On Wednesday afternoon, The Good Homes Alliance invited speakers to pitch their "Nudge Innovations" to their Christmas party audience and a judging panel.
Seven interesting pitches were made to offer new ways to encourage the delivery of better homes. Our Cullinan Studio / Levitt Bernstein pitch on behalf of research collective "Appropriate Housing" took both first prize and the popular vote, but the take-away theme from the event was the shift in discourse to consider the wider market beyond the delivery of buildings themselves.
Land and tax emerged as themes that had traction with the judges. Whilst our Appropriate Housing pitch considered the possibility of financial partnering of landowners and residents, we shared David Adams' position that without better tax policy, the UK housebuilding sector will continue to build for a market that rewards speculation and accumulation over good, appropriate homes. David's pitch - in his capacity as Technical Director at Melius Homes - concerned Stamp Duty Land Tax (SDLT) and took third prize.
As a tax on buyers, SDLT serves only to throw sand in the wheels of the housing market by discouraging mobility and adding a lucrative but unnecessary tax to already eye-wateringly high deposits. Instead, David proposed using SDLT as a tool to make Energy Performance Certificates (EPC) start to mean something. In a market that values the home as a land asset rather than the durable good that it is, this seems a win-win that could be implemented in a single Budget. He proposed to discount, rebate or multiply the SDLT rate so that it might reward performance whilst being cost-neutral to the Treasury.
The Appropriate Housing "nudge" proposed that land and development capital could be converted into shares. In our model, these shares are initially owned by the landowner and capital investors but are gradually acquired by residents over the long-term. Essentially, the landowner becomes the mortgage lender – the shared equity partner for the land portion of the development - with the transferral of shares being via stair-cased ground rent payments and equity disposals.
Other nudges concerned off-site manufacture (Go-Offsite and Reach Homes) as well as improved performance through measuring and scoring (Iceni Projects, XCO2 and BioRegionals' BEPIT - "Building Energy Performance Improvement Toolkit").
Thanks once again to the Good Homes Alliance for broadening the housing debate.