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					     Issue 06.01




                                                   Contents


           1. New Charges for Property Searches
           2. Home Information Packs
           3. Energy Performance in Buildings
           4. Renewable Energy
           5. Lifetime Homes
           6. Good Practice Guide on Monitoring Regional Spatial Strategies
           7. Thames Gateway Study – IPPR
           8. Low or Zero Carbon Energy Sources: Final Report
           9. Impact Sound Transmission – Final Report
           10. ICE’s - Waste Management Strategy
           11. Planning Gain Supplement
           12. Family homes in London
           13. Public Sector Construction Clients' Forum
           14. Sustainable Development Commission - Director
           15. English Partnerships - new appointments
           16. HM Treasury appointment
           17. NHBC - new Head of Social Housing
           18. Local Government Association - CEO resigns
           19. Audit Commission - new Board member
           20. New Years Honours
           21. The Economy
           22. The Market


1.      New Charges for Property Searches
        On 23 December DTI announced an action plan to “improve the way property searches were
        bought and sold ...in the lead-up to the introduction of Home Information Packs in 2007”. This
        was in response to an Office of Fair Trading study published in September.
        DTI accepted the OFT recommendation that local authorities should make available all the
        “unrefined information” on the Local Land Charges Register and other information used to
        respond to enquiries in form CON 29. Most of this information was to be provided in the Home
        Information Pack.
        DTI notes that, whilst some CON 29 material is required by statute other elements are not.
        Before HIPs were introduced in 2007 ODPM would therefore provide guidance to local
        authorities on how to take a more cost-based approach to fees and favoured the option of
        allowing local authorities to set their own fees for those elements which statute did not require
        or imply should be made free of charge. ODPM was working with the Chartered Institute of
        Public Finance and Accountancy (CIPFA) to establish an agreed cost base and methodology
        and detailed guidance would be produced as to what costs should be recovered from fees.
     ODPM was considering the repeal of the Local Authorities (Charges for Land Searches)
     Regulations 1994, to rely instead on S.93 of the Local Government Act 2003 which would allow
     best value authorities to set discretionary fees. In considering the methodology for setting CON
     29 fees, CIPFA would look at how the same principles might be applied to fees for local land
     charge services. If local authorities were to set their own fees for property information services
     this will require a robust independent monitoring system “proportionate to the size of the
     market”.
     Producing Information for HIPs: local authorities were required to turn-around information on
     CON 29 Part 1 in ten working days but ODPM agreed that this must be reconsidered in the
     context of HIPs and would seek to agree with local authorities and the industry how to measure
     local authority performance in dealing with property information requests.
     Information would be required in the HIP on who carried out the inspector for the search and,
     where different, who prepared the report. The name of the person who was responsible for any
     errors would also be provided. Suitable insurance arrangements must also be in place but
     current guidance did not explicitly require insurance details to be mentioned in the search
     report.

     The paper can be found at www.dti.gov.uk/ccp/topics2/pdf2/searchresponse.pdf


2.   Home Information Pack – benefits

     In Written Answers of 20 December, Minister Yvette Cooper said that the Home Condition
     Report contained in the Home Information Pack would mean that buyers were not faced with
     unexpected repairs. The information on the condition of the house would also help ensure that
     house prices were set more realistically.
     HIPs would not have an adverse effect on the housing market and their cost would be broadly
     neutral. The benefits of HIPs would include:
                 Delivery of the European Directive requirement for sellers to provide energy
                  performance certificates to home buyers. This would help deliver the
                  Government's target of a 20% reduction in residential carbon emissions by
                  2010 because it would identify cost effective ways of improving energy
                  efficiency.
                 Speed up the transaction process, bringing the UK into line with European
                  averages
                 Improve consumer redress because estate agents would have to belong to
                  an approved redress scheme.
                 Improve the position for first time buyers, who would receive pack
                  information "free", thus reducing the cost of entry into home ownership.
                 Create a more efficient housing market—thus facilitating greater flexibility
                  and labour mobility.


3.   Energy Performance in Buildings

     In a Written Answer of 20 December Minister Yvette Cooper said that, because there would not
     be enough suitably qualified Inspectors by January 2006, ODPM would be deferring the
     introduction of both energy performance certificates and plant inspection, using the three year
     derogation period in the relevant EU Directive. It was working to muster a cadre of inspectors to
     implement a phased programme.
     The introduction of the Home Information Pack in June 2007 and the training of Home
     Inspectors would cover the Directive’s requirements relating to the marketed sales of houses.
     ODPM would make a further statement on the implementation of the Directive in the New Year.


