If property had sat its GCSEs this year, would it have passed? Or would it have been among the growing number of pupils that have failed to live up to expectations?
Looking at the latest headlines it is hard not to think that if the real estate community had a school report card it would read “could do better”.
Now, I know it wasn’t so long ago on this very page that I quoted Rocky and asked us to celebrate the good that property could do and to turn our heads away from the gloomy and depressing headlines. But, and there is always a but, that musing did also include a call for us to think entrepreneurially and hunt out the opportunities in these tougher times.
So let’s look at the biggest “could do better” subject: housing. Whether it is the real estate community or the government failing to achieve top grades is by the by – if housing were a subject, we are all failing.
This week a report from Shelter, using Capital Economics figures, revealed that the government is falling well short of its target of building 1m new homes by 2020 and could miss its stated aim by 266,000. Mortgage approvals too are falling, to their lowest levels in 18 months. And a third planned merger of a housing association crumbled.
At the beginning of the year a handful of housing associations committed to merging to become bigger, braver and more capable housebuilders. L&Q, East Thames Housing Group and Hyde Housing, which cancelled their union plans earlier this summer, would have created the UK’s fourth largest housebuilder, with the capacity to deliver 100,000 new homes over the next 10 years. Genesis and Thames Valley Housing, which scrapped their plans for a merger this week, would have created a company with almost 50,000 homes under management and would have added 3,000 homes a year to a supply-starved sector – homes that would have been at an affordable level.
More “fail” than “could do better”.
There may be a way for us to claw some grades back, but it won’t be pretty. Not for business, anyway.
Last week, EG revealed that new London mayor Sadiq Khan was planning to enforce a 50% affordable housing rate across all public sector schemes (as compared to 35% for private sector projects). It is a proposal that could derail Transport for London’s plans to bring 300 acres of its high-value land to market for development.
TfL has an obligation to achieve best value on its land. Requiring a 50% affordable provision would make this difficult, if not impossible.
But this week Khan has clearly nailed his colours to the mast and put provision of affordable homes for the people above profitability (p20).
It is a directive that might not be universally welcomed, especially by those protecting bottom lines in these financially wobbly times, but perhaps it is one that business and central government should consider. If we want to pass the housing exam, is it time to put the needs of the people first, regardless of the cost?
Staying with GCSEs, the girls continue to outperform the boys, with the gender gap now being wider than it has ever been – some 8.9% for grades A* to C. As the women of the world get smarter, maybe we will continue to see more of them moving into (and up through) the wonderful world of real estate.
For those women already active in property (or thinking about it), EG’s women’s network REWIRE holds its latest event next month. Hosted by Nabarro at its London Wall office, EC2, REWIRE is bringing together some of the most exciting names in proptech to share their insights on entrepreneurship and how tech is changing the world in which we work. To find out more or to register to attend, e-mail me at samantha.mcclary@estatesgazette.com.
