This week's National news (December 15 - December 19)
- NATIONAL:Labour fails to scrap ‘bedroom tax’ in Commons vote
- NATIONAL:One in six Brits have to borrow to pay rent or mortgage
- NATIONAL:Landlords owed more than £800m in unpaid rent
- NATIONAL:New Homes Bonus having ‘modest’ impact on housing targets
- NATIONAL:Joseph Rowntree Housing Trust’s governance rating downgraded
- NATIONAL:FMB: Ring fence council planning budgets to stop ‘crippling’ housing crisis
- NATIONAL:Support for MP’s call to fine councils that fail to adopt Local Plans
- NATIONAL:Social housing repossessions in Wales at seven year high
- NATIONAL:Blog: Starter Homes: an opportunity missed
- NATIONAL:Shadow housing minister supports Home Group’s Gas Access Campaign
- NATIONAL:Shelter strike suspended following breakthrough in talks
- NATIONAL:Communities need greater protection against unsustainable development
- NATIONAL:New first-time buyer scheme ‘yet another short term initiative’
- NATIONAL:Call for overhaul of shared ownership to double supply of homes
- NATIONAL:Scottish Housing Regulator appoints manager to address ‘serious weaknesses’
- NATIONAL:Benefits cap ‘getting more people into work’, says DWP research
- NATIONAL:Supreme Court to hear ‘most important homelessness case for years’
- NATIONAL:Prime minister launches 20 per cent discount boost for first-time buyers
- NATIONAL:Supply of rental properties ‘eases against demand’
Thursday 18 December 2014
Wednesday 17 December 2014
Tuesday 16 December 2014
Monday 15 December 2014
NATIONAL:Labour fails to scrap ‘bedroom tax’ in Commons vote
The government defeated a motion from Ed Miliband's party to abolish the spare room subsidy by a majority of 32, winning the vote 298 to 266.
The Liberal Democrats were accused of betraying their members after pledging earlier this year to abolish the policy which penalises housing benefit recipients seen to have a spare bedroom. Campaigners say the welfare reform has pushed many families into poverty, often because there is no smaller property for them to move to.
In a debate over the motion, Labour's Geraint Davies accused the Tories of “ripping food out of the mouths of the poorest” and forcing people to rely on food banks.
Eilidh Whiteford, an SNP MP for Banff Buchan, said the government was “scapegoating” the most vulnerable for the problems in housing and that disabled people were on the “front line of the austerity cuts”.
Work and pensions minister Mark Harper (pictured) said: “Today of all days, Labour would rather talk about anything but the positive jobs figures we are seeking - more people in work than ever before, up 590,000 on the year, and up 1.7 million since 2010.
“Labour have chosen their Opposition Day to have a debate that is contrived to scare people instead of welcoming the record employment figures.”
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NATIONAL:One in six Brits have to borrow to pay rent or mortgage
Analysis conducted for the Debt Advisory Centre (DAC) found that people aged 18–24 were the most likely to have borrowed money to pay their housing costs, with nearly one in three (29 per cent) admitting to doing so to avoid missing their payment.
According DAC’s survey, one in 12 people (8 per cent) are in arrears with either their rent or their mortgage. Of these, 66 per cent were behind by one month; 20 per cent were in arrears by 2-3 months; and 14 per cent were more than three months in arrears.
Ian Williams, DAC spokesman, said: “Housing is a key priority, so it is extremely worrying to find so many people had to borrow money in October to make their payment. It is certainly a sign that their finances are in crisis and that they need to take action immediately to avoid further deterioration.
“In many cases, people have enough coming in to make their payment but have prioritised other bills – such as credit card or loan repayments. In this case it is important to remember that housing costs should be paid before any unsecured creditors.
“If you are tempted to borrow to cover food, housing costs or utilities, you should seek money advice first. An advisor can help you re-prioritise your budget and help negotiate with lenders on your behalf.”
NATIONAL:Landlords owed more than £800m in unpaid rent
The research shows that a typical landlord faces £1,649 of outstanding rent each, totalling £850 million worth of rent arrears across the UK.
The NLA research also shows that one in five (22 per cent) landlords in the UK, approximately 300,000, are worried that their tenants won’t be able to keep up rental payments over the next year.
The research supports the launch of the NLA’s latest campaign: rent, risk resolve. The campaign aims to highlight four of the biggest risks facing landlords and help them to minimise the impact on their lettings business:
- Rent arrears
- Rising interest rates
- Local landlord licensing and regulation
- The introduction of rent controls
“Regardless of the size of your portfolio the potential impact of these risks can be devastating on both the business and personal life. As the largest landlord association in the UK, we have a duty to support and advise on how to plan ahead effectively and manage these risks.”
The first focus of the NLA’s campaign will be the risk of rent arrears. The NLA has produced a guide to support landlords to deal with the problem.
NATIONAL:New Homes Bonus having ‘modest’ impact on housing targets
The report, published yesterday by the Department for Communities and Local Government (DCLG), found that almost 50 per cent of planning officers agreed that the New Homes Bonus is a powerful incentive for supporting housing growth and added that the bonus is meeting stated key policy principles of being “simple, transparent and flexible”.
A central government grant given to councils on the basis of the number of new homes added to the council tax register, the New Homes Bonus was introduced as an incentive for authorities to encourage housebuilding.
