Industry reacts with scepticism to housing white paper

The construction and infrastructure sector has reacted with some scepticism to the government’s housing white paper which was announced today.

Nelson Ogunshakin, chief executive of the Association for Consultancy and Engineering, said: “It is welcome news that the government has recognised the enormity of the issues facing the UK with the collapse of its housing infrastructure. We have been under-building for 30 years now and the situation has now got so bad that it threatens the UK economic performance. Nothing highlights this fact more that the fact that the average London home now ‘earns’ almost £10 more an hour than the person living in it.

“Although the industry welcomes today’s white paper, it does not go far enough as the government is failing to deal with a major failing of the housing market, which is the supply of local infrastructure. The current system of raising funds for new infrastructure created by developments is broken, collecting between 5-20% of estimated revenue leaving an 80% black hole in spending. No wonder people oppose new house building in their areas when they are left without investment in roads, schools, GP surgeries and utilities. If the government wants to make a real difference in the housing market, it should make sure infrastructure investments are made to ensure the success of housing developments,” Ogunshakin said.

Andrew Jones, practice leader for design, planning and economics at AECOM, said: “After endless attempts by successive governments to address the UK’s housing crisis, there is now universal acceptance of the desperate need to build more homes. The measures outlined in today’s much-anticipated white paper should go some way towards delivering housing growth. The government’s support for off-site construction is particularly encouraging. 

“The promise to free up more public sector sites for development is nothing new, but providing local authorities with more compulsory purchase order powers could lead to a welcome gear shift if there is support for local authorities to use those powers. Reducing the timescales for developers to implement a permission for housing development from three to two years is also encouraging. Improving speed of delivery will be crucial to enable a meaningful influx of new homes. 

“The absence of a comprehensive review of the green belt is a missed opportunity and central government should have been bolder on this issue. Selected green belt sites can play a valuable contribution to the additional supply of new homes. Leaving responsibility for decisions that affect the green belt wholly with local authorities plays well to local decision-making, but is unlikely to bring forward new schemes quickly. Strengthening the requirement for local authorities to have up-to-date local plans is a step in the right direction, but building a stable supply of homes requires greater emphasis on sustainable, long-term strategic planning. The private sector has a role to play alongside government in boosting the lack of skilled resources within local areas to accelerate plan production. Looking beyond small, incremental increases requires local authorities to plan for up to 25-years in advance, creating well-connected new communities close to transport links in areas where people want to live,” Jones said.

Rajiv Nathwani, director of financial specialists Quivira Capital, said: “Considering this has been delayed by three months, I would have expected much more substance. It was hailed as a great leap forward for home building in this country. Unless they have some big surprises, it just seems like they are promising more consultations. This is yet another paper stating that somebody will do something at some point. There isn’t much now. Incentives and schemes such as help to buy are what we need. They immediately help those looking to buy their first home.”

While the Environmental Industries Commission (EIC) welcomed the white paper, they said that more needed to be done to accelerate brownfield development. Michael Lunn, EIC’s director of policy and public affairs said: “To accelerate the level of house building on brownfield sites, additional funding is urgently needed for local authorities to bring forward brownfield sites which may have additional constraints such as contaminated land. Furthermore, DCLG needs to do more in encouraging local authorities to register all brownfield sites suitable for housing onto the brownfield register.”

Shraga Stern, director of housebuilders Decorean, said: “As a house-builder, we naturally welcome the news that the government has set itself a target of building a million homes by 2020. However, actions speak louder than words. We have seen promises and plans laid out before that have never come to fruition and we need to make sure this doesn’t happen again. For there to be a real change, the government must enforce changes to the planning system and regulations, which act as a stumbling block for many smaller developers.”

Paul Goodman, chairman of the National Association of Commercial Finance Brokers, said: “Today's white paper should have been a solid assertion that small and midsize construction companies are going to get the support they need to start building in serious numbers. Instead, if Sajid Javid's speech to Parliament is anything to go by, it just looks like the government is re-treading old ground. The government's commitment to ‘innovative’ building practices and its re-assertion of the pledges made around the £3bn Home Building Fund is encouraging, but we heard all this last year. What our broker members are seeing on the ground is that funders have a real appetite to financially support these developments - so there's clearly a disconnect.”

Aidan Rushby, chief executive of Movebubble, a London-based app which provides renters with an easy way to find, view, and secure their new home, said: ““This white paper has demonstrated that the government are only slowly opening up to the public’s changing attitude towards traditional property ownership and long-term renting. As such it will ultimately not help UK renters and agents in the long term, or counteract the belief, contributing to the housing crisis, that buying is the only acceptable end goal in consumers’ property journeys.” 

Jonathan Daines, chief executive of online letting agency, lettingaproperty.com, said:  “The government is acknowledging the fact that new thinking is needed if the country is to mend what ministers are now saying is a broken housing market. The white paper is a welcome move, but there’s a long way to go and the government is already behind schedule on its intention to build one million new homes by 2020. Building more affordable housing will take time and given government has fallen short of targets, this white paper needs to consider the support role buy-to-let landlords are playing to prop up this shortfall.”

Click here to download the housing white paper.