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CHAPTER 5
Improving Housebuilding

73. As part of its terms of reference the Task Force was asked to look particularly at improving the efficiency and quality of housing construction. Whilst the Task Force considers that the scope for improving performance is as great in housing development as in other forms of construction, we believe that there should be specific initiatives to encourage advances in this sector. In our view housebuilding is affected by some significant factors that distinguish it from other sectors of the construction industry:

• housing development operates within a regulatory environment, affecting the level and location of activity. There are some in-built inefficiencies within the process which arise from the present requirements of the planning system;
• land prices have a major impact on outturn costs, representing up to 50% of total costs in some areas. These are a function of demand rather than of efficiency;
• in the private housing market demand by a 'one-off' disaggregated client base is dictated as much by price and location as by quality of the housing product or the efficiency of its performance;
• in the social housing sector, demand by corporate clients (housing associations and local authorities) is affected by uncertainties and inefficiencies resulting from periodic changes in policy direction and unpredictable levels of investment.

Promising Developments

74. There are promising developments in both private and public sector housing in the UK, although most innovatory housebuilding is being undertaken overseas. Good quality public housing, indistinguishable from the housing for sale that it is increasingly located alongside, is becoming commonplace. In the social housing sector the main corporate clients are increasingly investigating innovative approaches to housebuilding which offer significant improvements in the speed and cost of construction while retaining high quality.
75. In the social housing sector housing associations are the dominant providers of new housing.In 1998/99 they expect to start schemes (both new build and rehabilitation) worth around £2 billion for approximately 30,000 homes. 60 housing associations account for some 50% of these schemes. The sector, including both housing associations and local authorities, also faces a growing demand for repairs and maintenance.
76. The Task Force believes that the main initial opportunities for improvements in housebuilding performance exist in the social housing sector for the simple reason that most social housing is commissioned by a few major clients. However, we would expect improved practice in developing social housing to affect expectations and activity in the wider housing market. Consequently we see much scope for cross-fertilisation of innovation between the public and private sectors.

Developments in Housebuilding

Westbury Homes are actively pursuing an innovative approach to housing. They are developing new customer-focused approaches to develop products which will enable them to expand into new markets. They are trialing new component systems and production processes in demonstration projects and they are developing partnering arrangements with their suppliers. Both Wimpey Homes and Westbury have brought in board-level expertise from manufacturing industry in order to implement new supply-chain management techniques. Over the last three years Bovis Homes, like many volume housebuilders, has standardised its product by using standard plan forms built from bulk-purchased parts. The standard house types are regularly re-engineered by the product development team in response to feedback from the sales and marketing team and customers. Research into what the customer wants is continually carried out using questionnaires, and value for different types of customer is defined in terms of price, locality, number of rooms, appearance, and quality of construction. A full customer care service is also provided. Housing associations such as Southern Housing Group, Peabody, Hyde Housing Association and Guiness Trust are implementing lessons from abroad to improve the procurement of low-cost, high quality adaptable housing. For example, the Dutch Open Building approach is being demonstrated, offering tenants a wider range of choices of internal fit-out in both new-build and refurbishment schemes. Modular industrialised housing systems such as those used in Japan by Sekisui and Toyota are being trialed to reduce the cost and time of construction and provide tight quality control. This can deliver housing with zero defects on-site, removing the need for expensive and time-consuming 'snagging' and 'making good'. Leading suppliers in the social housing market, such as Willmott Dixon, have initiated their own innovation strategies aimed at delivering greatly improved products and services to housing associations. Component manufacturers like Redland and Hepworth are also investing heavily in R&D to develop better component systems to speed up construction.

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