Are householders moving on or sprucing up? A look at the trends in planning activity for households across the country

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1 Britain s improvers of Great Britain 2017 WRITTEN BY Are householders moving on or sprucing up? A look at the trends in planning activity for households across the country

2 IN PARTNERSHIP WITH The Federation of Master Builders (FMB) Britain s Brian Berry CHIEF EXECUTIVE OF THE FMB British people love their homes and are obsessed with home improvement. The Barbour ABI provides a unique insight into the trends in domestic refurbishment right across Great Britain. Not only does it allow us to take the temperature of this vital business sector as a whole, the granular data also allows as to look at regional trends and dig down into the detail of what s happening in any particular town and city. The Federation of Master Builders (FMB) is the largest trade association in the UK construction industry, representing thousands of small and medium-sized (SME) construction firms in England,, and Northern Ireland. It is our members the small local builders who are carrying out this work and as such, this information is invaluable. The results of this year s Barbour ABI show that there was an 6% rise in home improvement work that requires planning permission in 2016 compared to 2015 and these results chime with our own research. Despite gloomy predictions from many economists in the run up to the EU referendum last summer, construction SME workloads have not only held up, they are in rude But it s not all good news builders do have concerns about the spike in material prices following the depreciation of the pound. Construction SMEs are also faced with an increase in wages due to the ever-worsening construction skills shortage. Unfortunately these price increases will have to be passed onto the consumer which may dampen consumer demand during However, for now, there is much to celebrate a booming SME construction sector and a strong rise in home improvement work right across Great Britain. Not bad when you consider what most analysts were predicting following the UK s vote to leave the EU. The results of this year s Barbour ABI show that there was an 6% rise in home improvement work that requires planning permission in 2016 compared to 2015 and these results chime with our own research About the Federation of Master Builders The Federation of Master Builders (FMB) is the largest trade association in the UK construction industry representing thousands of firms in England,, and Northern Ireland. Established in 1941 to protect the interests of small and medium-sized (SME) construction firms, the FMB is independent and non-profit making, lobbying for members interests at both the national and local level. The FMB is a source of knowledge, professional advice and support for its members, providing a range of modern and relevant business building services to help them succeed. The FMB is committed to raising quality in the construction industry and offers a free service to consumers called Find a Builder. Please visit health. Even as we approached Article 50 being served at the end of March 2017, the results of the FMB s State of Trade Survey for Q show that construction workloads continued to grow and 50% of firms expect this trend to continue into Q

3 OVERVIEW The changing drivers of home improvement Britain s The desire to improve our homes runs deep in the British psyche. Compared with other nations we tend to preserve our homes more and demolish few. So we have one of the oldest housing stocks in world. The latest English Housing Survey suggests around three quarters of homes are more than 50 years old. Also home owners today appear to be moving less often than they used to. So for those keen to upgrade their homes, home improvement will loom ever larger. For those who make a living from home improvement either doing the work or selling products and services, the key questions include: Who are the home owners most likely to improve? Where are households likely to dig deep into their pockets to shell out on home improvement projects? What influences their decision? We can get big clues from looking at the local authorities that come top of the Improvers owners today appear to be moving less often than they used to tables, which gauge where private homes are most likely to be the subject of a home improvement planning application. Naturally not all home improvements need planning permission and legislation has reduced the need for many would-be home improvers to seek planning before embarking on their projects. But a substantial number of the larger home improvement projects will require planning approval and Barbour ABI captures data on all these applications across Britain. This data when scaled for the size of the local housing market provides a good indicator of where home improvement hot spots lie. If we link this information to other sources of data we can begin to gain a better insight into what drives and what suppresses a household s decision to invest in improving their home. As we will see, some of these are pretty obvious. Where there s more money there s likely to be more home improvement. Some factors are less obvious. Some can appear to work in both directions, depending on market conditions, in how they prompt home owners to improve or move as they seek a home that better fits their changing needs and aspirations. So, armed with the rankings of home improvers nationally and regionally and an array of different data we ve sought to tease out some of the factors that are likely to support home improvement activity and those which make it more likely in one area than another. Naturally, underlying all of this, the health of the economy will play a major part in determining the confidence of those considering putting their hands in their pockets to splash out on a major investment in their home. But what will become very clear as we explore various factors below is that the pattern of households who are likely to spend on home improvement is in constant flux. The economy As we can see from Fig. 1.1 home improvement activity shifts very closely with changes in the economy. If we follow the heavier red line in Fig. 1.1 which shows the four-quarter average number of home improvement applications the link is very clear. The correlation becomes even stronger if you lag the measure for home improvement applications six months after the corresponding GDP figure. This suggests the number of home improvement applications have risen or fallen in line with rises or falls in GDP about six months later. But the impact of economic growth and recessions is not evenly distributed between households and this can alter the pattern of home improvement across Quarterly number of home-improver applications (thousands) FIG GDP and home improvement planning applications Source: Barbour ABI, ONS Applications quarterly moving average the nation. For instance, closer examination of the data indicates that the recession hits those reliant on income in terms of spending on home improvement more than those with wealth. Conversely a strong economy tends to support more growth in home improvement spend among those reliant on income rather than wealth. In recessions those in employment were more likely to hold back on improvements than those in or near retirement. So, in the, a traditional retirement destination, 15 The impact of economic growth and recessions is not evenly distributed between households Quarterly GDP ( bn) constant prices Recession CAN BE KEY Those reliant on income in terms of spending on home improvement are hit by the recession, more than those with wealth CONTINUED

