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10-year plan for housing Blog Post

Addressing the building safety crisis in the 10-year plan for housing

Let’s start with a simple statement of the problem. Around the country, between 9,000 and 12,000 medium or high rise buildings have fire safety problems with their external façade severe enough to pose a risk to life.

Of these, just 1,482 have completed works and just 5,025 have been formally identified. The identified buildings account for 273,000 individual homes, which means there are likely around 500,000 homes overall, which means something like 1.5m people sleep in blocks that might kill them in a fire.

Currently, we’re completing about 10 buildings a month which means that if we don’t speed up, we’ll finish the last building somewhere around 2100 (assuming the sea level rises don’t come for us first).

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And while we have some idea how to pay for these repairs (a messy combination of developers, taxpayers, freeholders and leaseholders), we don’t have anything approaching a financial strategy which matches the estimated £16.6bn price tag of the problem.

Our process of assessing buildings and working out what needs to be done is also deeply flawed, unregulated and currently the subject of predictable scandal.

This is a big problem, and demands a big strategy.

So far, the government has been unwilling to introduce big changes – sticking instead with the basics of the approach the preceding administration set in motion, albeit with some tweaks aimed to make it run faster.

This is not really good enough and represents (in my view) a classic embodiment of the sunken costs fallacy.

The building safety crisis is a complex and multifaceted one which evades a perfect or easy solution. But there are ways of approaching it which are less flawed and easier than the current mess.

The answer is to set up a system which offers three things the current one fails to: consistency, clear funding and control.

The current approach is inconsistent and unpredictable. The use of loose, bespoke guidance same building may be considered in need of remediation by one assessor, and cleared by another. The means of fixing the problem may also be different.

This causes an enormous amount of delay – because different parties fight over exactly what needs to be done to the building instead of just doing it.

A new approach would acknowledge a few simple facts. The first would be that we simply cannot fix every building. A combination of sloppy government guidance and industry malpractice means we have used combustible materials ubiquitously in the built environment for 40 years.

The government’s approach since the very early days of this crisis has been to say that building owners need to work out what to do based on professional assessment, instead of being told what to do by the state.

There is some logic behind this – all buildings are different and prescriptive rules can have messy, imperfect results.

But the reality is that the industry – with all its many conflicts of interest and incompetencies – has proved itself incapable of this task.

It is also true that while all buildings are different, most of them are also quite similar and what is a fire risk in Building A will also be a fire risk in Building B, C, D, E and F.

So we should have a basic, government-mandated system of scoring – with points added for factors like height, building occupancy, cladding material, extent of cladding, presence of combustible balconies and so on and taken off for sprinklers, fire alarms, second staircases and other features which reduce the risk. Score over a certain level, and you would need to bring the numbers down with the addition of risk mitigation – which may or may not involve full building regulation.

The next step is certainty of funding. Building remediation only really gets going when we have agreed how to pay for it. And the current bunfight over responsibility makes that very hard and very slow to define.

The answer is for Rachel Reeves to borrow the cash up front and over a long period of time.

But before someone screams the words “self-imposed fiscal rules” at their screen, she should also create a mechanism for getting it back – a long-term, statutory levy on companies across the various areas of the construction sector which have contributed to the mess.

Thanks to her tweaking of debt rules last autumn, this would actually give the government a pass to write the borrowing off.

And finally, control. In Victoria, Australia, a cladding taskforce has overseen and in some cases directly delivered the works to buildings. A regulator with powers to get a grip on the works, setting timescales and issuing fines for non-compliance, would force those who are delaying unreasonably to pull their fingers out.

Put all of these things together and you would have a system which focuses us on the most dangerous buildings, funds the work for them and gets it done. This does not need to be a process which drags on forever. But unless we take a new approach, it will be. 

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10-year plan for housing Blog Post

It’s time to move away from leasehold in older people’s housing

The Government swept to power with an overwhelming majority last summer and a mandate to deliver change. What better time is there to improve UK housing by reforming leasehold?

An important part of the housing sector in the context of the UK’s ageing population is specialist housing for older people. For example, Integrated Retirement Communities feature comprehensive service offerings such as restaurants, gyms and personal care (as distinct from age-restricted retirement housing with fewer amenities and services). Research from Homes England, published in 2024 and backed by HM Treasury, found that modern housing-with care schemes, such as Integrated Retirement Communities, deliver NHS savings of £1,840 per resident per year given their positive impact on resident health, as well as removing the factors that drive delayed discharges from hospital.

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But what is the right tenure of the future for Older People’s Housing? The independent Taskforce on Older People’s Housing’s, whose final report was published last autumn, recommended the UK look at new tenure models used overseas in order to drive growth in provision, affordability and innovation in the sector. Housing Minister Matthew Pennycook MP noted there is “rightly significant national interest in the Taskforce’s findings”.

Tenure reform in Older People’s Housing is needed not only because of the limitations of the current leasehold system, but because the UK is an outlier in its focus on property ownership in Older People’s Housing.

Indeed, the UK is highly unusual in using long leases (which are subsequently resold from one customer to the next) in modern, service-based housing-with-care schemes for older people.

Countries with more developed Integrated Retirement Community sectors have swapped a focus on property ‘ownership’ for a focus on those things that matter most to customers – affordability, cost certainty and consumer protection – all of which are delivered using contracts.

The experience of other countries, such as New Zealand, shows that a move to a bespoke tenure for the sector has massively helped the sector’s growth, as well as enhancing consumer confidence.

ARCO, the main body representing the Integrated Retirement Community (IRC) sector in the UK, has been looking into the viability of a contract model for the IRC sector in the UK since 2020, consulting with stakeholders from around the world, along with lawyers and investors. Our core conclusions to date are that the contract approach could work in the UK and could be used in both new and existing schemes as part of widespread reform to the leasehold system.

