From a change of government, to the return of social housing inspections and the Grenfell Inquiry, 2024 was a busy year for housing professionals. Here is Housing Today’s round-up of the biggest stories and talking points throughout the year.
2024 was an eventful year for the housing sector. From new consumer regulations, to turbulence in the housebuilding market and a new government, there is plenty to look back on.
See more of Housing Today’s best articles from 2024
Scroll down for the round-up of our biggest stories and talking points over the past 12 months.
Barratt seals Redrow takeover deal
The merger of two of the country’s largest housebuilders was undoubtedly the biggest news in the commerical housing market this year.
Barratt and Redrow announced in February that they had agreed a deal for the former to acquire the latter’s entire share capital to create a housebuilding giant with a combined turnover of £7.5bn.
Redrow’s founder Steve Morgan said at the time that the £2.5bn deal - between the UK’s biggest and sixth biggest housebuilders - would not have been necessary in a healthier housing market.
The Competition and Markets Authority had its concerns about the impact of the deal itself on the health of the market, raising concerns about an expected “substantial lessening of competition” in one local market in Shropshire.
Nonetheless, Barratt officially took ownership of Redrow’s shares in August after shareholder approval in May, with the competition concerns still outstanding, meaning the two businesses had to continue to operate independently.
It was not until October that Barratt Redrow satisfied the CMA and were given permission to proceed with its integration plan, which Barratt said could result in 850 job losses.
There was very nearly a second mega-merger in 2024. After two failed bids, Bellway’s £720m proposal to take over Crest Nicholson in July meant a deal looked likely. But the larger firm dawdled over committing to a firm offer before abandoing plans in August, with analyst speculating that the perceived risks were too high.
Here’s how Housing Today covered the story this year:
>> Barratt’s acquisition of Redrow: the numbers and key players
>> Barratt deal would not have been necessary if not for ‘dire’ housing market, says Redrow founder
>> Barratt and Redrow to complete £2.5bn merger after clearance from competition watchdog
>> Barratt Redrow anticipates closure of nine divisions as part of integration programme
The sector reckons with the damning findings of the Grenfell Inquiry
On 4 September came construction’s day of reckoning as the Grenfell Tower Inquiry published the findings of its second phase. The conclusions were damning.
The seven-volume report found that decades of government failure, a slapdash construction culture and the dishonesty of building product manufacturers had, in combination, resulted in the deaths of 72 people at the hands of the fire on 14 June 2017.
Those responsible for the disaster bore that responsibility “in most cases, through incompetence, but in some cases through dishonesty and greed,” the inquiry chair Martin Moore-Bick concluded.
Despite being branded as “dishonest” in the report, product manufacturers Arconic, Celotex and Kingspan came out fighting after the report, defending their involvement in the disaster.
Nonetheless, the government promised to bar companies named and shamed in the Grenfell Inquiry report from being given government work in future.
The inquiry also decided against recommending further regulation of social housing providers.
The industry is still waiting for the government’s full response to the report.
Here’s how Housing Today covered the story:
>> Grenfell Inquiry decides against recommending further regulation of social housing providers
>> Decades of central government failure led to Grenfell tragedy, says inquiry
The general election and a new Labour government
Even before it was announced by a rain-sodden Rishi Sunak outside Number 10 to the sound of protestors blasting out D:Ream’s Things Can Only Get Better, July’s general election was a foregone conclusion.
Everyone, within the industry and the country at large, fully expected Labour to win; the only question was by how much. When Starmer rolled in with a majority of 174 seats, the biggest since Tony Blair in 1997, it seemed to spell the end of the prolonged period of chaos in Westminster that had done so much to hold back confidence and investment.
The new government promised growth, but concerns about how exactly this would be achieved mounted over the summer as the party repeatedly warned of the dire state of the public finances. It was not until the autumn Budget that the picture became clearer as chancellor Rachel Reeves unveiled £40bn in tax rises, including a £25bn hike in employers’ national insurance and a rise in the national living wage.
As the business community reacted angrily to many of the announcements, the government was forced to defend a major boost to public spending which the Office for Budget Responsibility (OBR) does not think will have a lasting impact on growth. While the fact that industry commentators are still talking about the tax rises on an almost daily basis says a lot about the impact which her measures have had, others have seen reasons for optimism.