According to the DCLG's evaluation report, around 40 per cent of planning officers agreed that the bonus had resulted in officers and their elected members being more supportive of new homes, "though this was found to be much less the case in the wider community where only 10 per cent of planning officers agreed the bonus had begun to increase support for new homes for this group".
The report said that the bonus is capable of being a material consideration in planning decisions, but found that, to date, the bonus was having a "limited impact on planning applications involving new homes".
Only 36 per cent of officers said they "always/almost always or often/sometimes took into account the revenues from the bonus when considering planning applications for new homes", according to the report.
The research found a "clear and consistent view from officers and members that the bonus should not influence the requirement to make decisions in accordance with 'law and planning policy'".
The research found that only 11 per cent of authorities agreed that the bonus had so far been an "important influence on the number of new homes proposed or adopted in my local plan", with 71 per cent disagreeing.
The report also "did not find evidence" that an enhancement to incentivise the provision of affordable housing "was providing an additional incentive in increasing support specifically for more affordable homes".
The report concluded: "Four years into the policy, there remains some way to go before it can reach its full potential to impact on attitudes and behaviours such as housing targets in local plans and subsequent planning decisions. This is partly because, as a non ring-fenced form of revenue, authorities have the freedom to spend receipts in ways that may be unrelated to specific development proposals."
In a statement, planning minister Brandon Lewis (pictured) said: "We’ve got the country building again and given local communities control over where new homes go in their area. This is in stark contrast to the housing crash and failed top-down regional strategies of the last government.
"Councils have received more than £3 billion for their part in getting Britain building, and as a result housing construction has reached its highest level for 7 years.
"All local authorities are free to spend the money however they like to benefit their local communities – whether that’s supporting frontline services, providing new facilities or freezing council tax."
Evaluation of the New Homes Bonus is available here.
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NATIONAL:Joseph Rowntree Housing Trust’s governance rating downgraded
The regulator, which downgraded JRHT’s governance rating from G1 to G2, said the provider “meets the requirements on governance set out in the Governance and Financial Viability Standard, but needs to improve some aspects of its governance arrangements to support continued compliance”.
The provider retained its V1 rating for viability.
The regulatory judgement stated: “Based on evidence gained from contact with the trustees and executive, a review of board papers and other published documentation, the regulator has concluded that JRHT’s governance arrangements are adequate but that it needs to improve some aspects of governance to maintain compliance.
“The Value for Money standard sets a specific expectation that providers’ self assessments should enable stakeholders to understand the return on assets measured against the organisation’s objectives; set out the absolute and comparative costs of delivering specific services; and evidence the value for money gains that have, and will be, made and how these have, and will be, realised over time.
“We have concluded that JRHT has not published a robust self-assessment which sets out in a way that is transparent and accessible to stakeholders how it is achieving value for money in delivering its purpose and objectives. This means the regulator has only limited assurance that JRHT is delivering a comprehensive and strategic approach to achieving value for money in meeting its organisational objectives.
“The regulator’s assessment of JRHT’s compliance with the financial viability element of the governance and financial viability standard is unchanged. Based on evidence gained from contact with the executive and a review of the latest financial forecasts, annual accounts, and the quarterly survey the regulator has assurance that the financial plans are consistent with, and support, the financial strategy of the provider.
“The provider has an adequately funded business plan, sufficient security in place, and is forecast to continue to meet its financial covenants under a range of scenarios.”
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NATIONAL:FMB: Ring fence council planning budgets to stop ‘crippling’ housing crisis
Council planning departments should be treated as front line services and protected from local authority spending cuts, according to the Federation of Master Builders (FMB).
The call followed a review by the National Planning Policy Framework by a Communities and Local Government Committee which found that more needs to be done to help planning departments protect against unsustainable development in England and ensure communities aren’t subject to unwanted housing development.
A report by the CLG Committee concluded that developers are taking advantages of loopholes in the framework to launch ‘speculative’ planning applications leading to unwanted developments contrary to the wishes of local communities.
Commenting on the report’s recommendations, Brian Berry (pictured), chief executive of the FMB, said planning departments should be “sufficiently resourced” to help tackle the housing crisis.
He said: “The Committee is right to stress the importance of maintaining adequate levels of investment in planning departments. Although councils are under a great deal of financial pressure, with more cuts to come, there are some areas which must be prioritised over others and planning is one of them.
“Our country is in the midst of a crippling housing crisis and if we are ever to start building enough new homes, we need planning departments to be sufficiently resourced to ensure these homes can be built.”
Berry added: “I am also pleased that the Committee recognises that although the NPPF is not perfect, it merely requires some adjustment and not a complete overhaul. The last thing we need is for next government to embark on another major review of the planning system as the one we currently have is broadly speaking working fairly well.
“Another major planning review could act as a barrier to small house builders at the very time government wants them to increase their delivery of new homes. As the Committee points out, it’s still early days for the NPPF but what’s clear is the positive impact a simplified planning system can have.”
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NATIONAL:Support for MP’s call to fine councils that fail to adopt Local Plans
Rural businesses have backed the call of an influential committee of MPs for government imposed fines on local councils that fail to deliver Local Plans after three years from when planning laws come into force.
The report of the Communities and Local Government Select Committee is the result of an inquiry into the operation of the National Planning Policy Framework (NPPF) introduced in April 2012. The report concludes that while there are ‘significant concerns’ about how it is operating, the need is for ‘adjustment rather than complete overhaul’.
