29 Dec 2008

On Casey's Call To Arms

Over at Carbon Limited, Casey Cole calls us built environment commentators to arms over the government’s zero carbon consultation, downloadable here.

This consultation is a biggie, writes Casey, and I think he’s right. So let’s big it up and let the government know what we think before the consultation closes on March 18. I intend to dip into this subject over the coming weeks, partly to do it in digestible chunks, and partly to give me a little more time to collect my thoughts about it.

Initial feelings are not positive. Government housing policy is a mess. In the past few years they have pushed three objectives, all of which look pretty flawed to me.

• Let’s build 3 million new homes by 2020.

This target looks increasingly bizarre in the light of the credit crunch. At this point in time, builders can’t sell new homes for love nor money and the justification for all this new housebuilding — which was that we are suffering from a housing shortage — now looks like yet another bellow used to fan the housing bubble.

The government clings to the hope that this slowdown is a temporary blip and that normal conditions will return in a year or two. Normal for them means house prices rising again and people clammering to get on the housing ladder once more. I’m just not sure anymore.

OK, it’s only my opinion, but I don’t think we are going to return to the status quo ante. I don’t think we’ll ever see house prices back at 2007 levels. Or at least we won’t unless the government deliberately lets inflation out of the bag and devalues money, which is something else that worries me, but not something I am going to go into any more detail about here.

I think essentially that we’ve now finished building Britain, at last for a generation. Just as our road building programme came to a halt back in the 1990s, our house (and commercial) building era is now probably over, save for a few choice infills and lots of replacements; that sort of thing. I think the big plc housebuilders are dinosaurs, relicts from the era of unsustainable growth, and that they will all be out of business within two years. And I suspect that building land prices will carry on falling back towards agricultural land prices, where they once were. Back before the days of planning permission.

So there really isn’t a lot of point worrying about whether homes built after 2016 will be zero carbon or not because we will be building so few of them that it makes sod all difference.

But there is no box anywhere in the consultation for people who feel like this.

• Let’s build ten eco-towns

Lord knows, I have been on the attack against this absurd idea for yonks now, and I have now grown slightly bored of the whole topic, as has everyone else, by the looks of things. The eco-town proposal is now dead in the water, the credit crunch driving the final nail right through the heart. You’d think the government would be happy to shelve the whole thing if only to spare their own blushes, but no, they cling on desperately. Eco-towns even gets a page (p21) devoted to them in the zero carbon consultation paper. Why?

• Let’s build zero carbon homes

Conceived in a blaze of publicity, back in 2006 when the Code for Sustainable Homes was published, this too has always looked to me to be an ambition with zero sense. Building super energy efficient homes is one thing; turning them all into mini-power stations quite another. You can imagine this project coming out of some think tank or other, a minister or two then thinking, “that sounds like a great idea”, the Treasury then commenting “even better, we won’t have to pay a penny towards it” and, hey presto, it’s a policy.

And, ever since, good people have been scratching their heads, wondering just how on earth they are going to implement it. This consultation document, which Casey is pointing us towards, is the summation of all this head scratching. All 111 pages of it. If it really was a good idea, it would be very simple and easy to summarise on a single page of A4, so that every builder in the land could easily grasp what it’s all about. The very fact that there is a 111-page consultation about the definition of zero carbon shows that something is wrong with this whole project.

But there is no box anywhere in the consultation for people who feel like this either.

5 Dec 2008

Green Building Guides? Or Blacklists?

All of a sudden, Green Building Guides are in the news. Specifically, the BRE’s Green Guide, which is used for Code for Sustainable Homes ratings. One the one hand, the BRE itself is reported as saying that councils, specifically Milton Keynes, are guilty of insisting that all new homes have A+ ratings, which was never the original intention of the guide. Whilst at the same time, the Good Homes Alliance is insisting that the BRE guide is deeply flawed, principally because it allows some uPVC windows to score an A rating.

