21 May 2009
Property developers must cope with the present and look to the future
There has been a huge amount of media coverage in recent weeks of MP’s expenses alongside criticisms of bankers. These issues must not be allowed to overshadow everything else that we must cope with during this recession, including doing everything possible to stabilise the economy and then bring about a recovery. Indeed, we are planning ahead for the inevitable upturn.
We are engaging with those providers of goods and services and considering how the development industry’s capacity can be stimulated through the training and re-employment of professionals and craftsmen who have been made redundant. The question for all stakeholders is how we assist them and offer training to enhance their employment opportunities. Without a coherent strategy and incentives it will be many years before we return to the necessary levels of delivery of 240,000 new homes per annum.
How is my development company coping with recession? Like many developers we have deferred starting on some sites, slowed down the speed of construction on other projects and continuously reviewed our overheads and expenditure. At the same time we’ve been looking at the best ways of selling the new homes that we’ve been building, whether this is via Part Exchange, Shared Equity or other buyer support. As a result in recent months we have been experiencing encouraging numbers of visitors and reservations on almost all of our new home developments.
Where appropriate we have also sought assistance from the Homes and Communities Agency who have been given £600m of additional Government funding in the Budget to kick start a number of stalled housing schemes, including extra funds for HomeBuy Direct a shared equity scheme that we are currently offering on some of our sites.
The scale of what is needed to stabilise the housing market and then bring about a recovery is considerable. Whilst Government assistance is welcome, and will make some difference, it is not enough to get the development industry moving again. The effective rationing of mortgages and finance for developments are still the critical issues.
Whilst we are coping with present difficulties we must not take our eye off the future. We must prepare for it. This is particularly so for developers and many parts of the public and private sectors where forward planning and investment are critical for future success. Improving our infrastructure is a pre-requisite for many developments to move forward and therefore infrastructure works should get underway now. Developers should not wait until the market improves to progress their planning applications. Certainly we have been moving a number of major developments forward so that we will be ready to go ahead with them when the outlook improves.
Please do let me know if we can help you with planning and development issues that you may have.
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