The CLA, which represents landowners, farmers and other rural businesses, played an integral role in helping the Government to develop the NPPF and in ensuring it provided a framework for promoting sustainable development in rural communities.
CLA President Henry Robinson (pictured) said: “Two years on from the NPPF, slow rates of implementation are hampering development across the rural economy. We remain confident that national policy is broadly right, but inconsistent implementation is contributing to a crisis of underinvestment in infrastructure, business and housing across the English countryside.”
The report contained a number of recommendations including a statutory time limit and financial penalty for non-completion of Local Plans.
Under the NPPF every local authority should have in place a Local Plan which sets out how to best meet the ‘sustainable development’ needs of the local area. The Committee found that at the end of October 2014 41 percent of councils still do not have an up to date Local Plan and many of these are rural planning authorities. They call for a consultation on a statutory limit by which a council would have to have a plan in place or face a financial penalty.
Mr Robinson said: “We agree with MPs that Local Plans are vital to attracting investment, especially in rural communities. The problem is that over the past 24 years too often vital investment has been stymied by the fact there is not an up to date Local Plan in place. Drastic action is needed to make sure council’s are prioritising Local Plan making. That is why we back the Committee’s call for a law requiring all councils to have up to date plans in place no later than three years after the NPPF came into force. We also believe this should be backed up by some form of financial penalty.”
On the Committee’s recommendation for councils to review their local Green Belt policies, Mr Robinson said: “MPs are right to highlight the failures of current green belt policy. We agree that councils should have a clear policy, considered as part of their Local Plan. However, we are disappointed MPs did not go further and recommend a fundamental review of the aims and objectives of Green Belt policy.”
The Committee also set out recommendations related to the five year supply of land for housing including a proposal that viability “loopholes” should be closed and a brown field remediation fund should be established.
Mr Robinson added: “We agree with the Committee that allocating sites for housing requires careful planning and is best done through effective Local and Neighbourhood Plans. However, we are concerned that the Committee’s recommendations on closing loopholes in viability assessments would be a backward step. We will be encouraging the Government to resist this call to put barriers in the way of building much needed homes in our rural settlements.”
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NATIONAL:Social housing repossessions in Wales at seven year high
The number of social housing tenants who have had their homes repossessed in Wales has risen by 12 per cent in the past year, a charity has said.
Social housing repossessions hit a seven year high this year in Wales with nearly a thousand social tenant households losing their homes, a leading housing charity has revealed.
Shelter Cymru analysed Ministry of Justice data on court possessions and found that while mortgage repossessions have fallen in recent years, nearly a thousand social tenant households have lost homes over the last year – the highest level since before the recession.
John Puzey (pictured), director of Shelter Cymru, said: “This year has been particularly tough for social tenants, many of whom have suffered due to changes in welfare benefits and the rising costs of living. We have been working with landlords to ensure that they are doing everything they can to help tenants stay afloat – but these figures show that more clearly needs to be done.
“While some landlords are working hard to help tenants make the most of their income, others are failing to put support in place and are rushing to court far too quickly. We are hearing that some have started charging rent in advance from new tenants, forcing families into debt right from the outset of their tenancies.”
Social housing repossessions peaked in January to March 2014 – during these months Welsh social landlords were making more than 21 households homeless per week or three households homeless every day.
Across all tenures, nearly 2,200 households had their homes repossessed by bailiffs in Wales – equivalent to more than 42 households every week or six households per day. Many more would have lost their homes without going to court, so would not be included in these figures.
John Puzey added: “Tenants who are evicted from social housing have very few options open to them. Other landlords often won’t take them on if they have arrears so the only choice is the private rented sector where they may be vulnerable to rogue landlords.
“The worst time of year for repossessions is always the first three months of the year. This year, perhaps social landlords should show some forbearance post-Christmas and not rush to court as soon as the holidays are over.”
NATIONAL:Blog: Starter Homes: an opportunity missed
By Toby Lloyd at Shelter
This week the Prime Minister went to Poole to launch a new starter homes scheme that will deliver 100,000 homes for purchase by first time buyers at 20 per cent below the market value. Beneath this simple consumer-friendly message there is a complex scheme involving several different interventions and changes. In short, it’s half right – and half wrong.
On the positive side, the scheme is a very welcome sign that the government recognises the urgent need to build more homes, and to make them more affordable for families on typical incomes. The idea of offering homes to first time buyers at a discount is also reasonable in principle, as it should prevent speculators and buy to let landlords hoovering up the new supply, while the proposed restrictions on resale will (if designed well) prevent the buyers from simply flipping the homes on at the full market value and pocketing the discount.
The proposals include some bold innovations that Shelter has long called for – particularly around the use of public planning powers to bring additional land forward quickly and cheaply. In this case it is done by extending the principle of “rural exception sites” to industrial land. This technical detail is in fact the heart of what makes the proposals stack up financially – and what enables the government to say that it can be done without cash subsidy.
Paying for it: uplift in land values
By proactively identifying land that would not normally receive planning permission for homes and earmarking it for residential development, planning authorities can create huge amounts of value.
Industrial land roughly triples in value when it receives residential planning permission – creating around £1.5m per hectare overnight – although the exact amount varies widely across the country. The reason for this is quite simple. Selling homes is a far more profitable use of land (in high housing demand areas) than most industrial or commercial uses.