4.   Renewable Energy




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     On 30 December DTI reported that 35 windfarms were approved in 2005, with a combined
     capacity of 767MW and another 74 applications had been submitted with a potential capacity of
     4700MW.
     Energy Minister Malcolm Wicks said Government was aiming for 10% of the UK's electricity to
     come from renewable energy by 2010. It was essential that considerable year-on year-
     progress was made if that target was to be met. In a speech of 19 December Wicks confirmed
     that 4% of energy currently came from renewable sources, 19% from nuclear, 33% from coal
     and 40% from gas.
     Former UK energy minister Brian Wilson said the turn-of-the-year problem with Russian gas
     supplies of gas drew attention to the more serious issue of Britain's reliance on imported gas.
      He said, “By 2020, 70% of UK electricity will come from gas and 90% of that will have to be
     imported. A substantial amount - at least a third - will come from Russia and confidence in that
     must depend on Russia honouring its contracts."

5.   Lifetime Homes

     Yvette Cooper said a report on the review into the effect of the guidance on dwellings in the
     1999 edition of Part M of the building regulations should be published on ODPM’s website in
     2006.
     Lifetime Homes were to be included in the Code for Sustainable Homes. It was very important
     that there was increasing take-up of the Lifetime Homes standard. Government would monitor
     this and review the need for further regulation. [Parliamentary Written Answer, 20 December]


6.   Good Practice Guide on Monitoring Regional Spatial Strategies.

     On 22 December ODPM published a Good Practice Guide on Monitoring Regional Spatial
     Strategies.
     This updates guidance on the development and reporting of monitoring frameworks for regional
     spatial strategies including good practice in defining objectives, targets, indicators and
     significant effect indicators.
     It is available from ODPM Publications, PO Box 236, Wetherby LS23 7NB or by email from
     odpm@twoten.press.net. The ISBN number should be quoted when ordering.



7.   Thames Gateway Study – IPPR

     On 4 January the Institute for Public Policy Research published a report to help policy makers
     create sustainable communities in the Thames Gateway.
     IPPR interviewed potential movers to ascertain whether they would consider the Thames
     Gateway and existing residents living in relatively deprived parts of the Gateway.
     They found that low to mid-income groups were more inclined to consider moving to the
     Gateway. Higher income groups would only consider locations with a “strong cultural heritage
     and good transport links” and did not favour mixed tenure developments.
     Existing residents did not believe they would benefit from the Growth Area strategy or that there
     would be more employment opportunities. They expressed “very negative attitudes” towards
     prospective new residents and believed that they would not integrate.
     IPPR went on to make a number of policy recommendations, including greater investment in
     infrastructure to attract higher income groups, funding local authorities and the community and
     voluntary sectors to address “community cohesion issues” and the use of planning powers to
     ensure that development was designed and built to a high standard. It said that, given the “very
     negative views” of higher income groups towards social housing it was important that
     developers and housing associations were required to adopt a “tenure blind” approach,
     blending social and market housing to reduce fears that a mix of tenure would impact on
     property values. “Gateway People” can be downloaded from www.ippr.org.uk




                                                Page 3 of 9
      8.     Low or Zero Carbon Energy Sources – Report 4: Final Report
      ODPM published the Final Report on Low or Zero Carbon Energy Sources in December. The
      project aim was to develop suitable performance standards and guidance for the installation of
      low or zero carbon energy sources in buildings.
      It can be downloaded from www.odpm.gov.uk/index.asp?id=1162802


9.    Building Operational Performance Framework Scoping Study on Impact Sound
      Transmission – Final Report


      ODPM published the final report on Building Operational Performance Framework Scoping
      Study on Impact Sound Transmission in December
      It considers what work is needed to prepare guidance for builders and designers to help control
      transmission of sound from impacts in adjacent dwellings. The types of impact sound
      considered do not include footfalls on floors heard below, as this is addressed by the current
      Building Regulations.
      It can be downloaded from www.odpm.gov.uk/index.asp?id=1162799



10.   ICE’s Proposed Waste Management Strategy

      The Institute of Civil Engineers has published a report proposing changes to the treatment of
      waste, moving away from dispersed sites to multi-treatment recovery centres at a cost of about
      £10 billion. The Case for a Resource Management Strategy can be obtained from ICE tel: 020
      7665 2104.


