”
“Developers have been accused of deliberately restricting the supply of new houses to keep prices high after figures suggested that planning permission has been granted for 750,000 homes which have not been built.
A report by Civitas, a respected right of centre thinktank, found that overall more than two million planning permits were issued between 2006 and 2015, a rate which would be enough to build average of 204,000 new homes a year.
However, foundations were only been laid on 1.26 million of them, suggesting that developers and land owners are sitting on the permissions rather than building new homes. …
… campaigners said that they should have included a “sunset clause” which would have forced developers to build on land granted planning permission within a set time period. …
… The analysis shows that between 2011 – the last full year before the changes were introduced – and 2015, the number of unused planning permits jumped by 88 per cent, while new housing starts increased by just 26 per cent.
One third of “unbuilt planning permissions” were thought to be held by non-builders, Civitas said, which “points to land hoarding in the hope of further rises in land values”.
Civitas accused housebuilders of reducing sales to a “drip-feed” to maintain profit margins.
Daniel Bentley, editorial director at Civitas, said: “David Cameron’s relaxation of the planning rules has so far only been to the advantage of developers, who have banked the additional planning permissions and topped up their pipelines for future years without increasing output.
“The challenge for Theresa May’s government now is to break the stranglehold that the major housebuilders are exerting on the supply of new homes.”
He added: “It is increasingly evident that the brake on development is being applied by those who are sitting on land which is ripe for new homes and has been given the all-clear by planning authorities.
“This includes land speculators, who are content to sit tight while their holdings spiral in value, but is mostly housebuilders, who lack any incentive to get on and build the homes the country needs.
“Housebuilders are drip-feeding the market in order to push up prices and maximise their profits.”
Last night MPs said they would investigate the figures as part of a new cross-party Parliamentary inquiry into the UK’s sluggish house building rates.
Clive Betts MP, the chairman of the Communities and Local Government select committee, said: “Planning reforms will be a failure unless the Government can act and turn planning permissions into completions.
Now it’s West Hill’s turn to go under siege from developers
“A PIECE of land in the centre of West Hill could be transformed into more than 30 homes, a satellite doctors surgery and a gastro pub.
A coffee shop, pharmacy, bowling club, land for the village’s pre-school, and underground parking may also feature in pending proposals for a two and a half acre site opposite McColls in West Hill Road.
That is what scores of residents have been told by Councillors Claire Wright and Jo Talbot, who fear development of what is known as Copper Trust land could see more than 200 extra vehicle movements in the area a day.
Any such move would come hot on the heels of widely derided Blue Cedar Homes plans to build 50 dwellings on land near Eastfield that have garnered controversy and hundreds of objections.
“Either scheme, if approved, is likely to prompt other developers to submit their own applications, citing these examples as a precedent for their proposals to be accepted,” warned the Ottery town councillors in a letter to Ashley Brake, Elsdon Lane, Ford Lane, Beech Park and West Hill Road householders.”
http://www.eastdevon24.co.uk/news/west_hill_30_home_development_shocker_1_614147
Planners get antsy
Continual changes in the planning system have left planners without the powers they need to drive public sector-led development, the Royal Town Planning Institute has warned.
It said 73% of planners in England felt changes to the planning system had reduced their ability to deliver, and 53% thought the numerous changes had made it more difficult to ensure sufficient housing was built, while 70% felt their position was worse than it was a decade ago.
The report, Delivering the Value of Planning:
Click to access rtpi_delivering_the_value_of_planning_full_report_august_2016.pdf
[Don’t hold your breath: the authors think Cranbrook is an example of good planning!]
warned that deep budget cuts and continual changes had left England with a system that was complicated and uncertain, with planners possessing too few powers to ensure that development is well-planned and connected to transport and facilities.
RTPI president Phil Williams said: “For too long planning has been relegated to a reactive, bureaucratic function, instead of being able to plan strategically to drive development, jobs and growth.
“Public sector planners’ ability to be proactive is especially important in these uncertain times. It is absolutely crucial we resource councils’ planning teams properly, so that planners can operate strategically.”