4 CONTINUED The changing drivers of home improvement Britain s the home improver market was more sheltered from the recession than many other parts of Britain. One quick indicator of how the economy influences home improvement projects is to look at another House prices In Fig. 1.3 we plot the average number of home improvement applications for every 0 private homes in each of Britain s local authorities over three could moderate the relationship between home improvement and house prices. The key point, though, is that house prices in most places have a significant bearing on how much larger contractors on private housing repair, maintenance and improvement (Fig. 1.4) that the two follow a similar path. This doesn t prove a causal link, but it supports the big-ticket outlay for households, such as a car. Fig. 1.2 We would generally expect more home sales when the economy is more buoyant shows a strong relationship between car sales and home improvement. Economists will tell you that work on home improvement tends to follow car sales by about nine months. So it provides a neat early warning indicator. years against the average house price. It seems pretty conclusive that there s a strong link. But look at the data regionally and the relationship varies in strength from region to region. It is very strong in and in the, but much weaker in the and. Why this is the case is not clear from the data. There will be a number of factors at play. Certainly we might reasonably speculate, at least for the South West and, that one reason for the weaker link might be the high number of second homes. This scale home improvement projects are undertaken. This should not be too surprising as the higher price housing areas tend to be home to the better paid and wealthier. sales The link between the number of sales of private homes and the money spent on repairing or doing up homes is generally accepted among economists who track construction. Finding good data to back it up isn t that easy. But we can see when comparing transactions with the official figures for work done by idea that the more sales of homes the more home improvement there will be. But again we would generally expect more home sales when the economy is more buoyant and we would also expect more home improvement. As Fig. 1.4 shows, over the last couple of years we have seen a faster rise in housing repair, maintenance and improvement activity than in residential transactions. Interestingly, in previous years we have found that in local authorities where a higher proportion of the housing stock had been sold there had been a higher 24,000 3,000 1,400 22,000 2,000 Private housing RMI ( m) 20,000 16,000 12,000 8,000 4,000 FIG ,500 2,000 1,500 1, Thousands of new car registrations Average house price ( 000) 1,200 1, FIG improvement applications per 0 private homes Private housing RMI ( 000) 20,000 18,000 16,000 14,000 12,000, FIG 1.4 1,600 1, Thousands of transactions (England & only) Car sales and contracted-out private housing repair, maintenance and improvement Source: ONS, SMMT improvements and house prices by local authority Source: Barbour ABI, DCLG, ONS sales and private housing repair, maintenance and improvement Source: Barbour ABI, HMRC CONTINUED

