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UK house builder calls for stamp duty change
The chairman of one of the UK's largest housebuilders has called for stamp duty and Help to Buy changes to drive the housing market forward and keep the economy growing. Redrow founder and chairman Steve Morgan was speaking at the launch of Woodford Garden Village, one of the largest brownfield redevelopments in the North West, where local community groups, politicians and industry professionals had gathered to help Redrow celebrate its opening. During the day he highlighted how housing transactions have gone down as stamp duty has gone up and the tax was affecting people's mobility. ‘Stamp duty has a huge impact on the market. Not only do buyers have to raise huge deposits, they then have to find thousands more in stamp duty. The last two increases have been very damaging, particularly to the London market,’ he said. He also called for the Government to extend the time limit from application to completion on Help to Buy equity loans to 12 months from the current six months. He said this would enable first time buyers to reserve a new build house farther in advance of its completion when using the incentive, allowing them to compete with investors who are free to reserve at an earlier stage. Overall though the Redrow chairman was positive about the housing market, and saw the current climate as a good time for house builders, with land finally coming through the planning system, albeit still too slowly for his liking, and for customers, with mortgage interest costs remaining low. He pointed out that the Woodford Garden Village development, on the former Woodford Aerodrome site, near Stockport, in Greater Manchester, is the first garden village site for over 100 years in the north west of England and one of the first of a new generation of garden villages with Redrow leading the way. ‘It's important that we're creating sustainable new communities that have longevity and Woodford Garden Village is a prime example of that. It will be a self-sustaining development with a new primary school, shops, a village pub and doctor's surgery to name but a few of its amenities,’ he explained. ‘It's also perfectly located for commuters, close to Manchester Airport and, importantly, it's a brownfield redevelopment, so it's bringing a redundant industrial site back into good use in a fantastic rural location,’ he added. He thanked officers and politicians of Stockport Metropolitan Borough Council for their positive role in bringing the scheme to fruition. Continue reading
Auckland residential rents up 5% year on year
Higher Auckland house prices are not flowing through directly into the rental market, with the city’s average weekly rents seeing year on year increases of around 5%. Rents continue to increase by approximately 5% year on year with the average weekly rent for a three bedroom Auckland home now $514, according to the latest report from Barfoot and Thompson. Suburb pricing trends continue but Mt Albert, Parnell and Sandringham break the mould with year on year increases of over 11, the data also shows. The average weekly rent for a three bedroom home in Auckland during the April to June quarter was $514, up less than 1% on last quarter and 4.8% on the same quarter in 2015. ‘Three bedroom rentals make up around 40% of our managed properties, making them a good measure of the market,’ said Barfoot and Thompson director Kiri Barfoot. ‘Other property categories generally follow the same trend, albeit at lower or higher price points depending on the number of bedrooms,’ she added. A breakdown of the figures show that one bedroom properties averaged $335 per week, up 5% from $319 in the April to June quarter 2015, and two bedrooms $428, up 6.2% from $403, while four bedroom homes were $648, up 4.2% from $622 and five plus bedroom homes averaged $801, up 4.8% from $764. Pricing trends continued across the suburbs as well, with the Central Auckland apartment market remaining the most expensive for smaller properties of one, two or three bedrooms, and the Eastern suburbs maintaining position as the most expensive for four or more bedrooms. ‘Outside the city apartment market, it continued to be a story of two halves for Auckland's North and South this quarter too,’ Barfoot pointed out. South Auckland rental properties saw the greatest percentage increase year on year for the quarter of 6.8%, while North Shore rental prices experienced the least percentage increase, not including Central Auckland, only rising 3.7 %. Looking more closely at rental data from the first two quarters of this year compared to the last two quarters of 2015 three suburbs broke the mould with three bedroom rental averages increasing 11% or more. These were Mt Albert up 14.7%, Parnell up 11.7% and Sandringham up 11.6%. ‘These areas are centrally located but still offer the benefits of suburban living, making them popular choices. These areas are fast becoming popular as the new central suburbs, the next Ponsonby and Grey Lynns if you will, and our data suggests continued future growth particularly for Mt Albert and Sandringham,’ Barfoot explained. The company anticipates a pre-spring upswing in rental activity during the coming quarter, when they typically see a slight increase in new letting. ‘While not as pronounced as summer spikes, we often find a number of tenants are eager to move on from properties during the cold winter months and as we head into spring,’ said Barfoot. ‘It's therefore a good time to remind landlords to keep on top of winter maintenance and look… Continue reading
UK needs more home lending solutions for retirement, research suggests
More than one in three equity release customers in the UK are still paying off mortgages highlighting the growing need for retirement lending solutions, new research suggests. A study from national specialist Bower Retirement Services shows that 36% of over 55s seen by advisers are still paying home loans and advisers are seeing a surge of inquiries from customers with interest only loans. The firm’s quarterly Adviser Tracker Research report also shows that 68% of equity release specialists have seen a rise in customers with interest only loans looking for solutions. Advisers are also reporting an increase in customers who have considered downsizing as a solution but then decided not to go ahead. Some 23% of clients who looked at downsizing did not go ahead with key reasons including staying near family and friends and not being able to find a suitable home. Around 75% of those who did not go ahead said they wanted to stay near family while 54% could not find a suitable home. Bower believes the recent launch by Santander and Legal & General of a partnership to offer lifetime mortgages as an option to customers facing the possibility of repayment shortfalls demonstrates the growing need for new solutions. ‘The Legal & General and Santander deal is a significant move for the launch of retirement lending but much more needs to be done. Significant numbers of people aged over 55 are paying off mortgages but do not have the range of options they need,’ said Andrea Rozario, chief corporate officer at Bower Retirement Services. ‘Downsizing will be appropriate for many but it is also clear that many want to stay in their existing home for emotional and financial reasons and should be able to do so as long as it is in their best interests,’ she pointed out. She added that one potential problem for clients is their home not being worth what they thought and around 18% of advisers say clients who went ahead with equity release found their house was valued at lower than they had expected. Continue reading