Industrial to residential planning gain (VOA, 2010)
|Area||Industrial land value(£/ Ha)||Residential land value(£/ Ha)||Planning Gain (£/ Ha)|
|East Midlands||500,000 (Nottingham)||1,200,000||700,000|
|London Outer||2,000,000 (Croydon)||4,037,500||2,037,500|
|North East||225,000 (Newcastle)||1,300,000||1,075,000|
|North West||450,000 (Liverpool)||1,500,000||1,050,000|
|South East||1,000,000 (Oxford)||4,000,000||3,000,000|
|South West||850,000 (Bristol)||2,200,000||1,350,000|
|West Midlands||650,000 (Birmingham)||1,200,000||550,000|
In our current broken house building model, this ‘planning gain’ (the increase in value when you get permission to build and sell homes on land) goes to the owner of the land as a windfall profit. This windfall isn’t earned. It simply results from the enormous value of selling homes relative to anything else you can do with a piece of land in area with a housing shortage. Landowners in other similar countries like Germany and Holland don’t benefit from the same enormous pay-outs, but rather share the windfall profit more fairly with the local community in the form of investment in local infrastructure and better quality development.
Clawing some back
At the moment, we claw back some of the windfall profits to landowners by letting local councils impose some taxes on development. So called “section 106” and the Community Infrastructure Levy (CIL) are costs that developers factor in before they buy a piece of land – so they are in effect paid for through a lower uplift in the land value when it gets planning permission for homes.
The drawback of this approach is that the taxes are always up for negotiation by developers and landowners. They argue that these taxes make it harder for schemes to be “viable” as they are a cost. In fact, due to the nature of the land market these taxes are simply reflected in lower land prices. Over the last few years, the ability of councils to negotiate a better deal on behalf of their local community from these taxes has been reduced, as the legislation has been weakened.
But Starter Homes don’t do this
Starter Homes are the perfect opportunity to capture some uplift value for infrastructure or affordable housing, but they don’t do it. Some of the uplift is being used to fund a 20 per cent discount for buyers, but with prices rising at an annual rate of over 10 per cent in England this isn’t much of a cost on development.
Despite having rightly identified a smart way to get more public value out of the land by identifying land proactively, the government is immediately hands most of this back to landowners by scrapping the requirement to provide affordable homes and infrastructure.
This fails to really deliver for ordinary families for a variety of reasons. Firstly, it undermines the ability of local authorities to ensure development is of a high quality and is supported by the services and infrastructure communities need. Secondly it wastes a massive opportunity to increase investment in affordable housing with no cost to the taxpayer.
All that needs to happen to allow some of the uplift to go into affordable housing is for the government to give local councils the usual powers to apply an affordable housing requirement on these sites. It won’t impact on viability at all if done in a clear, upfront and consistent way as it will simply result in lower windfalls for landowners.
What is frustrating is that the policy comes so close to being what we need: a pro-active planning intervention to capture land value and get more homes built for those who need them. A small change can make that happen. We hope the government makes it.
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NATIONAL:Shadow housing minister supports Home Group’s Gas Access Campaign
Another high profile politician has backed a campaign aimed at improving gas safety for millions of people.
Shadow housing minister Emma Reynolds (pictured) has pledged her support to the Gas Access Campaign. The Labour politician has acknowledged the current access system available to social landlords who need to carry out gas safety checks is both costly and potentially puts tenants in danger.
The Wolverhampton North East MP is the latest high profiler backer of the campaign following the support of London Mayor Boris Johnson.
The campaign is being spearheaded by Home Group with the Association of Gas Safety Managers and CORGI Technical Services. It aims to simplify the legal process used to gain power of entry once landlords have exhausted all other options.
Ms Reynolds said: “I support the campaign to make it easier for social landlords to conduct essential gas safety checks. There are serious risks to the health of residents if gas appliances go unchecked and it can’t be right that social landlords are spending so much money to ensure their tenants are safe.
“But any new powers must be used as a last resort and clear guidance will be needed following any change. Any changes to the law must be balanced to protect the interests and privacy of tenants.”
Mark Henderson, Home Group chief executive, said: “We’re beginning to see true cross party support for this campaign. Politicians across the spectrum recognise the current system of gas access simply can’t continue. It’s costly financially and it has great potential to be costly in terms of lives.
“We’re delighted Ms Reynolds has backed the campaign and we agree with her view that any new power of entry should be balanced. We’re pushing for a very simple change in legislation which would speed up the court process once every other avenue has been exhausted.”
The issue is estimated to cost the sector £50m each year. Currently local authorities are able to apply to a court to gain lawful entry into homes within 24 hours of refusal by a tenant. Housing associations can take as long as four months to legally gain entry to a property.
Claire Heyes, chief executive of the AGSM, said: “The support of the Shadow Housing Minister is very welcome. Keeping tenants and their neighbours safe is a responsibility that social housing landlords take very seriously and we believe that tenants also wish to feel safe in their homes. Raising awareness across the political spectrum of the huge sums of money being wasted in achieving this level of safety is a crucial step to achieving the changes that we believe are needed.”
To sign the Gas Access petition visit here.
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NATIONAL:Shelter strike suspended following breakthrough in talks
A planned three-day strike by frontline workers at Shelter has been suspended following a new pay offer by management, the union has revealed.
Unite said the industrial action, which was due to start today, was called off following talks at Acas.
