A trend for down sizers is in the UK residential property market on the increase and set to continue over the next few years, it is claimed.

According to latest figures from Strutt & Parker's recent Housing Futures survey, some 52% of home owners between the age of 70 and 79 consider the need for a smaller home to be a key factor for moving house in the next five years.

It's a similar story for other age groups with 39% of home owners between 60 and 69 thinking about downsizing, and 22% of 50 to 59 year olds.

‘There is no doubt that downsizing is a consistent trend. Some 72% of the people we surveyed are planning on moving in the next five years,’ said Stephanie McMahon head of research at Strutt & Parker.

‘The UK has a housing shortage, however, we are also a nation of under occupiers and the move towards smaller homes will stay constant or increase over the coming years as the large group of UK baby boomers move into retirement and beyond,’ she explained.

According to Prudential, there are over two million downsizers which fit into the over 55s baby boomers category, often with grown up children owning properties worth in excess of £750,000. Rightmove has similarly profiled this generation as equity rich and cash poor, often looking to help family members by freeing up funds.

‘With the UK economic confidence returning, downsizers are sensing now is a good time sell after years of hesitating during the recession. Many are moving house to better suit their evolving needs both in terms of space and finance, or shrinking to share, save and spend,’ said James Mackenzie, head of the Country House Department at Strutt & Parker.

The firm says that this fresh stream of property for sale created by downsizers could ease current housing pressures by increasing supply and restricting further house price rises. ‘With average property asking prices remaining static between May and April, this trend may already be in motion,’ it concludes.

A passion for gardening is taking root amongst a new generation of home owners in the UK with many adopting a Good Life style, according to new research.

The Lloyds Bank Insurance Britain at Home report shows that home owners aged 25 to 34 year olds spent an average of £647 on their outdoor spaces in the past year, nearly double the average UK spend of £366.

Some 29% said that this expenditure is driven by a love for gardening, for 19% it is entertaining guests outside and 14% aim to increase their property's value.

The third Britain at Home report also shows that 19% of the new green fingered generation now owns a greenhouse and 29% have invested in new trees, plants and flowers for their gardens in the past year.

As gardening programmes and the trend for growing your own vegetables undergo a renaissance, some 34% of all home owners say they are spending more time improving their outdoor spaces, while 33% admit they are spending more money on doing so compared to five years ago.

The study also found that money is not just being spent on horticultural items either, with the most popular accessories for the garden now including outdoor furniture, owned by 81% of British home owners, barbecues by 49%, bicycles 37% and trampolines 10%.

‘We've witnessed a real return to homeliness, with everything from gardening, baking and cookery, to knitting and crafts coming back in style. It's interesting that this trend is growing against the rise of technology and in a post recessionary climate. There is a sense of holding on to traditional pastimes in an increasingly fast paced, modern society,’ said Frances Tophill, horticulturalist and presenter of ITV's Love Your Garden.

‘With the current waiting list to snag an allotment longer than that of any new restaurant, there is no doubt that gardening is growing in popularity among a younger generation and people are enjoying spending more time outside,’ added Tophill.

Despite home owners' willingness to spend time and money on their outdoor spaces, 37% admit that they do not have a secure lock for their garden and 24% admit none of their outdoor items are insured.

‘With a blossoming culture of green-fingered outdoor enthusiasts, the value of our gardens may be higher than we think, especially once everything from tools and toys to bikes, furniture and flower beds is taken into consideration,’ said Tim Downes, senior claims manager, Lloyds Bank Insurance.

‘With the latest crime figures showing over a million thefts from gardens and outdoor spaces took place in the year to September 2013, home owners should make sure their outdoor spaces are covered by their insurance policies, and securely locked,’ he added.

Property sales in Spain increased by 12.6% in May compared with the previous month with the Balearics seeing the biggest increases, according to the latest data from the National Statistics Office.

The data also shows that new home sales were down 8% from a year earlier and second hand homes up by 16% which could be good news for those who have been unable to sell.

The biggest annual increases in May were in the Balearics with a rise of 33.1, Cantabria was up 30.4%, Andalucia was up 10.7% and Catalonia was up 3.1%.

The biggest decreases were reported in Castilla-La Mancha with a fall of 15.2%, Galicia with a fall of 6% and Comunidad de Madrid was down 5.5%.

Meanwhile, the latest figures from the General Council of Notaires shows a sharp rise in the number of Chinese buyers in Spain, suggesting that they are responding to the golden visa rules which grant citizenship to non European Union nationals who invest a minimum of €500,000 in real estate.

Looking at non-resident demand for Spanish property in the first quarter of this year broken down by nationality, and comparing it to the same time last year, Chinese demand increased by 666%.

But Mark Stucklin of Spanish Property Insight pointed out that while no other country comes close, it has to be said that Chinese demand started from a low base of less than 10 sales in the first quarter of 2013, rising to 69 sales in the first quarter of this year.

The next best performer in terms of non-resident demand growth since the Spanish Golden Visa scheme came into force last year was the United States with an increase of 143%.

The only other country with an increase of more than 100% was Argentina, up 115% to 28 sales, once again starting from a very low base.

Big increases in purchases by non-residents from countries outside the EU are likely to be driven by golden visa buyers. ‘However, the Spanish golden visa scheme has not been a great success since it was launched last year, partly because it is still early days, but mainly because competitors like Malta and Portugal offer more attractive golden visa packages,’ said Stucklin.

Skills shortage concerns in the UK construction industry now stand at their highest level since 2008, the latest quarterly survey from the Royal Institution of Chartered Surveyors shows.

Some 54% of respondents said there are insufficient numbers of quantity surveyors currently available to meet workloads, up from 41% in the first quarter of the year.

The figures, also show that private housing, commercial and industrial sectors are driving strong growth across the whole of the UK, with particularly encouraging performance in the Midlands, which saw workloads rise at a record pace of 57% net balance.

However, there is a shortage of white and blue collar workers with 59% of respondents reporting shortages of bricklayers and 51% reported a shortage of managerial workers.

There are also difficulties in the sourcing of some key building materials. Brick imports were 63% higher than in the second quarter of 2013 and this is likely to result in upward pressure on costs and prices, while also presenting a challenge to further strong growth in the sector.

Despite this, employment prospects for the sector remain firm, as the industry gets to grips with meeting rapidly rising demands from a historically low base. Across the whole of the UK, a net balance of 60% of respondents expect employment to rise over the next 12 months, with London and the South East outperforming the rest of the UK and Northern Ireland's employment prospects steadily improving at 31%.

