CLG objectives within wider Government agenda

1. Housing – The Challenges AheadTerrie AlafatDirector of Housing Delivery and HomelessnessSouth East London Housing Partnership Conference Tuesday 24th November

2. CLG objectives within wider Government agenda Creating great places where people want to live, work and raise a family • Social justice and welfare reform - not allowing people to be left behind and supporting people into work • Community empowerment - putting communities in control to better meet their aspirations • Devolution and local government - decision making at the right level responding to specific challenges in different places • Public service reform - personalisation, choice and opportunity in public services

3. Looking forward: housing agenda • Overall objectives unchanged: • Demographics; Economy; Climate • Improving Quality AGENDA WHY? • Increasing Supply Improve long term housing affordabilityRespond to changing housing market • Improve health and well-being • Create safer neighbourhoods • Improve environment Improve life chances addressing human, social and economic consequences ‘invest to save’ Tackling Homelessness and providing support to the most vulnerable Improved delivery of housing services Tenant Empowerment Institutional Reform – Council Housing Finance NTV, TSA, HCA

4. What has been achieved so far? There were 207,000 new homes constructed in 2007/08 We met our target to deliver 75,000 social rented homes over the Spending Review 2004 period The number of non-decent social homes has been reduced by more than one million Good progress towards world leading objective for zero carbon new homes from 2016 Over one million vulnerable people helped to live independently each year through Supporting People Continued significant and sustained reductions in homelessness and households in temporary accommodation

5. Key challenges: demographics • UK population is increasing and • ageing and more people are living • alone - leading to increased demand for housing • Household projections imply • 252,000 extra households a year up to 2031 in England • and a projected 42% increase in population of 60-69 year olds and 45% of those aged 70-79

6. Housing need and supply Household projections • For decades, housing supply failed to keep up with our growing, ageing and aspiring population. • Significant problems of affordability, with consequences for increased need for social housing • Housing Supply target for 240,000 net additions per year by 2016 • Progress was good – in 2007/08 reached 207,500, the highest level for 30 years - • But the economic downturn has impacted significantly upon delivery Net additions

7. Key challenges: economy New supply has seen sharp falls: Net annual housing starts and completions in 2008/09 are down 42% and 20% respectively compared to 2007/08. Loan finance availability has reduced: large deposit of around 25% of the purchase price are now required: for an average FTB property £35,000 equal to 101% of an average FTB annual income. The average age of a FTB without parental financial help reached 37 in April 2009 compared to 33 in late 2007. Source: Council of Mortgage Lenders

8. Repossession Trends Notes: Data is non-seasonally adjusted CML data before Q1 2008 is derived from half-yearly data

9. Repossession numbers • Our analysis shows that three key groups make up majority of remaining owner-occupier repossessions: • Households who ‘bury their head in the sand’ • Households with multiple debts • Households with sub-prime lenders

10. Key challenge: climate change Zero carbon new development The Great British Refurb

11. Government action to boost supply since the downturn • Bringing forward funding to boost supply of affordable housing and housing improvements: • £350m for social rented housing • £250m for decent homes • £175m for major repairs • New investment for housing through the Budget and Pledge including: • Over £1bn to kick start stalled developments • £460m for Local Authorities to deliver new homes • £105m for Cavity walls and heating system • New Surplus Public Land Initiative • Overall have committed £7.5bn over two years to deliver up to 112,000 affordable homes.

12. A high priority for Government to prevent homelessness and repossessions ‘We want to do what no country has done before in providing new protections for home owners. We will do everything in our power to ensure that no hard-working family who demonstrate to their bank a willingness to pay can or should face the fear of repossession of their family home.’ Gordon Brown, 3rd December 2008

13. Help for households to avoid repossessions CML have revised down their forecast for 2009 from 75k to 48k Framework of protections already in place Universal help available Lender forbearance best option for many households Targeted support schemes for households in different circumstances Mortgage Pre-action Protocol (MoJ) Support for Mortgage Interest (DWP) Out of work Households 220,000 Households In 07/08 Homeowners Mortgage Support (CLG) Income shock Early estimates 42,000, although lower take up seems likely Mortgage Rescue Scheme (CLG) Vulnerable Households Up to 6000 households FSA regulation of the mortgage market (HMT) Free, independent debt advice (BERR) Free legal advice at Court advice desks (MoJ / CLG) Protections through the Courts (MoJ) Plus better protections for tenants of repossessed landlords

14. Preventing repossessions • CML figure last week - 11,700 repossessions in Q3, down 8% on figures in Q1. Total so far this year 35,800 • They also published their revised forecast for total repossessions in 2009, revising this down again from the 75,000 they originally forecast to 48,000 • Help at every stage for struggling homeowners. Over 300,000 homeownershave got help and advice with their mortgage since April 2008 • Over 136,000 households are benefiting from forbearance by lenders, 74% higher than the same time last year • 11,000 households have received free advice from their local authority through our Mortgage Rescue, with 92 households able to stay in their house since January

15. Tackling climate change • The UK Low Carbon Transition Plan (July 09) set out the Government’s plan to transform our homes and communities to cut emissions from homes by 29% on 2008 level by 2020 We are doing that by: • Driving high standards for new build – energy efficiency and renewables; and • Major programme of retrofit – the Great British Refurb • Supported by a strong and progressive planning regime with strong local leadership and delivery • Zero carbon new buildings Retrofit

16. We continue to deliver in difficult times Housing Supply still a challenge - need to invest now to deliver the needed homes and maintain capacity in the house building sector; Our response to current housing market is key to UK economy; Homelessness prevention is more important and relevant than ever; Challenge to all to ensure advice and preventionis available to all not just the statutory homeless; Tackling climate change essential through zero carbon new buildings and the Great British Refurb Strong local leadership and collaborative working is key for delivering this agenda - integrating the delivery of social, economic and environmental goals, to take a coordinated approach to delivering public services that work for everyone, including the most disadvantaged, and to think strategically for the long term