5 CONTINUED The changing drivers of home improvement Britain s proportion of home improvement applications. However, this relationship appears to be shifting, particularly in the hotter markets and is very apparent when we compare regional data. So, a once positive relationship between higher sales and higher levels of home improvement in, In a heated market there is a relative increase in the proportion of people improving rather than moving the and the has turned negative. Higher levels of home improvement appear now to be related to low levels of sales. If we look closer at the data we appear to be seeing falling sales in some of the hotter housing districts, but in many cases rising home improvement. As Fig. 1.5 shows the hotter home improvement districts tend to be found in places where sales are falling. Trying to unpick all the links and causes is a highly complex task with different housing markets at different phases of growth. And not all home sales are to home movers, with first-time buyers, buy-to-let landlords and second-home buyers all active in the market and the proportion of home movers far lower than in years gone by. But one possible explanation for some of this change may be that in areas where house prices are rising fast, finding and buying a better new home in the same local neighbourhood becomes harder for many existing home owners. This would, one might expect, increase the attractiveness of improving rather than moving. What we can see however very clearly in the data is that where there are higher prices, the ratio of home improvement to home sales is higher as we see in Fig Were we to cast this with data from a few years ago we would see that the ratio of home improvement applications to home sales has risen, especially in the higher-priced housing areas, which tends to support the suggestion that would-be home movers may well have decided to improve their current home rather than buy elsewhere. This analysis is clearly a simplification because many other factors are at play. But we can see suggestions Change in sales, 2016 versus average of 2014 & 2015 (%) FIG improvement applications per 0 private homes improvements in 2016 and changing level of sales by local authority Source: Barbour ABI, HM Land Registry, ONS, Registers of of this process at play in various locations. It does seem to point to the notion that in a heated market there is a relative increase in the proportion of people improving rather than moving if not an increase in the actual number of people improving. An interesting example of where the rate of home improvement has risen while homes sales have fallen is Cambridge. Here we have seen a sharp rise in price and a strong increase in sales between 2009 and However, in 2015 and 2016 there has been a marked fall in sales, presumably as prices became too high for many would-be buyers. But as sales fell there was a rapid rise in home improvement applications. The central point here is that there are both positive and negative relationships in play when it comes to the connection between home improvement and housing transactions. The data available here seems to suggest a more positive link in the early stages of recovery and a growing negative link when a housing market becomes overheated and the option to improve rather than move becomes more attractive. Not all home sales are to home movers, with first-time buyers, buy-to-let landlords and second-home buyers all active in the market R 2 = Planning applications per 0 sales FIG North East North West Yorks & Humb West Mids East Mids East South East South West 0 500, , , ,000 0,000 Number of home improvement planning applications for every 0 home sales and average house price, by region 2016 Source: Barbour ABI, HM Land Registry, ONS, Registers of Average house price ( ) CONTINUED

6 CONTINUED The changing drivers of home improvement Britain s Income improvement tends to be expensive. So inevitably there is a strong relationship between the average earnings in an area and the level of home improvement. Over the past 5 years the top 20% of households on the income scale have spent about 14 times the amount on home improvements than the bottom 20%, according to the Office for National Statistics on family spending (Fig. 1.7). Fig. 1.8 plots the Barbour ABI home improvement applications numbers for each local authority against average income. It illustrates the strong relationship. This is no surprise as income will tend to determine average house prices, so we d expect to see similar patterns. Interestingly though, finer regional analysis shows a much weaker link in the, and. The link appeared strongest in the. Planning Do people turn to home improvement more in areas where planning for new homes is tougher to win? Well, the data seem to suggest so. Using Barbour ABI planning data we can measure the proportion of applications rejected or withdrawn. The data are from the past and so may not necessarily reflect current practice, but they will be indicative and provide a rough-and-ready measure of planning rigidity for each local authority. When we look at the national picture (Fig. 1.9) it seems that there is a link between it being tougher Inevitably there is a strong relationship between the average earnings in an area and the level of home improvement to get permission for new homes and more home improvement. This doesn t mean there s a causal link. It could well be that well-to-do people are both more prone to improving their homes and also more averse to new homes being built near them. As with other factors, the impact of planning rigidity seems to vary region to region. In, and the the correlation between planning rigidity and home improvement applications is negligible. Rural or urban? The most active locations for home improvement at the moment are in. But does an urban or a rural setting influence the likelihood of the owner submitting a home improvement planning application? 8.6% 3.9% 12.6% 20.8% 54.1% Highest 20% Second 20% Third 20% Fourth 20% Lowest 20% Average income full-time employee jobs ( 000) R 2 = Planning rigidity index R 2 = FIG 1.7 FIG 1.8 improvement applications per 0 private homes FIG 1.9 improvement applications per 0 private homes Proportion spent 2012 to 2016 on contracted-out home improvements by households, by income Source: ONS Family Spending improvements and average income by local authority Source: Barbour ABI, ONS, ASHE Housing improvements and planning rigidity by local authority Source: Barbour ABI CONTINUED