11.   Planning Gain Supplement

      An article in the Financial Times of 6 January said that the role of planning and taxation reforms
      to encourage a greater supply of housing was very important and the Planning Gain
      Supplement would be an improvement on the current negotiated S.106 Agreement because,
      since society creates the increase in land value by designating land for development, it should
      also obtain some of the benefits, and the proceeds could be used to finance infrastructure.
      However important objections included the disincentive effect of such a tax on landowners,
      discouraging them from bringing land forward and the failure of previous attempts to introduce a
      land tax.
      It concludes that a tax on land values, determined on the basis of the planning designation,
      would be better than the PGS because it would encourage planning authorities to promote
      development and developers to undertake it.
      Government should have widened its consideration to encompass housing supply, planning,
      local authority finance and land use taxation. It suggests that David Cameron might wish to do
      so as part of his current, wide-ranging, policy reviews.



12.   Shortage of family homes in London

      Only four London councils (Hackney, Westminster, Kensington & Chelsea and Hammersmith &
      Fulham) are likely to meet the London Housing Strategy’s target of providing a third of new
      homes with a minimum of three bedrooms. The revised London Plan should include measures
      to ensure that larger households, including families, have access to appropriate housing.


13.   Public Sector Construction Clients' Forum (PSCCF)



                                                  Page 4 of 9
      The new Public Sector Construction Clients' Forum (PSCCF) met for the first time on 15
      December. It was established by the Office of Government Commerce and is intended to assist
      the delivery of affordable homes and the Olympics infrastructure, amongst other things. Its
      Chair is Sir Christopher Kelly,
      The Forum includes the chief executives from MOD Defence Estates, Highways Agency, CABE
      and the deputy CEO of the Housing Corporation. The PSCCF will build on work carried out by
      the Central Government Task Force and the Government Construction Clients' Forum, which
      were dissolved in 2002/3.

14.   Sustainable Development Commission - Director appointed

      Andrew Lee, currently Director of Campaigns at WWF UK, has been appointed as the first
      Director of the Sustainable Development Commission from February 2006. The Commission’s
      chairman is Jonathon Porritt.
      The SDC is the principal adviser on sustainable development to Government, and reports
      directly to the Prime Minister. This appointment is intended to reflect the Commission’s
      enhanced role as monitor and watchdog. The Commission may also be given a statutory role as
      an executive body following Government’s undertaking to strengthen the SDC in its 2005
      Sustainable Development Strategy).


15.   English Partnerships - new appointments

      On 23 December ODPM announced John Parker (former Chairman of the Building Societies
      Association), Richard Harrold FRICS (former Chief Executive of MEPC Ltd, and currently a
      Board member of the Lowestoft and Gt Yarmouth URC) and Geoffrey Wright (former President
      of the Chartered Institute of Building) had been appointed to the Board of English Partnerships.
      John Parker and Richard Harrold will be appointed from 1 January 2006 to 31 December 2008.
      Geoffrey Wright will take up his appointment on 1 July 2006, which will run to 30 June 2009.



16.   HM Treasury appointment

      John Kingman, currently Director of the Treasury’s Enterprise and Growth Unit, has been
      appointed Managing Director of its Finance and Industry Directorate, succeeding James
      Sassoon following Sassoon’s appointment as the Chancellor's Representative for Promotion of
      the City. The appointment comes into effect from 10 January.


17.   NHBC appoints Head of Social Housing

      Mehban Chowdery has been appointed to the new post of Head of Social Housing at NHBC.
      His work has included secondment to the Housing Forum on Egan’s Rethinking Construction
      programme. He will focus on improving the service offered under NHBC's Buildmark Choice.


18.   Local Government Association CEO resigns

      On 5 January Sir Brian Briscoe announced he was leaving the Local Government Association. He was
      appointed in 1996 to lead the merger of the Association of County Councils, the Association of
      Metropolitan Councils and Association of District Councils to form the LGA. He said that after 10 years
      in the post it was time to move on to new challenges.


      19.   Audit Commission - new Board member




                                                 Page 5 of 9
      On 20 December the Chairman of the Audit Commission stood down (see HBA05.52). On 3 January
      ODPM announced that Timothy Parker, Chief Executive Officer of the Automobile Association, had
      been appointed to the Board of the Commission with immediate effect, his term of office running to 31
      March 2008.

