All posts from: December 2009
It was the decade of reviews, inspections and targets, stakeholders, policy silos and holistic visions. Here are rest of my top 10 lessons from the noughties.
6) There are limits to homeownership
2000: More than 70% of us own our own homes. By 2005 Gordon Brown is boasting about creating a million new homeowners and pledging to create another million by 2010.2009: The actual total is down 163,000 by the end of 2008. The percentage of households who own has fallen to 68.3% - lower than when Labour took power in 1997 - and the first decline since records began. Given that the number of outright owners has risen, the fall in the number of families buying with a mortgage is even greater: 500,000 over the decade.
7) Prevention is not always better than cure
2000: Homeless acceptances rising steeply thanks to affordability problems. Legislation in England removes restrictions introduced by the Conservatives and expands the categories of priority need by also introduces ‘homelessness prevention’ and greater use of the private rented sector.
2010: By the end of 2008 homeless acceptances are half what they were in 2000. In 2008/09 local authorities say they helped 130,000 families through prevention and relief work. However, many question the fact that applications and acceptances are still falling even during a recession. A mystery shopping exercise by Crisis accuses some councils of gatekeeping – preventing homeless applications rather than homelessness itself.
8) The decade of private renting
2000: Despite 12 years of deregulation we still seem to be resisting the new golden age of caring landlords and happy tenants. The number of private tenants in Britain is the same as in 1988 when assured shorthold tenancies were introduced.
2010: Thanks to – take your pick - the boom in buy to let, house prices that are out of reach of many, increased use by local authorities and a social housing shortage, private renting is the unquestioned winner in of the noughties. We are on course for a million extra private tenants by the end of the decade. Regulation is struggling to keep up – three years after the introduction of HMO licensing more than half of properties are still unlicensed - but the private rented option helps keep down repossessions.
9) You’ve (almost) never had it so good
2000: Labour’s decision to stick to draconian Conservative spending plans means gross social housing investment in Britain slumps 20% in its first three years.
2009: Successive increases in spending mean investment is at its highest level in 15 years. According to the UK housing review, when private finance and stock transfer investment are taken into account, the total is the highest since 1990. Repossessions were not as bad as in the 1990s crash either.
10) Maybe we should celebrate while we can
2000: Few guess that the noughties will be the first-ever decade of Labour rule. The first few years are all about decent homes, anti-social behaviour and homelessness reforms but new homes are seen as a top priority by the end of the decade - and even council housing is making a comeback.
2010: That 20-year high in investment is just as well, since cuts seem inevitable whoever wins the 2010 election. A Conservative victory looks the most likely outcome and the party is pledged to sweep away many Labour innovations, including regional spatial strategies and targets set from Whitehall, in favour of a new era of localism. The big question is how far the Conservatives will go with a more radical agenda including changes to security of tenure and the homelessness legislation.
Apart from the importance of placing certain names in my blog intros to guarantee more search engine hits, I’ve been pondering my top 10 lessons from the noughties.
The last decade was not all about David Beckham, Angelina Jolie and Osama bin Laden. Apart from learning the importance of placing certain names in my intros to guarantee more search engine hits, I’ve been pondering my top 10 lessons from the noughties.
1) House prices are a one-way bet
2000: Despite the housing market crash of the early 1990s, the smart financial advice is to borrow as much as possible to buy as big a house as possible. Despite the end of mortgage tax relief, profits from main house ownership are still tax-free unlike other forms of investment. Average house price 1999 Q4: £81,596.
2010: Despite the housing market and banking crisis of 2007-2009, prices are rising again thanks to record low interest rates and government support schemes. The market looks set to stagnate but the smart advice is still to borrow as much as possible - especially since the government will bail you out if prices crash. Average house price 2009 Q3: £161,280
2) Being a chief executive is not too bad either
2000/01: Anchor Trust chief executive John Belcher is scraping by on £162,000 a year. Another 20 of his peers also get six figure deals.
2009: By now on £391,000 including a £111,000 bonus, Belcher quits ‘to pursue other business interests’. The bonus alone is more than the total cost of the £10 Christmas bonus Anchor traditionally pays to its 10,707 staff - except that weeks later that is scrapped. Salaries of the 10 highest paid chief executives are up 91% since 2001.