7 CONTINUED The changing drivers of home improvement Britain s We tested this nationally and regionally. If we look nationally at the urban-rural split of private homes there doesn t seem to be much difference. But if we look within regions, we see different patterns emerging. Obviously leaving out, for many regions it seems home owners in local authorities with a higher rural population have a higher tendency to submit home improvement planning applications than more urban areas. The relationship is particularly strong in the Midlands, where those living in more rural settings seem far more favourable to home improvement. The same is true of Yorkshire and Humberside and to a lesser degree the. In Eastern England and the there is only a marginal difference between urban and rural settings. Age profile Can you look at the age profile of an area and judge whether it s prime for home improvement work? The answer is not straightforward, but there are clues. The Office for National Statistics produce family expenditure figures that show how much different households spend on home improvement. Fig. 1., unsurprisingly, shows it s those between 30 and retirement. It also shows how the pattern is shifting over time with the Saga generation increasingly spending more, while those under 50 are spending less. In 2005, before the recession, the bigger spenders were the 30 to 50 year-olds. That s changed and seems to be continuing to change. Those aged between 50 and retirement are now the big spenders on home improvement. We must remember that the shift in the level of home ownership across the age groups will be a factor in this as we increasingly see an ageing profile of home owners. Kids Do families with kids spend more on home improvement? Well a quick look at Fig suggests they do. It shows the average annual spend recorded by the Family Spending Survey over two five-year periods. Those households with kids do appear to 75 or over 65 to to to 49 Under 30 FIG Average weekly spend ( ) have been spending more. And having a child may well prove a prompt for home improvement, if the aim is to expand the available space. But it would seem, by comparing the spending from 2012 to 2016 with that of 2007 to 2011, that households with children are spending less while other households are spending more. This may be that home ownership is increasingly dominated by older and retired owners, who may have long since seen their children leave home to to 2011 Changing pattern of spending on contracted-out home improvement work by age Source: ONS Family Spending Three+ adults with children FIG 1.11 Three+ adults no children Two adults with children One adult with children Non-retired two adults Non-retired one person Retired two adults Retired one person Average annual spend ( ) by household type Source: ONS Family Spending But are you more likely to see home improvement in areas where there are more homes with kids? That s a very different question and oddly the answer seems to be no. That is, if we place any store by the modest positive correlation, a suggestion of a greater likelihood of home improvement planning applications in a local authority where there is a higher proportion of homes with no kids. That relationship seems to hold in all regions of the UK with the exception of the. In 2005, before the recession, the bigger spenders were the 30 to 50 year-olds. That s changed and seems to be continuing to change 2012 to to ,000 1,500 2,000 Average annual spend ( )

8 DISTRICT OVERVIEW Which districts top the national table? Britain s The dominance of districts in the home improvement league table has waned. Yes, Kensington & Chelsea and Westminster still sat atop the 2016 table of local authorities. But where there were 11 districts in the table last year, that number has fallen to eight. The continued solid performance of the means it is still as well represented as a year ago, but the growth of home improvement activity in East of England has seen its boroughs making their way up the table. The most notable climber is Cambridge, which along with South Northamptonshire can also claim to be the most northerly district to feature in this year s top 25 home improvers table. With 6.5 planning applications for each 0 privatelyowned homes, Cambridge only narrowly misses out on ousting Westminster for the number two spot. Two years ago it only just squeezed into the top 70. There are common themes that run through areas where planning applications are more common. Income and wealth are clearly two. This is reflected then in areas where house prices are high and certainly we should expect an upswing in home improvement in neighbourhoods where house prices are rising. We also see on our measure of home improvement a tendency for the more rural areas to perform better, especially those in picturesque locations. This, to some extent, reflects the mobility of wealth as a proportion of the equity-rich older generations downsize and migrate to seek their rural idyll. So places where older folk are more present may also provide a clue to where home improvement activity is more concentrated. These factors, discussed in further detail elsewhere in the report, are seen in various mixes within the districts at the top of the list and their flip side in those at the bottom. What makes Cambridge and its It seems remarkable that Cambridge, which didn t make that top in the East of England two years ago, has seen it home improvement activity more than double growth particularly interesting is how rapidly it has shot towards the top of the table. Meanwhile, it s most likely comparator, Oxford, while still enjoying high levels of activity has slipped down the table. Cambridge appears to be the epitome of an improve not move location. After a rapid surge in prices, sales in the city have fallen back sharply while home improvement has rocketed. It is hard to be certain, but there is more than a suspicion that with a tight housing supply and bursting demand, those who have had a place in Cambridge but now wish to trade up are finding it financially and emotionally better to improve than move. It seems remarkable that Cambridge, which didn t make that top in the two years ago, has seen it home improvement activity more than double and now, outside of Westminster and Kensington & Chelsea in, has the highest ratio of home improvement planning applications to private homes of any borough in Britain. Looking more widely at the the growth of home improvement applications was down to more than just the Cambridge effect. Among many other districts in the region to see solid growth were those to the north of. St Albans and Hertsmere further secured their spots in the table and formed with a new entrant to the table, Three Rivers, an area of expanding home improvement encircling Watford. These are no doubt benefiting from the spread of the home improvement boom from central to the outer boroughs and beyond. The picture in the clearly echoes this effect, We also see on our measure of home improvement a tendency for the more rural areas to perform better, especially those in picturesque locations Kensington & Chelsea REMAINS However, where there were 11 districts in the table last year, that number has fallen to eight CONTINUED