He said planning should be more closely integrated with councils’ economic development teams, with stronger public sector-led management of land supply but also a stronger private sector role in development partnerships.
Mark Smulian
London Mayor releases land for affordable housing
Imagine what a difference EDDC could have made if it released land at Knowle or Honiton – or even the grossly under-tenanted Skypark Business Park …
for affordable housing NOT but-to-rent landlords creaming off housing benefit payments.
Persimmon – profits up 12% – see how they achieve it
“Persimmon saw first half pretax profits climb to £352.3million as revenues increased by 12 per cent to £1.49billion, with its private sales reservations up 17 per cent.”
AND STILL THEY CAN’T AFFORD TO BUILD AFFORDABLE HOUSING!
See an example of the scandal here:
“One of the most controversial developments in Cambridge is set to make millions of pounds more in profit than forecast when the original builder avoided hitting the city council’s affordable housing target, the News can reveal.
We have uncovered the vast discrepancy at the Grand Central development at Rustat Road, between what previous developer Persimmon told the council it was likely to sell the homes for and what current builder Weston Homes is actually selling them for. … “
“Councillors have no power”
“Sick of seeing Falmouth planning decisions overturned by centralised bodies with no local knowledge, one woman has launched a campaign to change the “undemocratic” planning process.
Kathryn Philpott has been spurred on to launch her petition, ‘Give Our Councils The Power To Make A Decision,’ after plans for Bosvale in Falmouth went to appeal at the Planning Inspectorate in Bristol, and plans for 94 homes at Poolfield in Budock were granted on appeal. Both had been refused permission by Cornwall Council following objections from Falmouth Town Council.
She said: “I think the most important thing I have realised is that our council has no real authority.
“Right through the county people are up in arms because their local councillors have got no power to stop building on inappropriate places.
“An issue for everyone here is that they have just passed out of county permission to build on the fields leading up to Budock Church. A stunningly beautiful area.
“It was taken off our council and taken out of county for the decision.”
She added: “Can someone tell me why we have a democratic vote to elect our counsellors to work on our behalf, protecting our county, as every time a planning issue arises and is turned down it immediately goes out of our county to a person or persons that know nothing about the wishes of the general public.
“We seem to have a democracy that is ill equipped to stand up for us. In fact it is very undemocratic to take a decision of this magnitude and sweep over our local council rendering them powerless.”
Kathryn has also said that having a Neighbourhood Plan in place would prevent developers “building everywhere” – a process which is already underway.
She is concerned that current developments pay no heed to problems like drainage and sewage, or to local amenity and open space.
But she is also worried that developers are rushing to get their planning applications in now, before Falmouth’s Neighbourhood Plan comes into effect, with designated areas for housing or other development, as well as areas that cannot be built on.
She said: “People are frantically putting their applications in because they want to get in before the Neighbourhood Plan comes into place, because that will be the end of this building.”
Kathryn wants appeals to go back to Cornwall Council for reconsideration rather than to the Planning Inspectorate, and is petitioning the government to give local councils the final say on planning decisions, not just in Cornwall but nationwide.
She needs 100,000 signatures if she is to hope to have the issue debated in parliament, and so needs her petition to circulate much further than Falmouth, although she has started a physical petition at Boslowick Garage for those without access to the internet.
She said: “Now is he time if people want to act. Now is their chance, but they have got to stand up and say, it’s people power.”
To sign the petition go to: http://you.38degrees.org.uk/petitions/give-our-councils-the-power-to-make-a-decision
“Greater Exeter” protects the countryside – honestly, that’s what they say!
And it must be true, because Andrew Moulding says so! Now, about Exmouth Splat … And look who the money is coming from: developers!
Teignbridge, East Devon District Councils and Exeter City Council have form a cross-boundary partnership to safeguard three internationally important conservation sites.
The three councils have established the South East Devon Habitat Regulations Executive committee to off-set the effects of new developments and population growth on the protected sites.
They will work together to protect places such as the Exe Estuary, Dawlish Warren and the East Devon Pebblebed Heaths for future generations to enjoy.