We are calling our proposal the ‘Retirement Occupancy Contract’ (ROC). Implementing such a model could be an important achievement of this Labour government.

Why? A key benefit of the model would be improved affordability and access to the sector for older people on average incomes, opening up this option to more households and ensuring that more older people have the option of living in an Integrated Retirement Community.

Implementing a contract approach can be included as part of the government’s leasehold reform agenda. Only minor amendments to primary legislation would be needed.

The leasehold system is commonly described as “archaic”, “feudal” and “outdated”. Although the Integrated Retirement Community sector in the UK has grown using Leasehold as the default tenure for private payers, the time is right to learn from best practice in other countries and provide the sector with a bespoke tenure model.

With a growing ageing population looking for housing that meets their changing needs, there has never been a better time to do away with the outdated leasehold system and create the tenure of the future.

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Letters to the editor

A Manifesto for Solving the UK Housing Crisis with Factory-Built
Housing

The UK faces a critical housing crisis characterised by unaffordable rents,
unattainable homeownership, and a house building sector that is too slow to deliver the 1.5 million homes that have been promised. This crisis damages communities and requires a bold, innovative solution. This proposal outlines a plan to revolutionise house building in the UK by embracing cutting-edge factory-built housing technology.

Vision:

The vision is a nation where everyone has access to a secure, affordable, and high-quality home. Factory-built housing is believed to be key to achieving this vision.

The Factory-Built Housing Solution:

Factory-built housing offers a proven approach with significant advantages:

  • Speed and Scale: Mirroring the efficiency of car manufacturing, factory-built homes can be produced rapidly and at scale. Existing factories, such as those in China with capacities of 10,000 sq metres of housing per day, per factory, demonstrate the potential to meet the UK’s housing needs. This proposal advocates for strategic partnerships to bring this capacity to bear on the UK housing shortage, delivering homes at an unprecedented pace.
  • Affordability: Streamlined factory production and rapid on-site assembly significantly reduce construction costs, translating to lower purchase prices and rents. Furthermore, the design of these homes prioritises ultra-low energy consumption, reducing ongoing running costs for residents.
  • Quality: Precision manufacturing ensures consistent, high-quality builds, often exceeding the standards of traditional construction. This proposal champions homes built to last, designed for modern living. Award-winning architectural designs, capable of on-site assembly in as little as 24 hours, illustrate the potential of this approach
  • Sustainability: Factory-built homes are inherently designed with sustainability in mind. The use of eco-friendly materials and the integration of energy-efficient technologies contribute significantly to achieving the UK’s environmental targets.
  • Flexibility: Modular designs offer unparalleled flexibility. Homes can be easily reconfigured or even disassembled and reused, adapting to evolving needs and minimising waste.

Action Plan:

To realise this vision, this proposal recommends the following key actions:

  • Investment in Factory-Built Housing Infrastructure: This proposal calls for strategic investment in developing UK-based factory capacity and streamlining planning processes to facilitate the rapid deployment of factory-built homes.
  • Partnerships with International Leaders: Collaboration with established factory-built housing providers is crucial to leverage existing expertise and capacity, ensuring a swift and effective response to the housing crisis.
  • Prioritisation of Quality and Design: This proposal champions innovative, award-winning designs that create vibrant and sustainable communities.
  • Ensuring Affordability: Implementation of measures to ensure that cost savings achieved through factory-built housing are passed on to residents, making homeownership and affordable renting a reality for all, is a core component of this plan.

Conclusion:

Factory-built housing represents not just a solution to the housing crisis, but an opportunity to build a better future. This proposal offers a pathway to a future where everyone has a safe, affordable, and sustainable place to call home.

By Eamonn Gabriel

Time to plan for the Budget in Autumn 2025

The dust is starting to settle on the 2024 Budget and if it’s possible to generalise across the spectrum of reactions, it’s probably “a good start but not enough to address even the most acute problems of poverty and inequality – there is still a long way to go”.

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There were welcome steps towards addressing wealth inequality with the changes to Capital Gains Tax and Inheritance tax, ending Non-Doms Status, VAT on private schools and increasing the tax on private jet travellers. We now need to call for all unearned wealth to be taxed at the same rate as earned income. We should also open a debate on how best to replace the regressive Council Tax with a fairer system.

The two main contenders are a Proportional Property Tax (PPT) and a Land Value Tax (LVT). Some favour PPT e.g. the IPPR and Fairer Share, while others such as Martin Wolf, Chief Economist at the Financial Times and the Mayor of Greater Manchester, Andy Burnham spell out the merits of LVT.

Importantly, the liability for payment of both these taxes lies with the owner not the tenant.

Labour Housing Group is well placed to promote this debate, raise awareness of the unfairness of Council Tax, and encourage the Government to initiate a public consultation in advance of the Budget in 2025.

Jacky Peacock, OBE, is the Chair of Advice for Renters and writes in a personal capacity.

Building the affordable homes we need

Dear Red Brick editors and readers,

I am not going to spend any time in this letter on why we desperately need more affordable homes. We are all aware of the statistics on housing waiting lists, levels of homelessness, children sharing beds with siblings, and the impact of housing costs within the cost-of-living crisis. That is why Labour’s manifesto was clear, “Labour will deliver the biggest increase in social and affordable housebuilding in a generation”. So the simple question is how?

First, the Government needs to confirm a long term, 10-year, rent settlement for Registered Providers (social and affordable housing landlords).  Only then can they plan and borrow for investment. The immediate increase in borrowing capacity will free Registered Providers to bid on the heavily subsidised affordable housing provided by private developers through their s.106 planning obligations. At present, this is not happening. This limits not only the delivery of affordable housing, but that of private housing as well.  This is an urgent issue and needs to be resolved now.

