Tough economic conditions

With falls in open market sales values approaching 20% in 2008, and commentators predicting further falls of between 5 and 15%, a peak to trough adjustment in sales values of 30% can be anticipated.

This change renders most existing consented land banks valueless and undermines the viability of future housing delivery – particularly on brownfield developments.

Reduced capacity

To meet Government targets for the numbers of households needed, the UK housebuilding sector needs suitable land with planning permission to build 240,000 homes per annum by 2016. Even in a growing economy since 1990, housing delivery has only increased slightly from 160,000 then to 173,000 in 2008. Given the current economic conditions, industry commentators estimate that it will take several years to restore capacity to where it was in 2007/08, let alone where it needs to be to meet Government housebuilding targets.

New Homes delivery in England and Wales, 1990 to 2008

Projected new homes delivery

Impact of regulation

Against this backdrop, the direction of Government policy and regulation is such that the industry can anticipate a significant and progressive increase in its cost base (Code for Sustainable Homes, Lifetime Homes, revised Building Regulations, increased space standards, increases in Community Infrastructure Levy (CIL) etc). This sets an uncertain and economically challenging framework within which to plan and invest for the future. Crest is continually working with Government and the Home Builders Federation to create a more viable platform for the future delivery of housing.

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See how we have responded to these conditions in Delivering homes and buying land.