‘The UK construction market is mirroring the natural consequence of a rise in demand after five subdued years. The upsurge in housing demand is creating pressure across an industry which failed to invest in attracting new talent or in the training of existing employees at the height of the economic downturn and this in turn is creating similar effects among material supply,’ said Alan Muse, RICS director of Built Environment.

‘The good news is that there is reason for optimism, with workloads, profits and employment all forecast to deliver growth over the next 12 months and it is now the responsibility of industry to invest in training and technology to ensure it capitalises on these opportunities,’ he added.

Skanska UK has reported a strong rise in first-half revenues and profits but has once again seen its margins squeezed a little further.

In the first six months of 2012, Skanska UK made an operating margin of 3.6%. Last year it was down to 3.2%. This year it is 3.1%.

However, it was still a strong first half performance for Skanska UK’s construction business, as it made an operating profit of £19.9m, up 14% on 2103’s first half operating profit of £17.5m. Revenue was up by an even healthier 20% to £651.4m (£12013 H1:£545m).

New orders also grew strongly. In the first six months of 2014, £858.8m of orders were booked by Skanska. This includes the £250m redevelopment of the Worthy Down, Hampshire and Deepcut Surrey barracks for the Ministry of Defence, and Creechurch Place, a new £95m commercial property development in the City of London.

Skanska UK president and CEO Mike Putnam said: “Our order bookings equate to a book to build ratio of 132%. Any figure greater than 100% is good as it means we are taking in more bookings than revenue. We are in the process of recruiting an additional 1,500 people to fill new roles as a result of this success.”

The outlook for the year as a whole is positive, said Putnam: “We have a very strong pipeline of work, which includes preferred bidder status for Papworth Hospital in Cambridge.”

Projects completed so far in 2014 include the construction of Bath Spa University’s ‘commons’ building, Crossrail’s Western Ticket Hall Box at Bond Street Station, two sections of the M25 and the Alexandra Wing of the Royal London Hospital. In the City of London, Skanska has completed commercial developments Moorgate Exchange and 6 Bevis Marks, as well as the refurbishment of Aldermanbury Square.

Mothballed brick factories in Worcestershire and Surrey are to be reactivated to help meet UK brick shortages.

Austrian company Wienerberger, which has 14 plants in the UK, said that it plans to increase its brick production capacity by 200 million bricks before the end of this year, creating 120 new jobs in the process.

Wienerberger will be implementing the capacity increases by bringing factories at Hartlebury and Ewhurst back into action and investing in technology upgrades. It will also supplement UK production by increasing imports.

Managing director Harald Schwarzmayr said: “This capacity increase shows our absolute commitment to ensuring that enough new housing is built to meet the requirements of the market. The UK needs a minimum of 200,000 new homes to be built each year, approximately 35,000 more than will be started in 2014. With our capacity increases equating to approximately 25,000 homes each year, Wienerberger is capable of manufacturing the core material for more than 70% of that extra housing requirement needed.”

Former Kier chief executive Paul Sheffield has been appointed managing director of Laing O’Rourke’s Europe Hub and a member of the group executive committee.

Mr Sheffield handed in his notice at Kier in February after 31 years with the company. (See previous report here.) Aged 52, he had joined Kier as a graduate engineer in 1983 and rose to the top job in April 2010.

He was on an annual salary of £481,000 at Kier, with entitlement to receive a cash bonus of up to 100% of that basic salary, taking his package towards a cool million. It was clearly not enough to keep him in post.

His resignation after just four years in charge came as a surprise, especially as he had only recently led the acquisition of May Gurney. He officially departed at the end of June and starts his new job in October.

At Laing O’Rourke Paul Sheffield will have executive responsibility for leading the development and delivery of the group’s growth agenda in the United Kingdom, Canada and the Middle East. He will report to group chief executive Anna Stewart, who said: “During this period of industry transformation, there is no better person to lead the development of Laing O’Rourke’s Europe Hub than Paul Sheffield.  He is a proven leader with hard core engineering and construction skills, industry vision and the ability to unite people behind that vision.  His passion for how the construction industry can positively influence the world around us is exactly what Laing O’Rourke needs as we enter our next chapter of innovation and growth.

“With a broad executive remit, he will spearhead the Europe Hub strategy to get closer to our customers by delivering the inherent benefits of our unique business offering.  As one of the few remaining civil engineers to lead a major international contractor, his experience of successfully running complex businesses will greatly benefit the group as we evolve our strategic focus towards expanding the opportunities to deploy our Design for Manufacture and Assembly approach.”

Commenting on his new role, Paul Sheffield said, “To make real progress towards the ambitions set out last year in the UK government’s industrial strategy for construction in 2025, businesses need to have the courage to find ways of doing things differently.  The 30% time and 50% cost savings targeted will not be achieved by incremental change alone.   Recent investments in innovation, manufacturing and engineering excellence at Laing O'Rourke have shown that they have the ambition to lead this change agenda and to drive it at a pace that I have not seen in any other business in the industry. I am delighted to have been given the opportunity to be at the forefront of this paradigm shift in the way our industry works, and am very much looking forward to meeting the team and getting started in October.”

Chairman Ray O’Rourke said: “We are absolutely delighted that Paul has agreed to join us and lead the development of our international businesses across the Europe Hub.  He is one of the leading figures in our industry and has an outstanding reputation in business development, corporate leadership and construction delivery. The opportunity ahead for Laing O’Rourke is huge, but in order to seize it, we must have clear focus, move at pace, while continually innovating and transforming our customer offering.  Paul possesses the skills and experience to help make this happen and the Board is looking forward to working with him.”

Former Arup Group chairman Sir Philip Dilley has been confirmed as the next chairman of the Environment Agency.

He was nominated for the post by ministers last month but the appointment had to be approved by the House of Commons environment, food and rural affairs committee. This approval has now been given.

Sir Philip will take up the £100,000-a-year post in September, when the term in office ends of Lord Smith of Finsbury, the former culture secretary.

The committee questioned the civil engineer about his previous experience and suitability for the role, considering his business skills, dealings with government and media-facing experience.

Sir Philip Dilley is expected to spend two or three days a week on the job, which employs around 10,600 staff and is the frontline service for flood protection, environmental regulation and water resource management.

Committee chair Anne McIntosh said: “We are satisfied that Philip Dilley has the professional competence and personal independence required for the post of chair of the Environment Agency. We wish Mr Dilley every success in his new post.”

Network Rail is planning the biggest transformation of Cardiff Central station since it was first built in the 1850s.