Second, as the Government is proposing, it needs to urgently reform the planning system to ensure that all local authorities in the country have a plan to deliver the homes they need. By 2025, 78% of Local Authorities in England will not have an up-to-date Local Plan, and 38% will have a Plan that is 10 years old or more.  What does this mean for affordable housing delivery? A few extreme illustrations of authorities with high percentages of green belt and their record of affordable home building might help. York has not had a Local Plan since 1954 and built a total of 3,329 homes in the 5 years to 31 March 2022. However, after accounting for Right to Buy loses, only a net 9% of those homes were ‘affordable’. Brentwood, over the same period, delivered a total of 1,394 new homes of which a net 8% were affordable. There are more examples that could be given, but let us be clear that in these areas, and many more, local authorities are not meeting their total housing requirements and certainly are not delivering the affordable homes we so desperately need.

Third, within the planning reforms, government needs to over-emphasise the importance of affordable housing delivery while ensuring that planning authorities bring forward the right mix of sites. We all agree that brownfield sites should be considered as a priority for development, but in many locations outside of London, the costs — such as for remediation, and construction — of developing brownfield sites means that they do not deliver the expected and necessary levels of affordable housing. Take Birmingham, in that 5-year period I referred to above, a total of 17,800 new homes were built. Yet after Right to Buy Registered Providers lost a net 994 affordable homes from their stock. You need to ensure that there are enough sites, effectively green field (not to be confused with Green Belt, but perhaps those as well, certainly Grey Belt!), being developed that can deliver the targeted level of affordable housing. There need to be checks and balances to ensure that local authorities are doing this.

Fourth, social rent needs greater emphasis among affordable housing requirements. Definitions and emphasis changed under the previous Conservative administration. In 2012, they changed the emphasis in grant funding and financial policy away from social rent (those homes with rents set at around 50% of market rents) to affordable rent (around 80% of market rent) in an austerity measure to lessen funding of affordable housing. While affordable rent might address part of the need for affordable housing, it should only be viewed as a piece of a larger jigsaw. We need to bring back social rent within the delivery mix.  This change has been further accentuated by Right to Buy losses as I have illustrated above. There needs to be greater flexibility in what defines affordable housing, but one thing is surely clear, that social rent should begin to once again play a greater part in delivery in many areas.  When I started in development over 20 years ago, the starting point was that social rent formed a large percentage of the affordable housing s.106 obligation on sites. We need to return to a point where planning policy sets a minimum percentage of social rent within the affordable mix. We should also be willing to accept other forms of affordable housing such as discounted market sales or rent to buy. The need is not uniform across the country, just as development viabilities are not, so there needs to be greater flexibility as to what is accepted.

Finally, I would like to challenge the Treasury. Affordable housing delivery should be considered as an investment in national infrastructure. We spend £31bn annually on housing benefit. Surely, a logical case can be made to commence a programme of government-led investment in affordable housing without viewing it as current account expenditure of the nation. We will have an asset, we may eventually reduce our housing benefit bill, it will lead to benefits for the wider economy – health outcomes, educational outcomes, social and labour market mobility – it would aid economic growth, improving fairness and creating opportunity.    

With Labour’s attention on immediate planning reform, its focus on economic growth and delivering more homes of all tenures, and with a willing development industry ready to deliver, bridging the gap in affordable housing delivery is achievable.

Paul Brocklehurst is Chair of the Land, Planning and Development Federation

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10-year plan for housing Blog Post

A ten-year plan for community-led housing

Image of London CLT member at project being built in Sydenham, south London.

Dr Tom Archer argued here in May last year that we need a more diverse and competitive housebuilding industry, including more community-led housing, if the government is to hit its housing targets. The 10-year plan must make diversification a key objective.

Labour ministers have repeatedly called for a great diversity in the housebuilding industry since coming to office in July. They join a long line of ministers saying this, going back well over a decade, with the previous government even declaring the housing market broken in a white paper in 2017. But the market has only become more concentrated and broken over that period. Labour’s long-term housing strategy needs to move beyond rhetoric to reforms that get to the root of the problem.

One aspect of market diversity missing from the UK is self-commissioned homes – those built or commissioned by individuals, families or community groups. The Bacon Review noted in 2021 that these approaches account for around 4 in 10 new homes internationally, but fewer than 1 in 10 in the UK. Community projects are even more acutely underrepresented within this market sector – a mainstream approach to social housing provision in many European countries, it accounts for just 170,000 homes in the UK, or 0.7% of the housing stock.

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Why so small?

As the Bacon Review put it, ‘our housing delivery system has become increasingly hard-wired in favour of one particular model of limited appeal’.

Part of the answer is cultural. Our housing system is built around paternalism and speculation. Increasingly large top-down organisations build homes for people in need, who are assumed to be incapable of playing any meaningful part in decision-making, and for consumers who will buy the same lowest-common-denominator pattern book product. You rarely hear mention of co-operative approaches. Policymakers and industry professionals tend to assume – against the evidence – that ‘self build’ means Grand Designs and ‘community’ means scrappy, slow and expensive. But look internationally and they are completely normal, integrated into the way that market, affordable, and social housing is built and managed.

At a time when public trust in institutions is so low, is it wise for those institutions and the government to write the public off as incapable blockers? Polling by Grosvenor found that just 2% of the public trust developers and 7% trust local planning authorities to make the right decisions for their neighbourhoods. Doubling down on the same broken system is a surefire way to stoke populism.

With a record number of Co-operative Party MPs in Parliament, and in key ministerial posts, there is a real opportunity to challenge this culture and to change the system, to adopt cooperative models that build trust and pride and cohesive communities, as well as housing units.

