MARKET
EXPERT COMMENT
The idea behind The National Housing Bank is positive, as long as it genuinely helps unlock delivery and infrastructure; particularly on more challenging sites that developers such as us often struggle to bring forward. The industry needs greater support to increase housing supply, especially in areas where viability, planning delays and infrastructure costs have slowed progress. If done correctly, it could help speed up support for first time buyers over the longer term.
bn of debt, equity and guarantees. Simon Century, chief executive of the National Housing Bank, explains that the NHB will “back delivery at scale and act at pace”, providing Government-backed finance to de-risk projects and unlock delivery that the market cannot change alone, “Our ambition and scale as a public finance institution creates the conditions for long-term, stable investment, focusing on delivery and giving investors confidence while enabling more innovative, scalable delivery models. With delegated authority, we will take decisions quickly and proactively, acting as an enabler, not a barrier, to the market.” RESPONSE FROM DEVELOPERS AND HOUSEBUILDERS So far, response from housebuilders, especially smaller operators, has been positive. Jon Di-Stefano, CEO of Greencore Homes, says, “We welcome the formation of the National Housing Bank. The Investment Prospectus was very clear in setting out the strategy and exactly what Homes England is seeking to achieve. As an SME developer, using modern methods of construction and delivering sustainable new homes, we were delighted to see that all three of those remain areas of focus for Homes England and the National Housing Bank.We look forward to extending our partnership beyond our existing debt facility and working with Homes England to deliver many more ‘Better Than Net Zero’ homes in the year ahead.” Matthew Norris, Managing Director at Croudace Homes South Thames, describes the formation of the NHB as “a positive step”. He adds, “Anything that helps get more homes built is welcome. But for developers, what really matters is whether this support will quickly and effectively reach the sites that need it most, especially to improve viability during land acquisition. If the National Housing Bank is meant to boost delivery quickly, it has to be straightforward to use, fast-moving and flexible enough to support regional – and not just volume – housebuilders.”
initiative will actually result in more affordable homes being available, with critics suggesting that a better way of helping people get on to the property ladder would be to address Stamp Duty, especially for first time buyers. Critics have pointed out that history has shown that when support is focused purely on supporting demand, without increasing supply, there can be a risk of house prices simply being pushed higher. Sheetal Smith, Sales and Marketing Director at Pennyfarthing Homes, explains, “We saw elements of this through previous schemes where increased purchasing power was not always matched by an increase in available homes. The key will be if the initiative genuinely unlocks additional delivery of new homes.” Smith believes that, for SMEs, the biggest barriers to housebuilding are still planning delays, infrastructure costs, utility connections and the growing difficulty of regulation and she feels that, from a first time buyer perspective, affordability remains a major issue. “While measures such as Stamp Duty changes may provide some short- term assistance, and would be welcome, the reality is many buyers are still struggling with deposits, mortgage affordability and higher monthly costs. It would be great to get practical support that provides access to lower deposit lending or shared equity-style support, something we have tried to access previously without success.” Others in the housebuilding sector have pointed out that the Government’s latest initiative is built upon “the fallacy that Whitehall knows how to finance and build houses better than the private sector”, says Kundan Bhaduri, Executive Director & Chairman of the Board at The Kushman Group, who describes the NHB as a “state-sponsored mirage”. He says, “Fundamentally, we have a critical supply-side crisis, everyone knows this. The solution is not to create a quango but to fix the Soviet-style planning system that makes building commercially unviable in the first place.” Bhaduri feels that pumping what he calls “cheap Government money into complex brownfield sites” won’t magically deliver genuinely affordable homes for first time buyers. “This Government’s idea is to simply socialise the commercial risk, leaving public money on the hook while propping up the margins of volume housebuilders.”
Sheetal Smith , Sales and Marketing Director, Pennyfarthing Homes
EXPERT COMMENT
The National Housing Bank is a genuinely significant and long-overdue intervention, bringing substantial public financial capacity and signalling a clear long-term commitment to tackling the UK’s housing shortfall. However, as with many supply-side initiatives, the real impact is unlikely to be felt quickly. Development timelines remain long, meaning many first time buyers and renters facing today’s affordability pressures may see little immediate benefit.
Tom Hawkins , Head of New Homes, Hamptons
EXPERT COMMENT
We need a targeted “downsizer’s exemption” on Stamp Duty to unblock the generational logjam in the housing sector, something that can instantly release family homes and free up starter stock at the bottom of the chain. Combine that with a temporary Capital Gains Tax waiver for private landlords who sell directly to first time buyers, and you immediately transfer existing rental stock into the hands of a new generation without having to lay a single brick. The state needs to abolish the friction taxes, and let the market work.
CRITICISMS OF THE NHB
Kundan Bhaduri , Executive Director &
Although more detail is yet to be announced, there has been criticism of the plans. One question is whether this
Chairman of the Board, The Kushman Group
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