Options are being explored for a major redevelopment of the station during its next five-year funding period, which starts in 2019. The plans are likely to see an extension to the Grade II listed building.

Signalling technology in the Cardiff area is already being upgraded and work has also started to electrify the line from Swansea to London.

But with passenger numbers forecast to grow 69% over the next decade and 145% by 2043, the station is not ready for the rising demand.

The remit for the initial design work, by Powell Dobson Architects, has been to integrate the historic elements of the station into a new building with a bigger concourse and improved connectivity to platforms. There will also be more shops, cafes and sandwich bars.

Network Rail says its wants the station to be not just a place people travel through on their way to somewhere else but “a destination in its own right serving the local community emerging around it”.

The site redevelopment proposals also envisage a new multi-storey car park, commercial developments on the existing south side and Saunders Road car parks and an enhanced transport interchange and public realm.

{{image2}}

Morgan Sindall’s housing development arm, Lovell, has opened a new office in Hampshire as part of a southern expansion drive.

Headed by newly-appointed area manager Bob Birch, who joins the company from residential developer Mansell, Lovell’s new office is on the Solent Business Park in Whiteley, Fareham.

The southern area team expects to build in the region of 150 homes in the next 12 months, with numbers set to increase over the next five years as it consolidates its market presence in Hampshire, Dorset, West Sussex, Surrey, Berkshire and Wiltshire. Lovell currently has 25 office- and site-based workers operating out of the Fareham office and more than 150 subcontractor staff working on its local sites.

Schemes for Lovell in the region include a £30m regeneration programme for Southampton City Council at three city estates where the company is building 221 homes.

“As the housing market continues to recover, we are in an excellent position to build on that success and help deliver the quality new homes which are so badly needed across the South of England,” said Mr Birch, who has also previously worked for Barratt and St George.

He added: “Alongside building new open market and affordable homes, we see major opportunities in the development of new housing for armed forces personnel and in the field of extra care housing where we have considerable expertise. There will also be opportunities to work with our sister company Morgan Sindall Investments on its large-scale joint venture regeneration partnership projects in Bournemouth and Slough.”

The Construction Industry Training Board (CITB) has introduced a new system for employers to complete their levy returns.

The new levy calculation process, designed to make life easier for companies, was approved by the CITB board yesterday.

Following an 18-month consultation with industry and  research with employers, the new process has been designed  by a levy working party (LWP) – a group of industry representatives tasked with looking at how to simplify the levy process.

The new scheme:

• maintains PAYE levy at 0.5%
• brings to an end the raising of levy on payments to labour-only subcontractors
• introduces a levy on payments made to net (taxed) CIS subcontractors, using figures already provided by employers to HMRC
• increases the size of the small business levy reduction from £100,000 to £300,000
• removes the labour-only payments received offset mechanism, which CITB says affects fewer than 10% of all employers.

The CITB says that all registered employers will receive a letter from next week, explaining the changes and the possible impact on their business.

CITB head of levy and grant Douglas Matthew said: “The changes have come in response to feedback from employers. They told us that the current process is complicated, time-consuming and can lead to extra administration costs.

“More than 22,000 employers currently pay the levy so it is important that we have the right system in place. Using figures provided by employers on their 2014 levy returns, we believe that under the new arrangements 84% of employers are likely to pay the same or less levy. Where companies face an increase in their payments, we will work closely with them to help them through the transition.

“To give all employers time to prepare for the new arrangements, the changes will not be implemented until 2017.”

For full details on the levy changes, see the CITB website.

Significant growth in the private rental sector in central London’s prime property market over the past decade now sees 16.2% more households living in private rented accommodation than in owner occupied properties.

New research also shows that supply is down with the number of new properties coming onto the market down in the second quarter of the year compared to the same period in 2013 with flats down 14% and houses down 27%.

The report from estate agency, W.A.Ellis in conjunction with independent property intelligence company, Dataloft and data provider Lonres, reveals that supply levels of flats have fallen most significantly in the lower price brackets, with new properties on the market below £750 a week down by 19% since March 2014. At the upper end of the price scale at £2,000 plus per week, supply levels have fallen by 10.2%.

Rental values achieved in the second quarter of 2014 were 5.1% higher than in the same quarter of 2013, a reflection of the improving economic outlook which sparked a turnaround in the market in late 2013.

The family house market in the prime central London sector is the most competitive with the number of family houses let so far in 2014 at W.A.Ellis up 12% on the same period in 2013.

Family houses are the most supply constrained homes. Since March 2014, houses have accounted for just 9.8% of properties brought to the market. The scarcity of family houses has meant tenants are paying 13.8% on average more for a house over a flat with the same number of bedrooms. In Kensington and Notting Hill this climbs to almost 25%.

The report also reveals that the lettings market has become more seasonal. Properties let between July and October accounted for 51% of all lettings in 2013. Over the last 10 years, properties marketed in November have taken 25% longer to let than those in September.

Gross yields for a two bedroom central London flat averaged 3% last year. Yields were lowest within the most expensive postcodes, with Chelsea and Knightsbridge recording yields at 2.5% and 2.3% respectively.

‘The growth in property sale values has prompted a number of landlords to cash in and sell their investment, one reason for the drop in supply levels in some areas of the market. Indeed, at W.A.Ellis, the percentage of vendors selling rental accommodation has risen from 22% to 32% over the past decade,’ said Lucy Morton, senior partner and head of lettings at W.A.Ellis.

‘This trend has been especially prevalent in the family house market, and is contributing to the current shortage of this type of rental property. The traditional buy to let market of one and two bedroom flats, however, is relatively unaffected,’ she added.

She pointed out that unlike investors in the mainstream housing market, investors in prime central London have long been willing to accept lower yields while prospects for capital growth remain high.

‘Total returns continue to be attractive, but growth in prices has outpaced rents and, as a…

When leaving a rental property, most people ensure they take their possessions with them but new research shows that they can leave some very strange things behind.

One tenant who left his Range Rover behind. It sat in the parking space with the keys left with the porter. When the letting agent contacted the former tenant informing him that the vehicle needed to be removed, he was told to keep it.
Unfortunately this would have been a bit problematic so after much to-ing and fro-ing, the tenant eventually arranged for someone to pick it up.

That tenant wasn't the only one who left something valuable behind. One letting agent was rather shocked to enter what was supposed to be an unfurnished flat after the tenancy ended only to find that everything had been left behind; furnishings, paintings, designer clothes and even Swarovski figurines. The foreign tenant was already halfway around the world so her possessions were eventually donated to charity.

The same outcome awaited the designer clothes and accessories left behind by a shopaholic. The charity shop was delighted to receive them, especially as they were still in their original bags with the tags attached.