3) Never be too quick with an obituary
2000: With local authorities restricted to stock transfer, the private finance initiative or arm’s length management as options to meet the decent homes target, the end of council housing was predicted by the end of the decade. Ministers ignore Labour conference votes between 2004 and 2006 for a fourth option of stock retention.
2010: Councils still own over 2m existing homes, Labour and Conservative are both bidding to build new ones, and reform of the housing revenue account is set to give them greater freedom still.
4) The penny finally dropped on new homes
2000: The final frontier. Total starts of new homes in England are stuck at under 150,000 a year. Private housebuilders complain of red tape while the government does not see new affordable homes as a problem compared to the condition of the existing stock. Labour’s decision to stick to Conservative spending plans means starts of affordable homes slump to just 11,000 in England in 2001.
2005: We have lift-off. Barker review convinces ministers that new homes are vital for economic competitiveness and a target of 240,000 net additional homes a year is set.
2009: Houston we have a problem. The housing market crash and financial crisis prompt a slump in starts and a search for the last time they were lower that settles on the early 1920s. Starts this year could be less than 100,000.
5) Green became mainstream
2000: The Kyoto Protocol, a flawed international treaty, is starting to have an impact but sustainability still seems more about a few pioneers building houses out of hemp and bales of hay. Most people assume ‘zero carbon’ is something out of Star Trek (it does not get a mention in Inside Housing until 2004). Car journeys, air travel and consumption of energy-guzzling gadgets are all rising.
2010: Another flawed international summit at Copenhagen exposes international divisions. At least the UK is leading the world in something with its pledge to make all new homes zero carbon by 2016. But concern is mounting that their inhabitants’ lifestyles will not be as zero carbon as their walls and roofs. Car journeys, air travel and consumption of energy-guzzling gadgets are all still rising.
Part 2 to follow on Wednesday..
Could the financial crisis finally pave the way for a change in the public borrowing rules that would benefit council housing?
That’s the intriguing possibility raised by Steve Wilcox in a chapter in this year’s UK Housing Review that also cuts through all those mind-boggling numbers about government debt.
Until the crisis hit, the UK operated its own public borrowing rule - that public sector net debt should not exceed 40% of gross domestic product (GDP).Council housing was treated as public debt.
But the rest of Europe has operated a different rule since the Maastricht Treaty - that general government (gross) financial debt (GGFD) should not exceed 60% of GDP. Under this system, council housing departments are treated as public corporations and their borrowing is not included in the total. This is the basis of the long-cherished hope that reform of the public borrowing rules could free up investment.
Since the crisis, the UK rule has been suspended and all that borrowing for the banking bail-out treated as a special case. If it adopted the same system as the rest of Europe government-owned banking interests would also be treated as public corporations - a clear incentive not to go back to the UK system as it was.
Wilcox argues that in practice the UK’s borrowing options will be ‘constrained by the “court” of international financial opinion’ and that the markets all ‘focus on internationally recognised general government financial measures’.
‘The case for a change in the UK fiscal rules is particularly pertinent to the housing sector,’ he says, ‘since, if the UK adopted EU-style general government based rules then borrowing for council housing would not count against the primary fiscal measures, and in that sense the council housing sector would be in the same position as housing associations.’
So far, so good. Except that the financial crisis has transformed the UK from being one of the EU countries with the lowest GGFD (just over 40%) to one of the highest (91% by 2013). That still makes us better off than the Greeks and Italians but way higher than the 60% target. And while the UK’s debt servicing costs are lower now than they in the last two financial crises - the mid-1970s and early 1990s - there is still scope for them to rise if international concern grows about our levels of debt.
Elsewhere in the review, Wilcox argues that overall investment in housing (including private finance and stock transfer proceeds) was the highest since 1980 with the single exception of 1989/90, when there were huge right to buy receipts.
Put those two facts together it looks like the change in the rules change could finally happen amid the bleak future predicted by the Chartered Institute of Housing ahead of publication of the review.
Happy birthday right to buy! But isn’t it about time you left home?