The committee said protecting the sites was important for a number of reasons, including providing safe areas for all users to enjoy and caring for the bird populations they support.
Human activity on or close to the sites can cause disturbance or even death of protected bird species, it warned.
This new Committee is working with partners including Natural England, Clinton Devon Estates, National Trust, RSPB, Exe Estuary Management Partnership and Devon Wildlife Trust.
Funding will come from developer contributions on new residential housing across the three areas and within a 10km “zone of influence” from the protected sites.
Measures and initiatives planned include a patrol boat on the Exe Estuary, a dog project officer, a review of codes of conduct, new and updated visitor publicity and signage.
Two new wardens will educate and engage with the public and ensure byelaws are observed.
East Devon’s deputy leader Andrew Moulding said: “This joint working between our three Councils is a really important step in protecting our beautiful coast and countryside.
“By working together through collective financial decision-making, we can share resources to protect important areas of conservation and improve enjoyment for residents and visitors alike.” …
http://www.rsnonline.org.uk/environment/councils-join-forces-to-protect-countryside
Bovis too poor to buld affordable homes in Seaton …. yet
“Bovis Homes posts 18% increase in revenue to £412m as UK market remains solid despite Brexit vote
Housebuilder says it is still too early to judge the impact of the vote to leave the European Union….”
And Owl still can’t understand how Tesco paid for raising the site years ago yet Bovis says it is bearing the cost …
Did Bovis buy the site INCLUDING the cost of raising it several years earlier and, if so, why?
And why is every develipment site costed separately, not taking into a ccount the developers profits as a whole?
It seems just about any and every site can be shown to make a loss so that affordables are unaffordable, yet all these unaffordable site seems to make bigger and bigger profits for developers when added together! Strange that!
Land value tax for developers, dukes and farmers?
” … In the 19th century landowners paid tax on their land. Today, so corrupt is our system of taxation, they actually receive subsidies for it. The rest of us, meanwhile, must pay council tax.
The largest landowners exploit a tax loophole. Land is passed from one generation to the next via the tax avoidance vehicle that is the trust. The rest of us must pay inheritance tax. …
… About the only way the person who starts out with nothing can improve his or her lot is through labour. And yet we tax labour constantly and heavily. The worker pays the vast majority of taxes: 40% of government revenue comes from income tax and national insurance, with another 20% from VAT.
The wealth of the super-rich does not derive from their labour, however. It derives from the appreciation in the value of their land, their houses, their stocks, their shares, their bonds, their fine art – what economists call their assets. These go untaxed, unless you sell. So most don’t. …
…
Instead of taxing our labour – what we produce – why don’t we tax what we use? Instead of taxing the wealth that is earned, why don’t we tax the wealth that is unearned? I’m talking about land. Nobody made the land. Nature gave it to us. By building on it, or farming it, or mining it, you have improved it, but the land itself was always there. So let us look solely at the unimproved value of the land. This is easy to assess.
If you want the right to occupy a piece of land, and you want the government to protect your title to that land, then a rent should be paid to the community that reflects the value of that land, because it is the needs of the community which have given that land value. What I’m describing might sound extremely left wing, but the granddaddy of rightwing economists, Milton Friedman, described it as the, “least bad tax”: that is LVT – land value tax.
Who would pay the most if we hand land value tax in the UK? The Queen (she owns most of it), the Duke of Buccleuch, the Duke of Atholl, Captain Alwyne Farquharson, pension funds, the Forestry Commission, the Ministry of Defence and, of course, the new Duke of Westminster – or rather the Grosvenor Trust, which owns the land. …
… There’s big money to be made in land banking but there is nothing creative about it. You are not bringing anything new to the world or improving it. It is simply exploiting the restrictive planning laws in this country that prevent progress. It is crony capitalism at its worst.
If you don’t want to pay land value tax, you don’t have to. This is a tax that is voluntary. You simply sell the land to someone who is prepared to.
The amounts of tax payable are clear. It’s an easy tax to administer. It doesn’t require 10 million words of tax code. And there need be no loopholes. The land is here – it is not in the Cayman Islands – and you are the owner.
