Additional Thoughts on Technology Obsolescence in Housing

So if you accept my theory that there will come a time when an old house is so much cheaper than a new house as no one will want them due to the associated energy costs, here are a few questions:

•           Can change happen piecemeal?
•          Could I demolish my terraced house and rebuild a nice cosy new one in its place?
•            If I do, would we want it to ‘fit in’ or should we relax planning laws so that we can set it back from the road, build it higher,  add a garage or whatever?
•           If change is piecemeal, how do we evolve from the ‘back to backs’ which worked until everyone decided they needed a car? Or is there a better solution to on-street parking?
•          If change can’t be one by one, how do we avoid the dilapidation and decay stage of the cycle?

Technology Obsolescence of Housing

Technological obsolescence is nothing new. At one of my 1^st jobs in the 70’s, the Telex machine was the hub of the office and secretaries produced schedules, invoices, cheques for signature and a whole range of other business documentation in response to the orders and other details which came in on the machine. However, back in 1964 Xerox had launched the first fax machine able to use telephone lines and within 15 years they were ubiquitous and the death knell for Telex had been sounded, its life span at the forefront was little more than 20 years. Now 20 more years later, who uses fax? Fax server, voicemail and email have done for fax what fax did for Telex.  We can tell similar stories with vinyl discs, music cassettes, CD’s and now downloads.

It is not different with houses here in the UK. In the 17^th and 18^th centuries, housing was revolutionised with the introduction of plate glass and the move from stone and timber buildings with lime mortar and no cavities to the sort of construction we see around us today.  But now, for the 1^st time in nearly 200 years we are seeing something so different in the construction of houses that it will make all existing structures obsolete – it will not happen at the speed of CD’s replacing cassette tapes, but that is due to the lack of supply. With new houses being effectively air-tight and fully insulated, energy costs for a modern dwelling can be as little as 10-15% of those in a comparable ‘old’ house (for example one built at any time in the last 200 years even if all of the available modern techniques for draught proofing, insulating, renewing boiler, adding controls, etc are put in place).

As energy gets more expensive (it is estimated to increase in cost by 20% in real terms in the next 17 years) and as the proportion of peoples salary spent on energy increases (current reports say energy increases outstrip salary increases by 8:1) and as the new technology in new houses improves, the difference between an expensive to live in old house and a cheap, affordable to live in new house will become so large, that those with a choice will opt for a new house and as a result, demand for old houses will drop resulting in large drops in the price of these houses.  At that time, we have to decide whether to allow these cheap old houses to become run down, for their neighbourhoods to go downhill and for the most fuel poor members of our society to be trapped in them or to decide to bulldoze the old and bring in the new.

When will this happen? When there are enough new properties on the market such that most people have a choice – so even if we add 1,000 new houses a year, a typical city like Portsmouth with around 60,000 houses is not likely to reach a tipping point for maybe 25-30 years. But when that point is reached, change will come quickly – how many 17^th & 18^th century houses are left today? How many music cassettes are sold today..

This is very much a UK statement. North America, the Nordics and Germany have continued to develop their house building methods over the years (due largely to their colder winters) and the UK is about to catch up in one big step.

What should we do? Altruistically, we ought to speed the demise of current housing, do everything we can to get as many new houses as possible and to get as many people into them as possible – this will be good for the residents, good for the planet and probably good for the city, but so many people have so much invested in what is there now, the resistance to change may leave us all worse off. Those cities which embrace this change could position themselves ahead of neighbours who resist.

Effect of Solar Power on House Prices?

Does anyone have any experience of selling houses which have a full MCS certified solar PV installation? These houses have a guaranteed income stream, inflation adjusted and tax free, for up to 25 years. If you were buying a business, it would not be unusual to factor in a 5-6x earnings comparison into the price - so in the housing market, a solar installation of say 1.8Kw producing around £1,000/year in the South of England ought to add at least £5,000 to the value of a house as it will come in regardless, unlike a business where you have to continue trading.

Interestingly this is also about the current cost of such an installation.

Am beginning to believe that Eco-Housing is coming out of the terrain of the beardies and tree huggers and about to go mainstream (which is good as I am off the EcoBuild 2012 this week).

Interesting week here in Portsmouth since the council meeting in my last post. First, it appears the property in Jubilee Terrace I wrote about has been empty for 6 months and needs 25-30K of damp treatment just to make it habitable. So all my annoyance at the unrealistic expectations of local residents appears justified.

Yesterday the local council published its SPD (Strategic Planning Document) in support of the 'maximum 10% homes in multiple occupation' and I have to say, it is well written and researched, though it does have one or two weaknesses - watch this space. The interesting piece of research in the document is the Liverpool Victoria Insurance (unpublished) report that shows student numbers down by 40% in 2020. If this is accurate it spells very bleak times ahead for the letting industry and many large cities. (See http://www.lv.com/media_centre/press_releases/press_release?urltitle=university-ghost-towns)

A series of occasional articles looking at life in Portsmouth from the perspective of members of local landlords

35 years ago I was cautioned by police for carrying out ‘major repairs on a public highway’ outside number 14 Jubilee Terrace because the snooty lady who ran the guest house there believed I was tarnishing the neighbourhood trying to repair my near defunct taxi outside her business (and just 3 doors away from AbbeyTax for whom I was working). It was thus hilarious for me to sit in the Portsmouth City Council Planning Committee  meeting last week and hear local residents plus one councillor extolling the virtues of 14 Jubilee Terrace, a grade 2 listed building, and crying with dismay at the thought of it being ruined by becoming a multi-tenanted house (known in the trade as an HMO – a House in Multiple Occupation).  Apparently it was too important to the city’s heritage to be trusted to mere tenants who might even be students and whoever they were, they would inevitably trash it. Plus there would be the noise and rubbish and general disturbance of people playing music and smoking in the garden and all those other things that normal people don’t do…  And it would be run by a landlord and apparently, all landlords allow their properties to fall into disrepair.

All these good people argued that number 14 needed to remain a ‘family house’.  I have to ask, if you were looking for a ‘family house’ in Southsea would you be interested in a property sandwiched between some post-war eyesore architecture described in the planning meeting as ‘cottages’ and an old pub on a busy main city thoroughfare with limited if any parking opportunity and nothing more than an overlooked courtyard for a garden?  The answer is obviously no, whatever the virtues of the internal layout or décor and it is for this reason that since the end of the war, number 14 and hundreds of other houses like it in Southsea have not been used as family houses.

In the 50’s and 60’s there were guest houses as far as the eye could see and as that trade died out, we were fortunate that Portsmouth University grew to fill the void and provide alternative jobs and a use for so many properties that otherwise would have fallen into disrepair or would have been demolished and replaced with smaller, more densely packed housing.  I know we’d all like to live in rural idyll in the city centre but that is not possible, so can we put away the rose tints and accept that the community we live in is as good as we make it, we all have a role, without the university the whole of Southsea would be like Somers Town was in the late 70’s and without local landlords there would be few with the money to regenerate the houses we all love and cherish and which create the ambience of this city which we all share.  So if you are a good citizen, did you knock the door when students moved in down the road, did you welcome them to Portsmouth and wish them well here, did you take them fresh coffee to refresh them while they unpacked and got settled in? If not, are you surprised they didn’t integrate, didn’t respect your road and now look at you like strange aliens? C’mon people – do as you would like done unto you.