The controversial policy turns 30 on Sunday. But rather like one of those boomerang boys who stay at home into the late 20s and beyond, it seems to ignore any hints from mum and dad that it might be an idea to think about moving on.
The Housing Bill that introduced the right to buy was published on 20 December, 1979. More than 2.5m homes have since been sold off in Britain. Research from HSBC today says local authorities received £45bn for homes worth £85bn, with buyers receiving an average 47% discount.
The arguments for an against have been rehearsed over and over again in those 30 years. In the blue corner, the right to buy gave millions of working class households the chance to own their own home for the first time. It can probably claim to be the most popular housing policy ever and changed the housing landscape for ever.
In the red corner, a high price was paid for all that. It cut off the supply of lettings to new households and increased waiting lists and homelessness. It residualised council housing. And it saw billions of pounds sucked out of the housing system that should have been used to build new ones.
Over the years, and especially since the rules on capital receipts and discounts were changed, more nuanced arguments have appeared. On the right, even Thatcherites have admitted that the policy had its faults - Iain Duncan Smith even said earlier this year that it was one of the reasons behind so-called ‘broken Britain’. On the left, it soon became clear that being seen to oppose the aspiration to homeownership lost votes by the sackful. Housing professionals had to work with the policy and accept the reality that they cannot tell tenants what to like and what not to like.
Meanwhile the right to buy is a shadow of its former self. The first 25 years of the policy saw up to 180,000 homes a year sold off. Thanks to rising house prices, falling discounts and a dwindling supply of homes to sell, the total in 2008 was 10,630 and it looks to be even lower this year.
Facing the axe in Scotland and possible change in Wales, the right to buy is also the subject of a fierce debate in England. Within the last year, Tory think tanks have put forward ideas including rewarding well-behaved tenants with a stake in their home, letting tenants on housing benefit capitalise it to buy a stake and giving tenants a right to move. Housing organisations have been working hard to develop the idea of equity stakes ever since Labour promised them in its 2001 manifesto. John Healey’s speech to the Fabian Society was full of thinking about ‘new choices’ in tenure.
Some of the furniture piled up in the garage may be secondhand but it’s ready to help you get a place of your own, right to buy. Isn’t it about time a 30-year-old stay-at-home kid stopped staying in bed all day and raiding the parental fridge?
The consultation paper on housing benefit reform ticks many of the right boxes and hints at the right u-turns with one big exception: shortfalls.
Work incentives? Check. Letting claimants keep their full housing benefit payments for three months after moving into work and setting fixed awards for up to six months should indeed ‘remove some of the uncertainty that goes comes with going back to work’.
Expensive properties (aka getting the tabloids off our back)? Check. Excluding rents on the most expensive properties in an area from local housing allowance calculations seems like a good idea and should mean fewer stories about £2.8m homes in Notting Hill.
Defusing the row about the withdrawal of the £15 excess payment? Check. It may be a somewhat embarrassing u-turn but the issues are more complicated than they seemed at the time and reviewing the decision for a year also dumps it into the in-basket of the next work and pensions secretary. Why not just stop it for new claims though?
Direct payment to landlords? Possibly. Yvette Cooper told the Commons yesterday that ‘it is important that the choice should lie with the tenant, not simply with the landlord because that has been an important way of empowering tenants and giving them more choice’ and there is still a determination to avoid what Malcolm Wicks called being ‘careful that we do not re-reform housing benefit purely in the landlord’s interest’.
However, the consultation paper says ‘we would also like to consider returning an element of choice to customers which would enable them to decide to have their benefit paid directly to the landlord’ and floats the idea of linking that to landlords improving the energy efficiency or quality of their properties. Quite how and whether that would work remains to be seen.
Shortfalls? No mention - understandable perhaps in a consultation focussing on ‘supporting people into work’ but surely a problem that needs to be addressed urgently.
Only last month a survey by Shelter and the Money Advice Trust indicated that 60% of tenants receiving local housing allowance found that it did not cover their full rent. In areas like Notting Hill the problem may be expensive properties with expensive rents but in areas like Cambridge the problem is whole areas where tenants cannot afford the rent and are left with a shortfall.
