Rupert Bates is editorial director of www.whathouse.co.uk. Follow him at www.twitter.com/rupertbates

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To date the government’s Pathfinder programme has cost over £2.2 billion and has resulted in the demolition
of 16,000 houses - four times as many as it has built. And the scheme has left thousands more houses empty
and decaying at a time when of soaring council waiting lists. This report, produced by Mark Hines Architects,
looks at how terraced housing, earmarked for demolition, can be adapted, upgraded and remodelled to a high
standard of energy efficiency, creating a range of accommodation and forming exemplar ‘eco-hoods’ of the
future.

Mark Hines was the architect responsible of the conservation and remodelling of the BBC’s Broadcasting
House. He says;

“The recycling of houses is environmentally friendly and allows us to provide homes quickly and
economically. To prove this, we have produced a number of houses types that would appeal to modern
lifestyles- from one bed double height live work units, to 4 bed family houses. We have designed extension
pods made from hemp, which will be made off site and allow bathrooms to be added upstairs. We found
that the houses could be upgraded to meet code for sustainable homes level 4 or 5, and could potentially
reduce carbon emissions by over 70%.”

The report marks the start of our wider investigation into what we believe could be the real eco-towns of the
future- huge run down parts of our existing cities. Unlike the proposed eco towns, these places are already
here- we’re just not seeing them yet.”

SAVE’s collaboration Mark Hines began in 2008 during a campaign to prevent the demolition of 500 Victorian
houses in east Manchester. This groundbreaking work forms the core of this report, but the study also looks at
how existing terraces can be linked together on communal heat and power networks supplied by green energy
to form genuinely sustainable ‘eco-hoods’ of the future.

Marcus Binney, SAVE’s President, says ‘This report is dedicated to one of the most distressing, indeed
shocking, sights you will see in English cities today. It is the sight of street after street of simple terraced
houses boarded up and awaiting demolition.

Many of these houses were people’s lifelong homes, others were bought up by enterprising young people as
their first step on the housing ladder.

‘Pathfinder programmes are among the most destructive and disgraceful official policies of recent years,
callously pursued by both central and local government. They have caused appalling anxiety and actual misery
to the people evicted from their homes. And this is the more galling when people see the sites of their homes
left vacant.’

‘Mark Hines’s bold vision for rejuvenating existing terraces and their surroundings is a bold vision and one
which no future government can afford to ignore.”

www.markhines.co.uk

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The very top end of the London residential market showed greater growth in Q2 of 2010 over Q1 thanks to a strengthening dollar and increased activity from Middle East investors, according to major regional and international real estate services firm Asteco.

“Over the past year sterling peaked at $1.69 in August 2009 and has steadily declined against the dollar to a 12 month low of $1.43 in May this year. It has climbed in recent weeks fluctuating around the $1.50 mark. However with the UK’s national debt of over £1 trillion growing by £167.9 billion (11% of GDP) this year alone and interest payments next year of £42 billion, it is easy to understand the pressure sterling is under,” said Richard Angel, Head of International Investment at Dubai-based Asteco.

International buyers are the lifeblood of this market sector, accounting for 63% of all prime central London buyers, since 2006, on purchases of £5 million and over. These high net worth individuals have rebuilt their wealth by around 20% over the past year. Comparing exchange rates year-on-year, investors from the GCC will save a cool £1 million on a property priced at £6 million.

“With the continued strength of the dollar and stable real estate prices in the capital, now is the ideal time for many regional investors to purchase a second home in London,” said Angel.

The latest analysis from property adviser Savills – Asteco’s UK partner – found super prime properties, which average around £5 million, rose by 1.3% and are now just 5.5% from peak, suggesting a resilience that is based almost exclusively on low stock levels and the sector’s appeal to international buyers. Ultra prime properties, which average £15 million and above, grew by 1.5%, but that is on the basis of a delayed recovery (following later falls), and values remain –15.8% from peak.

“In these globally uncertain times, London attracts overseas buyers and there are still a host of reasons for overseas buyers to come to London. Volatility is inevitable in a low turnover market that is heavily dependent on highly discretionary equity buyers and demand will remain fragile against the background of economic and fiscal uncertainty in the UK, euro zone and beyond. That said, the fundamentals of the prime central London market, remain sound provided London retains its status as a major world city and financial centre,” says Yolande Barnes, head of residential research at Savills.

