Rural radical, worth a listen

[Tennentslager]

Particular problems need particular solutions...at least this guy has taken a stab at one...thoughts?

http://www.hebrideanhomes.com/fragilehousing.html

[ProDave]

There are some interesting figures in there, some that I dispute.

 

Like £150K to build it to 20 year old standards, £250K to build it to current building regs standards. There is nothing in current BR's to add £100K to the build.  I wonder what figure he would have guessed to build to near passive house standards?

 

Land cost does seem high there. I got our plot for £50K just a little below open market costs, though plots closer to Inverness do ask more.

 

But what I do agree on, is at the moment if you buy a plot and build a house, you would be lucky to sell it on the open market to recover your costs.

 

But hold on. has owning a decent sized detached house on a decent plot EVER been a "starter home?"  I think not. It's something you aspire to at the top of the "housing ladder" (a term I hate) by which time you will have more assets and more cash and won't need to borrow to fund 100% of the project.  Unlike other parts of the UK, real starter homes are still affordable.

 

His "solution" build a CLT factory and churn out CLT kit homes as cheap as chips. I don't see how that's any cheaper than a stick build and while that build method has some good points, it also comes with some other complications.

 

 

If you really want to build cheap, I think the "portable building" model should be used more. You can build up to about 100 square metres without building regs so the freedom to make it as good or as bad as you want or can afford.

 

[Crofter]

I saw this doing the rounds on Facebook a few weeks ago, and actually meant to post it on the forum myself. It's received a fair bit of attention, with the original post being commented on by various local worthies (Councillors, MSPs, people in the industry etc) as well as coverage in the local paper.

 

It's an issue fairly close to my heart- I used to do research work in rural development and population movement. And of course I have lived in rural Scotland all my life, and been one of those who watched in despair as property prices went through the roof in the early 2000s just as I had left home and was contemplating the near impossibility of buying something myself.

 

Is there a problem? Yes, of course there is. The outflow of young people from rural areas cannot be sustained indefinitely and the demographics of many rural areas are changing, with an increasing proportion of part-time or retired residents. This then has a knock-on effect on the whole economy and becomes self perpetuating, as businesses move out of the area due to lack of suitable workforce. A fair number of the fishing boats rely on migrant workers from eastern Europe or the Phillipines these days. With traditional industries dying out, we risk seeing a gradual 'museumificiation' of the Highlands which is a very sad vision indeed. And eventually the overgrown and empty crofts will cease to resemble the (entirely man made) environment that visitors to the area expect to see.

 

If this all down to housing? No. It's what happens when young people want to go and do something 'better' than their parents did, and when their local area doesn't offer anything. In some of our studies as the UHI, we discovered evidence of a cultural phenomenon where staying in your birthplace equated with failure- the product of generations of people being convinced that the only way to 'better yourself' was to leave. I think this attitude may be changing, helped in part by the diversification of employment that remote working brings, and the growth of interest in small self employed niches. I can think of a small number of people who have deliberately moved back to their rural areas to take a significant risk in starting up e.g. craft or outdoor sports businesses.

 

Does housing play a role? Yes. There is a mis-match between the available employment opportunities and the market value of housing. Market value is distorted by the wealth of people moving into the area with deeper pockets. In some of the prettiest spots, e.g. Applecross, all the cute little traditional cottages are bought up by retirees or holiday home owners. If the only job you can get is cleaning or hotel work, how can you compete with someone who has just sold their ex-council flat down south for a six figure sum? The current mortgage situation does not help either. Whilst interest rates are next to zero, it is extremely difficult to persuade a bank to lend you money based on a seasonal minimum-wage job or an unproven new business idea.

 

So what can be done about housing? Two things, fundamentally. One is to control the existing supply in such a way that houses become available to those who it is necessary to retain in the population, i.e. those of working age and young families. But this is fraught with difficulties. People are used to ownership as being an absolute right. Crofting tenure is about the only example I can think of where failing to meet certain conditions can result in your rights being taken away. Something similar could be extended to housing in general but I would expect fierce resistance.

