9 Feb 2017
New homes for Britain made by Legal & General
The UK housing market is worth £5 trillion. We see many opportunities for investment in this market and are already a big player in the housing market. This market touches on a large number of our business divisions:
- We are building high quality homes to rent for various market segments, such as students, retirement and social housing. We have already completed developments in Plymouth and Salford (led by LGIM Real Assets) [LINK NEEDS UPDATING].
- We are developing new sites for housing such as the site at Crowthorne near Bracknell, the former location of the Transport for London research centre. Legal & General Homes (part of Legal & General Capital) are leading the work and will build 1,000 homes on site over the next three years.
- Building modular homes from our huge factory in Sherburn-in-Elmet near Leeds to supply our own construction projects and other developers (part of Legal & General Capital). In March 2013, we invested in CALA homes, premium national homebuilder, alongside Patron Capital.
- Legal & General Home Finance, part of Legal & General Retirement provide lifetime mortgages to enable people to free up equity from their home to support themselves or family in building their future. One customer story shows how Legal & General lifetime mortgage means that one young couple can get onto the housing ladder. Have a look at Jim and Gill and Becca’s stories.
- Our Mortgage Club, started 20 years ago, originated £50 bn of mortgages in 2016 and has over 30% of the intermediary market. This represents almost one in five of all the mortgages in the UK.
Influencing The Influentials On Housing
Legal & General is well placed to address the issues we face on housing and as you might expect, we are also working closely with government to help fix ‘the UK’s broken housing market’. Sajid Javid, Secretary of State for Communities and Local Government recently visited Legal & General Homes in Sherburn-in-Elmet. Mr Javid was joined by Roger Marsh, OBE, Chair of the Leeds City Region Local Enterprise Partnership.
Both were welcomed by Nigel Wilson and Nick Frankland, CEO of Legal & General Modular Homes. The aim of the visit was to share with Mr Javid our modular construction plans to help turn around Britain’s housing shortage. Mr Javid was able to meet the team getting the factory ready for full production, visit the prototype homes that have been manufactured on site and see the high level of finish this construction technique employs.
Nigel said: “It is terrific that we are able to support the government in its work on housing. We have a strong housing story, driven by our need to invest in the long term in the UK. The home prototypes at the factory are really impressive and demonstrate our production capability and quality. I was glad to see Mr Javid was really interested in the work we are doing in Yorkshire and I was hugely proud to show our progress to date.”
Well Placed To Address The Issues Raised In The Housing White Paper
The Housing White Paper, issued on 7 February shows that the government is taking the challenges of the UK housing crisis very seriously. The paper is supportive of many of our housing initiatives, for example, build to rent, last time buyers, modular homes and was encouraging for housing in the future in the UK. The key themes of the paper are:
- In the UK, we need to increase the supply of homes - 275,000 new homes per year need to be built to meet demand
- We need to diversify the market from large homebuilders to make room for new contractors and self-build models.
- We need to improve the supply and quality of homes for renters
- We need to help first-time buyers save for their deposit using tax-efficient savings products
- We need to support smaller building firms and those manufacturing some parts of homes off-site to increase the speed of construction and quality of homes built
- We must ensure there is planning for the right homes in the right places and clarify what land is available for new homes. In a recent article on the BBC news website, Nigel Wilson shared his views on planning and the ‘green belt’.
You can read the White Paper here.
Keep an eye on Landscape this year for more updates on Housing – it is going to be a key theme for 2017.
If you have any questions on Housing, contact us.