9 CONTINUED Which districts top the national table? 25 CLICK TO VIEW Top & bottom 25 districts Britain s with the more affluent commuter towns dominating the top and increasingly the slightly less affluent gaining ground. Outside the three dominant greater south eastern regions, there are only two spots in the table, one for As for the and the Midlands in general, the rural aspect tends to be more to the fore in finding the hotter home improvement spots the The Cotswolds and one for the South Northamptonshire. The had previously been represented with a couple of districts in the picturesque retirement and holiday hotspots of Devon. Now the focus is on what might be seen as more brash money. The Cotswolds is an attractive spot for the supermonied classes and this shows up the growing level of home improvement in a way chiming with the surge seen in central. As for the and the Midlands in general, the rural aspect tends to be more to the fore in finding the hotter home improvement spots. Income, wealth and house prices clearly matter greatly too, so South Northampton fits that profile extremely well so it should be no surprise it finds itself a spot in the top 25. It also benefits from being the most southerly district in the, butting up against some affluent areas of the. But even for those districts to the north outside the top 25, where less tends to be spent upgrading homes, the picture is far from bleak. Fig. 2.1 shows the steady rise in the number of applications for home improvement continued in But there is no getting away from the fact that at the lower end of the league table, ironically perhaps, stand many of the areas where the housing stock is in greatest need of improvement. It is the poorer more urban areas that tend to occupy the bottom spots on the table. This is no surprise given that house prices are one driver of home improvement planning applications, income another, while a rural setting tends to be more favourable than an urban one outside of. Blackpool remains rooted to the bottom with Stoke lifting up to third from bottom. But increasingly there are Scottish districts dotting the bottom of the listing. The chances of a planning application being submitted for any given private house in the bottom five districts in the list is about one tenth of those at the top. This gap may have closed a little over the years, but it gives a good guide to the disparity between regions when it comes to home improvement. But there are good news stories emerging from the lower ranks of the home improver table. Hull not long ago was sat among the lowest districts for home improvement planning applications per 1 private homes. In the year it takes the mantle of UK City of Culture it can say it no longer features in the bottom 25. It may well still be in the bottom tenth, but only just, and signs are that home improvement is on the rise in the city. There are some other encouraging signs. The latest Office for National Statistics Family Spending survey suggests that the gap in spending by households on altering and improving their homes is narrowing as the pressure on incomes has eased in recent years. Proportionately it is the lower spending regions such as the that have seen the greatest rise Monthly home-improver applications FIG ,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000,000 5, if we compare the 2015 and 2016 total spend per household with that of 2013 and That said, the spread spending on home improvements and alterations is far from even. The average spend in is about three and a half times that spent by the average household in the. The chances of a planning application being submitted for any given private house in the bottom five districts in the list is about one tenth of those at the top Applications 12 month moving average Monthly home-improver planning applications and 12 month moving average Source: Barbour ABI Yearly moving average STILL RISES The 12 month moving average shows that there is still a steady rise in the number of applications CONTINUED

10 25 Districts for home improvement Number of home improvement applications for every 0 private homes. BOTTOM 25 Districts for home improvement Number of home improvement applications for every 0 private homes. Britain s Rank District Region Growth (%)* Kensington and Chelsea LN Westminster LN Cambridge EE South Bucks SE Uttlesford EE St Albans EE Richmond upon Thames LN South Northamptonshire EM Elmbridge SE Sevenoaks SE Hammersmith and Fulham LN Guildford SE Three Rivers EE Barnet LN Hertsmere EE Harrow LN Chiltern SE Chichester SE Redbridge LN Cotswold SW Hounslow LN Windsor and Maidenhead SE Hart SE Brentwood EE Tunbridge Wells SE Rank District Region Growth (%)* 25 Sunderland NE Hyndburn NW Lincolnshire YH Wigan NW Rhondda WA Erewash EM Knowsley NW Inverclyde SC Wolverhampton WM Barnsley YH Halton NW Wirral NW Burnley NW North Ayrshire SC West Lothian SC Falkirk SC Copeland NW Redditch WM Dundee SC Renfrewshire SC North Lanarkshire SC Glasgow SC Stoke on Trent WM West Dunbartonshire SC Blackpool NW

