Housing Development in Review: Three key areas to look out for in 201906/03/19
In this edition of Housing Development in Review—a monthly newsletter which provides an overview of key changes in the housing sector—we review three key developments this year that our experts consider will dominate the housing agenda in 2019.
- The Shelter commission’s report
Shelter’s cross-party commission on social housing was formed in the aftermath of the Grenfell Tower fire and in response to the need to show positive change to restore confidence in the sector. The commission’s report was published on 8 January 2019 calling for 3.1 million new social homes over the next 30 years and an independent consumer regulator to operate alongside the Regulator for Social Housing (RSH). The latter recommendation is stated to come in response to recognition after the 2007/8 financial crisis that the conflicting priorities of a single regulator with a dual role of overseeing economic sustainability and the treatment of consumers will inevitably lead to consumer standards taking a second place to financial regulation. The RSH would operate on the model of the Financial Conduct Authority and focus on its core brief of governance and viability.
Shelter’s report serves to bolster the government’s recent activities addressing the housing shortage, which focus on creating greater funding certainty and enabling new strategic partnerships to build thousands of new affordable homes.
- Growth in house-building by Council-owned housing associations
The London Mayor Sadiq Khan’s Building Council Homes for Londoners fund, launched in May 2018, is beginning to have its intended effect as Councils work out solutions to invest the grant money. Barking & Dagenham Council is planning to use its £25.3 million award to build up to 293 new homes for let through its housing company, Reside, which must be listed as a registered provider in order to use the award. As Barking & Dagenham determine the most effective form of delivery, the 25 other London boroughs awarded a grant last year will be watching closely. Lambeth Council has also in January registered its housing company Homes for Lambeth’s new registered provider, HfL Homes. HfL Homes’ first scheme is with a JV formed of Qatari Diar and Canary Wharf Group and the 70 social rent homes are funded by a Section 106 contribution on a separate site.
- Builders boost sales with bulk deals for registered providers
Inside Housing has reported recently that a stagnating market in the last months of 2018 has led a number of private house builders to offer discounted stock to the housing sector outside of Section 106 deals as a means to boost sales at the year’s end. Continuing uncertainty in the UK property market into the first quarter of 2019 may provide registered providers with further opportunities to work with builders to increase outputs and create a more resilient market.
Taken together, government policy and market conditions indicate that the trend continues towards increasing the supply of new social homes and the growth of opportunities for housing associations in partnership with local authorities and private sector builders. At the same time, there is an increasing focus on the regulation of the sector both from governance and consumer protection perspectives.