The consultation paper does discuss the problems with broad rental market areas and floats the idea of setting rents in smaller, ‘more tailored’ areas. That might help but the proposal is made with more expensive rents in mind and it could even make the problem worse in some areas.
The problem is that nobody knows for certain how big the problem is. As Liz Phelps of Citizens Advice points out: ‘It’s very difficult to assess the various options without any knowledge of what the levels of shorfall are and the government should publish these.’
The sooner, the better.
Housing associations look away now. Just two months after a fall in the retail price index (RPI) triggered rent cuts from next April, inflation is rising again - and a change to the way it is calculated will really rub it in.
The RPI hit +0.3% in the 12 months to November compared to -0.8% in October. That 1.1% rise in one month was the biggest in 20 years and was mainly thanks to petrol prices. The figure in September was -1.4%, which means a 0.9% cut in rents from April under the RPI plus 0.5% formula.
The UK Statistics Authority is also about to implement a change to the treatment of mortgage interest payments within the RPI. As I read it, if it had it been in force two months ago rents would not have to fall in April and if it been in place in September 2008 rents would have risen even more this year.
Under a proposal that is out for consultation for introduction in March 2010, the RPI will use the average effective rate (AER) to calculate mortgage interest payments rather than the standard variable rate (SVR).
The idea is to reflect better the actual rate that borrowers are paying and in most years would not make much difference to the overall RPI rate. However, the gap between the two has been growing ever since interest rates started falling in late 2008 (presumably because the banks are charging a higher margin on their loans).
The SVR-based RPI fell to -1.6% in the summer - but an AER-based RPI would not have gone below -0.5% and not triggered a rent cut next April. Similarly, AER-based RPI would have been higher in September 2008, triggering a bigger rent rise last April.
Housing associations may already have moved on and be busily looking over the loopholes flagged up by the Tenant Services Authority. However, it’s yet another illustration of the absurdity of setting rents according to a formula that is so heavily influenced by the one thing tenants do not pay - mortgages.
When was the last time a housing minister said that a fall in homeownership might be a good thing? Or at least not a bad thing?
John Healey’s speech to the Fabian Society got me wondering and I’m struggling to think of one in the last 50 years. Even when governments were building hundreds of thousands of council houses per year they also wanted to see an expansion. And apart from anything else the last six years are the only time homeownership has ever fallen.
His speech was an attempt to map out what the post-credit crunch world - the ‘new normal’ will look like. ‘As we look to a future beyond the global recession, this is the time to ask what the future will look like in housing, and what role we want Government to play in shaping that future. We know that the world has changed economically and it won’t go back.’
He pointed out that homeownership had already fallen from 70.9% of households to 68.3% today. ‘Some point to the recession having shaken people’s desire to invest in bricks and mortar. But in reality, homeownership had been dropping since 2005. And I’m not sure that’s such a bad thing.
‘At the moment, up to 70% of the population has their money tied up in property. The proportion was boosted by Margaret Thatcher’s right to buy. But you don’t need to be a grocer’s daughter to know that it’s not a good idea to have all your eggs in one basket.’
But Healey does not stop there. Pointing out that almost a third of people are relying on the value of their home to top up their state pension, he goes on: ‘Not only is this property piggy bank unsustainable, it is also unfair…as housing wealth is passed from parents to children, inequality is compounded over the generations.’
Familiar stuff, maybe, to anyone who works in housing and in tune with the private view of previous ministers but this is pretty revolutionary from a party that until recently seemed to have little to offer except ever-increasing homeownership subsidies.
Healey’s solutions are more choices in tenure and more flexibility, the chance to sell equity back to a council, housing association or co-operative as well as buy it and even reform of taxation.
‘One great advantage of homeownership is that it allows you to build an asset and benefit from increasing property prices tax free. That’s why so many people choose to make their home their family’s main investment. If we want to make renting an equally valid option and an equally privileged option for those who want to rent, we need to extend that opportunity. That could be done with tax free savings for those who are renting, a deposit for homeownership in the future, a bond for renters to build assets and store wealth as homeowners do.’