11 REGION OVERVIEW How do the regions and countries of Britain compare? Britain s The story of home improvement in Britain is largely a story of the housing market. More than most other nations, Britain preserves its ageing homes. Its housing stock is arguably the oldest in Europe. We have tended to invest more in repairing, modifying, modernising and altering homes than we do in knocking old homes down and building new ones. Our love affair with repair, maintenance and improvement of housing really took off in the late 1970s and since 1980 construction firms have earned more doing up existing aside, the rise in home improvement activity continued to spread throughout Britain in There was solid growth in home improvement planning activity in the Midlands, where the more affluent rural areas remain the hotter spots, and in. In and the there was again solid no-fuss growth. The however was again the poor cousin in the North with growth, but underwhelming growth. GROWTH IN Applications increased 14% in the, compared with the average over the previous 2 years STRENGTH IN Commuter towns The more affluent commuter towns tend to enjoy the lion s share of home improvement homes than building new ones. And that obviously doesn t include the huge sums spent and much effort expended by DIY enthusiasts. So not surprisingly when we look to compare home When all said and done, it was the which enjoyed the greatest growth, with home improvement planning applications up 14% compared with the average over the previous two years and % comparing 2016 with improvement across Britain s regions and countries Number of home improvement applications for every 0 private homes. Rank Region/Country Growth (%)* improvement activity regionally within Britain, we tend to turn first to. It dominates the housing market and so it dominates the home improver market. And what do we see? A more jittery housing market and similarly a home improvement market looking far less gung-ho. This is especially true in the once scorching hot central boroughs. Growth in planning applications for home improvement in dipped below the national average. But despite signs of cooling over the past two years, Kensington & Chelsea and Westminster still dominate the home improver league table. Activity has shifted towards the outer boroughs where strong rises in house prices have made home improvement a Its star performer was Cambridge, which has rocketed to number three in the national table of home improvement districts. In many ways this is a spill over from as the money spreads out, although Cambridge has its own merits if looked at from a home-improver point of view high and rising prices, restricted stock and a very strong local economy. Despite being one of the prime locations for equity-rich migrants from and the, the saw less of the national growth than most in But its profile does suggest that while it remains a solid spot for home improvement it is a stodgier market, less prone to England Great Britain more attractive investment. both surges and falls.

12 FOCUS ON Cambridge took the top spot in the Improvement league table for in 2016 after a surge in home improvement applications for a second year. It now ranks third in the national table with more than six home improvement applications submitted for each hundred private homes in the borough. Uttlesford, the north Essex local authority that takes in Saffron Walden, Stansted, Thaxted and Great Dunmow, continues to perform strongly and holds a top five spot in the national table. St Albans and Hertsmere also secured their spots in the table and formed, with Three Rivers, an area of expanding home improvement encircling Watford. Indeed other local authorities have also shown strongly in home improvement, with the region as a whole experiencing the biggest annual growth in home Households in the region on average spent across 2015 and ,350 a year altering and improving their homes improvement applications submitted, up almost % compared with a national average of just over 3%. This brought Three Rivers and Brentwood into the national top 25 home improvers table. But the big story is Cambridge which appears to be the epitome of an improve not move location. After a rapid surge in prices, sales in the city have fallen back sharply while home improvement has rocketed. Outside of Westminster and Kensington & Chelsea in, Cambridge has the highest ratio of home improvement planning applications to home sales of any borough. But while Cambridge provides icing on the cake for local builders, the region continues to provide rich pickings. There was a 14% jump in 2016 in home improvement planning applications in the compared with the average over the previous two years. Overall there were more than 58,500 applications made in the region, which comes in at about 2.7 for every 0 privatelyowned homes, ranking the region third after and the and well above the British average of 2.0. In the region the price of houses seems to be one of the best guides to where home improvement activity is most likely and despite having a substantial rural population, there appears to be little difference between the more rural and less rural districts. When it comes to the choice of improve or move the balance seems to have been tipping towards improve. In 2014 there were 41 home improvement planning applications for every 0 home sales. That rose to 46 in 2015 and to 51 in Cambridge is the stand out district in the region with 1.4 home improvement planning applications for every sale in The Office for National Statistics Family Spending survey suggests that households in the on average spent across 2015 and 2016 almost 1,350 a year altering and improving their homes. That totals to about 3.4 billion spent in the region. Great Yarmouth continues to hold up the table, with applications for home improvement failing to rise over the past five years. Harlow, Norwich, Ipswich and Peterborough took the four other places in the bottom five. MORE THAN 58,500 APPLICATIONS made in the region for home improvement Cambridge IS ON THE UP leaping from well outside the national top 50 districts for home improvement in 2014 to 3rd in 2016 districts for home improvement Number of home improvement applications for every 0 private homes. Rank District Growth (%)* Cambridge Uttlesford St Albans Three Rivers Hertsmere Brentwood Welwyn Hatfield Epping Forest East Hertfordshire South Cambridgeshire Britain s

