UK housebuilders have been criticised (Dreamstime)
An independent peer has ripped into the “catalogue of failures” of the UK housebuilding industry, which he said is “failing us badly”.
Lord Best, a former director of the National Federation of Housing Associations, criticised the “record profits” of an industry “dominated by a half a dozen volume housebuilders”.
He said he was concerned by the “nation’s abject dependency on the sector”.
Best criticised the housebuilding industry for: “Poor quality in construction and design; miserable space standards; rip-off leases for houses, with escalating ground rents; deteriorating satisfaction of buyers; avoidance of housing for older people, where profits are lower; rejection of brownfield sites and a concentration on the easier greenfield opportunities.”
He also pilloried them for: “Little concept of creating properly planned places; sitting on land with planning consent until prices go ever upward; and, perhaps worst of all, reneging on Section 106 agreements and wriggling out of obligations to provide affordable homes for local people, on opaque grounds of ‘viability’ and housebuilders’ ‘right’ to make at least 20% profit on the deal.”
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Best noted that while major housebuilders’ shares had risen by 127% in the past four years, compared with 21% for the FTSE All-Share Index, he believed that “the private housebuilding sector has lost the confidence of the whole nation”.
The peer said planners needed to be more resolute in facing up to housebuilders, but admitted that “we are dependent on a planning system that has been starved of resources and now sorely lacks the capability to enforce quality housebuilding and place making”.
“We must restore authority and capacity to the planners, who are our front line against the social and environmental costs [or] we will otherwise suffer at the hands of over-powerful housebuilding interests,” he said.
Best said the prime minister’s announcement of a £2bn grant fund for councils and housing associations to deliver 25,000 new homes for social rent was a “recognition of the need to target those who can afford only a modest rent”, but he said it was dwarfed by the extra £10bn provided for the Help to Buy scheme, which would only “feed the housebuilders’ addiction”.
“Sadly… housebuilders [are] apparently too big to displease,” he added.
The peer was speaking at a House of Lords debate on the impact of the government’s policies on availability and affordability of housing, started by Labour’s Lord Smith of Leigh.
A spokesman for the Home Builders Federation said: “Housebuilders have delivered a 50% increase in supply over the past three years and are committed to building even more homes in the years to come and playing their part in solving the nation’s acute housing crisis.
“In addition to new homes, housebuilders are increasingly making billions of pounds worth of contributions to improved local infrastructure and amenities, providing an increasing percentage of the nation’s affordable homes and training and employing hundreds of thousands of people.
“House builders are a key part of the solution to our housing crisis and all people involved in housing supply, including politicians, need to be working together to develop workable solutions to the challenges we face.”
Image: Dreamstime
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The quality of housing is quite good but the design of them is poor. Imagine having a kitchen dining area and no room for a table and chairs. That is not good design.
It’s all in the hands of the Government. It alone can change legal frameworks to open the market to Local Authorities, Housing Associations, Combines and Special Purpose Vehicles to get the market moving.
The Tories are looking for a way to open up the market, well, issuing long-term bonds worked in the past. These low interest, long-term instruments allowed building in the 1930’s which helped overcome the Depression and provide good quality, spacious accommodation for thousands of families.
‘Priming the Pump’ in this way should provide a number of things;
1- a self-sustaining market
2- decent training
3- decent jobs
4- quality housing at affordable rents / costs
5- making use of existing brown-field sites.
Surely, it can’t be that hard?
I totally agree with Lord Best’s analysis of the current house building industry in this country that highlights nothing less than a monopoly situation by a small number of large house builders. The size of plot and living space that the majority of these new properties provide is extremely miserly with an apparent aim to simply maximise profit.
The current state of the housing market could be attributed to a lack of activity over recent decades particularly where volume house builders have owned most of the land available for house building.
The Home Builders Federation response quoted is the usual standard expected that infers how they are doing us a favour, but a little surprising in saying they are ‘committed to building more homes in the years to come’, as obviously that is their business, or perhaps what they actually mean is that while the planning system is in the same vulnerable position as it is now, they can now commit to building more in order to continue making ridiculous profits on the back of a nations need.
It is not the first time that such criticism has been raised against volume house builders recently, therefore Government officials need to take a walk around these quick fix developments and try to envisage them in another 10 – 20 years, particularly where taxpayer’s money is being handed out.
The Home Builders Federation is obviously deluded! It states that there has been a 50% increase in supply over the last 3 yrs, dubious figures I suspect?
As regards the provision of billions of pounds worth of contributions for local infrastructure & amenities, don’t be fooled into thinking that they are giving away profit out of the goodness of their hearts! The only reason they are able to do this is because they are charging extortionate prices, resulting in profits that most businesses could only dream of. Hence their CE’s & directors enjoy stratospheric bonuses.
All this at the expense of the house buyer, who is finding a home increasingly unaffordable.
This is a National disgrace, Government must act, time is of the essence.
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