The Green party actually has LVT in its manifesto, but it has it in addition to other taxes. LVT should replace other taxes. …”
Sign of the times?
Hug a planner? Maybe not in East Devon …
This report might have more credence if it did not mention Cranbrook as an example of good planning when we all know its developer-led design is already falling out of favour with residents!!!!
“A new report points out the benefits of listening to planners’ ideas instead of denigrating them.
If you know any planners, go out and hug them. At one time or another, most people will have reason to be grateful to their profession – for mitigating the expansion of a neighbour’s house, for example, or stopping an open-all-hours club opening in their street. We take it for granted that noxious industries can’t pop up in residential areas and that historic buildings and green spaces have some protection. This is due to planning, an area of government that is nonetheless showered with exceptional levels of derision.
Planners are faceless bureaucrats. Grey. So grey that they feel the need to brighten up their world and ours with colourful swaths of red tape. Or, worse, power-crazed social engineers who tell us how to live. They put brakes on prosperity, growth and freedom of choice. “There are countless jobs tied up in the filing cabinets of the planning regime,” said Michael Heseltine in 1979 and he thought the line so good and true that he said it again in 2012.
Actions follow these words. The planning system is endlessly being reformed, to speed it up, improve “delivery”, to save the £3bn a year that its delays are alleged to cost the economy. At the same time, planning departments are hit particularly hard by cuts in local government spending. Once councils have paid for their statutory and essential obligations, they find it easiest to squeeze apparently optional activities such as planning.
So it’s not surprising that the overwhelming majority of planners, according to a report to be published this week, believe that they cannot provide the benefits of planning due to the constraints and changes in their jobs. The report argues that reforms of the planning system often don’t work. It challenges the fantasy that, if only the bolts on the planning machine could be loosened enough, private enterprise would achieve the abundant flow of new housing that the country desires. It argues that there are economic costs to inadequate planning, such as uncertainty and the cost of poor decisions.
More than this, the report says that current demands for housing mean that planning should be strengthened, so that it can go beyond its usual role of reacting to developers’ and private citizens’ proposals. It can help remove obstacles to development such as contamination and poor infrastructure. It can assemble pieces of land to make a viable site. It can help remove risks and address the long-term quality of a place in ways that private companies often cannot.
The report cites examples of cohesive and successful developments, such as the seven-hectare Brindleyplace in Birmingham, where 12,000 jobs are now based, or the new community of Cranbrook in Devon, which may provide 7,500 homes. In these places, it says, planning played a crucial role in making private development possible.
The report is commissioned by the Royal Town Planning Institute, the professional body of planners, which will prompt the nation’s Heseltines to snort that they would say that, wouldn’t they? Certainly, it describes a world where planners are more influential and respected and better funded than they are now. Its plonky title, Delivering the Value of Planning, smells of those filing cabinets. Then again the Mandy Rice-Davies riposte could equally be applied to those housebuilders who argue for ever less planning. And rather than denigrate planners, it’s worth looking at the strengths of their arguments.
When making things that are expensive, immobile and long lived, such as construction projects, it’s common sense to consider the sum of actions in advance. When building a kitchen, you don’t just plonk down a cooker, sink and fridge and hope that they will end up in the right relationship to each other. You plan them. This gets more true as projects get larger and as space for building gets more scarce and precious, as is happening in Britain now.
Inadequate planning leads to places such as Ebbsfleet in north Kent, where huge investment has gone into its 19-minute rail connection to London, but it takes half an hour to walk from the station to the nearest house, and where some of the lakes formed by former quarry workings, potentially an asset, will be filled in. Good planning gives you places where people actually want to live, where value increases such that it can pay for more public benefits, where land is used well and homes are built at a reasonable speed. The choice is not that difficult.
Extended National Park boosts tourism, but NEVER for East Devon
Yorkshire, Lancashire, Cumbria and Dorset value their natural environments:
http://rsnonline.org.uk/environment/rural-boost-as-national-parks-extended
East Devon guards its developers and their concrete jungles jealously:
East Devon Watch 