So the other option is to build more houses. There is no shortage of land. In some ways that makes things more frustrating. It is understandable that in the middle of a city a plot might cost hundreds of thousands, due to physical scarcity of parcels of land. But up here the scarcity is artificial. and is entirely a product of the combination of land ownership and planning policy.

Finally, the actual build route/method and its impact on cost. This is not as big a factor as availability and price of plots, but will have some bearing. The cost of building a house has risen, as I'm sure we could all agree. Materials are up, the standard that must be met is up, people's expectations are up. On my own build I have been surprised at how large some of the unavoidable costs have been- water connection, planning fee, road related permits. From my point of view it does feel as though house builders are being milked to some extent by the cash-strapped council.

 

It is possible, though, to buck the trend. I know a couple of people who have built very nice houses indeed at impressively low costs. It helps if the land is your family croft, and therefore free. It helps if you are under 40 years old and qualify for the higher rate of croft house grant. And it also helps if you are a tradesman whose old school mates are also tradies, and you can count on almost free labour for your project, as well as trade prices on materials and first sniff at good deals or surplus. This attitude of helping one another out is a defining characteristic of crofting communities, and just one of the things we are at risk of losing.

 

Anyway, sorry for the essay...

[Stones]

Like @ProDave, I think the figures quoted are a work of fiction.  The figure I've heard most builders quote is around 5% extra.  

 

 

 

[MikeSharp01]

2 hours ago, Crofter said:

This attitude of helping one another out is a defining characteristic of crofting communities, and just one of the things we are at risk of losing

'Help out or die slowly' is the title of a picture we brought at the young Scottish contempories Exhibition in London last year. The artist is 25 and 'gets it' as you have described big time. Although he is based in Kirkentolch. Your piece is very cogent and speaks volumes on the challenges you and,  because of our wider interdependence - everything is connected to everything else, the rest of us face.  The problem is, as you have described, rampant self interest and the accompanying decay in the ideas of community and society.

[ProDave]

I take Crofters comment "There is a shortage of housing" .

 

NO THERE IS NOT.

 

You only have to look at the number of houses for sale (yes including mine) and how long they have been on the market. Many for up to 5 years now, in fact I can think of a couple that were put on the market at the downturn in 2008 and still have not sold.  The Highlands, like most of the UK, went into a house marker recession in 2008/9 and has NOT yet come out of that.

 

And don't try telling me it's because prices are to high. Any lower and they would be for sale at less than the cost of actually building them.  I can't afford to drop the price of my house by much or else I could be in the ludicrous position of selling the olf 5 bedrom house for less than it is actually costing me to build the new 3 bedroom one.

 

It's lack of people WANTING to live here that is now the problem, be that children leaving, or incommers not wanting to come here any more, or both. That is what needs addressing to stop a terminal decline.
 

[Crofter]

A couple of factors at play here.

Housing stock and its price may not reflect need. So yes there are houses on the market but, in general, they are too large and too expensive for first time buyers or for people working in the few local industries. If nobody who lives and/or works in the area can afford the house, then it is overpriced, simples.

Part of the original statement by Alasdair Stephen is that it costs so much to build a new house today. What @ProDave considers so ridiculous as to be impossible, that is, negative equity for new builds, is simply taken as fact in some parts of the Highlands (Alasdair singles out Lewis in his statement). This is not a new problem- many houses built under the croft house grant scheme would likely be uneconomic if built without the grant. If you plan to pass it on to your son, market value is not really important anyway.

 

A further point is that the Highlands is not a monolithic entity. I can't claim to have first hand experience of the whole area, but I have lived approximately a decade of my life in each of Argyll, Easter Ross, and Lewis, and have been in Skye now for around four and a bit years. The housing, employment, and general economic conditions are not identical in each of these areas (nor is it identical within these areas). The economy within commuting radius of Inverness is very different to, e.g, Tiree or Kinlochbervie.

