Richard Donnell: “Everyone needs to ask, ‘What am I really good at?’”

Richard Donnell has over twenty years of experience in the housing market, focussing specifically on data, analysis and technology. Here, he speaks to Housing View about home ownership, the Gobi Desert, and how technology can make everyone’s life easier

by Ben Wakeling

Richard Donnell has a deadline. He is writing a report on affordability, due to be published in early Autumn, and it’s bad news for those in the south of England.

“It’s that line from the Wash to the Bristol Channel,” he explains. “If you’re south of that line, then it’s really tough to access home ownership without a pretty chunky deposit and a pretty decent salary, whereas if you’re in the Midlands, the north of England, Scotland and Wales, house prices are not crazily high relative to incomes.”

The report is coming at a critical time for the housing market. Recent research by the Home Builders Federation has found that the age of the average first-time buyer has risen to over 33, and that those saving for a deposit would need to hoard over half of their remaining income – after rent and bills – for almost a decade.

Many businesses are less concerned about house price growth. They just want enough house price growth to encourage people to move.

One of the answers to solving the affordability challenge is simple on paper, but difficult in practice: we need to build more homes. More homes means more liquidity, and that’s key.

“We want the market to function; we want to know there’s people who want to buy, move, transact,” says Richard. “Many businesses are less concerned about house price growth. They just want enough house price growth to encourage people to move.”

Richard is, by his own admission, a ‘talking head’ when it comes to property and the housing market. He left Savills after twelve years to join a company called Hometrack in 2006 to support banks in automating mortgage lending decisions (“I knew the future was in data analytics”). Hometrack was bought by ZPG plc in 2017, and now Richard is an Executive Director at Houseful, the UKs leading software and data business in residential.

Houseful’s software is used by estate agents to run their businesses from enquiries to viewings, through to sales progression and beyond. There’s more to come, too; Houseful have recently launched a platform which connects consumers, estate agents and conveyancers together much earlier in the process, and empowers the consumer to have visibility of the sale and purchase of their home at every stage in the process. “It’s early days, but I think there’s real big potential there.”

Back to affordability, though. The problem with reduced home ownership is that pressure cascades down to the private rental sector and social housing; and, when it comes to building more homes, everyone needs to play their part, says Richard.

“What I’ve seen over the last ten to fifteen years is different organisations trying to go it alone building more homes. Housing associations, even local authorities, saying that they’re going to set up their own housing companies and manage the process end to end. It’s laudable, but the volume is simply not at the scale we need.

“For me, local authorities are all about: ‘How do I bring land together? How do I have a strategic view of the kind of homes I want, the land we could potentially release? What can I do to bring land forward?’. Everyone needs to ask, ‘What am I really good at, and what is my role in unlocking housing supply?’”

These are pertinent questions, indeed. Labour’s ambition to build 1.5 million homes over the next five years is the backdrop to all recent conversations around housing supply, but the silo mentality of the industry means that the next five years will be consumed with preparation to build homes, not the building of the homes themselves.

What I’ve seen over the last ten to fifteen years is different organisations trying to go it alone building more homes…it’s laudable, but the volume is simply not at the scale we need.

Richard believes too much of the conversation is around planning. “Planning is only a third of what you need to do. There’s three things you need in order to build more homes. One is a planning system that things strategically and is capable of making tough decisions in a rapid way.”

As an aside: devolution is a key part in this, Richard states, especially in the ‘Gobi Desert’ of the south of England, where there is very little devolution currently aside London and Bristol. “It is hard to see how we can roll out devolution more quickly across southern England,” he says, “but we need to think about how we can accelerate more devolved-type thinking than the current structure.”

The second ingredient to spur more housing is the labour force; a “big question mark – have we even got the workforce to build this stuff?”

The final piece of the puzzle lands squarely in Richard’s wheelhouse: who is going to buy the houses, and what they’re going to pay for it. “There’s plenty of demand; it’s just a question of at what price point, at what rent, in what tenure. And I think if we’re going to build more homes, we’ve got to get more focussed on that.”

Technology is a key player in the future of the housing market. Some of the most innovative firms start getting an advantage over their competitors, says Richard, and anything which eases the burden on the consumer as they make one of the most stressful purchases of their life can only be an empowering, positive force.

Our time is up: Richard needs to continue with his affordability report, drawing on not just latest data but two decades of experience. He has a couple of books in him when he eventually winds down, he says. Until then, he will continue with what the industry is perhaps guilty of neglecting over the past decade or so: “a lot of writing, a lot of research, and thought leadership to move the industry forward”.