“The number of new homes built in 2012 is estimated to have been just half of the 232,000 new households created, stressing the urgent need for this Government to get Britain building. Brownfield sites are nearly always the default option for developers but are not always viable. Greenfield land, not to be confused with Green Belt which is protected by law, is often unsightly scrubland and could cater for a significant number of those buyers who despite the current barriers still aspire to own their own home.
“If the Government is to succeed in its aims it is vitally important that it addresses the popular misconception that the UK is being concreted over. SmartNewHomes research has shown that three out of four people grossly overestimate the proportion of land developed in England. Only one fifth correctly identify it as being 11% while a quarter assumed it to be six times as much.”
“A raft of new competitive mortgage deals this year has meant that a fifth more first time buyers were able to get on the property ladder in October, compared to the same time last year. This still represents just 20,000 buyers over the month which is less than half of the number at the peak of the market.
“The biggest hurdle for first time buyers is having to find an average deposit of 20%, while also having to contend with spiralling rental prices and living costs. This is where innovative shared equity schemes such as NewBuy and FirstBuy come into their own and we hope the Government continues to support these schemes next year so that tens of thousands of first time buyers have an affordable route to home ownership.”
Planning Minister Nick Boles is calling for more than 1,500 square miles of land to be earmarked for new homes, to solve Britain’s housing crisis. But making the case for housing will be an uphill struggle while the public remains largely misinformed about development levels in the UK, says SmartNewHomes.
Nick Boles is advocating developing in unspoilt areas if we are to provide the housing needed for future generations. Currently in the UK about 11 per cent of land is developed, with only a further 2 – 3 per cent of land required to solve the housing shortage.
However, research by SmartNewHomes carried out in September this year, reveals that the public is widely misinformed of development levels in the UK, with 75% of those surveyed grossly overestimating the proportion of land developed in England. Only one fifth (21%) of respondents correctly identified it as being 11%. Nearly half believed it to be three times as much at 30% and a quarter an astonishing six times as much at 70%. Only one in 20 underestimated the proportion of land developed at 5%.
Steven Lees, Director at SmartNewHomes, said:
“With the UK crying out for millions of new homes, it is reassuring to hear that the new Planning Minister intends to tackle the issue head on. Without a sensible level of development over the next few years, an entire generation will only ever aspire to own their own home.”
“The new homes market is much leaner than it was and is well positioned to continue weathering the wider economic storm, which is likely to continue through 2013. Demand for new homes is still strong and prices have fared well in 2012, with growth of around 3% expected at the end of this year.”
“In spite of the launch of the NPPF and its ‘presumption in favour of sustainable development’ the industry is yet to see a significant increase in the number of new homes coming to market, exacerbating the already severe supply-demand imbalance. We are hopeful that as the changes to planning policy bed in, with the NPPF becoming applicable to those councils who already had local plans in place last year, and a Government-backed industry taskforce intended to help cut red tape gets to work, the number will increase in 2013. This is essential if we are to ever bridge the growing shortfall. However, the Localism Bill remains the new-look planning system’s ‘Achilles heel’ with the potential to undermine the drive for more new homes if local communities reject development without careful consideration.
“Moves to dramatically increase the number of new homes to meet buyer demand, however, will be rendered useless if mortgage approvals do not keep pace. An upturn in the number of high loan to value mortgage products for first time buyers this year, including housebuilder and Government backed shared equity schemes, has helped in making home ownership a reality for many thousands of people previously shut out by the banks.
“Although a long standing commitment to FirstBuy and NewBuy will see both schemes run long into 2013 and 2014, and homeowners are expected to start to feel the benefits of the Funding for Lending scheme, any move by the Bank of England to rein in inflation and help promote growth could see interest rates rise. Even if this amounts to just a nominal 0.25% next year it could make it even harder for first time buyers and existing homeowners to secure loans, reducing demand. For this reason we expect annual growth to slow next year to between 1-2%.”
82% disagree Government is balancing housing need and countryside protection
53% believe the UK is being concreted over
75% overestimate the proportion of land developed in England
New research from SmartNewHomes reveals that public misconception of the emotive issue of new development levels in the UK remains high with 82% of those surveyed disagreeing that the Government is striking a sensible balance between housing requirements and protecting the countryside.
While the Government is still targeting to build three million new homes by 2020, more than half of the respondents to the UK-wide survey (53%) still believe the UK is being ‘concreted over’. Although Green Belt land – that cannot be developed – has increased since 2007, nine out of ten believed it had decreased (72%) or stayed the same (21%) over this period.
The findings come as the National Planning Policy Framework (NPPF) celebrates its six month anniversary. Designed to make the planning process less complex the NPPF promotes a ‘presumption in favour of sustainable development’.
The new homes website found that three out of four of those surveyed (75%) had also grossly overestimated the proportion of land developed in England alone with only one fifth (21%) of respondents correctly identified it as being 11%. Nearly half believed it to be three times as much at 30% and a quarter an astonishing six times as much at 70%. Only one in 20 underestimated the proportion of land developed at 5%.
Steven Lees, Director at SmartNewHomes, comments:
“Development issues are still something of a hot potato and there remains a common misconception that the countryside is being gobbled up by housebuilders for development. In fact, 60% of new home developments are built on brownfield sites with the remainder often on unsightly scrub and wasteland. It is a shame that six months on from the launch of the Government’s flagship planning policy, the NPPF, and the promise to get local people involved at the decision stage of the process, the public remains blinded by a lack of available information.
“With the UK crying out for millions of new homes we need to see increased awareness of development issues in the UK if we are to meet buyer demand and prevent an entire generation from only ever aspiring to own their own home.”
Buyers are increasingly seeking the support of housebuilders and the Government to realise their dreams of owning their own home, says SmartNewHomes, as it reveals that the launch of the Government guaranteed NewBuy scheme saw buyer registrations on the website increase 101% compared to the previous week.
With many first time buyers lacking the ready cash for a deposit and facing difficulty accessing higher loan to value mortgages, SmartNewHomes is calling on the Government to continue its support of schemes such as NewBuy, which is helping tens of thousands of buyers to bridge the deposit gap and navigate their way on to the ladder or upgrade to a larger family home. The call comes during NewBuy Week which runs from 10th-16th September to raise awareness of the scheme which launched six months ago.
NewBuy is available at selected new home developments in England and involves the housebuilder and Government underwriting mortgages of up to 95%. This means buyers require a deposit of just 5%. NewBuy is available to all buyers on new build properties up to the value of £500,000.
Steven Lees, Director at SmartNewHomes, comments:
“NewBuy has helped unlock pent up demand from buyers with many rushing to take advantage of the scheme which offers the cash poor but perfectly credit-worthy a much needed helping hand up the property ladder. With the mortgage drought set to continue, innovative schemes such as this will continue to play an important part in helping to get the housing market moving. We hope that the new Housing Minister, Mark Prisk, will grant the scheme his seal of approval by opting to extend the NewBuy budget further, following the success of its first few months.”
“The £280million extension of FirstBuy will be welcomed by the tens of thousands of buyers for whom raising a deposit remains a stumbling block to home ownership. However, housebuilders have found themselves in a catch 22 situation, unable to meet growing buyer demand because of a revamped planning system that is still finding its feet and over-zealous financial constraints.
“The move announced today to fast-track large residential schemes through planning could help in bringing many more new homes to buyers but how the proposal to bypass councils not performing ‘properly’ will sit alongside the Government’s flagship Localism Bill remains to be seen. The government still needs to prove to the industry that it can act decisively to kickstart growth and support schemes that are proven to deliver – not just flash in the pan announcements.”