Overall, prime central London residential property price growth has slowed almost to zero over the past three months, a dramatic slowdown after four consecutive quarters of growth.

Savills’ quarterly indices show that values rose by a marginal 0.6% between April and June, arresting the previous growth which stood at 3% in the first three months of the year and 4.3% in the closing quarter of 2009. This brings annual growth to 12.3%, and means that values are minus 10.1% from peak.

Savill’s strength of market indicator for the prime markets of SW London (which include Fulham, Wandsworth, Richmond, Barnes, Putney), remained strong throughout May when the central prime areas were weakening. This strength was largely the result of continued low levels of supply coming to market and reflected in sustained price growth in these areas over the quarter. Values rose by 2.6%, taking year-on-year growth to 22%, and leaving prices just 3.7% off peak.

Going forward, Savills expects these locations to begin falling alongside the central locations as more stock comes forward and demand, which has already appeared to soften over June for all but the £1million family home, remains subdued.

“With the majority of Savills UK web visitors living within the GCC, we are expecting a steady flow of enquiries from prospective investors throughout the region over next few months,” added Angel.

www.asteco.com

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The government’s national housing and regeneration body today published its second set of official six-monthly statistics in relation to housing starts and completions delivered through its National Affordable Housing Programme (NAHP), Kickstart Housing Delivery Programme, the Local Authority New Build Programme (LANB) and Property & Regeneration (P&R) programme.

Reflecting a strong year of delivery, the top line figures, published in detail at www.homesandcommunities.co.uk/statistics, show that the Agency far exceeded its key outputs for 2009-10, completing a total of 64,811 housing starts on site against a target of 53,315, and 56,118 housing completions in England against a target of 52,325 in the financial year ending 31 March 2010. Over half of the housing starts were in London, the South East and the South West and over half of the housing completions in London, the South East and the East.

Chief executive of the HCA, Sir Bob Kerslake, commenting on the figures, said:

“These figures further demonstrate what we believe has been a successful first year. This is an excellent result, considering the extremely fragile market, and illustrates how we are making a significant impact in areas facing the greatest challenges in maintaining a supply of affordable housing.

“I am especially pleased with the progress made on Kickstart and LANB, which show how we as an Agency were able to respond swiftly to challenges presented by the economic downturn.

“This is, however, no time for complacency. Looking to the year ahead, whatever the outcome of the June Budget, it is clear that with less public funding available to support housing, we will need to focus our efforts where they have most impact at local level and drive value for money in key areas such as affordable housing.

“We will certainly be no less committed to making sure we not only continue to hit targets, but, in this new era of localism, also continue to support our partners in achieving our shared ambition for creating high quality places.”

The statistics on housing starts and completions break down as follows:

2009/10 Target
2009/10 Actual
% of Target Achieved

Total Housing Completions (No.) of which:
52,325
56,118
107

NAHP

Social Rent
27,500
30,857
112

LCHO
21,700
22,079
102

Kickstart Housing Delivery

Social Rent
-
20
N/A

LCHO
-
13
N/A

Open Market
-
2
N/A

P & R
3,125
3,147
101

Total Housing Starts (No.) of which
53,315
64,811
122

NAHP

Social Rent
30,000
35,682
119

LCHO
10,500
11,764
112

Kickstart Housing Delivery

Social Rent
2,000
1,693
85

LCHO
2,000
3,674
184

Open Market
5,000
6,544
131

Local Authority New Build

Social Rent
1,000
2,068
207

P & R
2,815
3,386
120

The HCA will publish its next set of six monthly statistics in November/December 2010.

ENDS

For further information: Helen Stoddart, HCA press office on 020 7881 1615 or email helen.stoddart@hca.gsx.gov.uk The full set of HCA six-monthly statistics including regional breakdowns can be found at www.homesandcommunities.co.uk/statistics

Notes to editors

The figures presented include restated figures for the 6 months to 30 September 2009 for the National Affordable Housing Programme and the Property and Regeneration Programme (published in the release of official statistics dated 24 November 2009) together with figures for the 6 months to 31 March 2010 and the 12-month totals.

The figures in this release show the supply of affordable homes delivered under the National Affordable Housing Programme, the Local Authority New Build Programme and the Kickstart Housing Delivery Programme together with all homes delivered under the Property and Regeneration Programme.