His ‘egalitarian vision’? ‘Housing in the period beyond recession will be fairer, with a reducing divide between the housing ‘haves’ and ‘have nots’… Renting will be more stable, more secure, of a better standard, and probably more common an option as it is for people elsewhere in Europe. Changing tenure may not mean changing your home, with options to release and buy back equity and convert from renting to owning with government help. There will be more and new options for those on lower and middle incomes, those who are less likely to get access to social housing at the moment. And the type of home we live in will become less of a marker of our economic status.’
That’s brave stuff. Not only does it go against all conventional political wisdom - Grant Shapps is already tweeting ‘Housing Minister confirms that if you work hard, save hard & have aspirations for your family - Labour no longer for you’ - but it also contradicts what his own boss said just four years ago. Homeownership has indeed been dropping since 2005 but that was the year Gordon Brown pledged to create a million extra homeowners by 2010.
Healey says he set out to make housing ‘more visible and more political’ and he is certainly succeeding in both. The big question is whether the ‘new normal’ really as different as he thinks.
It’s not the idea of red flags flying over Tory councils - Labour and Lib Dem authorities get them too - but that one of them goes to Conservative Hertfordshire for planning for new housing. Hertfordshire is of course the home patch of the man leading the Tory fight against exactly that policy: shadow housing minister and MP for Welwyn Hatfield Grant Shapps.
‘The county has been allocated large targets for new houses and jobs,’ notes the assessment dryly. Those are of course exactly the targets that Shapps has opposed nationally - and locally in the ‘no way to 10k’ campaign.
The red flag assessment says that:‘Despite more affordable housing being a priority, plans for the delivery of housing in the future are underdeveloped. There is not a comprehensive assessment of what Hertfordshire’s housing needs are. The range of organisations involved in housing provision have not effectively coordinated their work to produce clear plans for how housing need in Hertfordshire is going to be met. This means that currently, the prospects of meeting the area’s housing needs are weak.’
I suspect that the assessment - which in fairness also notes that Welwyn Hatfield was one of the districts that ‘built more homes than they were targeted with’ - is not going to change many people’s minds. Conservatives will see it as yet more evidence that top-down targets do not work whole Labour supporters will see it as proof that scrapping them in favour of localism will just mean fewer homes.
However, it would surely be enough to convince the Tories to scrap the whole process of comprehensive area assessment - if they hadn’t promised exactly that already.
And perhaps with good reason. One of the other red flags goes to my home authority, Cornwall Council, for housing provision and quality in general and lack of affordable housing in particular.
The council has some pretty spectacular incompetence since being it became the unitary authority for the whole county in April, but it’s hard not to sympathise in this case. Affordable housing is indeed in desperately short supply but as the chair of the local strategic partnership, Blair Thomson, points out: ‘This is a totally unfair criticism as the amount of affordable housing we can build is entirely dependent on the level of funding we receive from the government…The government has short changed the South West in this area and it is outrageous that they are now criticising us for a situation they have created.’
One of the ways housing associations in the county are tackling the problem is through local housing trusts. Just to tie things up neatly, Shapps is in Cornwall today to talk about them in a village that has one of the highest concentration of second homes in the country.
However, he gets a personal red flag from the National Housing Federation, which argues that his requirement for a 90% positive vote by local people to set up a trust could ‘hand a veto to rumps of local nimbys’.
It’s clear from yesterday’s pre-Budget report (PBR) that the housing market is delivering some rare good news for the government - not just politically but financially too.
The political good news has been clear for some time. There may still be 48,000 repossessions this year but that means the rate at which people are losing their homes is around half that seen in the depths of the last housing market crash in the early 1990s.
That’s a stat you can expect to hear over and over again as the government hammers home the point that it acted when the Tories did not. ‘In the early 1990s, hundreds of thousands of families lost their homes,’ Alistair Darling said yesterday. ‘I did not want to see this repeated.’
The financial good news is more unexpected but it’s the direct result of the recovery in the housing market over the last six months. The fine print of the PBR shows that the Treasury now expects its take from stamp duty this year to be £2.5bn higher than it forecast in the Budget in April. The forecast for 2010/11 is £2.6bn higher. And it’s not just stamp duty - the Treasury also gains from increased inheritance tax and VAT on housing-related consumption.