Some other interesting items left behind include a toupee left in a biscuit tin in the kitchen, entire window (glass and frame) lying on the bed, fake Grecian columns and statues that had been cemented in situ in the reception room and a case of champagne.

Other less strange, but expensive items, include several cases of knives of all descriptions, a flat screen Bang & Olufsen TV, a set of skis and full set of ski attire, an American fridge freezer despite there being a working integrated fridge already in situ, and a full sized treadmill in the reception room.

‘Just when you think you've seen it all, something comes along to surprise you,’ said Marc von Grundherr, director of Benham & Reeves Lettings.

‘The Range Rover wasn't even the only vehicle we've had left behind. It was just the most expensive. I probably thought about keeping it for a second too long but then realised it would've been hard to transfer the title into the company name,’ he added.

After 10 days of the scheme being opened, 175 people had contacted The Construction Workers Compensation Scheme for an application enquiry form.

A third of those had returned their forms as of Tuesday this week.

That represents approximately 5% uptake of the compensation offer in the early days of the scheme as there are 3,213 names on the Consulting Association database eligible for the offer.

Whether the remain 95% are holding out for the prospect of a bigger settlement from the courts, are not aware of the scheme and their entitlement under it, or are simply slow off the mark remains to be seen.

The take-up figure was revealed by the scheme’s legal advisor Richard Slaven, a partner at Pinsent Masons, to the House of Commons Scottish Affairs Committee yesterday.

As previously reported, The Construction Workers Compensation Scheme opened on 4^th July.

Full details of the terms of the compensation scheme – from the application process to levels of compensation – can be found at www.tcwcs.co.uk. Any construction worker, or the family of a deceased construction worker, who believes they may have been affected by TCA records can download an initial enquiry form which is also available from the TCWCS free-phone helpline on 0800 980 8337.

The real estate market in Abu Dhabi has been relatively steady in the second quarter of 2014 with prices and sales seeing little movement, according to the latest residential report from Asteco.

It says that on average villa prices remained stable with increases of only 2% and overall there was continued levels of demand for all types of property.

Transaction levels for freehold development such as Golf Gardens and Al Raha Gardens were steady but affordable developments such as Al Reef saw no growth during the quarter as prices had peaked earlier in the year.

Rental rates also remained relatively stable with quarterly growth rates ranging from 0% to 7%. High end developments saw the highest levels of growth and the report says that reflects a clear preference for newer, master planned traditional supply on the Main Island.

It also points out that with the removal of the rent cap, several lower end properties leased as reduced rates have reverted back closer to market rents, especially in areas such as Central Abu Dhabi and Khalidiya/Bateen.

It has also been announced that a rental index will be launched in Abu Dhabi later this year with the aim of creating a more transparent market and regulating maximum rental increases.

The report also points out that with rental rates at Al Reef Villas reaching significant highs they are 14% higher than in the second quarter of last year.

The high rents seen in Al Reef led to an overflow of demand for Hydra Village where villas had already achieved a 5% rental increase since the third quarter of 2013.

‘Nonetheless, we do not foresee significant increases in Hydra Village, at least until proper landscaping and supporting facilities are completed,’ the report says.

Last month saw the UK housing market bolstered by remortgaging and buy to let activity, coupled with a sharp rise in property valuations, according a new report.

The latest data from chartered surveyors Connells Survey & Valuation shows that the total number of all property valuations were up 30% in June compared to May.

This expands on a more gradual month on month recovery of 3% in May, following a sharp correction in March and April.
On an annual basis, this leaves total activity at the same level as a year ago, with a 0% annual increase compared to June 2013.

According to John Bagshaw, the firm’s corporate services director, affordability is potentially a very real limiting factor for the housing market and it has been for some time. ‘Now, with the imposition of the Mortgage Market Review in April, alongside the latest note of caution from the Bank of England, the world of mortgages is revealing its fundamental link to household incomes,’ he said.

‘A rapidly improving economy with the prospect of real wage growth this year means that progress should continue. But we are now in a different phase of recovery, making new headway rather than just playing a rapid game of catch-up. This good news as there is now a sense of optimism that the housing market will be more stable and sustainable in the long term due to these developments,’ he added.

The report also says that remortgaging has formed the backbone of the monthly recovery, up 61% between May and June. In part this rapid growth can be attributed to making up ground lost in previous months, coming after a cumulative drop of 40% in March and April, and a very gradual 4% rise in remortgaging activity in May. However this still leaves remortgaging activity 10% higher than in June last year.

Moreover, as a proportion, remortgaging made up 28% of all valuations in June 2014. This is not just higher than the temporary low of 22% of all valuations seen in April, but also significantly above the average of 26% of all activity attributed to remortgaging in the previous 12 months.

Buy to let activity has also seen above average growth, seeing the same 10% increase since June last year. This follows 31% growth between May and June in the number of buy to let valuations.

‘It appears that some mortgage lenders have decided to refocus on remortgaging and buy to let. There are two aspects to this dramatic month on month growth; firstly that remortgaging was severely affected by the short term transition to the new MMR regime, and the temporary backlogs this created.

‘Secondly, a more subtle shift may have taken place. Pre-MMR there was a real focus on home movers and particularly first time buyers. But the latest noises from the regulator and the Bank of England seem to have put a cooler on riskier lending, especially at high income multiples. Equally, the expectation that interest rates might increase…

Senior directors of Balfour Beatty, Laing O’Rourke and Vinci yesterday repented for their sins in front of a committee of MPs and sought forgiveness.

They didn't get much.

As part of the House of Commons Scottish Affairs Committee’s long-running investigation into the construction industry blacklisting scandal, the three bosses once again admitted the culpability of their companies and acknowledged that their supporting of the Consulting Association had been wrong.

Balfour Beatty Construction Services UK chief executive Nick Pollard, Laing O’Rourke group finance and commercial director Callum Tuckett and Vinci Construction UK managing director Andrew Ridley-Barker gave evidence to the committee. They admitted their companies used the blacklisting service up until the Consulting Association was raided and shut down by the Information Commissioner's Office in 2009. "We should never have done it," said Mr Ridley-Barker.

They were accompanied by legal advisor Richard Slaven, a partner at Pinsent Masons, and crisis management consultant Richard Jukes of Grayling, both of whom are retained by The Construction Workers Compensation Scheme, set up by the guilty contractors to pay off the workers whose lives they may have ruined.

