Tag Archives: autumn
UK stamp duty changes set to boost house building
A leading UK builder has announced that the recent reforms to the Stamp Duty property tax has given it the confidence to bring forward the next phase of a major development. While the stamp duty reform has been widely hailed as a boost for first time buyers trying to get on the housing market the announcement from Crest Nicholson shows it is also going to boost house building. The house builder said it will bring forward the next phase of development at Centenary Quay in Southampton and build 280 new homes, some 128 of them in the next year. New analysis by the company revealed that the reforms will save buyers in Southampton over £1,660 per transaction and increase demand for new homes. In addition, since 2013 some 44% of sales at Centenary Quay were made through the government’s Help to Buy scheme and a further 101 apartments were sold for Build to Rent. Chancellor of the Exchequer George Osborne, who announced the stamp duty changes in his autumn statement earlier this month, described it as great news. ‘Not only are Crest Nicholson building more homes quicker but buyers will also see real cash saving when they purchase a house,’ he explained. ‘Stamp duty was one of the worst designed taxes and acted as a real brake on aspiration for those who wanted to get on or move up the housing ladder. As part of our long term economic plan we have made the system fairer so people only pay tax on the part of the property that falls within each band. The average property will pay £4,500 less stamp duty, with 98% of people who buy a home benefiting from the reform,’ he added. Debbie Aplin, managing director of Crest Nicholson Regeneration, said the reforms will undoubtedly boost activity in the housing market, re-stimulating building rates and enable the firm to drive the rate of sales back to pre-recessionary levels. ‘Last year alone we were able to facilitate 571 new home purchases through government backed incentive schemes such as Help to Buy, and now with the addition of stamp duty reform we remain committed to our target of building in excess of 3,000 new homes in the UK in 2015,’ she pointed out. ‘This will in turn support further job creation and have a positive overall impact on the entire economy. Most importantly though, the impact of changes to stamp duty will remove a lot of uncertainty for consumers over the coming months, helping to solve the affordability challenge so many purchasers are facing,’ she explained. ‘This is particularly true for first time buyers struggling to get on the housing ladder. A massive 72% of our purchasers benefiting from Help to Buy were first time buyers, and we hope to see a similar impact from stamp duty reforms,’ she added. The Home Builders Federation has campaigned for the abolition of the stamp duty slab system that caused distortions in the market, penalised buyers… Continue reading
Positive outlook for UK regional commercial markets
UK regional office markets have seen subdued rental growth over the last few years but the outlook is now more positive as a broadening economic recovery is feeding through to improved occupier demand. This together with the diminishing availability of Grade A stock and lack of significant speculative development completions over the last few years is driving rental growth across the regions, according to the latest report from Knight Frank. The real estate firm expects to see strong rental growth in the majority of regional city centres over the next 12 months, with new development completions securing higher prime rental levels. Manchester, Birmingham, Newcastle and Aberdeen will see the strongest growth while all other centres, apart from Sheffield, will see positive growth. Prime headline rents in Manchester and Aberdeen are expected to reach record highs of £34.00 per square foot by the end of 2015, representing corresponding increases of 10% and 6% over the year. Birmingham offices will also see rents rise by 8% to a seven year high of £32 per square foot. While there is unlikely to be any rental growth in Sheffield in 2015, Sheffield rents are expected to rise more sharply up to £22 per square foot by the end of 2016. Given the diminishing availability of Grade A stock and lack of developments, vacancy rates are likely to fall or at least remain stable, with the exception of Aberdeen where the level of speculative development is higher, the report points out but the firm is also anticipating a slight softening of incentives over the next 12 months. ‘As economic growth spreads to the regions we expect to see prime office rents rise across regional city centres in 2015. Lack of supply at the prime end of the market will add further upward pressure on both prime and secondary rental growth,’ said Louisa Rickard, associate, commercial research, Knight Frank. According to James Robert, Knight Frank’s chief economist, office rents will rise across regional city centres in 2015. ‘Lack of development to date could quickly migrate growth from prime to secondary,’ he says in the firm’s latest UK market outlook report. He explained that while the punchy rebound seen by commercial property in 2014 is encouraging, the recent figures from IPD are not sustainable in the long term. ‘The total return numbers may accelerate a little further, but we expect them to drop back early in 2015, perhaps picking up again in the autumn on rental growth. This will be due to slower capital growth as investors acknowledge that prices have rebounded from the double dip period. The slow and methodical business of increasing value by asset management then begins. Note though we are predicting a deceleration not a decline,’ Robert said. ‘A year ago one could only speak meaningfully of rental growth in central London, but in 2014 we saw it re-emerge for prime in many M25 towns, Birmingham, Glasgow, and Leeds. The economic recovery… Continue reading
Average rents in England and Wales hit all-time high
Average rents across England and Wales have reached a new all-time record high of £768 per month despite a slowdown in annual rises, the latest data shows. Rent rises increased by just 1.5% in the year to September, down from 2.4% in the year to August, according to the buy to let index from lettings agent networks Your Move and Reeds Rains. On a monthly basis September’s average rents are 0.8% higher than in August, representing a rise of £7 in absolute terms since the previous month. David Newnes, director of estate agents Reeds Rains and Your Move, said that historically rent rises have broadly tracked inflation and as the wider cost of living grows ever more slowly, so too has the cost of renting a home. ‘That said, autumn is always a busy period for the lettings industry, and this has been no exception. Looking ahead, it is likely that rents in most parts of the UK will have now reached their seasonal peak so as the market cools along with the autumn weather there may be opportunities for some tenants to pick up a favourable deal,’ he explained. ‘Landlords predict slower rent rises to continue for at least a year. The latest LSL Landlord Survey shows expected rent rises of just 1.8% over the next 12 months, below the target rate of inflation,’ he added. Newnes pointed out that another critical development in the rental market is the resurgence of demand in regions outside of London and the South East. ‘Regions with a new charge of economic growth, like the North West or East of England, have now led annual rental growth on an equal basis with the capital for most of this year. London’s rents were rising by 8% at the start of 2013 but are now climbing at around a quarter of that pace,’ he said. A breakdown of the figures show that rents in five out of 10 regions of England and Wales are higher than a year ago. The East of England has seen the fastest annual increase, of 3.1%, followed by the South West at 2.3% and London with a 2.2% rise in rents since September 2013. Meanwhile, rents in the West Midlands are now 2.4% lower than a year ago, followed by an annual fall of 2.3% in the North East and rents in Wales dropping 1.1% compared to September last year. However on a monthly basis none of the ten regions has seen rents fall. Between August and September the average rent in the South East rose by 1.8%, while the North West has seen a monthly increase of 1.4% and in the North East rents are now 1.2% higher than in August. By contrast, Yorkshire and the Humber has seen no change in rents since August, while the slowest monthly rent rises were seen in the East Midlands, up just… Continue reading
