Platform: New homes industry cannot afford lofty low-carbon goals

Published on Friday 20 November 2009 21:46

ARE HOME buyers willing to incur premiums of up to £8,000 for low-carbon living or "bolt-on renewables", which seem to offer little in the way of payback, may prove difficult to understand and operate, or are untried with regards to long-term performance and maintenance?

At a time when early signs of stability in the housing market may be starting to appear, this is the question being prompted by proposed new building standards aimed at further reducing Scotland's overall carbon footprint, scheduled to come into effect next year.

According to Scottish Government research, the housebuilding industry has already made significant progress towards low-carbon policy targets in comparison to almost all other industry sectors. New homes already generate more than 60 per cent less emissions than older properties – the equivalent of driving 10,000 fewer miles a year per household.

While Homes for Scotland, which represents firms building 95 per cent of new homes built for sale, supports the sustainability agenda, the Scottish Government must take account of the dramatic impact the credit crunch has had on our industry. With much new development across the country still effectively on hold, we will, for the foreseeable future, simply be focusing on re-growing baseline supply and meeting consumers' expressed core needs in a trading environment where affordability, in its widest sense, is significantly constrained.

Most builders are still to construct houses that comply with even the current 2007 regulations. We have yet to test what impact these proposed extra costs, which are predicted to add 3,000-8,000 on to every new home, will have not only on sales but also entire project viability. Furthermore, property valuations undertaken for mortgage lenders confirm that energy-saving equipment at present does not add value to the property.

It is simply not possible for the industry to absorb costs of this magnitude at present, particularly given the ever-expanding list of developer contributions towards education, affordable housing and the like, burdens that are still being placed on our members by local authorities.

Given the fact that annual new-build supply is likely to remain constrained below 1 per cent of the existing built environment for a considerable time to come, much greater emphasis needs to be placed on systematically improving the carbon performance and energy efficiency of existing dwellings.

There may be merit in exploring an approach whereby rather than a home builder incurring very high costs to achieve a marginal improvement in limited new-build stock, they contribute towards the improvement of existing housing stock in the immediate area where more efficient and easy-to- deliver carbon emission reductions can be achieved. This would also assist the Scottish Government in the realisation of its overall carbon emission reduction targets across the whole of the residential built environment, to even better or quicker standards, with much less significant per unit costs.

We implore the Scottish Government to seriously consider the substantive progress already made by the home building industry in reducing the carbon footprint of its products to date and reduce the speed with which it moves to introduce very low carbon new homes.

Otherwise, with national housing supply targets already shattered, it stands only to further delay the provision of essential new housing to meet both private and social needs.

&#149 Jonathan Fair is chief executive of Homes for Scotland