The construction bosses and their advisers were given a rough ride by MPs who gave every indication of being on the side of the victims on this one. Committee chair Ian Davidson dismissed their compensation scheme as “damage limitation” rather than a real demonstration of repentance.

Mr Davidson rejected the claims of the contractors that they were being proactive in putting things right. He said they were merely reactive. He said that all the evidence  contractors would have continued blacklisting had they not been caught and only set up the compensation scheme once they had been hauled over the coals and told to do so by his committee.

Richard Jukes and Grayling were accused by MPs of 'misrepresenting the compensation scheme' in publicity information they had put out to the media, claiming union support that they did not, and do not, have. It is, in fact, a unilateral scheme.

Breedon Aggregates, supplier of raw materials to the construction industry, saw its revenues grow 25% in the six months to 30 June 2014.

Half-year revenues reached £125.5m, up from £100.2m for the same period last year.

Underlying operating profit was up 57% to £10.4m (2013 H1: £6.6m). Pre-tax profit more than doubled to £9.1m (2013 H1: £4.4m).

Executive chairman Peter Tom said the improvement was partly driven by better weather –   the start of 2013 was severely affected by poor weather – and partly due to improvement in the economy. The Mineral Products Association has reported national volume increases of 15-18% for aggregates and asphalt and 5% for concrete in the first quarter of 2014.

Breedon’s numbers were also boosted by acquisitions

The results include a full six months' benefit from the acquisitions of the former Marshalls quarries in England and the former Aggregate Industries (AI) operations in Scotland, which were completed on 30 April 2013. The results also include a month's contribution from Huntsman's Quarries, acquired on 1 June 2014 for £15m.

Mr Tom said: “Market conditions in England generally remain stronger than in Scotland, although the Scottish business had a strong first quarter on the back of increased spending by Transport Scotland.  We continue to focus on our core customers and markets, where we successfully differentiate our products by offering better quality and service.  The improved market conditions have enabled us to increase prices, recovering input costs, and make up some of the ground lost during the recession.

“We have finally come to the end of the long-running investigation by the Competition & Markets Authority (CMA) into the acquisition of the AI business in northern Scotland.  This drawn-out process started at the end of April 2013 and, as previously reported, the CMA's findings mean that we are obliged to sell one concrete plant and one asphalt plant in the Aberdeen area and enter into a price-control agreement on asphalt in the Inverness area.  We have six months to comply with the findings.  Pleasingly we are now able to fully integrate the business, which has been operating as a commercially independent entity for the past year, and we expect to deliver synergy benefits in the second half of this year.

“We continue to invest in our core business and in the first half we acquired a new sand and gravel quarry at West Deeping in Lincolnshire and opened a new concrete plant at Cannock near Stafford.  We also acquired, from AI, the concrete plant in our Clearwell quarry (purchased from Marshalls last year).  In addition, we invested in a significant amount of capital equipment in the first half, including new processing plant at Craigenlow quarry in Scotland and a major investment to increase capacity at our large Norton Bottoms quarry near Newark.  We continue to see good opportunities for further organic investment in the business at attractive returns.”

Former chief executives of Kier and Costain have both joined the board of construction consultant Sweett as non-executive directors.

John Dodds was 40 years at Kier Group, with the last seven as chief executive until his retirement in 2010. He is currently non-executive chairman of Severfield and a non-exec director of Newbury Racecourse and Lagan Group Construction Holdings.

Alan Lovell was chief executive at Costain during a turbulent time in the mid 1990s, having stepped up form finance director to succeed Peter Costain. An accountant by profession, he has also had spells propping up Conder and Jarvis. These days he is chairman of Tamar Energy, and a non-exec director at Progressive Energy and TidalStream.

Both men join the board of Sweett next week, with Mr Dodds as chairman, replacing Michael Henderson.

Sweett Group CEO Dean Webster said: "I am very pleased that John has agreed to join Sweett Group as chairman. He is an industry heavyweight with broad experience and is highly respected by both the construction sector and the investment community.  I very much look forward to working with him and benefitting from his experience. I welcome Alan too, whose expertise will add another dimension to what is a very strong board.”

Living close to a good school remains a priority for home buyers in the UK with 20% of estate agents believing it is the most important factor.

The latest research data from Move with Us, a network of independent estate agents in the UK, also found that 18% of estate agents believed good transport links were key. Proximity to local amenities such as a doctor’s surgery and shops came in third with 14% of the votes.

Other factors that were less important to buyers include a fast internet connection which scored 7.6% and a good mobile phone signal with 13%.

Estate agents also cited what factors buyers are less interested in compared to five years ago. Home buyers are less interested in garden sheds which got 18% of the vote. Garden size and outhouses came in at second and third place with 15% and 14% respectively.

Other results include the traditionally bath tub with 14%, a power shower at 10% and finally, a dining room with 8%.
The one factor estate agents can’t seem to agree on however, is the garage. Some 11% of estate agents have noticed home buyers are more interested in properties with a garage whereas 9% say home buyers are less interested in them.

‘The property market has been through peaks and troughs over the last five years but properties bought near to good schools, transport links and local amenities are typically sound investments,’ said Robin King, director at Move with Us.

‘Anyone looking to buy a good property should stick to these golden rules. Surprisingly, a fast internet connection and good mobile phone signal came low down the wish lists of prospective buyers although interestingly, a good internet connection is becoming increasingly sought after in rented accommodation,’ he added.

The Considerate Constructors Scheme has appointed Mike Petter as its new chairman, with Angus Kennedy and Albert Ree joining the board.

Mike Petter, former managing director of consultancy firm Five Dimensional Management, became a director of the scheme in July 2012 and vice chairman last year.

He takes over from David Watson, who has been chairman since 2012, who helped the scheme introduce a number of new initiatives, including the Code and Checklist in 2013 and helped develop Supplier Registration.  David Watson will remain on the board for another year. 

Angus Kennedy, who has been monitoring for the scheme since 2011, is a chartered builder. He was construction director on the £150m Maxim Business Park in Lanarkshire in 2007.

Albert Ree has worked for Balfour Beatty for more than 30 years and has been a director of Balfour Beatty Construction Northern. He now heads sustainability for Balfour Beatty Construction Services UK.

John Sayers steps down from the board but assumes the new position of scheme ambassador, representing CCS at industry events.

Chief Executive Edward Hardy said: “David has made an enormous contribution to the ongoing success and growth of the Scheme and we’re happy to see him remain on the Board for another year. I’d like to welcome Mike who brings his industry expertise to the position and I know the Board is looking forward to working with him to continue the successful development of the Scheme and its valuable work.”

