Starters’ orders

So the national housing strategy now comes down to this ahead of the election: think of a big number and double it.

Even by recent standards, the starter home initiative plumbs new depths in allowing the politics to drive the policy. The idea of building 100,000 homes at a 20 per cent discount for first-time buyers was first proposed in David Cameron’s conference speech in October. The launch (of a website to register interest, as no homes will be built for some time) was accelerated to this month when the consultation was published in December. And in Cameron’s housing speech today it’s been doubled to 200,000 homes.

Housing minister Brandon Lewis made a written statement earlier that is an extraordinarily rapid government response to a consultation that only ended three weeks ago. However, the response (full version here) is only to the original plan for 100,000 homes, not Cameron’s doubling of it. Reading through some of the responses to the consultation today, I was especially struck by this comment from the Council of Mortgage Lenders:

‘Our overall view of the scheme as outlined is that it could provide a modest addition to the flow of lower cost housing for FTBs and we would support this main objective. But we would warn against setting over-ambitious targets for the scheme at this juncture, before the attractiveness of this particular proposition has been tested on the market.’

-> Read the rest of this post on Inside Edge, my blog for Inside Housing


The tenure trap

New official figures show stunning changes in housing in England. Here are a dozen examples of what’s happening. We already knew that the number of people who own their own home has shrunk rapidly, that the number of private renters has soared and created Generation Rent and that private renting has overtaken social renting. However, the first results from the English Housing Survey 2013/14 show that these trends are not just continuing: they are accelerating. Everywhere you look in the report and the accompanying tables there are stunning new comparisons to be made:

  • More people now own their home outright than are buying one with a mortgage. The split between them is not available going back very far but I reckon this must be for the first time since the 1930s, when the inter-war mortgage boom was in full flight. Here are the main tenure trends since 1980:

Tenure

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Little progress

It’s time for another peek inside the workings of universal credit. IDS look away now.

The work and pensions secretary told us about his latest triumph two weeks ago: the start of the national roll-out heralded a new benefits era; it was £600 million under budget; and it was helping people find work quicker. The commentariat seemed to agree: in his final Telegraph column Peter Obornewas gushing; and in The Guardian Matthew d’Ancona wondered if IDS might even be ‘the man to save the Tories’.

However, as I’ve blogged before, universal credit exists in two states at once: triumph and not-triumph. It didn’t take long for the other state to be highlighted: Nigel Keohane pointed out that only 0.3 per cent of claimants are on universal credit so far plus a host of other practical problems; and a claimant who advertised it told the BBC he now thought it was a nightmare.

And today’s progress update from the House of Commons Public Accounts Committee concludes that ‘very little progress has been achieved on the frontline’.

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Right to buy: a clarification

Oops. The final Right to Buy stats before the election show that the reinvigorated policy is delivering less than half the new homes the government previously claimed: one for every 11 sold.

Up to now, the ratio was running at one start on site for every five homes sold compared to an apparent pledge of 1-for-1 replacement when discounts were increased in April 2012. The chances of achieving that always seemed somewhere between slim and zero given that the Treasury still takes a cut of the receipts and the fine print meant that the pledge only applied only to additional sales on top of those already expected, even though the replacements would not be like for like.

However, as Pete Apps reports, today’s figures for replacement starts on site have been revised downwards substantially. The apparent 4,795 starts between April 2012 and September 2013 turn out to be just 2,298. That compares with more than 26,000 homes sold off since April 2012.

The graph below shows the comparison quarter by quarter:

RTB

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Falling short

What do the final housebuilding figures for England before the election have to say about the deficit and the debt – in new homes?

Needless to say, ministers have greeted them with their usual mix of spin and agility in finding the measure that looks best in PR terms. So housing minister Brandon Lewis says ‘housebuilding continues to climb’ on the basis that housing starts in 2014 were 10 per cent up on a year ago. That may be but starts have been falling for the last two quarters: October to December 2014 was down 10 per cent on the previous quarter and 8 per cent on a year ago, suggesting perhaps that the recovery sparked by Help to Buy is petering out.

Lewis also claims that ‘overall 700,000 new homes have been delivered since the end of 2009’ without any acknowledgment that he is talking about completely different figures – additions to the council tax register – or that he has to borrow six months of the last Labour government to come up with the number.

Starts may indicate current activity but you can’t live in a start and completions are a more reliable measure of housebuilding progress. Curiously, Lewis does not mention these even though the news is actually not bad for the government: October to December completions were up 1 per cent on the previous quarter and 8 per cent on a year ago; and the 118,830 new homes built in 2014 represented an 8 per cent increase on 2013.

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Rallying call

If the political weather turns out to be even half as good as the winter sunshine at Land’s End today, then Homes for Britain is set fair for success.

A rare national housing event happening up the road from me was too good an opportunity to miss so I was there at lunchtime for an event to mark the start of a baton relay that will make its way through the South West by bus in time for the campaign rally in London on March 17.

Hosted by around 30 different housing associations, progress will be marked in different towns and cities along the way with events including snakes and ladders in Bristol and school children making model houses in Witney (David Cameron’s constituency). Regional events are also happening in the North East, North West and Yorkshire & the Humber.

The relay will reach London for March 17 for what is being billed as ‘the biggest housing rally for a generation’ at Methodist Central Hall in Westminster and that will be followed by a billboard campaign in April.

The housing problems of the South West will be highlighted along the way. As Simon Nunn, assistant director of external affairs at the National Housing Federation, told the Land’s End launch, house prices cost 11 times average earnings in Cornwall. You need earnings of £50,000 to buy an average home on an 80 per cent mortgage and £40,000 to buy a lower quartile home. Mean earnings are below £20,000.

Backing his call for action were representatives from housing associations and other organisations across the region, pictured here with the Betsy, the Routemaster bus that will make the trip to the capital:

IMG_0365

-> Read the rest of this post on Inside Edge 2, my blog for Inside Housing


Cry freedom

What are the implications of the Dutch housing association debacle for the UK?

Two weeks before Policy Exchange made its controversial call for ‘free’ associations in England on Housing Day in November, a parliamentary inquiry in the Netherlands was publishing a report on a scandal that rocked the country’s social housing sector to its foundations. It concluded that Dutch housing associations strayed ‘too far from home’ after they won their commercial freedom in 1995.

As I report for Inside Housing this week, it’s the details that catch your immediate attention: the prison sentence for fraud, the steamship, the Maserati, the suitcase full of cash and Vestia’s €2.7 billion losses on derivatives deals that went wrong. Those and much more besides are what leap off the page at you in the report of a parliamentary inquiry published at the end of October but barely reported here until now.

-> Read the rest of this post on Inside Edge 2, my blog for Inside Housing


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