13 FOCUS ON South Northamptonshire, centred on Towcester, continues to hold its place at the top of the home improvement league, as planning applications in the borough continued on an upward path in There were five and a half home improvement applications submitted in the borough for every 0 private homes in 2016, close to double the number in That the borough tops the league should be no surprise. Its healthy stock of wealthy executive types and flourishing families and continued strong earnings growth will have helped drive home improvements. It is the only East Midlands region to feature in the national top 25 listing. That said, strong earnings growth also supported an expansion in home improvement applications in Rutland in Its relatively high level of home improvement application will also have been supported by its large stock of affluent greys, who continue to be big spenders, if not increasing spenders, when it comes to doing up their homes. Over the past two years home improvement activity has increased, with the more affluent districts boosting the overall numbers of planning applications in the region to almost 27,000, with a more gentle rise in 2016 of 4% in applications after an 8% rise in Despite increasing numbers of planning applications, with an average of 1.6 made for every 0 private homes, the East Midlands remains below the average across Britain of 2.0. Looking at what drives home improvement, the evidence from Barbour ABI research seems to point to three main factors in the region. Income seems to be the big driver. But where the proportion of homeowners over 50 is high we are also likely to see more applications, suggesting that equity plays a strong role too. And we also see more applications in rural locations than in the larger urban areas. Certainly the pattern of more rural boroughs at the top of the pile in the region is reflected with the urban boroughs of Mansfield, Erewash and Chesterfield taking the bottom three places in the regional table this year. When it comes to the choice of improve or move there are few signs that the improve option is gaining ground in the region. There were about 30 planning applications for every 0 sales in the in 2016, a similar level to that in Households in the region on average spent across 2015 and 2016 almost 1,0 a year altering and improving their homes the previous two years. That said in South Northamptonshire there was broadly one home improvement planning application for every sale in the borough in Looking at the amount spent by homeowners in the region, the Office for National Statistics Family Spending survey suggests they spent an average of about 2.6 billion annually on home improvements over 2015 and This averages out at almost 1,0 a year per household on altering and improving their homes. 8% RISE IN 2016 In 2016 applications rose 4% to 26,800 following an 8% rise in 2015 DOMINANTION IN rural locations Rural areas tend to be much stronger for home improvement applications than larger urban areas in the region districts for home improvement Number of home improvement applications for every 0 private homes. Rank District Growth (%)* South Northamptonshire Rutland Harborough Rushcliffe East Northamptonshire Daventry Charnwood South Kesteven Derbyshire Dales Derbyshire Britain s

14 FOCUS ON s super-affluent boroughs of Kensington & Chelsea and Westminster continued to hold the top places in the Barbour ABI/FMB rankings for home improvement planning applications in But their grip is slipping as growth in the number of planning applications in these boroughs has stalled in recent years. But despite the huge amount of work already done over recent years the planners are still receiving about seven home improvement applications a year for every 0 private homes in these table-topping boroughs. Across as a whole the home improvement bug appears to have calmed down and there was a smaller increase in 2016 in the number applications than in any other English region or in. The real growth in applications in the capital is tending to come from previously less fashionable, less central boroughs, such as Barking & Dagenham, Waltham Forest and Newham, broadly to the outer east of. This expected shift mirrors the earlier expansion in home improvement in the outer borough of Barnet, Harrow, Redbridge, Hounslow and Brent, which now feature firmly in the region s top. Despite more sluggish growth, there was still a small rise to more than 0,000 in the number of home improvement applications submitted to planning authorities in 2016, which represents about a quarter of all those submitted across England. The driver behind this continued upward trend in home improvement in is not surprising. With land values booming the economics of spending on enhancing and expanding an existing home can be compelling. And there is no shortage of people with sufficient wealth, income or both to invest. Meanwhile, the recent easing in growth reflects the general softening of the housing market in the capital of late. When it comes to the balance between home improvement and home movement, the evidence over the past few years has weighed more towards improve in. In 2013 there Households in the region on average spent across 2015 and 2016 almost 2,500 a year altering and improving their homes were 67 home improvement planning applications for every home sale. That rose to 72 in 2014, 82 in 2015 and to 86 in At the vanguard, naturally, are Kensington & Chelsea and Westminster where over the past two years there were almost two planning applications for every sale. The Office for National Statistics Family Spending survey suggests that the total spend by households annually on home improvements averaged 7.4 billion over 2015 and This means an annual average spend of about 2,500 a year per household, if we include those renting, on altering and improving their homes. Outer boroughs INCREASE s boom in home improvement continues to spread from the central to the outer boroughs MORE THAN 0,000 APPLICATIONS submitted to planning authorities last year for home improvements, almost a quarter of those submitted in England districts for home improvement Number of home improvement applications for every 0 private homes. Rank District Growth (%)* Kensington & Chelsea Westminster Richmond upon Thames Hammersmith & Fulham Barnet Harrow Redbridge Hounslow Brent Kingston upon Thames Britain s