Some stamp duty comes from share transactions but the lion’s share of it comes from home sales. The total take will still be around half what it was before the crash but with financial pressures all around it’s a welcome boost.
Up to £5bn over the next two years really does put the cost of all the support measures into perspective. While the stamp duty holiday, low interest rates and homebuy direct have had a direct impact, there have also been far fewer distressed sales thanks to those lower repossessions.
Today’s pre-Budget report sees the government congratulating itself on the rescue. Now for the really difficult part: the recovery.
Chancellor Alistair Darling was able to boast in his speech that ‘repossessions are now running at around half the rate they were in the early 1990s’. I wonder which party was in power then.
And he announced that some of the time-limited support measures announced in the aftermath of the banking crisis will continue, including improved income support for mortgage interest for a further six months.
‘There will, of course, be a cost to this and other continued government support,’ he said. ‘But the cost to families of losing their home would be immense. And it would be a false economy for the country. For the more successful these measures are in restoring confidence to the housing market, the lower the cost will be to the exchequer.’
While the stamp duty holiday will finish as planned at the end of the year, HomeBuy Direct will continue into 2010/11.
However, buried deeper in the pre-Budget papers and not mentioned in the speech itself are plans for a housing recovery strategy ‘to support a timely and effective housing supply response through the recovery, in order to maximise delivery of high quality, energy efficient homes’.
The strategy has five key elements:
- Boosting land supply with checks, incentives and penalties for local authorities depending on how they handle their five-year land supplies
- Reducing regulation by ‘scaling back section 106 requirements’, looking at the ‘case for and form of regulation on Lifetime Homes’ and not making it mandatory until 2013 at the earliest and ‘establishing a national baseline for total regulatory costs by Budget 2010’.
- Studying the drivers of housebuilding growth and what can be done to improve ‘diversity and innovation’.
- Enhancing the role of local authorities in building new social housing ‘including examining the scope for local authorities to borrow against the revenues from new council homes to support the delivery of housing where this offers value for money, and considering interactions with wider reforms to the council housing finance system’.
- Reforming the delivery of infrastructure for new homes.
That raises all sorts of intriguing possibilities. The second point sounds like ministers have been listening hard to housebuilders’ complaints about regulation. It remains to be seen what scaling back section 106 means but the Lifetime Homes decision represents a u-turn on the targets announced in January. Might that national baseline lead to some kind of movement on the code for sustainable homes too?
The fourth point sounds like local authorities might be able to win extra freedoms for council housing beyond those announced so far.
But the pre-Budget report was not all about homeowners and housebuilders. Council tenants will see a cut in their rent rise from April 2010 while private tenants receiving excess local housing allowance have won a one-year reprieve.
After hopes were dashed in the Queen’s Speech, private tenants looking for extra protection when their landlord is repossessed could hardly have hoped for a better MP to top the ballot to introduce private members bills. The Protection of Private Tenants (Morgage Repossession) Bill proposed by Brian Iddon looks to have a good chance of success despite the fact that the parliamentary session will be cut short by the election. He has backing not just from groups like Shelter and the Chartered Institute of Housing but also from housing minister John Healey who has pledged to ‘work with him closely on this important legislation’. The Conservatives have also previously called for action on the issue. The Labour MP for Bolton South East said that he had received hundreds of representations from worthy causes but it sounds like housing was always going to get his attention. ‘As a former chairman of Bolton’s housing committee for 10 years, I came into Parliament in 1997 to campaign on housing policy,’ he explained. ‘This government has taken action to improve housing in this country and to ensure that there is support for home owners in difficult economic conditions. In this, my last session of Parliament before I retire, I am going to use my privileged position to close a loophole to protect tenants living in privately rented accommodation.’He’ll be following in an honourable tradition of private members bills that includes probably the most important of all housing legislation – the Housing (Homeless Persons) Act 1977 introduced by Liberal MP Stephen Ross.But the store cupboards at Westminster are also stuffed with private members bills that never made it into law and are still gathering dust: bills to ban garden grabbing, link infrastructure to new housing development and give new rights to housing association tenants all failed in 2007.Private tenants could now get at least two months’ notice when their landlord is repossessed thanks to Iddon’s bill. At least 2,000 tenants, and probably many more, were affected this year.However, the Queen’s Speech also left out the wider controls on dodgy landlords recommended by the Rugg review. Those will have to wait until after the election.