 

Anyway, I'm not sure what can be done to lower the cost of building new houses in the areas where this is needed. Access to building land is obviously crucial. Placing some form of tie on a house is possible. I think it could be hard to do much about the actual building cost though, without going back to the old days. But it would be a very interesting discussion to have perhaps on another part of the forum.

[Steptoe]

Yes, it's a fact if life that many houses cost too much to build, that's just as it is, and if you are building it for yourself, then it doesn't matter how much it costs.

But, if you want to sell it, it matters not one jot how much it cost to build, or you think it is worth, the bottom line is this, a house (or anything else for that matter), is only worth what someone else is willing (or can afford) to pay for it.

The only reason houses don't sell is that the vendor has overpriced them,

FWIW Dave, I'd buy your house, but I wouldn't pay a penny over £140K for it, I could build/buy similar, in a similarish setting for that sort if money. 

 

[AliG]

The original piece doesn't really make sense. If houses cost more to build than you can sell them for then why would anyone pay £80,000 for a piece of land. For the opportunity to lose money. And as pointed out, other than a few thousand extra for insulation, build costs haven't really changed that much.

 

TBF I noticed the same phenomonen in the US after the housing crash. People were still trying to sell pieces of land for hundreds of thousands of dollars when you could buy houses that were a couple of years old for less than build cost.

 

The writer suggests that there is a problem and that the government needs to step in to fix it. There are times when the government can help things along, especially for example in areas like safety where the market may simply not work. But this kind of suggestion that the government needs to fix a supposed problem I disagree with.

 

Firstly what is the problem. People are leaving The Highlands. Is this really a problem? Is there any particular reason people should live in The Highlands or anywhere for that matter. People will choose to live where they like. I would never live in the countryside, some people would never live in the town. Demographic trends have been pretty constant for some time. People, young people in particular, like to congregate in cities where there are more opportunities and more things to do. Indeed so strong is this impulse that you have people living in modest houses in London worth millions of pounds. They could sell these houses and retire almost anywhere else in the UK, yet they so like living in London they would rather work 20 extra years to cover the cost.

 

The population of Glasgow has been falling for some time and Edinburgh rising, Eventually Edinburgh will overtake Glasgow on current trends. Should the government subsidise housing in Glasgow so that people don't move to Edinburgh? The crazy one for me is Aberdeen. I wouldn't buy a house in a city where the main industry will almost disappear over the next 20-30 years. Now of course if this kept going everyone would live in London, but eventually the price differences mean people might want to live elsewhere for a better quality of life.

 

There is a general problem in the country of a lack of affordable housing. This is due to difficulty in obtaining planning, historic subsidies to btl owners and overseas investors cornering a finite asset. These things the government can help, because these are distortions of a free market.  But I really don't believe that the government should interfere in where people would want to live.

[Crofter]

The negative equity on new builds thing is, I think, happening in two different ways.

You have the (relatively) highly desirable areas like the Sleat peninsula with its £80k plots, which appeals to incomers with deep pockets, who are financing their dream house through the sale of one in a higher value part of the UK. Often older or retired people. They may wish for a very high specification, and may not fully appreciate the local ceiling values, or simply not care about them. If it's going to be your last ever house, what does the finished value matter? If it's your dream house, aren't we all guilty of letting the budget slip a bit? 

Alternatively, you have the local 'stayers' or 'returners' who want a basic but decent modern house in their chosen area, so that they can live close to family, work the family croft or business, etc. Again, they are building what they want and need, this time to a lower budget, and again the final sale value is not really part of the equation, because they are not planning on going anywhere.

 

I do think that there is currently an abundance of overpriced plots on the market, post crash; as @AliG points out, this reflects sellers failing to adjust to current market conditions. Perhaps they are all holding out for that Grand Designs buyer with big dreams and deep pockets. Occasionally a plot sells, so I can see why people hold out if they are in a position to do so. But there aren't enough of these buyers, and it makes things tough for the rest of us with more realistic budgets.