I have been working with counterparts in the UK Cohousing Network and the Confederation of Co-operative Housing, and a wider network of communities and professionals, to feed into the ministry’s work on its long-term housing plan.

We have a long shopping list of ideas connected to the current Government’s policy programme. Some have excited activists, such as implementing a Community Right to Buy that encompasses housing and regeneration.

But at the heart of our proposals is something more akin to an industrial strategy.

If you look at housing coops in Switzerland or cohousing in Denmark you mostly do not see plucky groups of people banding together to become amateur developers, using complex community rights to build on marginal sites. You see a mature market of cooperative developers and enablers working in partnership with the public and private sector. Sometimes they start with a site and build the community around the new homes. Sometimes communities commission their homes from suppliers that come with all the required skills, access to finance and industry relationships to codesign and build them.

We had some of this when the government last supported housing coops in the 1970s and tenant management organisations in the 1990s. There is a small marketplace of these enablers and developers today. But they have struggled with constant policy churn and tokenistic support, while billions were ploughed into volume housebuilders and the largest housing associations via grant funding and Help to Buy schemes.

Our discussions with the government are inspired by the approach set out in its emerging industrial strategy.

The government needs to engage in a sustained collaboration with the community sector, providing a clear direction for growth with less policy churn and stable policy decisions. This means fixing the planning system so that it is less expensive, slow and risky for SMEs, without watering down standards. It means redesigning grant and investment funds in Homes England and the Greater London Authority so they improve access to suitable and affordable finance, including flexible grants for social and affordable housing. It means using opportunities like new towns and public land to create opportunities for community-led housing.

The government also needs to catalyse activity that otherwise would not happen, and build institutional capacity and structures. This means investing in our growth lab to support the development of more co-operative developers and enablers, and using tools like financial guarantees to bring private capital into a fledgling market. It means incentivising or requiring the large housing associations to partner with and support community-led projects as a condition of funding, extending successful partnership models that are currently very concentrated in the rural South West.

The 10-year housing strategy also needs to recognise that the problems, and the barriers to the solutions, are very different in Cornwall, Bristol, Liverpool and Cambridgeshire. Community-led housing has often struggled when developing locally-appropriate solutions that fall foul of Homes England funding rules, or Treasury metrics on value for money. Policy needs to follow local needs, not the other way around.

A ten-year industrial strategy could transform the agency and power of communities in England. It could give real hope to millions that they can meaningfully shape and control house building and management. Make them builders not blockers, partners not consultees, actively engaged in our national renewal.

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Why we urgently need to start climate proofing our homes

Secret Garden, Climate Innovation District, Leeds by shuunyanet is licensed under CC BY-NC-SA 2.0

In its landmark 2019 report on the future of UK housing, the Committee on Climate Change (CCC) pulled no punches on its assessment of the climate resilience of our homes.

“UK homes are not fit for the future”, the statutory advisory body stated bluntly, observing that the UK’s 29 million existing homes needed to be made low-carbon, low-energy, and resilient to a changing climate.

In the half decade or so that has followed, we have made some progress towards the ‘low-carbon’ and ‘low-energy’ spokes of this wheel. However, our existing homes are little more resilient to a changing climate now than they were in 2019.

Meanwhile, our planet continues to warm unceasingly. While climate projections carry an inherent degree of uncertainty, the target of limiting warming to 1.5°C, as per the Paris Agreement, is slipping from reach. According to the UN Environment Programme, there remains a large possibility that eventual global warming will exceed 2°C or even 3°C, a possibility that some scientists now believe to be inevitable.

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The implications of these scenarios for UK homes are simultaneously urgent and underappreciated. Already, up to four fifths of UK households report their homes overheating in hot weather, an increase from just one fifth in 2011. Around 6.3 million UK homes are at risk of flooding, a number that will rise to eight million in 2050 on current climate trajectories.

Wind and driven rain will also increasingly affect homes across the western and southern coastlines of the UK, making them more vulnerable to rapid heat loss and serious fabric problems. At the sharp end of the different warming scenarios, the extreme climate events we currently think of as rare will gradually, yet inexorably, become the norm.

Although the impact of these events on the structure of our homes, buildings and wider infrastructure is great, the economic and health reverberations are also worth considering. Around one third of people who experience a flood event develop depression, anxiety, and/or post-traumatic stress disorder (PTSD).

The evidence is also conclusive that overheating exacerbates risks to health and wellbeing, especially when indoor temperatures exceed 25°C. If temperatures continue to rise, overheating in buildings could, according to the Chartered Institution of Building Services Engineers, cause 4,500 premature deaths per year by 2050.

The economic cost of climate events is larger still. Just two months ago, the Institute and Faculty of Actuaries – not famed for their alarmism, being risk specialists – estimated that more than ten per cent of global GDP could be lost if 1.5°C of warming is exceeded.

To an extent, we are seeing these impacts already; observe for example the groundbreaking London Climate Resilience Review, which documented how the 2022 heatwave melted roads and caused hospital IT infrastructures to fail in the capital, delaying operations and bringing the city to a partial standstill.

In this future world, a world that is increasingly intruding into the present, our homes have a central role to play. As the Labour MP Torsten Bell writes, there is hardly any corner of our lives not profoundly shaped by our homes, not least our physical, mental, and financial health.

Our collective ability to make our homes more resilient to a changing climate – to install shutters to block out extreme heat, or reinforced doors to prevent the entry of swollen floodwaters – will at least partly determine the extent to which a warming world impacts our health, the economy, and our prosperity.

In other words, it is time to take the CCC’s 2019 assessment of the future of UK housing seriously, all of it, and get on with the urgent task of climate proofing our homes.