15 FOCUS ON The district of Northumberland once again tops the list of boroughs in the Barbour ABI home improvement league for the, narrowly pipping Newcastle to the post. In 2016 the region saw 3% growth in the number of planning applications made for home improvement compared with the average over the previous two years. This growth was less than across Britain as a whole putting the region yet further behind the national average when it comes to the likelihood of homeowners submitting a planning application for home improvement. The average number of planning applications for home improvements in 2015 across Britain was two for every 0 private homes. Even Northumberland, which top the table in the, only manages 1.5, while Sunderland at the bottom of the regional table barely saw half that. Despite the tending to have an older age group than the UK average, there is a strong link across Britain between the level of home improvements, average earnings and house prices. This pattern is very evident currently in determining why the sees less home improvement than the UK average and in determining where within the to expect most home improvement to happen. Within the region this pattern broadly holds. Northumberland and Newcastle, the two highest ranking districts are both at the top end for average earnings in the region and are among the districts with the highest average house prices. That said, the official data does suggest that earning in Northumberland slid in 2016, although it may well also benefit from being a more rural area, which tends to correlate with more home improvement. At the bottom of the table we still see Gateshead and Sunderland where pay growth and general prosperity remain hard fought. The balance between home improvement planning applications and home sales over the past few years has generally been downward, suggesting little sign of any great Households in the region on average spent across 2015 and 2016 almost 900 a year altering and improving their homes shift among those moving up the housing ladder to consider improving rather than moving. Across the region there were less than 26 applications for every 0 home sales. On a positive note, while the level of overall spending on home improvements in the region is still well below the national average there has been an increase to almost 900 million spent by the average household on home improvements annually across 2015 and 2016, according to the Office of National Statistics Family Spending survey. This suggests nearing 1 billion a year was spent across the by households altering and improving homes. Average earnings & house prices ARE A BIG FACTOR determining where home improvement happens in the Further behind NATIONAL AVERAGE Despite a rise in home improvement planning applications the still fell further behind the national average in 2016 districts for home improvement Number of home improvement applications for every 0 private homes. Rank District Growth (%)* Northumberland Newcastle upon Tyne North Tyneside South Tyneside Darlington Stockton on Tees Durham Middlesbrough Redcar and Cleveland Hartlepool Britain s

16 FOCUS ON Ribble Valley has regained its place at the top of the North West s league table for home improvement having ceded its title to the Trafford district of Greater Manchester for the previous two years. The borough saw a leap in applications in 2016 after a two year slump in the numbers submitted. During the recession it tended to be the more rural and picturesque districts where home improvement flourished. This still tends to hold for the region today although far less firmly, with the emphasis for home improvements having shifted away from the rural idylls, such as Ribble Valley and Eden. Boroughs where homeowners are more likely to submit planning applications for home improvements do tend to be those where average incomes are higher. This holds for the, although the relationship is perhaps less strong than elsewhere in Britain. Ribble Valley ticks that box with higher average earnings than in most other boroughs. Indeed all but Eden that appear in the top table appear towards the top of the average earnings table, with Trafford at the top. So while the pretty retirement and second-home hotspots still rank high in the home improvement tables, the more economically potent boroughs are solid spots for home improvement. While they may not feature in the region s top, the boroughs that have seen the fastest growth in applications for home improvement over the past year are Preston, Burnley and Salford. Blackpool continues to prop up the bottom of the list of districts for home improvements in the and it continues to be where we find the lowest average earnings in the region. In Blackpool last year there was just one application made for home improvements for every 250 private homes. That was the lowest rate in Britain. Households in the region on average spent across 2015 and 2016 almost 1,0 a year altering and improving their homes The balance between planning applications for improvement and home sales has been fairly static for the past three years as both have risen. The level in 2016 was about 27 applications for each 0 home sales. But there has been a rise in some of the hotter markets such as Ribble Valley and Lancaster. Across the in 2016 the average number of home improvement applications received for every 0 private homes was a shade above 1.3, well below the average of 2.0 across Britain. The total number of applications for the region was just over 33,000 in In terms of average spend per household, although still below the national average, the figures from the Office for National Statistics Family Spending survey suggest an improvement. They suggest the average household in 2015 and 2016, including renters, spent almost 1,0 annually on home improvements. That makes the estimated market for home improvements in the worth about 3.2 billion. MORE THAN 33,000 APPLICATIONS made in the region for home improvement Ribble Valley REGAINS ITS SPOT Despite the emphasis for home improvement in the having shifted a bit from the more picturesque boroughs, solid average earnings helped Ribble Valley regain its top spot districts for home improvement Number of home improvement applications for every 0 private homes. Rank District Growth (%)* Ribble Valley Trafford Cheshire West and Chester Cheshire East West Lancashire Warrington Lancaster Stockport Eden Fylde Britain s