Revisions to official statistics for the 6 months to 30 September 2009

The following revisions have been made to the official statistics which were published on 24 November 2009 for the 6 months to 30 September 2009:

· The number of NAHP affordable housing starts has reduced by 470, from 12,946 to 12,476 and the number of housing completions reduced by 370, from 19,146 to 18,776. These provisional half year numbers have been revised to correct for allocation transfer between schemes.

· The total housing starts on site figure for the Property and Regeneration Programme has increased by 35 units from 1,190 to 1,225. The net increase relates to notification by the respective developers of 84 additional units offset by a reduction of 49 units which had also been reported under the National Affordable Housing Programme.

· The total housing completions figure for the Property and Regeneration Programme has increased by 54 units from 1,031 to 1,085. The net increase related to notification by the respective developers of 85 additional units offset by a reduction of 31 units which had also been reported under the National Affordable Housing Programme.

The Homes and Communities Agency is the single, national housing and regeneration agency for England. Our role is to create opportunity for people to live in high quality, sustainable places. We provide funding for affordable housing, bring land back into productive use and improve quality of life by raising standards for the physical and social environment.

For more information visit www.homesandcommunities.co.uk

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Called Hitting the Green Wall … and Beyond, the report is a collaboration between the British Property Federation, international law firm Taylor Wessing, and specialist research and communications consultancy Spada.
With over 7,000 individuals surveyed, the report is believed to be by far the most comprehensive survey to date of the development industry’s sentiment towards – and preparedness for – sustainability and carbon reduction. Despite the difficult economic conditions, the survey also finds that the importance accorded to sustainability has held steady during the recession, and highlights the increasing prevalence of green agreements.
It builds upon the findings of Taylor Wessing’s award-winning 2009 report ‘Behind the Green Facade’.[1]
Key findings of Hitting the Green Wall … and Beyond include:

> All sectors of the UK development industry are sceptical of Government’s policy objectives. 76% of respondents think that the Government’s plans for making all new housing zero carbon by 2016 are unrealistic. 73% percent believe plans to make new commercial property zero carbon by 2019 are unrealistic. However, respondents are also convinced that the ‘stick’ of regulation is most likely to drive progress in future, highlighting the need for closer industry-government collaboration.

> The importance accorded to sustainability remains high, despite the recession, with over 68% saying sustainability was either ‘very’ or ‘highly’ important. When compared to the 2009 report, importance dipped only marginally by 3%, a sign of durable commitment in the face of a severe recession. Contractors, however, reported a 10% dip in importance.

> Sustainability strategies are now widespread, but success is frequently not measured. Over 70% of those surveyed had a sustainability strategy in place, but only around half of respondents set internal targets, whilst only approximately a third set targets related to business dealings.

> Top management take responsibility for sustainability. Over 80% of respondents said that senior management are responsible for sustainability. It is unclear who supports the senior management team as only a minority say they employ dedicated staff (36.18%) or consultants (36.05%).

> A majority of all sectors (60%) have direct experience of using green leases and other green agreements. This is a dramatic increase from Behind the Green Façade which found that 46% of end users were not even aware of the existence of such green agreements or provisions. Of the approximately 40% of respondents who had not yet used a green agreement, almost half said they would consider it in future. Non-binding arrangements are by far the most common.

> The industry acknowledges that it is not communicating well with regards to sustainability. Only a minority of respondents say they are communicating sustainability performance ‘quite well’ or ‘very well’ to internal (47.4%) or external (33.7%) audiences. Traditional industry divides, the complexity and fragmentation of the industry and the lack of a common currency of frameworks and benchmarks combine to create a major communications challenge.

> A plethora of benchmarking tools exist, but these all measure diverse factors and there is little common application. EPCs, BREEAM and ISO 14001 are all popular. Sustainability is reported on by the majority of respondents (72.33%) but across varying timeframes and in a multitude of ways.

> Improved operational efficiency and greater flexibility of use are most likely to motivate respondents to retro-fit existing stock in order to meet sustainability goals. The industry seems unconcerned about future energy security.

> The industry is taking tentative steps in trying to measure green value. Data relating to environmental performance is requested or provided during financial transactions by approximately one third of respondents.

