7 Feb 2019
Assistant director of real estate, Stephanie Pollitt, provides our latest blog, following our annual residential investment conference and dinner 2019: Questions with Answers.
As my train pulled into Marylebone station on Monday morning and I congratulated myself on having successfully negotiated with my 3 year old that tee-shirts and sandals were not acceptable attire when it was 3 degrees outside, I was quietly optimistic that it was going to be a good day. I was not wrong.
There was a palpable buzz in the room as the great and the good of the industry came together for the 20th annual BPF Residential Conference at the Landmark Hotel on Monday morning. With residential investment through build to rent hitting ever greater heights, against the backdrop of an uncertain political and economic landscape and ambitious government targets for the delivery of new homes, there was a great deal to discuss.
Nick Jopling, our ever playful chair, seized the opportunity to ask delegates whether the Government’s target of 300,000 new homes by 2025 would be achieved. The response was not a resounding “no” with some 16% believing it would be reached, but it was a “no” nonetheless.
The insights from John Hawksworth, Chief Economist at PWC and Steven Charlton MD at Perkins+Will provided the big picture, providing context for how the UK economy was faring now, the potential challenges of a Brexit “No Deal” and what the housing sector could learn from the hospitality industry’s evolving approach to design. It was an insightful start and delegates were eager to hear more as the Rt Hon John Healey MP took to the stage. The Minister made it clear that closing the gap between the housing haves and housing have nots was just as critical as building more homes and if we wanted housing to be affordable, then we needed to build more affordable homes. An insight which might seem obvious in its simplicity, but one which rings true, nonetheless.
But of course, we have a crisis now and that needed to be addressed. It was no secret that Labour took a favourable view on rent controls and the Minister sensed the nervousness in the room as he elaborated further. The suggestion that rent could increase in line with CPI over the course of a longer tenancy and be capped was met with cautious consideration among the delegates. The caveat that a more stringent policy would be applied in areas of high demand, was less favourably received.
Sir Oliver Letwin MP provided a little welcome relief, delving a little deeper into his review. Yes, building more was important but it was about building better – multiple tenures, multiple types of housing and larger sites. The subsequent panel sessions supported this; there were new ways of working, new ways of building and these needed to be embraced if the industry was to get anywhere near the Government’s aspirational target.
Lunch provided delegates with the opportunity to cogitate over the details of the morning and it didn’t escape anyone’s notice that the Minister of State for Housing, Kit Malthouse had arrived in good time for his keynote address. Perhaps it was the opportunity to be seen to be proactive and an eagerness to engage with the industry or just the draw of a free lunch but, either way, we had successfully achieved a full house with our ministerial speakers.
Taking to the stage, the Minister was in positive mood. Innovation was key, and the industry needed to build beautiful. The only way to secure community support was to build the types of houses that people wanted to live in. You couldn’t argue with this logic, but it fundamentally failed to address the immediate problems of the housing shortage and the potential repercussions of a No Deal for the industry.
The closing panel sessions challenged the industry to look beyond itself with Polly Neate of Shelter inviting delegates to see what was happening at the frontline of the housing shortage. It was clear call for the sector to come together and one that provided a defiantly positive end to the day.
The audience were asked once again if Government would achieve its target of 300,000 new homes by 2025? Again, the answer was “no”. But, the industry and Government have made great strides in understanding what needs to be done. That’s the easy part. The difficult part, however, is going to be doing it against an uncertain economic and political backdrop which for now, continues to leave the industry with more questions than answers. Much like dressing a 3 year old; laying out a sensible outfit is easy, convincing him to wear it is altogether more difficult