Given the level of warming we are likely headed for, we must place this task on an even footing with the installation of low-carbon heating and energy efficiency measures. Retrofit programmes that do not include provision for climate adaptation and resilience measures are essentially flawed, missing an opportunity to climate proof our homes – and the people who live in them – in one fell swoop.

How might we do this? In a chapter published in the forthcoming UK Housing Review and an accompanying paper released with the UK Collaborative Centre for Housing Evidence, we have sketched out a way forward.

Our proposal is to incorporate climate resilience into an updated Decent Homes Standard (DHS), potentially via the creation of a ‘Criterion E’. This new criterion would stipulate that a home cannot be defined as decent unless a) it has a ‘climate resilience audit’ carried out, and b) it has been subsequently upgraded with all recommended measures to meet a reasonable definition of being climate resilient.

Linking this new DHS to a suitable funding stream – perhaps provided through a new Decent Homes Programme that consolidates and simplifies existing funding streams for retrofit, building safety, and housing quality – would enable us to the rise to the challenge of climate proofing our homes. Of course, the cost of this programme would be large, but the cost of doing nothing to our health, the economy, and the planet potentially far greater.     

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10-year plan for housing Blog Post

Reforming the housing association model in the 10-year plan for housing

The delivery of new homes is at the centre of government’s plans for growth, and its radical moves so far to unblock planning are very welcome, but they won’t deliver unless we get the foundations right. The changes needed to get even close to 1.5m homes are much deeper, and more difficult, but it is also possible that only this government with its will to build could deliver them.

Housing associations deliver most of Britain’s affordable housing and the “mixed funding” model we use is a product of the 1988 Housing Act that enabled private borrowing to improve Britain’s housing at scale for the first time. At the time, before the fall of the Berlin Wall and when Bros topped the charts, the investment this enabled led to very real improvements to the homes of millions of people.

Through this model, housing associations invest in homes using debt supported by the net rents from existing homes, after covering normal costs of management and maintenance. This enabled significant private finance to be raised for investment into social homes. As of 31 March 2024, the housing association sector had £99.7bn of drawn debt, which has been invested in existing and new homes.

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But now that it has reached its fifth decade, the model is showing strain. There are limits to sector borrowing, with the model stretched by rent reductions and the rent cap that was right at the time but came without any mechanism to recoup lost income. This income deficit continues to be compounded by maintenance costs soaring far above the headline rates of inflation, older homes that are reaching the end of their practical lifespan, and ever-increasing expectations of service delivery policed by stringent regulation.

In basic terms, the cost of managing and maintaining many social homes is above the level of income that the home generates, primarily through rents. This is unsustainable, and it does not even benefit existing social housing residents as providers make increasingly tough choices where to invest dwindling resource.

The strain on the housing association sector is evidenced by the average interest cover ratio[1] for the sector now being below 100% for the first time since the 2007/08 global financial crisis. This is a key measure of an organisation’s ability to cover finance costs from operating income and contrasts to a sector average in 2019 of over 150%. Some of this deterioration is down to a sustained rise in borrowing costs due to the current interest rate environment but that is not expected to change in the medium-term.

In the more recent past some organisations sought to create more ongoing capacity through cross-subsidy from developing and selling homes for sale. While sometimes effective, this brought additional risk and complexity, which is still being worked through in some organisations. Recent surges in construction costs, far above increases in values in most cases, and increased regulatory requirements in the construction of new homes also undermine this model. It simply doesn’t work in many areas of the country, where costs of constructing a home are now above its value.

This doesn’t just damage social housing. One symptom of the model failing that has bled into the wider development market is that Section 106 homes, the affordable element of most market development schemes, have remained unsold to housing associations at record levels as associations focus limited resource on meeting regulatory requirements for existing homes. This jams up the delivery of all new homes.

Housing associations suffer because they offer a practical solution to a political problem, neither satisfying those who believe that affordable housing should be provided primarily by the state, or those who see housing simply as a market.

This isn’t good enough, and a new model needs to be created that sets ideology to one side and enables a sustainable affordable housing sector. The Government can’t fully fund a huge building programme at the same time as retrofitting the oldest and draftiest homes in Europe, nor will the market alone deliver the affordable homes we need.

The development of this new model should be collaborative, and that government should bring together a group, possibly similar to the New Towns Taskforce, for a once in a generation revision of the funding of social homes. This group should carefully consider a range of options and the costs, requirements, and rents underpinning social landlords as organisations.

In the meantime, a ten-year CPI+1% rent settlement with convergence would give the breathing space for this work to happen. If this group’s work starts now then there would be a fundamentally different sector in ten years’ time, doing much more for current and future residents.

[1]Earnings before interest, tax, depreciation and amortisation inclusive of capitalised major repairs (EBITDA MRI) interest cover which measures net revenues before interest, tax, depreciation and amortisation less spend on capitalised major repairs as a percentage of the organisations’ contractual interest payments in the year.

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How Labour’s Planning and Infrastructure Bill will get Britain building again

Working people in Britain are paying the cost of our failure to build new homes and infrastructure over the past 50 years. Housing supply has fallen far short of demand, driving up prices, making homes harder to afford, and leaving too many people without any decent options.

Labour has pledged to build 1.5 million homes over this Parliament to address the crisis. But to do so, we need to fix the planning system, streamline decision-making, and ensure that land is available for new homes.

The Planning and Infrastructure Bill, recently introduced by the Labour Government, is a major step towards achieving these goals. By cutting unnecessary hurdles, freeing up land, and ensuring local authorities have the tools to support housebuilding, this Bill will increase the number of homes built and make housebuilding faster, fairer, and more predictable.

