A number of studies have considered life cycle environmental impacts from the housing sector (e.g. Adalberth, 1997; Adalberth et al., 2001; Peuportier, 2001; Asif et al., 2007; Hacker et al., 2008; Hammond and Jones, 2008; Bribián et al., 2009; Oritz et al, 2009; Mohan and Powell, 2010; Cuéllar-Franca and Azapagic, 2012) but the life cycle costs have seldom been addressed. And yet, economic aspects such as housing costs and affordability are important for the sustainable development of the residential construction sector.
The housing sector is very important for the UK economy as it directly affects the economic growth (HC, 2008). For example, in 2010, the construction industry contributed 8.5% of the UK’s total gross domestic product (GDP) of £1.45 trillion, to which the residential sector contributed 40% (UKCG, 2009). After Denmark and Greece, the UK has the highest housing prices across the European Union with people spending around 40% of their income on housing costs such as mortgage payments and energy bills (Eurostat, 2012). The latter is the cause of fuel poverty of around six million households owing to the rising energy prices (DECC, 2009; Bolton, 2010).
In recent years, many people have been unable to purchase a home because of changes in the availability and types of financial and mortgage products (Sergeant, 2011; DCLG, 2012; RICS, 2012). This situation has created an unstable housing market, which has led to a fall in house prices, and dragged the UK economy further into recession. For example, the average house price of around £190,000 in 2008 fell to £160,000 in 2011 (HPUK, 2012). Home ownership is also declining and in 2011 it dropped to 66% from 70.9% in 2003; so the proportion of households that own their own homes has fallen back to where it was in 1989 (BBC, 2012). This trend is expected to continue over the next 10 years (Sergeant, 2011). Such a situation is affecting particularly young people – only 10% of all owner occupiers are under 35 years of age (BBC, 2012) while 33% of first-time buyers are over 35 (DCLG, 2012).
It is therefore important to understand the full costs of housing and their main sources along the whole supply chain. This is the subject of this chapter, which sets out to estimate the life cycle costs of the current housing stock in the UK and identify cost reduction opportunities. Three typical types of houses are considered: detached, semi-detached and terraced houses (Utley and Shorrock, 2008). This work complements a previous study on life cycle environmental impacts of the current housing stock in the UK (Cuéllar-Franca and Azapagic, 2012), which are also briefly discussed later in the chapter as part of an improvement analysis. As far as the authors are aware, this is the first life cycle cost study of the housing sector in the UK. Elsewhere, only two life cycle costing (LCC) studies of individual houses have been found in literature, one based in Finland (Hasan et al., 2008) and another in the USA (Keoleian et al., 2000).
Life Cycle Costing: For the Analysis, Management and Maintenance of Civil Engineering Infrastructure.
⏩Puplisher: Whittles Publishing
⏩Puplication Date: 2015
⏩Size: 6.95 MB