The Mayor of London is calling on the government to extend its plans to accelerate the release of disused public land in the city and enable him to unlock new development to help meet London's housing needs.

Boris Johnson said that he wants to be able to fast track the development of thousands of homes on a host of public land sites. Speaking during a visit to Catford where 500 new homes are being built on a site taken on by the Mayor in 2102, he highlighted how effective this kind of development can be.

The former Catford Dogs Stadium site in Lewisham had lain empty for more than 10 years before coming into his control. Now 87% of the site is in development.

Johnson said there is the capacity for thousands more homes on strategic public land across London that is ripe for development.

The £117 million redevelopment of Catford Green is bringing more than a thousand jobs and 589 new homes to the site in the heart of Lewisham under a deal reached between the Mayor and developer Barratt London. When finished, this will include 173 low cost homes to rent and buy.

The Mayor's work to redevelop disused public land is one strand of his comprehensive Housing Strategy to double house building and create the homes needed in London.

This financial year the Mayor is supporting the completion of more affordable homes than in any other year since 1980. This month further allocations will be made to 54 housing providers, as part of the Mayor's 2015/2018 £1.25 billion pot.
This puts the Mayor on track to deliver the affordable housing targets in the draft London Housing Strategy and adds to the Mayor's 100,000 low cost homes programme across his two terms.

Johnson is driving a cross-party amendment to the government's Infrastructure Bill to extend new powers to accelerate the release of public land to London, by giving the Greater London Authority the same powers to work with Whitehall bodies as the Homes and Communities Agency.

‘This is a fantastic opportunity for us to work with the government and unlock the potential of the many empty and unused sites across the capital. Rapid redevelopment, regeneration and most importantly thousands of new homes for Londoners could be just around the corner given the necessary fast-tracking powers. Dramatic transformations, like the one we are witnessing in Catford, would be possible all over the city,’ said Johnson.

Baroness Jo Valentine, chief executive of business group London First, pointed out that while there are empty sites and redundant buildings owned by the public sector that could be much better used for housing there is no body dedicated to actually identifying where all this land is.

‘First we need to give the Mayor the power to create a 21st Century Domesday Book for London so we know where this land is. Then we need to ensure he has the ability to get on with selling it using his trademark gusto,’ she said.

Catford…

The number of tenants in the UK severely behind on rental payments has fallen by 35,000 or 35% in last 12 months, new research shows.

The improvement means that 98.5% of private sector tenants now avoid significant rental arrears, according to the latest Tenant Arrears Tracker report from LSL Property Services.

Overall some 67,000 households remain more than two months behind on rent but this is compared to 102,000 in the second quarter of 2013.

Most recently the number of tenants in severe arrears has dropped by 0.2%, between the first three months of 2014 and the second quarter of the year.

As a proportion of all tenants, those in serious arrears of more than two months has also improved, standing at 1.5% in the second quarter compared to 2.2% in the second quarter of 2013.

Improvements in serious rental arrears tally with the latest figures on overall rent arrears, of any duration. According to LSL’s latest Buy to Let Index, overall tenant arrears now stand at just 7%, as of May 2014, down from 8.2% in May 2013.

‘Private renting has absorbed enormous pressure and will continue to do so. For over half a decade, our national aspiration to own our own homes has struggled in the face of the longest economic crisis on record. And in the midst of this, private renting has provided a solution,’ said Paul Jardine, director and receiver at Templeton LPA.

‘Certainly, some households succumbed to the wave of unemployment that followed the 2008 crisis, and as the broader monthly squeeze tightened its grip. For a time, though still for only a small minority of tenants, there was a significant rise in serious rental arrears. But now as the jobs market gradually comes back to life, the effect on the most hard pressed of households is clear to be seen,’ he explained.

‘While wages are yet to pick up significantly, those in the most serious financial problems often face a lack of any earnings at all. So as the risk of unemployment retreats this year, those with serious problems paying their rent, and most at risk from losing their homes, are benefiting the most,’ he added.

However, the report also shows that despite fewer tenants falling into the most severe arrears, the number actually facing eviction, while significantly lower in absolute terms, has continued to rise. As of the first quarter of 2014, some 33,000 tenants are facing potential eviction via court order, up 5.9% from the fourth quarter of 2013. On an annual basis this leaves evictions levels 10% higher than in the first three months of 2013.

Meanwhile, landlords have continued to benefit from both the improving financial position of tenants, and a beneficial mortgage market. Landlords’ own mortgage arrears have fallen for the sixth successive quarter, with just 14,700 buy to let mortgages in arrears in more than three months in the first quarter of 2014, down 10.9% from the previous quarter. On annual basis this means…

Residential property sales in Canada increased by 0.8% in June compared to the previous month, the five monthly rise in a row, taking transactions to their highest level since March 2010.

The data from the Canadian Real Estate Association (CREA) also shows that national average price for homes sold in June was $413,215, up 6.9% from the same month last year.

Sales rose in about half of all local housing markets in June, led by gains in Greater Vancouver where activity hit its highest level in more than three years, and Montreal where activity is now 10% above post-recession lows reached earlier this year.

Actual, not seasonally adjusted, activity in June stood 11.2% above levels reported in the same month last year. June sales were up from year ago levels in three out of every four local markets, led by Greater Vancouver, Fraser Valley, Calgary, Greater Toronto and Hamilton-Burlington.

While prices are up almost 7% on a year ago, the report points out that the national average price continues to be skewed upward by sales activity in Greater Vancouver and Greater Toronto, which are among Canada’s largest and most expensive housing markets. Excluding these two markets from the calculation, the average price is a relatively more modest $336,164 while the year on year increase shrinks to 5.2%.

Year on year price growth varied among local housing markets tracked by the index, with the biggest gains having been posted by Calgary with a rise of 10.74%, Greater Toronto up 7.77% and Greater Vancouver up 4.37%.

Two storey single family homes continued to post the biggest year on year price gains with an increase of 6.19%, followed closely by one storey single family homes up 5.35% and townhouses up 5.07%. Price growth for apartment units remained comparatively more modest 3.85%.

The number of newly listed homes changed little in June, having eased by 0.1% compared to May. In May, new listings reached their highest level since April 2010. On an actual, not seasonally adjusted, basis, new listings set a record for the month of June.

‘At least some of the recent burst in new supply reflects the slow start to the year, when a harsh winter caused many sellers to delay listing their home in many parts of the country,’ said Gregory Klump, CREA’s chief economist.

‘In markets with tight supply and strong demand, the strength of sales in recent months reflects how many properties were snapped up once they finally hit the market. Because the impact of deferred listings and sales has likely run its course, activity over the second half of the year may not be able to maintain the kind of pace we’ve seen over the past couple of months,’ he added.