Major supply side reforms, including in the planning system, and a series of ambitious targets for housing and decarbonisation, have raised the prospect of a more promising year ahead for housing, as has a proposed five-year rent settlement for social housing providers.
Concerns about skills and capacity in the sector, and uncertainty about the level of future grant funding, however remain.
See examples of our political coverage below:
>> Autumn Budget 2024: key measures for housing at a glance
>> Sector’s leaders welcome Labour government’s ‘clear commitment’ to housing in King’s Speech
>> Key takeaways and talking points from the Labour Party conference
>> Reeves announces £3bn in guarantees for SME housebuilders and confirms £500m AHP top-up
The National Planning Policy Framework
The run-up to the July general election saw Labour campaign on a pledge to “kickstart economic growth” and at the centre of party’s plan to acheive this - as set out in its manifesto - was “planning reform to build 1.5m homes.”
After its landslide victory, Keir Starmer’s party wasted no time, putting out a consultation paper on its proposals to change the National Planning Policy Framework within weeks.
The proposals include restoring mandatory housing targets and freeing up ‘low-quality’ green belt land - which Starmer terms ‘grey belt’.
The final version of the NPPF was published in December, alongside a working paper proposing that developments can bypass local planning committees where developments meet local plans and national guidance.
See Housing Today’s coverage below:
>> The ins and outs of Labour’s new National Planning Policy Framework
>> Updated National Planning Policy Framework explained
>> The new NPPF: the time for waiting is over
>> Broadly positive reception for NPPF: round-up of sector reaction
>> NPPF: Government drops 50% affordable housing requirement for grey belt sites
>>Targeted funding and the right tenure mix: how to ensure the NPPF can deliver the housing we need
The section 106 slowdown and housing association capacity
Concerns about the financial capacity of housing associations continued throughout 2024, as providers battled inflation, rising costs, squeezed margins and interest cover and uncertainty about future grant funding and rent levels. This is not to mention increased regualtory pressure to improve existing stock along with decarbonisation and building safety commitments.
One consequence of all of this has been a notable reduction in appetite among registered providers to forward buy homes off housebuilders through section 106 planning deals.
Increasingly providers, with less cash to spare and a desire for more control over design and quality of schemes, have been moving more towards doing their own ‘land-led’ development and away from section 106 purchases.
This is leading to deep concern in the housebuilding sector as section 106 currently accounts for around 44% of affordable homes and housebuilders, particularly SMEs, won’t want to proceed with schemes unless they have a buyer for the affordable units.
The Home Builders Federation (HBF) estimates from a survey of its members that more than 17,000 homes are on hold because of a lack of registered providers in the section 106 market. Homes England has responded by launching a section 106 homes ’clearing service’ - a database that matches buyers and sellers of affordable homes, however the HBF warns that the lack of financial capacity and appetitie to invest within the housing association sector is the real barrier.
See our stories here:
>> What does the collapse in section 106 demand mean for housing delivery?
>> Yorkshire housing providers consider setting minimum quality standard for section 106 homes
>> More than 17,000 homes stalled due to lack of section 106 bids from housing associations, says HBF
>> Section 106 delivers numbers- but to ensure good services, HAs need more control
>> Fears grow over lack of buyers for section 106 homes
>> Could smaller section 106 deals help keep affordable housing delivery alive?
>> GLA should buy up Section 106 homes to fix development ‘logjam’, says business group
Consumer regulation and the return of social housing inspections
April saw the Regulator of Social Housing’s new proactive consumer regulatory regime come into effect.
The “serious detriment” test, which restricted regulatory intervention unless there was evidence or risk of significant harm to tenants, has been consigned to the dustbin.
Instead, the Regulator of Social Housing (RSH) can now assess providers’ compliance against four revised consumer standards, armed with increased enforcement tools. The change means housing inspections are once again being carried out by a government body for the first time in more than a decade.
Ministers hope the new regime, along with the forthcoming Awaab’s Law - which requires landlords to tackle hazards such as damp and mould within set timescales - and the professionalisation of social housing managers, will help raise standards in social homes.
Throughout the year Housing Today reported extensively on how housing associations and councils have been adjusting to the regime along with detailed reports of the learning from the first regulatory judgements since the changes.
See a selection of our articles here:
>> Evolution or revolution? What new consumer standards mean for RPs
>> Why are councils getting low consumer regulation gradings?
>> What is the social housing sector doing to get ready for mandatory qualifications
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