New housebuilding models required to support an affordable, sustainable future


In August, we published a blog discussing some of the benefits of homes that can generate, store and release their own energy – we call these ‘Homes as Powerstations.’ Independent energy consultant Andris Bankovskis’s report suggested these homes can cut energy consumption by 60%, saving households up to £600 per year. He went on to suggest that building one million of these homes could reduce peak generating capacity by three gigawatts, reducing carbon dioxide emissions by nearly 80 million tonnes over 40 years.

So you might be asking yourself – why haven’t more sustainable homes being built? To really reap the benefits of ‘Homes as Powerstations’ we need to scale-up, but here-in lies the problems. We are currently stuck with a housing model which is designed to maximise the profits of housing developers and their investors, rather than the community at large.

At the heart of the issue is the ‘speculative’ house building model – this is the competitive way in which housebuilders acquire the land to build on. Developers compete against one another to offer the highest upfront sum to the landowner, based on assumptions of how many homes they can build, how much they can sell them for, and how much they’ll be expected to contribute to the community in the form of affordable housing and infrastructure. The developer who can offer the highest sum wins.

Because the landowner naturally goes to the highest bidder, the developer is forced to cut affordable housing and community infrastructure as well as slow the build rate to keep house prices artificially high – competitive pressure, therefore, works against the public interest and the end result is, poorly built homes taking no account of total cost of ownership and energy efficiency other than minimal compliance with the codes which in themselves are kept low to appease the major house builders.

 

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Speculative building is a system we have been relying on to construct homes for over a generation, and it is one of the primary reasons the housing crisis runs so deep in the UK. Thankfully, there is another, a community-led model called ‘Civic Housebuilding’ that has already created some of our most iconic housing areas in the UK including; Bath, Edinburgh’s New Town, the Peabody Estates, Letchworth Garden City and Milton Keynes. Housing charity Shelter recently released a report about the new housing model and how it can be harnessed by Government to build the homes we need.

At its heart, Civic Housebuilding is based on the principle that the goal of building homes is to benefit the people who will live in them, and the communities they will be part of. Under the speculative model, the public benefit from housebuilding is generated by whatever value is left in a scheme once profits have been extracted. The Civic Housebuilding model means the opposite: the level of profit in a scheme will be determined by how much value is left once the public interest has been served.

It works like this – the local community decides what they want to see from the development, which is published in a detailed plan. Government steps in to empower local authorities and other public agencies to buy the land for a reduced rate. These agencies then ask developers to bid for the project and the one that best meets the community plan wins. Lower land prices mean the Civic Housebuilding model can afford to build better quality, more affordable homes, as well as invest in community infrastructure and sustainable enterprises.

There is little doubt that incentivising community-led housing development models is the key to building affordable, sustainable homes at scale. The additional money available through these schemes will also enable developers to build energy savings technologies into the infrastructure of housing, reducing the cost of living and delivering long-term environmental benefits.

We are beginning to see these schemes working on a small scale – developments in Nansledan, Cornwall, and Derwenthorpe in North Yorkshire have all demonstrated the success of Civic Housebuilding models with sustainable credentials. In June, the UK’s largest ‘Passive Housing Scheme’ was opened in the Saffron Lane area of Leicester. The scheme has been described as a ‘beacon of sustainable, affordable housing’ and is a classic example of a development that has the community and environment’s interests at its heart.

However, we need to see a fundamental change in the way housing is built in this country before we will witness change at a scale that will truly make a difference in the cost of living and the environment. It is up to Government to support and incentivise new models of housing development that serve the needs of our communities, rather than housing developers and their profit-focused investors.

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