Union members had been due to walk out over fears they were in line for pay cuts. Shelter previously said it had a ‘simple but painful choice’ between reducing salaries or cutting services and making redundancies.
However a fresh offer was made by Shelter management which includes improved rates of pay for new starters and the withdrawal of proposals to review existing staff pay in 2015.
The new offer will be put to members in a ballot.
Unite regional officer Peter Storey said: “After intense negotiations at Acas, Shelter management have put forward an improved offer. It represents a significant improvement on previous offers by the charity and will be put to our members in a ballot over the coming days.”
Campbell Robb (pictured), Shelter chief executive, added: “Both sides have been working up to the wire to try to avert this week's strike action and are delighted that the efforts made on all sides have proved successful. We very much hope that union members will respond positively to the new offer now on the table.
“We have more people coming to us for help than ever before at a time when we are facing greater competition for donations and cuts to government funding for services. Therefore we increasingly face a simple but awful choice: continue to pay some new jobs above the typical salary, as we do currently, and face cutting some of our services and making some roles redundant, or pay the median salaries for new staff and maintain the number of people we are able to help.
“Decisions on these issues are tough and not ones any of us want to make. Along with the package of measures we were able to agree with the union, we were also pleased to reaffirm that we have no plans to review the pay rates of existing staff.
“Christmas is a crucial time of year for us, both in supporting people facing homelessness and raising the money to fund that support. We are delighted that as an organisation we can now ensure we are all fully focused on this vital work as we approach the festive season. I would also like to take the opportunity to thank those involved for the way these difficult discussions have been handled – that staff have respected each other's views and remembered that whatever happens we share the same mission to end homelessness and bad housing is a great credit to the organisation.”
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NATIONAL:Communities need greater protection against unsustainable development
The government’s flagship planning policy, the National Planning Policy Framework (NPPF), needs to do more to protect against unsustainable development in England and ensure communities aren’t subject to unwanted housing development, a Communities and Local Government Committee a report has concluded.
The CLG Committee found that developers are taking advantages of loopholes in the framework to launch ‘speculative’ planning applications leading to unwanted developments contrary to the wishes of local communities.
Clive Betts MP (pictured), chair of the Communities and Local Government Committee, said: "The NPPF has brought welcome simplification to the planning system but the government must strengthen the planning framework to tackle emerging concerns about inappropriate and unsustainable development. The same weight needs to be given to environmental and social factors as to the economic dimension to ensure the planning system delivers the sustainable development promised by the NPPF."
The Committee welcomed the government’s efforts to simplify planning by reducing, in the words of the former planning minister, “over 1,000 pages of often impenetrable jargon to around 50 pages of clearly written guidance”. However, it is concerned that communities are at risk of unsustainable development due to the granting of planning permission to substantial housing development on the edge of towns and villages as a result of ‘speculative’ applications by developers.
This problem was particularly acute when a local plan or five year supply of housing land was not in place. In these cases, developers take advantage of the absence of the plan or five year supply to seek planning permission in areas that local communities do not consider suitable for development.
Clive Betts added: "Councils must do more to protect their communities against the threat of undesirable development by moving quickly to get an adopted Local Plan in place. The NPPF is designed to work side by side with local plans. At the moment, 41 per cent of local authorities do not have an adopted local plan which is simply not good enough. To put an end to councils dragging their feet on this issue, we call for the Government to make it a statutory requirement for councils to get local plans adopted within three years of the legislation being enacted.
“We must also close the loophole that allows developers to challenge the inclusion of sites within a council’s five year supply on the grounds of viability. We heard that developers were claiming sites were unviable in order to obtain planning permission on other, more lucrative sites against the wishes of the council and community. In doing so, they are undermining and delaying the local planning process. Requiring all sites with planning permission to be counted towards an authority’s five year supply will help put a stop to this behaviour and give communities greater protection."
The Committee also recommended that clearer guidance is needed about how housing need should be assessed and that local authorities should be encouraged to review their green belts as part of the local planning process.
It agreed that more homes should be built on brownfield land, but is not convinced the chancellor’s local development orders policy will do enough to stimulate activity. Given the biggest barrier to more building on brownfield sites is the availability of resources to make the land suitable for development, the Committee called on the Department for Communities and Local Government to establish a remediation fund for brownfield sites.
The Royal Institution of Chartered Surveyors (RICS) “strongly welcomed” the review as an important first step to understanding whether this important change is working, and creating more homes and economic growth.
Jeremy Blackburn, RICS head of policy, said: “The recommendation of a framework to evaluate the operation and impact of the NPPF over the longer term is crucial if we are to get away from the acrimonious ‘greenbelt vs brownfield’ debate and a brownfield remediation fund will help make more brownfield sites viable.
“Support for Local Plans also mirrors what RICS has called upon government to do and a future government should make the adoption of up to date local plans compulsory with any Local Authority failing to keep plans up-to-date being classed as underperforming and placed into special measures where required. This will greatly help with the legitimacy of development for local communities.
“However we view the call for an end to Permitted Development Rights as premature. Taken as a whole, PDR is helping in a small way to boost much needed housing supply – in London where the shortage of affordable housing has reached a chronic level, 10 per cent of offices are earmarked to provide these much needed homes – so calls to terminate prospective PDR development is, we believe, at this stage, foolhardy.”
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NATIONAL:New first-time buyer scheme ‘yet another short term initiative’
The National Housing Federation has labelled David Cameron’s offer a 20 percent discount to 100,000 first-time buyers as a short term solution which will not address the root of the housing crisis.
