Thoughts for the summer and looking ahead
Avid readers of Altair e-bulletins will know that in our last edition we had a Christmas wish for housing and we are pleased to say that, in England, the spending review gave us quite a lot of the goodies we’d asked for: a long term settlement on rents; the HCA with an enhanced role for public sector land release; another round of grant funding; and more money.
Not a game changer perhaps but it means we can also start planning for post 2015. The season’s Block Buster was not a bad one this year. There was some good news for Scotland too, with increased grant for associations, and in Wales we await its own Housing Act.
As we head into summer, the sector is in an interesting place. Once we’ve got the devil of the detail around the settlement, we can move into delivery. Two years ahead of the actual programme and two years ahead of an election. Wow.
So our thoughts turn to the post 2015 things that are not fixed. Firstly, the tricky issue over delivery of the current programme. It looks like the first shoots of economic recovery in the construction industry are putting build costs up and increasing the price of new homes. Also a buoyant housing market doesn’t quite equate to the increased provision of homes that we need. Without a lot more homes the market remains dysfunctional.
Rents are unaffordable for a third of the country, says the recent Resolution Foundation report. We have the high cost of housing and the high cost of renting. But only in some parts of the country. We still have a government housing strategy that needs to address the issues beyond London and the South East.
And Universal Credit is starting to have an impact, across the UK. We will have to see whether this is more bad than good for tenants, and if the government’s belief that it will support people into work and cheaper housing comes to pass. For housing providers, business plans will need to be closely monitored and services potentially reconfigured.
Then there is the thorny question of how is it all going to be paid for. Some public funding is better than no public funding, but there is still a big gap in the cost of development that has to be filled somehow and more intensive housing management costs. But expect pressure to come on Registered Providers and local authorities to respond to the ‘something for something’ ask of Housing Minister Mark Prisk. The heat is on.
Which brings us round to the need for innovation and to take some risks, but as the summer heat gets hotter so the Regulator will want associations to stay closer to the shade.
The good thing though is that even as Summer 2013 gets into full swing we can start planning for Summer 2015. Only a world cup, another Wimbledon and a general election between us and then.
Enjoy the summer. The challenges will be waiting for the autumn.