Liz Peace, Chief Executive of the British Property Federation comments:

“With an industry that is sceptical about carbon reduction targets, closer collaboration between Government and the industry is essential if these are to be met. Government will need to work with all sectors to understand fragmented views and identify why certain sectors feel the targets are more achievable than others

“Government faces a huge challenge in striking the right balance between ‘carrot’ and ’stick’ in order to secure its sustainability objectives, whilst the industry must engage as much as possible and attempt to meet and exceed targets. An inconsistent approach to regulation and its implementation, or the setting of targets that are perceived as unachievable, is likely to impact negatively on the delivery of the sustainability agenda by the industry.”

Helen Garthwaite, UK Head of Construction and Engineering at law firm Taylor Wessing adds:

“The burden and complexity of regulation affecting sustainability at EU and national levels will continue to increase. The industry believes that the ’stick’ of regulation is necessary to drive the pace of change, alongside fiscal incentives and other measures. Non-binding green agreements are growing in popularity and we expect this trend to continue. The preference for non-binding agreements could shift towards binding agreements as the regulatory agenda evolves.

“Alongside regulation, better measures to define success and value will be essential. The rationalisation of benchmarking tools and agreement over their application is needed. It is possible that some voluntary benchmarks could in effect become mandatory through industry promotion and use.”

Gavin Ingham Brooke, Chief Executive of Spada, concludes:

“The report reveals a deep reservoir of goodwill and a durable commitment to the sustainability agenda, reflected by the fact that over 80% of respondents say that senior management take responsibility for sustainability and the recession has barely affected the industry’s commitment.

“Goodwill is not enough. Energies and resources across this complex industry need to be pointed at defined objectives which are commonly understood, with every stakeholder guided by consistent frameworks, measures and, frankly, language. Hitherto separate disciplines - technical consulting, organizational development, law and communications - need to be brought together to crack the challenge of change.”

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According to a new international investment report by Knight Frank, Asian Investors are now buying more than a fifth of all central London new-build properties, and now account for 49% of all investment purchases in central London (this compares to only 36% purchased by UK investors).

Liam Bailey, head of residential research, Knight Frank, commented: “The revival of international investment demand for new-build property has been one of the most remarkable features of the residential property market over the past 18 months. While the market has returned to life, after it pretty much shut-down in 2008, current international investment demand is almost totally concentrated on London and is primarily coming from Asia.

“Of the 7,595 new-build properties completed in the 12 months to March 2010, 41% of these were bought by investors rather than owner occupiers.

“49% of all investors in the 12 months to March 2010 were Asian, 11% were from Chinese / Hong Kong, 10% from Singapore, and 7% Malaysian.

“Knight Frank estimates that over the last 12 months the total volume of Asian investment has totalled £761million.

“Why is this demand growing? While the weaker pound has created a compelling buying opportunity for Asian investors, overseas purchasers buy property in the UK for a number of reasons but in almost all cases they are looking for a secure return on their investment. The interaction of currency movements, strong capital price growth and, more recently, rising rents, have created an attractive investment case for many investors considering central London property.

“Despite prices rising by 22% in the 14 months up to the end of May 2010, effective prices in central London were still 32% lower compared to their peak March 2008 level for a purchaser looking to buy in Hong Kong dollars as a result of currency movements. Asian buyers have also benefited from the wealth created from strong Asian price growth. Similar savings have been delivered to Singapore, Malaysian and European buyers.

“Rents in London have been rising since June last year and high demand has meant lower void periods. The problem for buyers looking to secure stronger investment yields has been that capital growth has outstripped rental growth in the past year and yields are being squeezed further. For new build properties in a good location a gross yield of above 5% is rare.

“As Asian domestic markets show their own signs of difficulties, Chinese buyers in particular are keen to spread their exposure and invest in markets they regard as more secure than their own if they can get through the regulatory minefield and release the funds. In mainland China, local investors have become more nervous about keeping money in their own country after outstanding credit rose by 30% and at least seven Chinese cities saw their new home prices surge more than 50% over the 12 months to March 2010. The Chinese have built a reputation as strong savers and investors, the relentless rise in domestic property prices since house ownership was legalised in 1998 has encouraged a strong belief in bricks and mortar investments.