What is it about timber frame that induces such a sense of déjà vu?
Inside Housing’s coverage of the Peckham fire brought back memories of the Colindale fire in 2006. Both involved homes under construction – just like others in Dungannon and Edinburgh in 2008.
And all of them trigger memories of the World In Action TV documentary in 1983 alleging that defects in workmanship made timber-frame homes more vulnerable to fire and rot.
Despite vigorous denials from the industry and independent tests that appeared to support its case, the documentary effectively destroyed timber frame in England for a generation. Its share of new homes collapsed from up to a third of the market to about 6%.
The answer seems obvious when you look at any sentence that includes ‘timber’ and ‘fire’ yet the déjà vu seems especially strong in England. Elsewhere in the world timber frame continued to dominate, accounting for 90% of new homes in North America, Australia and Scandinavia and 75% in Scotland.
Almost a quarter of a century later and timber frame’s market share in England is growing again rapidly, especially in social housing following government and Housing Corporation encouragement of modern methods of construction.
Thanks to its speed of construction and strong environmental credentials, by 2005 timber frame accounted for 58% of all new social housing and 16% of new private housing.
With private sector starts plummeting in the recession, its overall share reached 25% in 2008 and it may even be back to pre-World in Action levels this year.
All of which makes the need for answers after the Peckham fire all the more urgent – especially for housing associations and their tenants but equally for the timber frame industry and its supporters in government.
And that search for answers has to include the way that housebuilding sites are managed and the procedures for checking the quality of work in new buildings. It’s not just déjà vu to point out that modern methods of construction are only as good as the people using them.
Remember Gordon Brown’s 2005 pledge to create a million extra homeowners by 2010? A new compendium of stats confirms that by the end of 2008 there were 163,000 fewer.
In what seems like another era now, the then chancellor Brown and deputy prime minister John Prescott launched the government’s plans for Extending Home Ownership in May 2005. ‘We are determined to build on the one million more home owners since 1997 to reach two million by 2010,’ said Brown.
Housing and Planning Statistics 2009 shows that the number of owner-occupiers has actually fallen every year since then and that the decline is accelerating. The 105,000 fall in 2008 was almost certainly the biggest fall in home ownership in history. In contrast, despite far more repossessions, it grew in each year of the early 1990s.
Given that the number of households rose by more than 200,000 during the year, the fall in the number of owners translates into an even bigger fall in their percentage share of tenure, from 69.6% in 2007 to 68.3% in 2008. That’s significant because it is lower than the 68.6% who owned when Labour took power in 1997.
The figures are even starker than that when you consider that the number of people who own their homes outright grew during the year. The number of households buying with a mortgage fell by 250,000. Some 37.3% of households are now buying with a mortgage, down from 38.9% in 2007 and 42.2% in 1997.
Where are the non-owners going? The number of social renters edged up by 40,000 in 2008 but the number of private renters grew by almost 300,000.
Private renting’s share of tenure rose from 12.7% to 13.9% in 2008. Granted, the tenure has seen its share rise in every year of the noughties but that is a remarkable increase in a single year. To put it in some kind of perspective, in the ten years after the 1988 Housing Act deregulated the sector the number of private renters only grew by slightly more than in the last 12 months.
Labour can still claim to have created a million extra homeowners - it already had by 2005 - but it is well on the way to creating a million extra private tenants too.
It may have an unfortunate acronym that conjures images of dismal singalong sessions and bingo but the Housing Our Ageing Population: Panel for Innovation (HAPPI) picked a good day to publish its call for action.
While the Care Quality Commission tells eight local authorities they must urgently improve their social care services for adults and warns that one in four care homes are adequate at best, residents of homes their councils’ decision to remove their live-in wardens in the High Court.