The scheme, which will see first-time buyers offered a 20 per cent discount, will reform the planning system to free under-used or unviable brownfield land from certain planning costs and levies.
In return, the new homes which are constructed will need to be offered for a below-market value sale price.
While welcoming the focus on the issue, National Housing Federation chief executive, David Orr (pictured), said it is “disappointing” that no new investment was announced.
He added: “This initiative will come at the expense of investment into properties for affordable rent and shared ownership, effectively worsening the situation for renters to help first time buyers.
“Whilst we’re pleased that government is recognising the urgency of tackling the housing crisis, this is yet another short term initiative in the housing market that fails to address the root of the problem - that we just aren't building enough houses. We are calling on the next government to commit to end the housing crisis within a generation and to publishing a long term plan detailing how they will do this.”
The scheme has been backed by members of the construction industry with leading house-builders, including three of the UK’s largest firms, along with councils from across the country, already pledging their support for the initiative.
More than 30 house-builders have said that they support the plans and would consider bringing forward land to develop the new, discounted houses from next year.
Stewart Baseley, executive chairman of the Home Builders Federation, said that increasing the housing supply is a huge and complex challenge and significant barriers remain.
Bringing forward more land for house-building, while also enabling more first-time buyers to realise their ambition of homeownership, should be another positive step on the way to tackling the housing shortage, he added.
Brian Berry, chief executive of the Federation of Master Builders (FMB), said: “We back the principle of this scheme which aims to enable more new homes to be brought forward and targeted at first time buyers, who are a crucial section of the market. The government’s recognition of the importance of boosting supply from smaller house builders has been underlined by recent announcements extending the Builders Finance Fund to smaller sites and setting a ten unit threshold on affordable housing and tariff style planning obligations. It is crucial that the Starter Home initiative will also be open to firms and sites of any size.”
Berry concluded: “It is now important that we make sure that the details of the scheme ensure that the central objective - to deliver 100,000 new homes for first time buyers at 80 per cent of market value – is realisable in practice. That’s why the FMB and 15 leading member firms have pledged to work with the government on the development of the Starter Homes scheme.”
Paul Smee, Council of Mortgage Lenders director general, said: “Mortgage lenders support measures that deliver affordable ways for people to access home-ownership. This new scheme should provide a modest additional flow of lower-cost housing for first-time buyers, which we welcome.
“Lenders will need to consider whether there are any specific lending risks involved, and we will respond to the consultation to help ensure that the scheme is practical and workable from a lending perspective. Once it is up and running, we will help signpost first-time buyers to government website information about the scheme.”
The CML will respond to the consultation by the closing date of 9 February.
NATIONAL:Call for overhaul of shared ownership to double supply of homes
A national report exploring how an overhaul of shared ownership could double supply to 30,000 homes and help address the UK’s growing affordability crisis is published today.
Initial findings show that current demand for shared ownership homes outstrips supply by as much as 10:1.
Former Army engineer, Simon Sanderson, from Ipswich, and his wife and four children now live in a shared ownership property.
Orbit Group and the Chartered Institute of Housing (CIH) have released an interim report exploring the potential to expand shared ownership so it becomes a fourth mainstream tenure alongside home ownership and social and private renting.
The report sets out the key issues that government and the housing sector will need to address to increase shared ownership from its current 15,000 homes per year to at least 30,000 within the next Parliament – around 13 per cent of the 240,000 new homes England needs each year. The full report will be published in February.
Orbit, CIH and other organisations have been making the case for shared ownership. Last week the chief secretary to the Treasury Danny Alexander MP, announced a Government consultation on shared ownership, and it also featured in the Autumn Statement.
Evidence shows that people increasingly want to own their own home, yet less than one-fifth of families on lower quartile incomes could afford a two-bedroom home with a 90 per cent mortgage. Whereas, shared ownership is more affordable than buying outright and renting privately in all regions, except the North East.
Simon Sanderson from Ipswich was in the army for 13 years as a mechanic in the Royal Electrical Mechanical Engineers, and now lives in a shared ownership home with his wife and four children.
He said: “Without shared ownership I don’t think I would have been able to purchase a house suitable for my family due to my household income not allowing for a large mortgage and no savings. If shared ownership did not exist I would have been forced into private rent and don’t know if I would ever get out of expensive rentals.”
The report sets out challenges for Government to make a commitment to long-term consistency in the name, product, target market and investment into shared ownership. It has involved discussions with leading housing, financial and investment organisations (see acknowledgements in Shared Ownership 2.0 report), as well as focus groups with around 40 customers.
Paul Tennant, chief executive of Orbit Group, said: “We and others have been championing shared ownership and we were delighted to see the government responding with a commitment to shared ownership in the Autumn Statement. This recognition that the product needs to be attractive to households, developers and investors is critical and, as our report demonstrates, is key to shared ownership becoming the fourth mainstream tenure. There’s lot of work to do, but our initial findings set out clearly the areas a range of experts feel need properly addressing.
“Shared ownership has huge strengths as a product. But the housing market has changed a lot since it was launched and we need to refresh the product, remove some complexities, commit to long-term investment and ensure its fit for purpose in the world of 2015. This will help it reach scale and maximise its potential at a time when it’s needed more than ever.”
