Private sector new housing – the green light at the end of the tunnel

The worst may be over, at least as far as the private housing sector is concerned. That was the considered view of at least one expert at a recent industry seminar on the state of the housing market. Now the challenge is to meet the government's zero-carbon targets.

The recent CIMCIG seminar on profiting from housing growth gave delegates an insight into the state of the housing market and what they might have to look forward to in the coming months. The first notable point was that the news was no longer all doom and gloom. Even with the then uncertainty surrounding the precise nature and stability of the incoming government the message was positive and the mood optimistic. The general consensus was that the worst might conceivably be over, for the private housing sector at least.

Dr Noble Francis, Economics Director at the Construction Products Association, laid the foundations by giving an upbeat appraisal of the prospects for new housing growth in the public and private sectors. Little change was predicted in new public sector housing, but Dr Francis forecast double-digit growth in UK private sector housing across the next three years. Equivalent to 149,000 new housing starts, this figure is still down 18 per cent on 2007 figures but represents a marked improvement on 2009. Overall, he anticipated significant growth in the new housing market from 2011.

Neil Jefferson of Zero Carbon Hub suggested that, with homes contributing 27 per cent of the UK's CO₂ emissions, new and existing housing represented the biggest challenge to government in reaching its zero carbon targets for 2016. He made the point that hitting the targets was about energy use, as well as building materials, and that developers and energy providers should work together to provide more practical and cost-effective solutions.

Surprisingly, four out of five UK homes currently at planning stage will not achieve the required targets, nor accommodate the necessary technologies to reach the standards. Building new homes that meet, or even that fall just short of the zero carbon standards, adds a premium to the cost. Developers are passing these costs on to homebuyers. Homebuyers therefore perceive energy efficient homes as luxury 'Grand Designs', rather than the norm.

The industry will have to develop a new marketing strategy to change perceptions, achieve buy-in and help recoup their costs. Instead of homebuyers seeing energy efficiency as something they 'ought to do' they must be persuaded to see it as something they 'want to do', argued Jefferson. Emphasis should be placed on 'good homes that are energy or carbon efficient' rather than 'zero carbon'.

Developing clear, consistent marketing messages for consumers will make it easier for developers, builders and manufacturers to sell the concept, he said, and so make premium pricing less of an issue. Consumers are less likely to worry about the premium if they can see, and feel good about, the long term benefits.

With the general trend towards higher levels of sustainability throughout the industry, the increasing requirements of zero carbon technologies, and everyone demanding more for less, the housing sector will need to find more innovative ways of doing things. In the words of the Publisher of Housebuilder magazine and chair Ben Roskrow, "House building has never been more exciting".

 

Author Deborah Rowe is a member of the organising committee for the Chartered Institute of Marketing Construction Industry Group (CIMCIG) and principal consultant at Sheba Marketing.

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