Both developments illustrate the complexity of housing provision for older people and the way it has to cope with a whole spectrum of care - which can only increase as millions more of us get older - and the need for a much more ambitious strategy in future that creates many more options than staying put in an unsuitable home or going into a home.
As HAPPI’s report today argues,, that should be a national priority. That’s not because of what the statistics say about the future - the number of over-60s is projected to increase by 7m in the next 25 years and more than half of the babies born now will live to be 100 - but because it can help improve the housing system as a whole.
The panel concludes that while action is being taken to improve the quality of life of the ‘older old’, little is being done that appeals to the ‘younger old’ with lesser care needs, who comprise the majority of the over-65s. They constitute a ‘massive, growing and unsatisfied market’ and yet already have more than £600bn worth of housing equity.
Giving them a desirable alternative to an existing home and garden that may have become a burden would deliver wider benefits too, the panel points out. Some 37% of UK households under-occupy and half of those (3.3m) are in the 50-69 age group.
The panel found plenty of inspiring examples in visits to European housing schemes for older people and identifies the key design elements for a new generation of schemes here - not just space and flexibility inside, but balconies and outside space, shared facilities and hubs and not just the homes but places too.
Its a message that should be heard loud and clear by central and local government, housing associations, developers and architects - and by older (and younger) people too.
The idea behind eco-towns was always too important to be lost in the storm of protest that greeted the original proposals so can the second wave announced today restore some of its sheen?
The big difference this time seems to be that the proposals are going with the grain of the planning system rather than against it. The original rules tried to ensure that schemes were additional to those already earmarked in local plans but that left them vulnerable to the charge that they were undemocratic.
This time around, apart from two schemes that will be redesigned to meet eco-town standards, most sites seem to be already identified in local core strategies and regional spatial strategies.
Another idea behind the original plan was that only freestanding new communities could generate the sort of behavioural change that would lead to truly sustainable living. That was always a problematic argument because without connections to public transport what was to stop them becoming dormitories for commuters with cars? That too seems to have been scrapped this time and a majority of the new proposals seem to involve urban extensions.
That plus the work being done to ensure that eco-towns embrace all aspects of sustainable living - the latest guidance on biodiversity was published by the Town and Country Planning Association today - appear to augur well for the future.
It remains to be seen what their fate will be under a Conservative government but localism should mean that if local authorities are in favour they should get the chance to succeed.
Another month, another rise in house prices that would have seemed inconceivable a year ago.
The Nationwide index published this morning shows that prices rose 0.5% in November, the seventh successive monthly increase. Prices have now gained more than 10% since they reached their lowest point in February. If they continue to rise at the sort of rate seen over the last six months they will be back to peak levels by early 2011.
The Nationwide sees two key reasons for the trend apart from a continuing shortage of homes for sale. First, unemployment has not risen by as much as economists expected because in many cases employers have opted to cut hours and pay rather than jobs. Second, record low interest rates mean that borrowers can still afford to pay their mortgage even if they have been forced from full-time to part-time work.
The dramatic effect of those low rates can be seen in the Nationwide’s index on affordability for first-time buyers, which measure mortgage payments as a percentage of take-home pay. Taking 1985 as 100, the index peaked at 136.2 in late 2007 then fell progressively to just 91.6 early this year. Despite that 10% increase in prices, the index will probably still end the year at less than 100.
So how long can the mini-boom continue? Mortgage approvals, which were rising strongly in the spring, are now only edging up slightly. That is already being reflected in the Nationwide index, with the three month on three month rate slowing from 3.8% six months ago to 2.8% now.
Figures published by Hometrack yesterday show that the price rises so far have been seen in only 40% of postcodes and that those are concentrated in London, the South East and South West. In the East Midlands, Wales, Yorkshire and North, less than 20% of postcodes have seen rises. While the percentage of the asking price continued to rise in November, Hometrack said the time taken to sell had started to plateau and that price rises were likely to slow down.
Prices remain out of kilter with earnings but it would take rising unemployment or house sales or interest rates, or some combination of the three, to trigger another fall.
The consensus of forecasters now seems to be at least two years of minimal growth in prices - but then the consensus this time last year turned out to be hopelessly wrong.