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Faster planning decisions

A major barrier to house building in the UK is the slow and unpredictable planning process. This is bad for everyone — it annoys local people as they cannot be sure if or when building will commence; it makes building more costly as housebuilders have to spend more on lawyers and consultants; and it frustrates councils as it delays targets to meet local housing needs. The new Bill introduces several key reforms to make planning decisions quicker and more efficient:

  • Cutting unnecessary delays: The Bill streamlines the process for approving planning applications, ensuring that unnecessary bureaucracy does not hold back development. It will reduce the number of statutory consultees from over 25 to a more manageable size that ensures that council time isn’t wasted.
  • Delegating more decisions to planning officers: A national scheme will determine which planning applications can be approved by officers rather than committees, helping to reduce unnecessary delays and saves committee time for the big decisions.
  • Mandatory training for planning committee members: Poor decision-making and a lack of confidence at the local level can often hold up new homes. Under the Bill, planning committee members will need training and certification before making decisions, ensuring they understand the planning system.
  • Councils can set their own planning fees: This will ensure local planning authorities (LPAs) are properly resourced and can invest in service quality improvements.

These changes will mean that planning applications are determined faster, with greater consistency and fewer bureaucratic delays.

Making development work for communities

The Bill will make it easier for the Government to take action and deal with the housing crisis. Too often landowners and vested interests make it difficult to build the homes we need. The Bill tackles this issue by making more land available at a fairer price:

  • Compulsory Purchase Order (CPO) reform: Local authorities will have more power to buy land for development at lower prices by removing ‘hope value’ — the speculative premium that landowners expect based on future planning permissions.
  • Stronger powers for Development Corporations: These public bodies will be given greater flexibility to plan and deliver large-scale housing projects, ensuring that major new communities are built in a coordinated and strategic way.
  • New Spatial Development Strategies (SDS): Combined authorities will be required to create regional housing plans, setting targets and identifying growth areas. This will enable cross-boundary cooperation, ensuring housing needs are met across multiple local areas.

These reforms will prevent land speculation from driving up costs, making new housing developments more viable.

Making housebuilding happen

Major housing developments often get stuck in a cycle of delays and legal challenges, even after receiving approval. The Bill includes measures to streamline large-scale developments:

  • Faster approval for Nationally Significant Infrastructure Projects (NSIPs): Large housing-led infrastructure projects will no longer be bogged down in endless consultation and legal battles.
  • Regular updates to National Policy Statements (NPSs): These statements guide major infrastructure and housing decisions. The Bill requires updates every five years to ensure policies remain aligned with housing targets and investment needs.
  • Limiting judicial review challenges: The Bill removes paper permission stages for judicial reviews and restricts appeals for cases deemed “totally without merit”, preventing frivolous legal actions from delaying housing projects.

By ensuring that major housing developments proceed quickly and efficiently, the Bill will unlock thousands of new homes that would otherwise be stuck in legal and bureaucratic limbo.

Infrastructure and energy reform to support new homes

A lack of supporting infrastructure can be a major barrier to housebuilding. The Bill tackles this by ensuring transport, energy, and utilities can keep pace with new developments:

  • Better transport planning: Faster approvals for road, rail, and public transport projects will ensure new homes are built with the necessary connectivity.
  • Electricity grid reform: The shift to a “first ready, first connected” system for energy projects will prevent housing developments from being delayed by slow grid connections.
  • EV charging expansion: The Bill removes licensing barriers for installing electric vehicle charging points, ensuring new housing developments are future-proofed for sustainable transport.

By addressing infrastructure bottlenecks, these reforms will remove key barriers that prevent new housing developments from being delivered at scale.

Labour to get Britain building

Labour’s Planning and Infrastructure Bill represents the biggest planning reform in a generation. By speeding up planning approvals, unlocking land for development, and ensuring infrastructure keeps pace with growth, it lays the groundwork for the Government’s ambition to deliver 1.5 million homes over this Parliament.

For too long, a broken planning system has stifled communities, locking out renters and first-time buyers. With this Bill, Labour is removing some key obstacles, creating a fairer system, and getting Britain building again.

If we want to solve the housing crisis, we need bold action. The bill is a great foundation to deliver it.

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Blog Post

How to increase housebuilding by adopting the 15-minute city

Understanding the 15-Minute City and the 20-Minute Neighbourhood

The concept of the 15-Minute City is an urban planning model where residents can access the majority of their daily necessities such as work, shopping, education, healthcare, and leisure within a 15-minute walk, bike ride, or public transit trip from their homes. This design approach aims to reduce dependence on automobiles, fostering healthier, more sustainable lifestyles and improving the overall wellbeing and quality of life for city residents.

The core idea behind the 15-Minute City is to create a human-centric environment that prioritises walking, cycling, and the use of public transportation over car use. In line with this vision, urban areas designed as 15-Minute Cities often feature abundant green spaces, bike lanes, and pedestrian-friendly walkways, rather than emphasising car-centric infrastructure. This concept is also referred to by various terms, including 20-Minute Cities, 20-Minute Neighbourhoods, or Complete Communities, all of which share a similar focus on accessibility and sustainability.

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Key Benefits of the 15-Minute City and 20-Minute Neighbourhood

The 15-Minute City and 20-Minute Neighbourhood concepts offer numerous benefits, many of which have already been realised in areas where these models have been implemented:

Reduced Reliance on Vehicles: The primary objective of the 15-Minute City is to minimise vehicle dependency by ensuring that essential amenities and services are within a short walking, biking, or transit distance. This shift not only alleviates traffic congestion but also lowers carbon emissions and promotes healthier lifestyles through increased physical activity.

Reduced Pollution: By decreasing the need for personal vehicle use, this urban planning approach contributes to lower pollution levels. Fewer vehicles on the road result in decreased traffic and congestion, improving air quality. Additionally, the reduction of noise pollution, which has been linked to various health issues such as stress, anxiety, and hearing loss, is another positive outcome.

