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Building the Right Homes in the Right Locations - Has the Industry Really Responded?

28/05/19
Posted by: Christopher Ruddick

We are virtually a year on from the first release of findings in the Letwin review which went on to highlight about the issues of speed of build out, need for greater diversity on developments and training within the industry among a number of other findings.

Following the release of the review many industry bodies, who in some cases aided the review body, responded and in turn released their own interpretation of the review within their specific industry specialism, an example of such is RIBA’s response and ten characteristics that will help meet the findings of the review.

In addition, changes to permitted developments (PD) rights for extensions, which was only temporary in 2013 and was due to run out this year, has now been made permanent measure within PD rights. Ultimately meaning the only consideration being the impact on neighbours around them. 

To put some perspective on how much these rights have been used in temporary form by those looking to increase the size of their homes produces a figure of over 110,000 times by homeowners requiring more space and deciding to extend their homes instead of moving to a new property. 

Therefore, the question for the industry is one of has it really responded to the findings of the Letwin report?

Equally, with the Government changing the planning permission for extensions to a permanent change is this indicative that the industry is failing to build the right type of homes required.

Taking the first question at hand is the industries response. 

The industry performed very well in increasing the number of new homes built last year, but that was still well behind the Government targets for the industry. The critical bit from the Letwin report and industry bodies ultimately is ensuring that these new homes were of the right type, and in the right locations for those looking to buy.

This is where the industry seems to be failing most of all, some of the reasons are fairly obvious, whilst others are more discrete. 

  • The most popular type of home is still a terraced home in the UK, but for those looking for larger “family” homes that are likely to be their second or third homes it stills seems there is a lack of options for them from the industry
  • The industry does not seem to have responded to ways in which they can “entice” and make the process of moving homes easier for those looking for a larger home. 
  • The industry has not highlighted and “exploited” the potential issues and pitfalls of doing extensions over simply moving to a new larger home.
  • There is a failure to cater fully to different age range and periods of life within society by the housebuilders. For example, many retirees are looking to downsize from larger properties to release funds and provide for their future or their families future. However, as it stands there are number finding that the new homes, they are looking at are simply too large or equally too small for their needs. In addition, some of these new builds fail to meet the requirements of the ageing clients and need to be more catered to those with more specific needs and requirements 
  • Failing in many areas to deliver new homes which reflect their local area or simply take various elements of a local distillation to meet planning permission requirements for new homes. The other issue here is that the build out needs to slower to ensure that these off the shelf have a maximum absorption rate in the market and therefore they need to be built slower or be more drip fed on the market to ensure values stay more resilient
  • The homes are not always in the right location – the industry should be taking account of not only that have success now.  But are aspiring areas that have the potential to be areas requiring a greater level of new homes 
  • Greater involvement of the SME’s builders which seems to have not had a significant impact on the number of homes being built in the UK.

We then move on to the Government’s decision to make planning changes for extensions permanent. The Government has promoted these as a suite of changes that should help reduce the issues of the housing crisis, but have they been pushed because the industry is failing to adequately respond to the number of new homes being built?

Chances are to a degree if the industry had truly responded and met the issues then the temporary allowance would have never been made a permanent planning change. 

Whilst the industry has failed in some areas like the above, the Government have almost failed in some areas to adequately support elements of the Letwin review – first and foremost there has been inadequate response and action and equally the Government has failed to support many of the SME builders with a policy that helps provide easier sources of funding for these smaller builders.

These SME’s would help promote greater competition and potentially these smaller house builders can provide new homes that fit the area they are in significantly better than larger builders off the shelf designs tweaked to meet various requirement of planning permission. 

The failure of Government to mobilise these companies is another area that could significantly increase the national output of new homes and maybe the Government needs to take a closer look at how it can best provide support to these companies and not just the larger house builders. Many of which simply do not have the additional capacity to build even more new homes easily.

Putting the issues (and failures) of the industry and the Government there are other issues such as infrastructure, utilities and local planning authorities. 
In regard to infrastructure there is simply not the delivery of these necessary facilities quickly enough and there is a similar problem with utilities not being resolved quickly enough.

The other issue is simply local authorities not having large enough teams to understand, detail and meet all the requirements.

Overall like so many issues in the housing market there a number of factors that appear to have combined to slow progress of responding and implementing the findings of the Letwin review from 2018. There is not one single party that appears to have done everything possible to ensure faster build out and therefore ultimately delivery of new homes in a more timely fashion. 

 
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