Gavin Smart, deputy chief executive of CIH, said: “One of the many symptoms of the housing crisis is a growing group of people who we might call the squeezed middle. For them, home ownership is increasingly out of reach – because of stagnant wages combined with rising prices, the scale of the deposit required, and stricter lending criteria – but they don’t have the level of need and vulnerability to qualify for social housing. For the vast majority of these people, the private rented sector is going to be the only option –and for some it might be the right option, but what if it isn’t?
“This is where an expanded programme of shared ownership could come in. Our new report explores how to achieve an increase in numbers but also how we can make it simpler and more flexible, so it works better for consumers, housing associations and mortgage lenders. We need new and radical solutions if we are going to solve our national housing crisis within a generation and we are really pleased to be working with Orbit Group on this report, which has the potential to transform the housing options available for many people who have previously had little choice.”
Read the interim report published by Orbit and CIH
A full report will be published in early February, which will look at solutions to deliver shared ownership at scale.
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NATIONAL:Scottish Housing Regulator appoints manager to address ‘serious weaknesses’
The Scottish Housing Regulator has used its statutory powers to appoint a manager to Muirhouse Housing Association after it identified a “serious and urgent risk” to its financial health.
The regulator, which has also made three statutory appointments to Muirhouse’s governing body, revealed on Friday that it had moved its engagement with Muirhouse to a high level in light of the serious governance and financial issues it is dealing with.
Muirhouse revealed that a significant proportion of its tenants’ homes will not be compliant with the Scottish Housing Quality Standard (SHQS) by 31 March 2015, something which the regulator said calls into question the completeness and accuracy of the returns which Muirhouse previously submitted. It also has financial implications for Muirhouse which have not yet been quantified.
The manager and appointees to the governing body are for a period of six months, though could be extended if necessary, and will be accountable to the regulator.
Ian Brennan, director of finance and risk, said the action was taken to protect tenants’ interests.
He said: “Muirhouse’s poor governance and financial management present an immediate risk to tenants’ interests, to public and private funders’ confidence and to the reputation of RSLs.
“Muirhouse currently does not comply with our standards of governance and financial management. Our appointment of a manager and our action in strengthening the governing body is the most proportionate way we can ensure that Muirhouse has the support it needs to meet the standards required.”
A statement from Muirhouse Housing Association said: “The association is going through considerable change at the moment due to the impact of borrowing over £8 million to provide 122 new homes in Muirhouse. This significant increase requires that the Association reviews its governance and financial control arrangements to ensure compliance with all regulatory and financial requirements.
“This engagement notification does not affect the day to day operation of the organisation. During this improvement period, service to our tenants and others will continue as normal.
“All tenants of the association will receive a letter from us in due course to provide more detail and reassurance.”
A regulation plan has been published which describes how the regulator will work with Muirhouse to resolve these issues.
Meanwhile the regulator has moved Loreburn Housing Association down to a medium engagement level after it made “significant progress” regarding its governance issues.
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NATIONAL:Benefits cap ‘getting more people into work’, says DWP research
A study for the Department for Work and Pensions (DWP) found those affected by the cap were 41 per cent more likely to get a job than people who were unaffected.
The research shows that 38 per cent of those capped said they were doing more to find work, a third were submitting more applications and 1 in 5 went to more interviews
It also found where households said they intended to seek work because of the cap in February 2014 (45 per cent) by August the vast majority of them (85 per cent) had done so – 2 in 5 (40 per cent) of those who said they had looked for work because of the cap in February actually entered employment by August
Work and pensions secretary Iain Duncan Smith (pictured) said the benefits cap was "changing attitudes and behaviour".
He said: “By putting an end to runaway benefit claims and introducing a system which guarantees you will always be better off in work, we are incentivising people find employment. Every month hundreds of people who have been affected by the cap are making the positive move into work – gaining the financial security and esteem that comes with a job and a pay packet.
“As part of our long-term economic plan, we’ll continue to support people to break free from welfare dependency so they can look forward to a better, more secure future for themselves and their families.”
The Institute of Fiscal Studies said savings from the cap were "small".
It said the cap affected about 27,000 families in the UK - which represents less than 1 per cent of working-age families who receive housing benefits - and saved around £100m a year.
NATIONAL:Supreme Court to hear ‘most important homelessness case for years’
The appeal, which will be heard from 15-17 December, involves three cases (Johnson, Hotak and Kanu) and deals with the way in which local authorities assess the vulnerability of housing applicants when deciding who to prioritise for housing assistance.
In what is likely to be one of the most significant cases on homelessness for many years, submissions will be made by charities Crisis and Shelter.
Both are seeing a rise in rough sleeping and evidence of people in desperate situations being judged by local councils as not being vulnerable. These include women fleeing domestic violence, people with learning disabilities, people with mental health problems and young people forced out of the family home.
Giles Peaker, housing, leasehold and property disputes partner at Anthony Gold Solicitors, who is representing Crisis, said: “This is arguably one of the most important cases on homelessness for a decade. It is the first time that the issue of vulnerability has been tested by the Supreme Court and will have considerable implications for homeless people and local authorities who are required to house those deemed ‘vulnerable’ under the Housing Act 1996.
“The three cases involve homeless people who were not considered vulnerable enough to be prioritised for housing, despite one suffering from mental health issues, another having learning difficulties and other disabilities and in the third case, recovering from drug addiction.