Economic Benefits: While the 15-Minute City model is often associated with large urban centres, it is equally applicable to smaller towns and rural areas. In these settings, it can drive increased foot traffic, stimulate local commerce, and create job opportunities, thus providing a much-needed boost to local economies.

Enhanced Public Health and Wellbeing: The design of 15-Minute Cities typically incorporates more green spaces, cleaner air, and easier access to essential services, all of which contribute to a higher quality of life. These elements encourage outdoor activity, improving both physical and mental health. Additionally, the reduction of pollution and increased access to community spaces can help combat issues such as depression and loneliness.

Improved Social Connectivity: The 15-Minute City model fosters more connected communities. With amenities and services located within close proximity, residents can more easily engage with each other, fostering stronger social bonds and enhancing opportunities for social interaction, entertainment, and community engagement.

Controversies Surrounding the 15-Minute City and 20-Minute Neighbourhood

Despite its many advantages, the 15-Minute City concept has faced criticism, particularly from those who raise concerns about potential restrictions on personal mobility. Some detractors argue that these models could lead to overly controlled or confined communities, limiting freedom of movement.

However, this concern is often mitigated when such developments are supported by robust public transit systems. The best examples of well-planned 15-Minute Cities invariably have public transportation facilitates to travel both within and beyond the designated area, complementing the use of private cars. Rather than banning car usage, the model aims to reduce reliance on them, offering residents greater flexibility. Public transit provides increased mobility for those who cannot drive or afford a car, ultimately expanding their options for travel and enhancing overall freedom of movement.

Incorporating Public Transit into the 15 minute City Urban Planning Concept

The role of Transit-Oriented Developments (TODs) in facilitating new housing has been highlighted in a previous article ‘Building homes connected to infrastructure, the benefits of Transit Oriented Developments’. Like 15-Minute Cities, TODs are inherently designed as high-density, mixed-use communities. By integrating TOD design principles into the 15-Minute City and 20-Minute Neighbourhood frameworks, and incorporating housing as a central element, these urban models can play a significant role in addressing the growing demand for new housing.

Adopting the design principles of the 15-Minute City, 20-Minute Neighbourhood, and TODs allows for sustainable urban developments that can support higher population densities. This approach simultaneously enhances the effectiveness of public transit systems. A larger residential population located near transit hubs creates a greater passenger base, which, in turn, helps justify further investment in transit infrastructure. This creates a well-connected, sustainable urban environment that meets both housing and mobility needs.

What can be done to Promote this Concept

To minimise the use of undeveloped land and avoid the high costs associated with new public transit systems or extensive road construction, the development of high-density, transit-connected urban hubs is essential. Achieving the ambitious housing target of 1.5 million homes of varying types and tenures within a relatively short time frame will require such urban hubs.

By drawing on best practices from cities around the world with successful examples of TOD and 15-Minute City designs, the government should provide clear design guidance and principles. These guidelines will help local planning authorities (LPAs) and Development Corporations develop both new and existing urban hubs, while addressing potential opposition to these developments.

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Blog Post

Labour’s Planning Bill is the keystone of its housing delivery plans

Prime Minister Keir Starmer and Angela Rayner NPPF visit by No. 10 is licensed under CC BY-NC-ND 2.0

On Monday 24th March, the most ambitious planning reform in a generation will be debated in the House of Commons. Labour’s’ Planning and Infrastructure Bill is the latest in a number of changes to the planning system, and will be central to the Government’s plan to deliver 1.5 million homes over this Parliament.

What does the Planning and Infrastructure Bill do?

The remit of the Bill goes well beyond housing and targets the planning obstacles to delivery in a number of key areas:

  • Simplifying the approval process for Nationally Significant Infrastructure Projects (NSIPs), including by reducing consultation requirements for these.
  • Establishing a Nature Restoration Fund for developers to pay into to address issues like nutrient neutrality.
  • Compulsory Purchase reform, so that councils can acquire land for social housing at existing use value rather than inflated ‘hope’ value.
  • Reforming planning committees, including the introduction of compulsory training and a delegation scheme to empower non-political council officers to make more decisions.
  • Introducing sub-regionally developed Spatial Development Strategies to encourage councils to work across their borders.

The Bill also has a number of other measures such as the devolution of planning fees, and reforming and strengthening development corporations to make their roll-out easier.

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How will this address the housing crisis?

In essence, the Bill eliminates some important reasons for which homes do not make it through the consenting process, or are stalled after approval.

For instance, introducing a Nature Restoration Fund will help to unlock 160,000 homes blocked by nutrient neutrality rules.

Reforming Compulsory Purchase Orders will also make it easier for local authorities to deliver council homes. Hope value can inflate agricultural land by as much as 275 times its existing value, and can result in councils having to decrease the percentage of social homes on a site.

Measures around spatial development strategies and reforming committees should also help to resolve issues where large sites are made more contentious due to the lack of existing infrastructure. By ensuring that councils are coordinating across boundaries to provide key services, and by ensuring that more decisions are made by council officers, political factors should play less of a role in discretionary planning decisions.  

A keystone to other Labour’s plans:

The Bill cannot be seen in isolation, and instead has to be viewed as part of a package of measures which the Government is using to achieve a much-needed uplift in housing delivery.

It comes alongside an update to the National Planning Policy Framework, which restored and strengthened housing targets, alongside allocating low-quality ‘grey belt’ land for high quality developments with affordable and social housing and the enrichment of green space.

There have also been a number of reforms to boost delivery in urban areas, not least the introduction of brownfield planning passports, so that development on brownfield sites automatically goes ahead if it meets local planning requirements. Also in this category are plans to allow for ‘zoning’ around train stations.