20.   New Years Honours

      On 31 December the New Year’s Honours were published. These included:
      Knights Batchelor:
      John Henry Ritblat, chair, the British Land Company, services to the Arts

      GCB:
      Sir Richard Clive Mottram, Cabinet Office

      CBE:
      Alistair Grant Arkley, former chair, Tees Valley Partnership, services to regeneration in the
      North East
      Marcus Binney, founder of SAVE Britain’s Heritage, services to conservation of the built
      environment
      John Robert Cridland, Deputy Director General, CBI, services to business
      Philip John Fletcher, director-general, Office of Water Services
      Lester Hicks, Director of minerals and waste planning division, ODPM
      Stephen Hindley, chairman, Midas Group, services to construction industry

      OBE:
      Robert John Higgs, Chief Executive, Heating and Ventilating Contractors Association, services
      to the environment
      Paul Louis Pedley, executive deputy chairman, Redrow, services to business in Wales

      MBE:
      Yash Pall Gupta, former member, Thurrock BC and Thurrock Thames Gateway Development
      Board, community services

21.   The Economy


      UK budget deficit
      Borrowing reached 3.2% of GDP in the financial years to March 2004 and March 2005, and is
      expected to rise to 3.4% in 2005-2006, breaching the budget deficit ceiling in the European
      Union’s stability and growth pact for the fourth year running. The EU Commission will formally
      call on EU finance ministers next week to confirm that Britain is running an “excessive deficit”
      and will propose that the UK is asked to bring borrowing below the 3% threshold by 2006-2007.
      France and Germany have been in breach of the pact since 2002, and Greece and Portugal’s
      borrowing is also over the threshold.

      Manufacturing - December data
      On 3 January CIPS/RBS Purchasing Manager’s Index was published showing that activity grew
      for the fifth consecutive month in December. However the industry’s performance in 2005 was
      below the long-term trend and margins continued to be squeezed.
      The index of input prices rose from 59 in November to 61.9 as prices rose for energy, some raw
      materials, and packaging. Output prices rose at the fastest rate in three months. Managers also
      reported they had shed jobs for the ninth month in a row to counter rising input prices and tried
      to improve productivity.

      Service sector - December data




                                                  Page 6 of 9
      Data published on 5 January by CIPS/RBS showed the service sector (the largest part of the
      economy) expanding at its fastest rate since spring 2004, reducing the likelihood of a cut in
      interest rates.
      The Index rose to 57.9 in December from 55.8 in November. Companies’ margins continued to
      be squeezed and input costs continued to rise.

      Energy Trends
      On 5 January DTI issued Energy Trends and Quarterly Energy Prices showed that, between the
      third quarters of 2004 and 2005, coal and other solid fuel consumption fell by 7.4%, oil
      consumption decreased by 0.5% and gas consumption fell by 2.8%, while primary electricity
      consumption rose by 6.7%.
      The December edition of Energy Trends includes articles on regional and local energy
      consumption and electricity generation and supply for GB, 2003 and 2004. It can be found at
      www.dti.gov.uk/energy/inform/energy_stats_overview/index.shtml

      CBI – New Year message
      In its New Year message, issued on 30 December, the CBI President was concerned about the
      “number of policy balls” that the Government had in the air. Taxation-creep had weakened
      competitiveness.
      "Trying to fix a £10 billion black hole through greater borrowing sounds like pouring more water
      into a leaky bucket...” and companies would feel more reassured if Government made a real
      effort to slow the rate of public spending.
      He urged the Government to make pragmatic long term decisions on pensions and energy, not
      to opt for the most politically expedient options.

      Consumer Confidence – December
      On 29 December GfK NOP published its survey of consumer confidence in December, reporting
      a fall to -9, the lowest recorded since March 2003.
      Consumers remained pessimistic about the wider economy, optimism about personal finances
      fell to 7 from 8 and the major purchases’ measure fell 3 points to 2.

      2006 Forecast
      A survey of economists by the Financial Times, published on 2 January, showed that the state
      of the housing market was of less concern to them than it had been at the start of 2005. Only 7
      of the 42 economists who submitted detailed responses saw the housing market as a risk.
      Although the majority thought the housing market was overvalued, they believed there was little
      risk of prices falling rapidly in 2006.
      A weak global economy, weak domestic consumer spending and high energy prices were seen
      as the principal risks in 2006. Most thought the year would not be a year of strong economic
      growth. Asked what element of economic policy they would change, most voted for reform of
      the fiscal policy framework and then to simplify taxation and reduce Government
      micromanagement.


22.   The Market

      NHBC data
      NHBC data on registrations and completions for November shows that there were 14,092
      private registrations (c/w 14,030 in 2004) and 14,660 completions (c/w 14,998 in 2004).
      Housing association registrations had risen from 1,324 to 3,035 and completions to 2,144 from
      1,922.