The national sales to new listings ratio was 53.6% in June, up slightly from 53.2% in May but still well entrenched within the range between 40 and 60% that marks balanced market territory. Just over half of all local markets posted a sales to new listings ratio…

Skills shortages and increasing delivery times for certain materials have become substantial constraints on construction activity, surveyors are warning.

The latest construction market survey form the Royal Institution of Chartered Surveyors found that 51% of surveyors say skills shortages are curtailing activity and 58% cited materials shortages as an impediment to growth. A year ago these figures were just 7% and 5% respectively.

Some 54% of firms have had difficulties recruiting quantity surveyors and 59% have struggled to find bricklayers. This compares to 19% and 7% who were noticing shortages in these roles last year.

Surveyors have also noticed changes in the behaviour of contractors. Marc Menear from the Bristol office of Faithful+Gould said: “Contractors appear to be coming more selective over which projects they tender for.”

Jonathan Park of Harrogate-based Appleyard & Trew commented: “Contractors are at capacity on enquiries and struggling to submit tenders with periods set.”

Anthony Millward of Allan Reynolds Partnership in Wolverhampton said: “Shortage of bricks and bricklayers are a problem. As contractors are getting busier we are finding their management resources can't cope. This is impacting on preplanning and seriously affecting progress on site.”

The Q2 2014 RICS construction market survey shows a continuing improvement in activity across all areas of the UK, with the private sector leading the way. The headline national workloads net balance, which captures the change relative to the previous quarter, softened only marginally from Q1’s record high of 43 to stand at 41 for Q2.

{{image2}}

The private housing, commercial and industrial sectors are driving this growth in workloads with the individual balances for each of these sectors also moderating only slightly from the series high values recorded in Q1.

The private housing sector has been the main driver of the recent growth in the official construction output data and the continued strength of the RICS private housing workloads series, which recorded a value of 41 in Q2, shows that momentum in this sector remains strong.

The net balance of private commercial workloads came in at 51 in Q2, from Q1’s series high value of 55, and as with the private housing sector, workloads grew robustly across all areas of the UK that we monitor. In the industrial sector, the workloads net balance recorded a value of 38 in Q2, down slightly from Q1’s reading of 40.

Workloads grew strongly across all broad regional blocks with the Midlands region in particular seeing workloads rise at a record pace. Scotland and Northern Ireland have generally experienced more moderate growth in activity than the other areas of the UK over the last year but workloads have, nonetheless, been consistently rising, RICS said.

{{image3}}

Almost half of all tenants in the prime London property market are renting due to employment relocation as the city attracts companies from around the globe, according to a new analysis.

This demonstrates the increasingly important role of corporate demand in the prime rental markets across world cities, says the report from international real estate firm Savills.

Traditionally, the financial and insurance services sector has dominated the corporate relocation market with 50% of tenants working in this area in 2007. But in the aftermath of the financial crisis they now account for just 39% of the market, signifying the shifting nature of employment in the capital.

In its place there has been a rise in the number of technology industries locating in the capital, facilitated by the development of ‘Tech City’ in the east and the recent regeneration of King’s Cross.

‘London attracts companies from around the globe and remains one of the world’s most important centres for global commerce. Consequently, we have a diverse range of different tenants from all business sectors looking to relocate to areas throughout London,’ said Matthew Salvidge, the firm’s head of Corporate Services.

Over the next five years it is estimated that there will be an additional 368,000 employees in London, and around 25% of these will be accounted for by the technology industry. It is set to become the largest industry in central London, and growth in the sector across the UK will outstrip that of California’s ‘Silicon Valley'.

Compared to employees in the financial and insurance industry, who from 2007 to 2013 increased by 6%, underperforming the London average of 10% growth, tech industry employees grew by 19% over the same period.

The latter, however, have on average 25% less budget when relocating and the report points out that this disparity naturally impacts on where they choose to live in London, resulting in a locational shift.

The tech industry has traditionally been concentrated around Old Street and has dispersed outwards from there. Consequently, areas such as Highbury and Islington have benefitted from a rental perspective, with 22% of employees living in these areas working in the sector. This is due to their easy accessibility from the core technological hubs and excellent transport links.

Areas surrounding and easily commutable to King’s Cross, the location of Google’s new headquarters, are likely to enjoy similar success and Savills predicts a 9% increase in office based employment here by 2018. Financial services employees on the other hand prefer living in prime central London locations such as Chelsea or near to their work, in Wapping.

By 2018, while the number of employees in the financial and insurance sector in central London is forecast to remain the same, employees in the professional, scientific and tech industry are set to increase by 16%, making it the largest industry in central London according to Oxford Economics.

‘As the tech industry continues to expand, this extension in popular locations will continue and the demand for rental properties suitable for corporate relocation tenants…

The demolition of an eight-storey office block next to Hounslow bus garage in west London appeared to go out of control yesterday afternoon when a huge section came crashing down, leaving the remaining structure unsafe.

Reports suggest that it cause quite a stir across the vicinity.

The building, in Hounslow High Street, is being demolished to make way for a housing development.

According to Demolition News, Lincolnshire-based contractor GBM Demolition suspended work pending arrival of an inspector from the Health & Safety Executive to investigate the unplanned collapse.

It appears to have been only through good fortune that all debris remained within the perimeter of the site and no one was hurt.

{{image2}}

House prices in Scotland increased by 0.5% in May, but sales fell by 3% probably due to the marketing adjusting to new mortgage rules, according to the latest monthly index.

Year on year prices have climbed 4.3%, or £6,750, to an average price of £162,302, the LSL Property Services/Acadata index also shows.

It points out that May marks longest period of sustained monthly price growth since before the economic crisis and the property market recovery has strengthened across the country, with a new price record being set in Aberdeenshire.

‘We are now seeing the longest sustained period of price growth in seven years. Prices have not climbed so steadily every month since December 2007,’ said Donald MacLellan, chairman of Walker Fraser Steele Chartered Surveyors, part of LSL Property Services.

‘Not only this, but growth has put down roots across the country, with 87% of the local authority areas in Scotland enjoying annual average house price rises. In May a new record house price was reached in Aberdeenshire, taking the cost of an average home to £224,803,’ he explained.

He pointed out that first time buyers provide a solid foundation for the recovery to continue building on.’ In the three months to May 2014, the number of flats sold rose 26% on the same period last year, followed by terraced houses with a 22% annual increase in sales. As the typical property choices for first time buyers, this illustrates the stream of activity at the entry level of the market powering growth and consumer confidence,’ said MacLellan.