Finally, the Government has added £800 million to the Affordable Homes Programme, and refocused it on the delivery of social housing, so that private housebuilding is supplemented with crucial state provision.

Labour’s ‘everything theory of housing’

It was clear from the outset that the Government had a ‘Housing theory of everything’. Solving the housing crisis will be crucial to a number of Labour’s aims to improve living standards, generate growth, and solve the climate crisis, and Labour clearly understands this.

But the way in which they have gone about this programme also shows that they have an ‘everything theory of housing’, using a range of levers to boost delivery, and clearly identifying which issues need solving through primary legislation, which through policy tweaks, and which through further funding.

Doing this alongside passing a generational boost to the rights of private renters, reforming the feudal leasehold system and introducing commonhold as a default tenure, boosting funding for homelessness prevention and setting up a cross-Government homelessness taskforce, increasing resourcing for the Building Safety Regulator and accelerating the remediation of dangerous cladding, investing £3.4 billion into a new Warm Homes Plan, and identifying 100 sites for urban extensions or new towns, shows a Government in hyperdrive to fix this most pressing of crises.

Planning reforms have so far primarily addressed stalled housing delivery in exurban and rural areas, where delivering new homes is, in theory, easiest. Going forward, the Government also needs to tackle other critical barriers to building new homes, such as the cost of building homes, and the construction sector’s skills shortage, not to mention issues around densification and regeneration or urban sites. Looking ahead to the Comprehensive Spending Review, finding ways to support councils building as has been laid out in Red Brick’s 10-year plan for housing series will be welcome to boost much-needed council homes.

But, for the present, the Second Reading debate of the Bill on 24th March should provide an opportunity to celebrate legislation which will meaningfully contribute to ending the housing crisis, and to make the case for how important it will be going forwards for this to remain at the top of the Government’s agenda.

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10-year plan for housing Blog Post

Living with the Private Rented Sector

Whatever the housing sector looks like over the next 10 years, it is a certainty that the private rented sector will remain a major part of its makeup. Currently the second largest form of tenure after ownership, it is likely to remain so for much, if not all, of the next decade.

It has also become the default form of tenure for those for whom it is, in many ways, manifestly unsuitable – there are increasing numbers of retirement age private tenants, increasing numbers of families, and, in the absence of sufficient social housing, large numbers of low income and otherwise homeless people. This is not a problem that is going to go away quickly.

For all these reasons, a long term plan for the private rented sector is vital, even if most answers are ‘well you don’t want to start from here’.

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The Renters’ Rights Bill (in the House of Lords at the time of writing) is a very significant step forward.  I think we have forgotten how unthinkable some of the measures in the Bill would have been 10 years ago. It is the biggest change to the PRS in 37 years. My view is that it will have both immediate and longer term effects in shaping the PRS.

It hugely reduces the central problem with the PRS – the inbuilt, deliberate instability of tenure for tenants – and with that, gives tenants more confidence to pursue their rights in terms of housing conditions, unlawful charges, over-market rent increases etc. that had been deterred by the (often justified) fear that complaints would result in a section 21 notice and eviction.

It goes some way towards encouraging an actual market in PRS tenancies by enabling tenants to serve notice and leave an unsatisfactory, or overly expensive, property with two months notice, not locked into a year or longer fixed term that could not be terminated earlier.

The ‘landlord database’ – a de facto national landlord register for England – could be a powerful tool for addressing the criminal end of the sector, addressing undeclaration of income tax, but also, and perhaps more importantly, encouraging or requiring the professionalisation of the sector. (Most PRS landlords have only one or two properties. The extent of ignorance over the law and their obligations is breathtaking.)  What information is recorded on the database, and what information will be available to current or prospective tenants will be key.

The prospect of a new Decent Homes Standard applying across both social housing and the PRS could be a very effective move. We know that housing standards are generally lower in the PRS than the social housing sector, though there are far too many poor quality and hazardous homes in both. But what the standard will be and how enforced will be key.

There are some ‘could be’s here for two reasons. First, the devil will be in the detail of forthcoming regulations, and second because the effectiveness of the regulations will largely be reliant on enforcement by Local Housing Authorities.

If it all goes right, the direction of travel for the PRS should be better standards of accommodation, a focus on longer term tenancies and steady rental income. Not short term rent-inflating tenancies and a model based on ‘passive income’ paying the mortgage on properties where the landlord’s real gain is quickly realisable increased equity in the property.

If it all goes right, the sector will become increasingly professional, and the criminal actors be identified and suffer penalties that make the risk not worth the reward.

But that will need enforcement. The track record of LHAs on housing-related enforcement over the last decade is, to put it mildly, patchy. About half of LHAs do none at all. This has to change – enforcement staff must be recruited and trained, active policies on enforcement set out. This may require, at the least, seed funding for LHAs and for training programmes.

As the Renters’ Rights Bill proceeds, there have been inevitable and loud calls for rent controls in the PRS. To which the current answer is ‘well, you don’t want to start from here’. There is no tried model of rent control that doesn’t either raise rents overall, or result in the sector shrinking at speed.  At this point, we simply can’t afford for either to happen. The homelessness crisis is already severe, and LHAs are finding it increasingly impossible to find affordable PRS accommodation by which they can discharge their duty to the homeless. A shrinking PRS hits both ends of that equation. Maybe in 10 years and with a lot more social housing, things might be different, but right now it is a potential disaster.

That said, local housing allowance rates cannot remain frozen. The rate currently does not restrict rents, it reduces supply.

The Renters’ Rights Bill sets the stage for the future direction of the PRS, and it really needs to be considered in terms of its potential longer term impact on the culture and practices of the PRS, not just the immediate changes to tenure. But there is a lot of detail to get right in the subsequent regulations, and then a lot of LHA enforcement to do, to really bring that home over the next decade.