      Mortgage Lending
      Bank of England data issued on 4 January showed that the number of loan approvals for house
      purchase rose to 115,000 in November, the highest figure since May 2004. Net lending
      secured on homes was £8.7bn in November, up £1bn on October and £1.2bn more than the
      average for the previous six months. However net lending to individuals in November grew by




                                                 Page 7 of 9
the smallest amount for more than five years, at £0.9bn compared to £1.2bn in October. The fall
was the result of weaker credit card lending.

Nationwide
Data issued by the Nationwide Building Society on 30 December showed that annual house
price growth fell to 3% in 2005 compared with 12.7% in 2004, the weakest full year rise for a
decade. For the first time since 1999 house price rises were outperformed by equity growth.
Nationwide said that growth was modest by the standards of the last five years and, although
there was “a supportive environment” for house prices, affordability, particularly for first-time
buyers, remained a significant obstacle. It predicted that house prices would rise by between
0% - 3% in 2006.

Mortgage lending – November
On 29 December BBA issued further data on lending in November which showed that:
           seasonally adjusted net mortgage lending (gross lending minus repayments
            and redemptions) rose by £5.081mn, the highest increase since July 2004
           there were 192,927 mortgage approvals (for all purposes) in November,
            about the same as October. November's approvals of house purchase loans
            were 51% higher by number; remortgaging loans were 17% higher by
            number and equity withdrawal loans were 1% higher by number.

BBA said that approvals, particularly for house purchase, continued to be strong, with little
evidence of the normal seasonal slowdown.

George Wimpey - trading statement
On 6 January George Wimpey issued a trading statement ahead of preliminary results for the
year ended 31 December, which will be announced on 21 February.

Total housing completions stood at 17,024 across the US and UK (c/w 2004: 16,654).
UK completions stood at 12,100, 1% lower than 2004 (12,232). Average UK net selling prices
were 4% lower as the result of changes in mix and the use of increased incentives. Improved
overhead recovery in the second half had broadly offset the effect of increased incentives and
costs. The forward order book stood at £731 million, 31% ahead of last year.
The company had an average of 307 sales outlets in 2005 and expected this number to remain
unchanged in 2006.
The land market had remained strong during much of 2005 and land acquisition policy had
been to replace land.
The US housing market had a record year. Completions grew 11% to 4,924 (2004: 4,422) and
completions in the continuing businesses rose by 17%. Sales outlet numbers in the continuing
businesses were 10% higher that at the beginning of last year. The forward order book was
36% higher. The land bank was 9% higher.
It was too early to predict the UK market for 2006 but the company was encouraged by some
firming, particularly in the south, during the autumn. Only a modest slowdown was expected in
the US this year and most markets should remain, supporting continued growth.

Redrow - trading update
In a trading update of 5 January (ahead of interim results for the six months to 31 December,
which will be published on 7 March) Redrow said that it had achieved 2,077 legal completions
(H1 2004/05: 2,111), a fall of 1.6%. Average selling price was 8% lower, reflecting the impact of
product and geographic mix. The number of In the City completions fell from 446 to 152, while
there were 105 completions in the new Debut by Redrow range, with houses costing as little as
£49,995 each.
Sales outlets continued to increase. Forward sales at 31 December 2005 were 1,816 units (Dec
2004: 1,948).
The current land bank had increased to 18,400 plots (Dec 2004: 17,500) but the land market
remained competitive for those sites capable of early conversion to a sales outlet.




                                           Page 8 of 9
First half profitability would be lower than the same period last year, with profits in the year to
June 2006 expected to be weighted towards the second half.
The first six months of the financial year had been challenging and
competitive, with incentives continuing to be widely promoted in the industry. It was expected
that transaction levels across the housing market for 2005 would be at their lowest level for
thirty years and consumer confidence would be important in determining the strength of the
housing market this Spring.

Galliford Try - trading update
In a trading update for the half year to 31 December, issued on 5 January, Galliford Try
reported a 25% increase in housing completions to 484 units in the six months (c/w 387 units at
the same time in 2004). Average selling price had fallen from £228,000 a year ago to
£203,000, reflecting the company’s concentration on the mainstream market.
Contracted or completed sales had risen by 21% and sales rates were satisfactory. Visitor
levels were encouraging, based on limited sales incentives and marketing support. The
company was operating from 20% more sites than a year ago.
The affordable housing sector continued to generate good opportunities for both construction
and house building and Stephen Teagle (currently development director of the Devon and
Cornwall Housing Association and MD of Westco, its commercial arm) had been appointed
Galliford Try’s Affordable Housing Director, joining the Group in February.
With no sign of any easing in supply through the planning system, Galliford’s said it would
continue to pursue its expansion policy.




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