“The outcome of the case is all the more crucial at a time when local authorities are being asked to cut costs further and have limited funds available to house those in need. With the Department for Communities and Local Government seeking to intervene to set out the Government’s ‘long-standing position’, the case is likely to define how local authorities assess the vulnerability of single homeless people, and whether there is a duty to house them, for years to come.”
NATIONAL:Prime minister launches 20 per cent discount boost for first-time buyers
Under-40s who have never owned a property before can register their interest in buying via the Starter Home initiative from the beginning of next year - six months earlier than planned.
A change to the planning system will mean under-used or unviable brownfield land is freed from certain costs in return for a below market value sale price on the homes built on the site.
Developers and councils are being asked to respond to the proposals to ensure the changes will unlock a range of sites across the country.
Mr Cameron said: "Hard-working young people want to plan for the future and enjoy the security of being able to own their own home. I want to help them do just that.
"Under this scheme, first-time buyers will be offered the chance of a 20 per cent discount, unlocking home ownership for a generation.
"This is all part of our long-term economic plan to secure a better future for Britain, making sure we are backing those who work hard and get on in life."
Communities secretary Eric Pickles added: "The 2008 housing crash blocked millions of hard-working, creditworthy people from becoming home-owners, at a time in their lives when they should have been able to expect to get on the property ladder.
"We're turning that around with Help to Buy, but today's new Starter Homes scheme will offer a further boost, giving young people (under 40) the opportunity to buy low-cost, high-quality new homes for significantly less than they would normally expect."
Stewart Baseley, executive chairman of the Home Builders Federation, described the initiative as "another positive step" towards tackling the housing shortage.
He added: "The industry is keen to work with government to develop policies that would allow for more high-quality homes to be built in the right places."
Builders can currently face an average bill of £15,000 per home in Section 106 affordable housing contributions and tariffs.
But under the proposals, developers offering Starter Homes would be exempt from certain charges. The homes could then not be re-sold at market value for a fixed period to ensure the savings are passed onto buyers.
More than 30 house builders have said they support the plans and would consider bringing forward land to develop the discounted houses from next year.
A design panel, including world-renowned architect Sir Terry Farrell, will be established to ensure the new homes are not only lower cost but also high-quality.
Sir Terry said the panel had the potential to make a real difference and would build on the recommendations of the Farrell Review, which highlighted the need for more proactive planning.
He added: "Only by planning and designing our villages, towns and cities together with local communities can we create the kind of built environment we all aspire to and should be demanding."
Shadow housing minister Emma Reynolds said no-one would believe Mr Cameron's promises on housing and home ownership.
The Labour MP added: "He said he would get Britain building but instead he has presided over the lowest levels of house building in peacetime since the 1920s.
"He said he would boost home ownership but instead it's fallen to its lowest levels in 30 years.
"He said he would help the next generation onto the property ladder but instead one in four young people are living at home with their parents in their 20s and 30s.
"The only way to restore the dream of home ownership is to build more homes and Labour has a plan to get at least 200,000 homes built a year by 2020.
"We are in favour of building starter homes but it is not clear how the Government is going to deliver these homes 20 per cent cheaper than market price."
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NATIONAL:Supply of rental properties ‘eases against demand’
ARLA’s latest quarterly report reveals an increase in the average number of buy-to-let properties managed by ARLA Licensed members in the last three months, from 135 properties in the third quarter to 148 properties this quarter – an increase of almost 10 per cent.
ARLA Licensed members believe the number of landlords increasing their investment in buy-to-let properties was driving the improved outlook for supply in the private rented sector, with the number of landlords purchasing properties now exceeding the number selling their investments – a reverse on figures reported three months ago.
Those landlords increasing their investment in buy-to-let properties rose from 27 per cent to 30 per cent in the last three months. Meanwhile landlords looking to sell their current buy-to-let investments fell 9 percentage points, from 32 per cent to just 23 per cent.
Although the increase in available buy-to-let property is a step in the right direction for the private rental market and good news for renters, the bad news is that demand still strongly outweighs supply. Two thirds (65 per cent) of ARLA Licensed member agents said there were still more would-be tenants than properties available on their books, a decrease from 68 per cent last quarter, suggesting that the market could be heading towards a more level playing field.
David Cox (pictured), managing director of ARLA said: “This quarter we’re seeing promising signs that the market is taking small steps towards achieving a better balance between supply and demand, or at least it is easing slightly. With more landlords investing in their portfolios, ARLA Licensed members have reported a growth in supply, while the level of demand witnessed last quarter has fallen slightly. Of course, the market has a fair way to go in terms of completely balancing out.”
The increase in supply is down to more investment in buy-to-let property; however a number of ARLA Licensed members also reported an increase in rental property coming back onto the market following failed attempts to sell, rising for a second consecutive quarter, from 16 per cent to 24 per cent.
As supply and demand levels ease, tenants are taking advantage of the slightly less competitive market – as the number of would-be tenants haggling with landlords over rents increased from 32 per cent to 35 per cent over the past six months.
David Cox added: “It’s great to see an increase in consumers making an active play to agree on rent prices. Letting agents should be able to help tenants to get the fairest deal, and to ensure the process of finding a property, and signing on the line, is as smooth a process as possible. Renting can be a stressful experience; to ensure the best standard of practice and level of advice, always ensure you are using an ARLA Licensed agent. All ARLA Licensed agents follow a strict code of conduct, therefore you are guaranteed the highest professional standards to guide you through the rental process.”
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