Tag Archives: consumer
Good design could help make Build to Rent popular in the UK, says a new report
Good design is the secret for the future success of the build to rent sector in the UK with developers needing to look beyond traditional layouts, says a new report. Britain is on the verge of a rental revolution with around £30 billion of institutional investment earmarked to build and manage homes for rent, but success means creating homes that foster a sense of community, according to the report. Indeed, the report ‘Funding Britain’s rental revolution’, by Addleshaw Goddard, a law firm and the British Property Federation, a trade body, says Build to Rent could bring in substantial additional finance for housing. For example, it says that getting tenants to know their neighbours will help encourage them to stay for the long term, saving operators money on costly voids. The key to this will be creating user friendly living areas that encourage circulation within the buildings. It points out that much of the concept around Build to Rent is borrowed from North America’s multifamily sector where listed companies own much of the housing stock. Many of the Build to Rent schemes coming forward will include a range of communal space throughout the buildings and the report suggests this could include top floor amenity decks in the place of penthouse flats allowing all renters to benefit from the views and additional space. Others will be simpler, such as a lobby area with shared seating but the report says that crucially, all schemes need to be of a decent quality. Overall it suggests that the shift towards a professionally run rental market with developments owned by single companies rather than multiple speculators and buy to let investors, promises to offer Britain’s nine million renters higher standards, better value and greater transparency with homes purposefully designed for renters. Institutions such as APG, Hermes, and Legal & General, together with companies such as Grainger, Essential Living and Fizzy Living are spearheading the new sector and the report says that the growth of Build to Rent is good for the economy, communities, investors and consumers. It also points out that extra finance for housing is unlikely to surface through existing house builders or council funded development so Build to Rent could bring in more than £30 billion over the next five years. The positive includes that fact that it allows investors to match to long term liabilities such as annuities or pensions with stable returns delivered from rent and it reduces the amount of debt held by individuals at a time where record low interest rates are set to rise. On top of this Build to Rent investors can take a long term view and residents will be offered long term tenancies since the homes will not be sold off. Also, landlords will encourage tenants to stay by offering onsite amenities and good customer service. In America, this is the way companies seek to beat their competition. Build to Rent has emerged as a separate new asset class, distinct from… Continue reading
Miami real estate market continues to be popular with US and overseas buyers
The Miami real estate market, one of the most popular in the nation with international and domestic buyers, continued to gain momentum in March with sales growing strongly. The latest data shows that single family home transactions registered double digit growth year on year and existing condominium sales rose despite an increase in new condo construction. The figures from the Miami Association of Realtors reveal that single family home sales are up 10% compared with a year ago. This comes on top of a record 2014. While condo sales were up 4.2% year on year. ‘Miami continues to attract international and domestic home buyers looking to live in a global city with world-class amenities and a diversified economy. Buyer demand in Miami properties is leading to more sales and higher sale prices,’ said Christopher Zoller, the association’s 2015 residential president. The report points out that single family home prices remain at affordable 2004 levels despite more than four years of consistent year on year increases. Condo prices has seen 45 months of growth in the last 46 months. Prices are also seeing growth. The median sale price for single family homes increased 10.6% to $260,000 in March 2015 from $235,000 in March 2014. The average sale price for single family homes increased 3.2% to $473,677 last month from $459,102 during the same time period last year. The median sale price for condominiums surged 7.5 percent in March to $215,000 from $200,000 a year ago. The average sale price for condos increased 5.8 percent to $398,994 from $377,290 in March 2014. Miami single family homes and condominiums continue to sell close to asking price, reflecting a strong consumer demand, the association says. The median number of days on the market for single family homes sold in March 2015 was 54 days, an increase of 14.9% compared to the same period in 2014. The average percent of original list price received was 94.6%, down a negligible 0.3% from a year earlier. The median number of days on the market for condominiums sold in March 2015 was 60 days, an increase of 1.7 percent compared to the same period in 2014. The average percent of original list price received was 93.5% a 0.7% decrease. In Florida as a whole sales of existing single family homes were up 24.6% over March 2014, according to Florida Realtors while condominium sales were up 13.7% compared to March 2014. The statewide median sale price for single family existing homes last month was $190,000, up 9.2% from the previous year, according to Florida Realtors. The statewide median price for townhouse condo properties in March was $152,000, up 8.6% over the year ago figure. Miami sees twice the national average of cash buyers, representing 54.2% of sales in March 2015, down from 60.5% in March 2014. Nationally, just 24% of all national housing transactions are made in cash. Since 82% of foreign buyers in Florida purchase properties all cash, Miami’s high percentage of cash… Continue reading
UK regional cities house price growth outperforms central London, says latest index
House prices in larger regional cities in the UK have outperformed central London for the first time since 2005, the latest property index shows. Although central London recorded year on year house price growth of 3% in the first quarter of 2015 the capital’s most expensive boroughs are being eclipsed by growth in large regional cities, according to the UK Cities House Price Index from residential analysts Hometrack. Some 12 of the UK’s largest regional cities have registered higher price rises year on year than Central London including Glasgow with growth of 7.6%, Manchester 6.8% and Leeds 6.6%. Indeed, Kensington and Chelsea and Hammersmith and Fulham have seen price declines of 3.4% and 5.1% respectively amidst uncertainty due to the threat of mansion tax and affordability pressures in the run up to the general election. Newcastle, Sheffield, Manchester, Leeds and Glasgow registered the strongest pick up in house price growth in the first quarter of 2015 as households gain in confidence over the economic outlook and attracted by record low mortgage rates. Together these cities account for 30% of housing stock covered by the Hometrack index and this pick-up in growth is supporting the headline rate of house price growth which was 0.8% in the first three months of the year. Average house prices across the 20 cities included in the index registered growth of 3.8% in the first quarter compared to 3% over the same period in 2014. While the UK picture is polarised by a North/South reversal in house price growth, the London market is divided by its East/West compass points. The balance of house price growth across the index for London has shifted from high value markets driven by international capital to the lower value markets favoured by owner occupiers. Newham, Barking and Dagenham, Greenwich, and Croydon registered 14.2%, 12.5%, 12.4%, and 12.1% growth respectively in the last quarter compared to the same period 12 months ago. The index report says that these boroughs are sustaining the capital’s growth, despite house prices in the affluent central London areas falling. The report also suggests that areas of London that are still undergoing regeneration or are benefiting from new investment have proved popular with owner occupiers priced out of the boroughs favoured by international buyers and investors. The highest year on year growth rate was recorded in Newham and Barking and Dagenham, where average house prices are £275,000 and £215,000 respectively, and track 33% and 50% below the London average of £417,000. ‘House price growth is holding up better than expected as a result of a lack of new supply of homes for sale and record low mortgage rates attracting buyers into the market,’ said Richard Donnell, director of research at Hometrack. ‘Growth in London is still running in double digits and high capital growth rates in recent years have pushed down average loan to values in London, creating further capacity for additional borrowing for households that can pass tighter affordability… Continue reading
