ROOF Blog

Housing Minister John Healey and the Local Government Association (LGA) today announced they are launching joint work to look at how councils can deliver new homes to tackle the shortage of affordable housing and help drive economic growth. A new Commission chaired by Lord Richard Best and made up of council chief executives, housing association chief executives and academics, will assess what councils are already achieving and advise on ways councils could play an even greater part helping to build the homes of all types the country needs, as well as extending their strategic housing role to better meet local needs and aspirations. The Commission will report to Government and the LGA in summer 2010.

House prices are up 0.1% compared to February, the smallest margin ever recorded at this time of the year, when prices have never fallen month on month, according to property website Rightmove. The near standstill in prices has fuelled concerns that a decline in the housing market could lead to a slowdown in the wider economy as unemployment, public sector spending cuts and potentially higher interest rates hit the consumer. Both Nationwide and Halifax reported house price falls in February. Nationwide said average prices dipped 1% to £161,320, ending a run of nine consecutive monthly rises. Halifax reported an even sharper fall of 1.5%, with average house prices dropping to £166, 857. It remains unclear whether February’s data was a blip caused by the severe weather conditions in the UK or a more long term trend.

The British housing market is improving at a faster rate than property prices across most of the rest of Europe, a report by the Royal Institution of Chartered Surveyors (RICS) has found. House prices rose in only five European countries, including Britain, during 2009. But other countries continued to suffer a sharp market correction, with prices diving by up to 53%. RICS warned that countries with vulnerable economies would continue to suffer from price falls and depressed markets during 2010. Norway led the revival, with property prices in the country rising by 12% during 2009, followed by Finland at 8% and Sweden at 7%. Britain was the fourth best performing country, with the average cost of a home ending the year 1% higher than it started it, although house prices had risen by 10% from their lowest point in April.

Two of the biggest bellwethers of the housing market yesterday provided mixed messages on the recovery of the UK property sector. While the housebuilder Barratt Developments boasted an improved trading performance and an uplift in selling prices over the six months to 31 December, Travis Perkins, the owner of the DIY retail chain Wickes, reported a slump in annual sales at its eponymous builders’ merchants, and warned that it was unable to predict when the group will return to growth. Barratt Developments’ buoyant update came against the backdrop of stark warnings on the economy and housing market by Kate Barker, a member of the Monetary Policy Committee, on Monday, that the rally over the last 12 months cannot continue.

Britain’s oldest building society is to be taken over by the much larger Skipton Building Society. The Chesham, which was founded in 1845, said that it had been badly squeezed by economic and interest rate conditions and was loss-making at the operating level last year. The society boasts 20,000 members and three branches in the Buckinghamshire commuter towns of Chesham, Aylesbury and Little Chalfont. Skipton has promised to keep the three branches and an agency in Tring open for at least 12 months. There will be no compulsory redundancies among branch staff, but some head office employees will lose their jobs. The deal will require approval from both Chesham members and the Financial Services Authority.

The end of stamp duty relief at the start of the year has helped cause a substantial dip in mortgage lending during January, with just £8.02 billion lent during the month, the lowest level since March 2001. This compares with an average monthly amount of about £18 billion during 2007. The data, released by the British Bankers’ association, are the latest figures to suggest the economy will endure a slow recovery, after signs of optimism at the end of last year. A leading member of the Bank of England’s Monetary Policy Committee warned today that the housing market could be ‘weak’ during 2010.

Applications to build houses across the UK rose in the last quarter of 2009, according to the NHBC. It said applications to build new homes between October and December 2009 rose 64 per cent from 15,879 to 26,078 compared with the same period in 2008. This was driven by the private sector, where applications surged 113 per cent, from 8,646 in the last quarter of 2008, to 18,393 in 2009. Public sector demand saw a six per cent rise, from 7,233 to 7,685. Imtiaz Farookhi, chief executive of the NHBC, said: ‘Our house building colleagues across the industry have shown cautious optimism as they reveal their predictions for 2010. Now the nation’s housebuilders need support from the government as they see their way out of this downturn and try to meet the need for new homes.’

Most Britons believe that house prices will rise this year as the country awaits official confirmation that the worst peacetime recession is finally over. A survey by Rightmove found that 53 per cent of those in the UK believe house prices will rise over the next 12 months, compared with just 10 per cent at the beginning of last year. The sharp upswing in confidence about one of the worst affected sectors during the recession comes prior to the publication of figures tomorrow that are expected to show the economy started growing again in the last quarter of 2009. Economists are predicting that the Office for National Statistics will say that gross domestic product increased by 0.4 per cent, which would mark the official end of the recession following six quarters of contraction.

The UK’s largest privately owned housebuilder said the availability of loans to homebuyers would be a crucial ingredient in a return to a stable housing market. Delivering an upbeat trading statement for the year to December 31, Miller Group, the Edinburgh based building, construction and property company, said it was seeing a gradual improvement in the housebuilding market in spite of a demanding economic environment. ‘Volumes are low but the demand has fallen a long way as the money to buy is not as readily available and the balance with supply is now much more in line,’ said Keith Miller, chief executive. ‘However, if we are to see any degree of long-term stability, it is crucial that the housing market gets a continuing supply of mortgages,’ he added.

A major study on the impact of devolution on the most disadvantaged people and places has shown that despite falling poverty and improving employment levels in the devolved countries, most significant progress has been down to reserved (UK) powers. The research, commissioned by the Joseph Rowntree Foundation (JRF), explore trends in social and economic disadvantage and policy developments in four key areas: housing and homelessness; employment; neighbourhood regeneration and long-term care for older people.