What are we to make of this? Personally, I really despise the whole idea behind Green Building Materials guides. I think it’s just blacklisting by any other name. If you don’t like uPVC, then just don’t specify it, but why try to stop other people using it? If the process of manufacturing uPVC is deemed to be too damaging to the environment, then it should be dealt with by legislation, not by blacklisting, especially if that blacklist then becomes enshrined within the building regulations via such devices as the Code for Sustainable Homes. The problem here is that the whole field is just rife with subjectivity and prejudice, and however well intentioned bodies like the BRE set out to be, they will never please everyone.

But what really gets my craw here is not that the Green Building Guide is flawed, but that its very existence serves to encourage checkbox design, which is just what Milton Keynes have been indulging in. How about letting building designers use their own judgment about which materials to use?

1 Dec 2008

Cash Deposits — The Difficult Question

For many years, I have helped out on the Ask The Experts stand at the Homebuilding & Renovating shows, which are held at various venues across the country. We work as a small team (usually about six of us) and we advertise ourselves as offering independent advice. It’s also a very useful exercise for us as working journalists in that we informally monitor the questions being fired at us, and this gives us good feedback on what issues are of concern to selfbuilders. Besides the ever-popular planning questions, for the last two years the main question has been “How should I heat my house?” A jolly good question it is too, and one which has no clear answer.

November always plays host to two shows, one in Yorkshire, the other in Somerset, and this year credit crunch questions were a notable feature at both venues. One question which did come up repeatedly was: “Is it safe for me to hand over a large cash deposit to a supplier for future delivery of some product?”

The main area of worry here is the package build suppliers, where deposits of tens of thousands are often requested, but it also came up in relation to a kitchen supplier and a window manufacturer. Many of these companies have built their business models on getting upfront payments and many have good reason to charge a large deposit, as the work about to be undertaken is usually specific to the individual contract and would be almost valueless if the client were to default. For instance, between 70% and 80% of the work carried out on a timber frame kit is value added by the manufacturer — the timber itself is rarely more than 20% of the final bill.

The unofficial line that we adopt (and we have as a group discussed it) is to suggest that, if the client is at all concerned, then they should insist on their funds being placed in a third party or clients’ account, also know as an escrow account. This would be run by a solicitor or a bank, and the deposit would stay there until the goods are delivered to site. In theory, it sounds fine, but in practice very few firms actually offer such a facility. The main reason is surely that just by mentioning it, the seed of doubt gets sown: it makes people think about the security of their deposit and that alone maybe enough to scare them away. It’s that confidence thing. In addition to this, escrow accounts are costly and time consuming to administer and once people start thinking about them, they tend to want to start adding additional clauses, such as quality audits and time penalties. You can see just why manufacturers don’t like them.

And yet, such is the severity of the downturn in construction that customers are focussed on security in a way they haven’t been before. Construction-related businesses are getting squeezed. In truth, many of the ones which primarily deal with the selfbuild market seem to be weathering the storm quite well — the selfbuild market isn’t exactly thriving but it certainly hasn’t ground to a halt either — but how is a customer to know what businesses the supplier normally sells to and what it is like for any individual company at any given moment? Again, it’s that confidence thing that’s so important.

The problem for the deposit-taking suppliers is that confidence in their businesses may just seep away, even if they continue to trade well. Potential customers may just assess the whole sector as being too risky and decide to postpone their project, or chose build methods which can be entirely funded in arrears. An industry-wide deposit guarantee scheme might have helped, but no such thing exists for package build and it’s probably too late to organise such a thing now, at least as far as this recession goes. A more realistic option is for individual companies to reduce the size of the deposits requested (be they via escrow accounts or not), or even to go ahead on contracts without deposits.

So my advice consisted of the following. Firstly, be aware of the issue surrounding deposits; don’t be afraid to mention it to the potential suppliers and to express your concern that your deposit might not be safe. Ask them what they can do to address your fears. If you like the product and the company, and you are tempted to go ahead with them, then by all means use the deposit as a negotiating tool. But do bear in mind that just as customers are ultra wary of paying out large deposits at the moment, so businesses are worried about delinquent customers as well. It might help matters if you, as a customer, could demonstrate your ability to pay before getting too clever with discounted deposits. It’s all about confidence, but that cuts both ways.