Lunchtime news Monday 22 September 2023

Just a few days after the National Housing Federation warned the government will miss its house building target by up to nine years, the Town and Country Planning Association has also said that three million new homes will not be enough to meet the expected growth in the number of elderly people and young families. The report claims that at least a further half a million homes are needed in England alone in the next twelve years – with growing demand in the North East and Midlands, as people move from the South East. The changes are a result of people living longer, women having children later and long-term migrants starting families.

The National Housing Building Council has reported that applications to build new homes reached an all-time low in the UK during August – registering a 76 per cent fall in the year. However, applications to build social housing is rising, with an eight per cent increase in applications in the three months to August, taking the year on year figure to a six per fall overall.

As house prices fall the number of properties up for sale is expected to decrease. The financial turmoil on the money markets of the recent weeks is taking its toll as homeowners fear further price falls. According to Rightmove, the asking price for a home in England and Wales dropped by one per cent during the five weeks to September 13, but this was less than the decrease recorded during each of the previous three months. The annual rate of decline eased slightly to 3.3 per cent, compared with 4.8 per cent last month. This is the first index to include the effect of the government’s stamp duty initiative, which appears to have had little impact in stimulating demand.

Meanwhile homeowners have been told to expect a sharp increase in fixed rate mortgage rates next week. The three month Libor rate is at its highest since April this year, up to six per cent. Analysts are saying that this could lead to a quarter point increase in mortgage deals.

Pensioners have been warned not to unlock equity in their homes unless it is a last report. Consumer group Which? said that equity release schemes are expensive, inflexible and leave people with little equity, which may affect the level of means-tested benefits they are entitled to. The organisation is urging people to consider other options before turning to equity release, such as downsizing to a cheaper property, using their existing savings, or even borrowing money from family that could be paid back when a home is eventually sold.

Millions of families will not qualify for free insulation under the £1 billion energy efficiency scheme introduced by the government last week. The government launched the scheme after facing criticism that as many as five million households in the UK face fuel poverty this winter, and said that up to 11 million low-income households would qualify. But critics say the figures are misleading, arguing that those with some insulation already would not be eligible; homes built before the 1930s are unsuitable for cavity wall insulation; while most council-owned and housing association properties have already been insulated. The government had argued that two million households could benefit this winter, but an industry spokesperson said that he doubted there was enough capacity to insulate more than 500,000 homes in a year let along a winter.

Labour is again coming under fire from unions at its annual conference regarding the introduction of a windfall tax and price cap on ‘greedy’ oil and energy firms. Joint general secreatary of Unite said that even a ‘modest’ levy on firms would help almost six million households and added tjat if the companies were not prepared to do the socially acceptabe thing, then the utility companies should be brought ‘back into public ownership’.

And in another move that could trigger a backlash against Gordon Brown, the government plans to cut the time pensioners can claim backdated pension tax credits from 12 months to three months. In a move expected to save the government hundreds of millions of pounds, as many as 110,000 pensioners may be affected.

More children aged between 10 and 14 are being locked up in England and Wales than in any other western European country. Only Russia and the Ukraine put more children in prison. A fivefold rise has been reported in child and youth custody sentences during the past decade despite there being no significant increase in serious crime over the same period, while the annual cost of keeping a young person in a secure children’s home is believed to be £185,000.