He also said that the 3% fall in sales goes against the historic seasonal trend for this time of year, suggesting that tighter regulations under the Mortgage Market Review have temporarily slowed housing transactions.

‘But with recurrent indications that interest rates will rise before the year is out, new record property prices being set, and only three months to go before the independence referendum, potential buyers may also be taking heed of caution and delaying purchase decisions until they can be clear what the future holds,’ he commented.

‘Whether this monthly blip is symptomatic of a broader turning tide in the housing market remains to be seen, as it is still too early to see. More changes are afoot, with greater stress testing and loan to income caps coming into play to ensure the long term health of the property market,’ he said.

He also pointed out that the Bank of England or the UK government intervening further in the property market to rein in housing demand is not necessary in many parts of the UK, and could pull the rug out from under the feet of recovery in areas where growth is still bedding down.

Prices are not rising everywhere. In the city of Glasgow house prices dropped 3.1% in the month to May 2014. ‘The Help to Buy scheme and further investment into new housing developments are a lifeline in areas such as these to consolidate growth,’ added MacLellan.
…

The future of ambitious proposals for a new airport in the Thames estuary is set to be determined in the autumn.

That is when the Airport Commission will decide whether to keep this option in the mix or throw it out.

The government established the Airports Commission in September 2012 to advise on the need for and location of future runway capacity. Its interim report in December 2013 set out three options – two at Heathrow and one at Gatwick – and called for further consideration of the Thames Estuary option.

Since then, promoters of shortlisted options have provided more detailed proposals to the commission. This autumn, the commission expects to decide whether or not to shortlist an estuary option, and will then undertake formal consultation on the shortlisted options.

The final report will be published in summer 2015, by which time it will be up to a new government to make any decision.

House sales transaction levels in central London’s prime property market are down 45% compared to June 2013, according to a new report.

The volume of transactions is concerning as the market slows down for the summer months, says the analysis report from W. A. Ellis.

It is probably due to buyers are adopting a 'wait and see' approach for political and economic reasons, said Richard Barber, partner at the estate agency.

‘We've seen a 25% reduction year on year in sales at all price ranges across our prime central London areas of Belgravia, Chelsea, Knightsbridge, South Kensington, Mayfair, and Kensington,’ he pointed out.

‘For instance, in June 2014 only 185 properties were sold, compared to 249 properties in June 2013. It is the underlying reduction in the volume of transactions which is of most concern as we enter the traditionally slower summer quarter,’ explained Barber.

The agency said that the proportion of sales under £2 million has also reduced, but only marginally from 67% to 62%. ‘However, when one looks at the actual number of sales, a more disturbing trend emerges, namely that only 115 flats have been sold in June 2014 beneath £2 million and perhaps the most frightening statistic of all is that only 27 houses were sold in June, whereas last year 49 were sold, a reduction (in transactional terms) of nearly 45%,’ said Barber.

‘The underlying factors are very apparent to close observers of the market; the combination of mansion tax threats, higher stamp duty, ATED and the fear of a Labour government is having a cooling effect on the market in general, but is particularly swingeing within the family house market,’ he explained.

‘There are currently 374 houses for sale within our chosen areas and approximately 92% of them have a price tag in excess of £2 million so it is not entirely surprising that the transaction level is lower,’ he added.

He pointed out that arguably, there is also value to be found as many of these properties offer greater floor area, albeit spread over four to five floors, gardens, patios and better bedroom accommodation.

‘It is apparent, however, that the traditional buyer of these houses, buyers from northern Europe and the UK, are currently weighing up the situation both political and economic, and perhaps adopting a wait and see approach,’ Barber added.

‘What is clear is that keen vendors will need to adjust their expectations if they wish to find a buyer this summer. We have achieved 99% of our asking prices since January 2014 which underlines the importance of accurate and responsible pricing in a changing marketplace,’ he concluded.

ISG has promoted Paul Sharp to head its specialist technical fit-out operation in its UK Engineering business.

The move is part of the company’s plan to strengthen its delivery capability in technically complex fit-out projects within the healthcare and research & development sectors.

ISG has recently worked on specialist fit-out projects at Guy's Hospital in London for Cell Therapy Catapult and also a new research facility at the Natural History Museum. Paul Sharp is currently working on a new stem cell laboratory for King’s College London.

In his new role, Mr Sharp will lead ISG’s bid for opportunities in the forthcoming Medcity in London, which will collaborate with the universities of Oxford and Cambridge to form a world-leading bioscience cluster, where there is significant planned investment in R&D facilities and laboratories. He will also drive the roll out of ISG’s specialist fit-out business nationwide.

Mr Sharp said: “My new role represents a strategic decision by the company to capitalise on many of the world-class technical fit-out projects that ISG has delivered, creating a formal structure to take that expertise to the marketplace as a defined service offer. The success of the bioscience cluster in attracting ground breaking academic research and commercial scientific companies from across the world provides considerable opportunity for the business, with its strong credentials delivering highly complex and mission critical projects.”

Social housing organisations could save £285m a year in building repair and maintenance costs by improving their purchasing, a new study suggests.

The analysis of a range of social housing providers, undertaken by MindMetre Research, highlights that by re-engineering R&M materials purchase and management procedures, social housing organisations could stand to save £1.7bn in social housing R&M costs by the end of the decade.

The research was commissioned by builders’ merchant Travis Perkins.

The study, Material Advantage, looked at 95 housing associations and local authorities that have already addressed inefficiencies in this area, and found that partnering with an organisation to reduce their materials supply chain can enable housing authorities to improve efficiency and productivity with:

• Shorter supply chains
• Accurate stock levels, elimination of wasted time and better ‘first time fix’ rates
• Reduction or elimination of storage requirements
• Product standardisation, ensuring high quality materials at lower costs
• Improved management information on workforce productivity.

Ian Church, managing director of Travis Perkins Group Managed Services, said: “With social housing providers under continued pressure to do more with less, the smallest inefficiency can cause much larger issues for authorities.  Identifying the purchasing and management of R&M materials as a starting point, however, means housing associations can begin to address the issue.

“Partnering with an organisation that improves and shortens the supply chain presents a viable way for organisations to better meet budgets and reduce inefficiency. Bringing purchasing costs closer to the original supplier not only reduces costs, it also brings the benefit of product standardisation, which leads to high product quality and lower long-term costs. What’s more, the improved IT capabilities brought by partnerships like this enable better scheduling, reducing downtime and limiting gaps in between tenancies.”