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New home planning approvals up in London quarter on quarter
The number of planning application approvals for new homes in London increased by 46% in the second quarter of 2016 compared to the previous quarter, the latest data shows. Some 6,310 new homes were approved out of a possible 8,280 that could have been permitted across the quarter, a 76% approval rate, according to the London New Homes Monitor from estate agents Stirling Ackroyd. However, approvals and decisions fell year on year. The second quarter of last year saw 8,063 new homes, out of a possible 10,662, granted permission but this was down to 6,311 allowed in the second quarter of 2016. ‘London has had a tough time lately, as Brexit injected a dose of uncertainty into the property market. In spite of this, the number of new home approvals improved in the run up to the result,’ said Andrew Bridges, managing director of Stirling Ackroyd. ‘There may still be an impact to come but for now, this pick-up is a sign that London’s property market is resilient. It’s a new game of unknowns and London could emerge a winner,’ he added. The most approvals were in Westminster at 1,720 new homes with 99% of all new home applications received approved, the highest rate in Greater London while Newham recorded the lowest approval rate across London, rejecting 92% of potential new homes applications. ‘Westminster is soaring ahead in terms of approvals and applications, but these are unlikely to be affordable for the typical Londoner. Many in the capital are left feeling let down as affordability drives them further away from a home of their own,’ Bridges pointed out. Bridges believes more needs to be done with research by the firm suggesting that there is space for up to 570,000 new homes in London in the next 10 years and he added that a more efficient planning system would help. ‘Planning reforms are still on the government agenda for now and they need to stay there. Overall, more resources and time need to be committed to achieve the number of new homes London needs. Having a new home can transform lives and London has always been an aspirational city,’ he concluded. Continue reading
Italian commercial real estate investment going from strength to strength
Investment in Italy’s commercial real estate markets is going from strength to strength with the first half of 2016 seeing over €3.4 billion of sales, up 35% on the same period last year. The latest investment analysis report from international real estate advsor Savills says that favourable market conditions are fuelling supply in the Italian market through fund liquidations or equity fund investors who are taking advantage of the point in the market’s cycle to dispose of some of the most liquid assets in their portfolios. It says that it is significant that cross border investment into Italy accounted for more than half of the total investment volume in the first six months of 2016, and close to 65% of all deals. Savills has recorded that international funds are increasingly dominating the market, with 80% of foreign capital coming from Europe. ‘Our analysis suggests Italy is at an earlier stage in the cycle compared to Europe’s primary markets in France, Germany and the UK, therefore international investors are still identifying the potential for capital growth and better returns from core Italian product,’ said Eri Mitsosterigiou, director of research, Savills Europe.. ‘We believe that investment demand for the remainder of the year will continue to be driven by European investors, however we also envisage domestic investors to up their buying activity,’ Mitsosterigiou added. According to Savills, investment into the office sector in Italy this year accounted for circa 46% of all activity, over 40% ahead of the first half of 2015. The retail sector represented 26% of the total investment volume, also a yoy 40% hike. The report points out that the high streets of Milan, Rome and Florence are dominating the retail investment market and the first six months of this year saw around €505 million invested, an increase of circa 80% compared to the previous year. ‘Italy is a country with above average household disposable income and strong tourist flows in some of its biggest cities. The resilient characteristics of high street retail, with stable or rising rents, low vacancy and high demand is attracting investors,’ said Marco Montosi, head of Investment, Savills Italy. Savills also recorded that the first half of 2016 saw a notable increase in investment into alternative commercial real estate sectors including hospitality. Almost 22%, some €761 million, of the total volume can be attributed to investment into the alternatives sector, markedly within healthcare. Also of note is that the vast majority of the transactions so far in 2016 were on a single asset basis, whilst portfolio transactions accounted for 21% of the total, down from 35% in the first half of 2015. Looking at the next 12 months, Savills believes that the supply of commercial real estate is set to increase as funds will take advantage of the improving market conditions, particularly the ones that purchased in the low point of the cycle in 2011/2012. ‘Prime locations of major Italian cities… Continue reading
New research shows huge fall in home ownership in England, not just London
Home ownership in England has fallen to a 30 year low with cities in the north of the country worst hit by lower number of people owning their own home, according to new research. Greater Manchester, South and West Yorkshire and the West Midlands Metropolitan area have seen double digit falls in home ownership since their early 2000s peak, the analysis report from think tank the Resolution Foundation. The analysis shows that having peaked at 71% in 2003, the proportion of people owning their own home across England has fallen steadily over the last decade by 8% and suggests that the widely reported increase in home ownership in 2014 was likely a blip to correct a sharp fall the year before, rather than a welcome reversal of a long standing trend. The Foundation says that while much of the discussion around the struggle to buy a home has centred on London, Greater Manchester has actually recorded the sharpest fall in home ownership of any major city area in the last decade or so. In 2003 some 72% of households living in Greater Manchester were owners, slightly above the average across England as a whole. However, home ownership has since plummeted by 14%, almost twice as fast as it has in England and a whole, and by last year just 58% of households living in Manchester owned their own home. The Foundation notes that people living in Greater Manchester are no more likely to own a home than people living in Outer London, and that home ownership rates have fallen below all other big northern city areas apart from Tyne and Wear. It says falling deposit affordability has played a major role in this trend. The Foundation warns however that plummeting home ownership isn’t confined to Greater Manchester. It notes that Outer London, South and West Yorkshire, and the West Midlands Metropolitan Area have also experienced double digit falls in home ownership since the early 2000s. This fall in home ownership has corresponded with a near doubling in the proportion of private renters across England, up from 11% in 2003 to 19% in 2015. The proportion of households renting privately in Greater Manchester has more than trebled over that period, from 6% to 20%, while Outer London and West Yorkshire have also reported double digit growth. The Foundation says that the shift from home ownership to private renting, which is taking place throughout England, particularly among young people, is concerning for a number of reasons. It notes that households in the private rented sector spend a far higher share of their income on housing than those who own with a mortgage, 30% compared to 23%, helping to explain the fact that the share of income that households spend on housing across the UK has increased by around a quarter since 2003 and by around a third in the North West. Renters are also more likely to face the greater insecurity associated with short term contracts,… Continue reading
