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What was acceptable in housing only months ago is suddenly unacceptable

Will Hurst
  • 2 Comments

There’s a sea change in housing and Theresa May’s calling out of volume housebuilders is part of a toughening attitude, writes Will Hurst

Housing developers are getting a lot of stick these days. In a speech delivered on Monday at the National Planning Conference, prime minister Theresa May became the latest to get in on the act, warning volume housebuilders not to take government subsidies for granted. ‘Public investments in infrastructure and schemes such as Help to Buy have provided a real boost to housebuilders,’ she said. ‘If they want that to continue, they will have to raise their game.’

While May did not mention Persimmon by name, it was likely that the firm’s £200 million-plus management bonuses and rather less impressive housing delivery numbers were in her mind when she lamented the fact that such bonuses are based ‘not on the number of homes they build but on their profits or share price’.

The housing crisis has now reached such a pitch that May is beginning to sound like Jeremy Corbyn

Tory governments are usually friendly to this sector but the housing crisis has now reached such a pitch (and is presumably seen as such a threat to the government) that May is beginning to sound like Jeremy Corbyn. The pill she forces volume housebuilders to swallow could become more bitter still, depending on the results of a review into land banking led by former minister Oliver Letwin, which is set to report this week.

And it’s not just the volume housebuilders that are under fire. As the AJ noted in a recent news feature on estate regeneration in London, a political change in the air has put developers such as Lendlease and Capco under pressure to rethink large-scale residential-led masterplans in Haringey and Earl’s Court. This follows accusations that the schemes don’t provide enough affordable housing and are not in keeping with the wishes of their local communities. 

Meanwhile the ongoing £9 billion Malaysian-backed redevelopment of Battersea Power Station is becoming a rallying point for the opposition Labour group in the forthcoming Wandsworth Council elections, due to a 40 per cent reduction last year in the number of affordable homes planned for the site. There are also new fears of overdevelopment around the Giles Gilbert Scott-designed Grade II*-listed landmark.

What was deemed acceptable in housing development only months ago suddenly seems unacceptable. Architects in this sector should take note.

This article appears in the Homes issue

  • 2 Comments

Readers' comments (2)

  • Yes it was so tough the share values of the main volume house builders only went up by around 1.5% after the announcement!

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  • Response from Wandsworth Council

    Last year Wandsworth delivered the second highest number of affordable homes across all 33 London boroughs and has just unveiled its own £150 million housebuilding scheme that will deliver 1,000 new low incomes homes of which 60 per cent will be for social rent and low cost shared ownership.

    Our decision on the power station was made at a time when the future of this key regeneration site, which had lain semi-derelict for nearly 40 years, was facing enormous uncertainty and in serious danger of becoming unviable.

    If this had happened it would have threatened the future of the whole Nine Elms regeneration zone which is delivering over 20,000 homes for Londoners and more than 25,000 permanent jobs.

    We were faced with the very difficult choice of either accepting a potentially lower number of affordable homes or refusing the application and risk losing all of them. And it would have placed in jeopardy the future of a much-loved and iconic Grade II Listed building that had been on English Heritage’s “at risk” register for decades.

    What has therefore been agreed is that the power station will now bring forward the construction of nearly 400 affordable homes making them available three years earlier than originally scheduled, while the redrafted legal agreement means that they will be required to add the remaining affordable homes quota if market conditions improve. Therefore there is every chance these extra affordable units will be built at a later stage in the project.

    It is also worth pointing out that the power station’s owners have contributed very substantially to the £1.2 billion cost of bringing tube services to this part of south London for the first time.

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