Memorandum from The Housing Forum (CRED 39)

 

1. Achievement of the Government's housebuilding targets and the financial viability and ongoing business of housing associations

 

a. In the specific circumstances we are dealing with housing associations will not be able to fill the gap left by the decline in private housebuilding production.

b. Housing associations deliver a relatively small amount of new units each year, and are in any case are subject to the same market pressures as private housebuilders as their development business model is based on cross subsidy from market sale.

c. In recent years the majority of affordable units have been supplied via Section 106 agreements anyway, which will tail off. Housing associations are likely to need increased grant levels if they are to build the same or more properties that they have been up to this point.

d. We would urge caution about encouraging housing associations to pick up 'bargains' under the housing package that do not offer long term value in terms of increased long term maintenance costs. This also applies to making sure that associations continue to procure in general on value rather than on lowest cost.

 

2. The relationship between standards and the regulatory burden on viability

 

a. The cost of increased standards has been met through houseprice inflation in recent years. As this cannot happen in a period of reduced house prices, the Government may need to prioritise the various regulatory burdens in order to keep housebuilding viable. There would seem to be tacit acceptance that housing associations are being allowed to buy properties built to lower standards under the housing package. We are not advocating the jettisoning of standards, but there does need to be a more open debate, particularly over the financial burden and its effect on viability.

b. Over the past 18 months The Housing Forum has done a lot of work on the sustainability of the existing housing stock. It would be sensible to shift some of the emphasis places on enhancing the sustainability of new build properties to the far larger existing housing stock. A reduced new build market will not deliver the efficiencies through volume that had been expected to help meet upper levels of the Code for Sustainable Homes in a cost effective fashion in the near future.

c. Investment in a programme of refurbishment of the existing housing stock would also help to preserve the capacity and skills of the construction industry for when there is an upturn in the market.

d. We would also like to see the utility companies given a greater role in reducing energy and water consumption in both new build and existing housing.

 

November 2008