 

As to build costs, I could compare my 1976 Department of Agriculture bungalow with a modern house to give one example. My house is sturdy, but undoubtedly was cheap to build. Single glazing, storage heaters, quality of finish very poor by today's standards (walls and ceilings are not even taped, let alone skimmed. You can see every joint and nail. Cheap doors, skirtings, etc.) The foul drainage pipework is far too shallow to meet current regs and has no access points. The road crossing is at a depth of about 300mm, not today's 700. The septic tank and soakaway is a joke by modern standards, just a pile of stone really. The access and bellmouth is nonexistent, the house is basically built beside a layby on the road. The electric supply is a cable six inches below the lawn, and not in a duct. As originally built, there was virtually no insulation. Cold bridges and air leaks everywhere. 

Some of these factors can be avoided with better design and only marginal extra materials cost. But other ones are more significant. On the new house, I will have spent about a third of the budget on drainage, access, and laying services- all elements that if done 'the old way' would have cost a fraction of this.

 

However, I would not advocate a return to the old fashioned standards. If we consider that houses should last for several lifetimes, and if we can agree that investing in more efficient housing is a good thing, then perhaps there is a case for more government intervention or support to enable that standard to be met. It is a long term investment, and not something that the open market is able to do by itself.

[Ferdinand]

There are some ideas there, but so many that it is not clear what he really wants. And I think it is perhaps unfortunate that the input has come from a smallish, rather expensive, house builder. The numbers are way off imo and should be doable for 70% of that even if we like the scheme and even in The Islands.

 

Running through his house wizard gave me a build cost of 195k for a 136sqm WH202 house, which is a trad 1.5 storey rendered double fronted house with 3 beds and 2 dormers and an extra room at one end.that is standard not posh spec with them building it.

 

Compare with a conversation on GBF a couple of weeks ago where a chap is building passive houses in lots of 4 or so at a cost of 90k each not incl. plot. THese are pairs of 3 story semis at 100sqm ea. Link

http://www.greenbuildingforum.co.uk/newforum/comments.php?DiscussionID=14688&page=2

 

The closest I can find for HebHaus is 160k though detached. Basically 50% more for a lower spec product, allowing 25k for the detached over semi. A crude comparison, but that difference is not absorbed by location costs and extra things included if any.

 

CLT is interesting, but not afaik particularly enviro-friendly over the lifecycle - about 15% better than trad concrete frame. The scheme seems to be a big government factory and giving houses away to lucky groups. That is a recipe for wasting a lot if money imo, and there are better schemes possible.

 

There already exist LA supported mortgage schemes in England. Do they in Scotland? I could see the benefit of extending Help to Buy style schemes to self build.

 

The timber frame idea seems good as it is weatherproof quickly.

 

But then crofting etc is a little unique and may justify subsidies etc. I wonder if a specialist Housing Association would be a way with shell and basics provided on a leasehold or rented plot and sweat equity for part of it? Needs a custom designed scheme perhaps.

 

Knowing a little about the Scottish landscape, I could see standard house type kits working as there are well defined vernacular styles.

 

Staying off negative equity and market prices this time.

 

Ferdinand

Edited December 29, 2016 by Ferdinand

[Tennentslager]

I was more interested in the IT infrastructure elements of his paper. Tele-medicine (hi def video consulting etc), tele-care (assistive technology for frail/elderly people) and redeployment of city central IT/ call centre jobs into rural houses.

Add in similar approaches to education and it's easy to see how high speed broadband can be as transformative as rail was in Victorian times.

This must be a higher priority for both governments in London and Edinburgh.

BTW, my 47 sq/m rural abode ( now 71m if you include balcony/outdoor space cost less than £10k and it's perfectly comfortable even without running water ?

Tongue firmly in cheek, but, it can be done way cheaper than the norm if there is less regulation.

Just my two-bobs worth...

[SteamyTea]

The problem with reducing regulations too much is that you run the risk of having dangerous homes.

Though I agree that there probably many regulations, and the differing interpretations of them, that add very little.

The main problem with the lack of affordable homes is low wages and insecure jobs.

Not only do we pay young people about half of older people, we offer them almost no security.  And the gap is getting worse.

Don't expect loyalty form them.

It may give a pointer to future property values though.