Building a reputation

Building a reputation

David Bainbridge, MRTPI, Partner, Planning at Bidwells, has 20 years’ planning experience. He has successfully delivered planning permission and land allocations for residential, industrial, leisure and mixed-use developments. David is a former Chair of the East Midlands Royal Town Planning Institute, having qualified in 1999

David Bainbridge, a Partner at Bidwells, looks at the importance of reputation.

It is often said that a good reputation is hard-won and easily lost. This is especially true of housebuilders; small and large. There are few purchases as significant as a new home and house building is daily news.

In early April, following appointment of a new Chairman and a new Chief Executive, Persimmon Homes announced an independent review of itself. Led by Stephanie Barwise QC, the scope of the review will examine customer care and quality control among other aspects.

The announcement by Persimmon was the latest in several steps taken in response to the reputational issues faced by the company.

Many aspects of house building have been criticised of recent times including the size of profits by the big five, building quality and customer service. The outrage over leaseholds held and sold by some developers continues and has without doubt contributed to tougher talk by some ministers.

In March the Housing, Communities and Local Government Committee, chaired by Clive Betts MP, announced recommendations on leasehold reform. They urged the Government to ensure that commonhold becomes the primary model of ownership of flats in England and Wales and for the Competition and Markets Authority to investigate claims of possible mis-selling in the leasehold sector. This matter has some road to run and further bad headlines seem inevitable.

Customer satisfaction
Despite the bad press, the number of new mortgages has grown quite steadily and some measures of customer satisfaction make positive reading.

The Financial Conduct Authority and the Prudential Regulatory Authority jointly announced in March that the value of new mortgage commitments was 4.6% higher than a year earlier.

In their latest annual report on customer satisfaction the Home Builders Federation reported that in 2018, there was more satisfied new home owners than in all previous years since the survey began in 2006. 87% of new home owners were reported to recommend their builder to a friend. The results for the year showed many of the large house builders achieved a top 5-star rating including Barratt, Redrow and Taylor Wimpey.

Help to Buy
The building back-up of a good reputation is important in a climate of calls to review those housebuilders who participate in the Government’s Help to Buy Scheme. The provision of an equity loan from the Government to first-time buyers and existing homeowners for purchase of a newly-built home has contributed towards the volume of new homes sales. This assistance comes with conditions especially where some housebuilders are being scrutinised.

House building is one of the few sectors of the economy where a product is made mainly here in the UK. Whilst for economic purposes, housebuilders are not included within the manufacturing sector there is a case to be made for this, not least as the supply chain stretches far and wide.

The Government itself is not entirely blameless when it comes to bad press for new housing. A recent report for BBC News highlighted the living standards in an office to residential conversion in the once new town of Harlow in Essex. Permitted development rights to convert such buildings, introduced by the Government, has diminished the role of planning leading to accusations of unsettling the balance of communities and poor standards of accommodation.

The planning system having been viewed as impediment to a step-up in the pace and scale of new housing does add value to new developments, but this leads to the frustration of some who want less and not more regulation of new housing.

Whilst there is typically at least some substance to poor headlines for house building, it seems the sector is in good health, with good outweighing the bad and a reputation that some other sectors would be envious of.


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