“We cannot underestimate the role of UK education in encouraging inward investment into London; over the past decade the number of Asian students studying in UK universities has risen by 175%. The strongest growth comes from Chinese, Indian and Pakistani nationals. The number of Chinese studying in the UK rose from 4,017 in 1998/99 to 47,035 in 2008/09. In many cases Asian investors look to buy to cover the period of their child’s university duration and then retain as an investment.

Where do they buy?
Sebastian Warner of Knight Frank’s residential investment team commented: “Asian investors focus on good location, favouring zone 1 and 2 and generally demand that they are very close to a tube station. The prospect of a new underground station can attract investors to previously less fashionable postcodes. The jubilee line extension south of the has brought intense interest to the Southbank, and further along the jubilee line to Canary Wharf. Many foreign investors have bought into the regeneration of Dalston, and the East London line extension. They also like to purchase near well known landmarks such as ‘St Paul’s Cathedral’, ‘The City’ or the River Thames.

“Investors are primarily looking for capital growth with an increasing number also looking at income returns. Asian investors are shrewd, and much more sophisticated in their research than they were just five years ago; they want detailed insight on the market and locality of the property / properties they are purchasing. New build developments prove attractive as they offer high quality security, facilities such as gyms and restaurants, services such as concierges and secure car parking.

“In the past 12 months Knight Frank’s experience has shown a change in buying power with Asian buyers looking at more upmarket quality product. In 2007 exhibitions in Asia were focused on smaller affordable units but now demand is for more spacious one and two bedroom apartments priced from £400,000 to £800,000, if not more.

“Canary Wharf is now established as one of London’s main locations for residential investment. Pan Peninsula, one of the tallest residential developments in Europe located close to Canary Wharf’s hub, has been incredibly popular with investors in the Far East. It has been one of the most successful campaigns ever in Hong Kong and Singapore, with 110 units selling at prices from £250,000 to £4million. Sales were at an average of £800 per square foot.

“Chinese buyers were attracted to the waterside location, which has very good Feng Shui connotations, and the iconic nature and height of the development. The proximity to the financial centre, Jubilee Line and on-site facilities such as the concierge, gym, spa, private swimming pool, on-site cinema and sky high cocktail bar were also attractive features.”

Power shifts

Bailey concludes: “The West to East shift in power has had a tremendous influence, it is not just a corporate and government trend, but now is tangible at a personal level, the purchasing power of an Asian buyer is far greater than UK buyers - the UK resident is suddenly 30% poorer against an Asian resident. We anticipate inward investment continuing as the Sterling exchange rate is still likely to provide a key driver for international purchasers into 2011.”

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DO YOU, OR YOUR CLIENTS, BUILD THE BEST NEW HOMES IN BRITAIN?

The entry deadline for the What House? Awards is just six weeks away, for what promises to be the best ever showcase of UK housebuilding, as housebuilders and housing associations do battle for the biggest prizes in new homes across 23 categories.

It is the 29^th year of the What House? Awards, recognised as the most prestigious accolades in UK housebuilding, rewarding the best new homes in Britain.

“The industry has been hit by news of Kickstart cuts and is desperate for coalition government clarity on planning policies and yet continues, in the teeth of economic uncertainty, to build outstanding houses,” said Rupert Bates, editorial director of www.whathouse.co.uk.

As well as the quality of entries from across the new homes sector, the calibre of the 2010 sponsors* is further testimony to the prestige of the Awards and how highly they are respected by housebuilders, suppliers and homebuyers alike.

“The Awards are very much the industry ‘Oscars’. We were delighted to win, No matter how successful a company is on paper, the external endorsement of a What House? Award is worth its weight in gold,” said Tony Pidgley, chairman of the Berkeley Group, winners of the What House? Housebuilder of the Year 2009.

The Awards will be announced at the gala presentation lunch at the Grosvenor House Hotel, London on Friday November 19^th.

Closing date for entries to the Awards is Friday July 16^th and more entry forms can be downloaded at www.whathouse.co.uk

For entry details and to book tables at the Awards luncheon please contact Derek Smith. ds@globespanmedia.com. Tel: 020-7324-2800.

*Confirmed sponsors for 2010: Google, Electrolux, Roca, Laufen, ScottishPower, Nolte Kitchens, Johnson Tiles, Premier Guarantee, The Construction Network, Mitton Marketing Solutions, www.whathouse.co.uk, Showhouse magazine and Tailored Home.

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