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Fewer affordable homes being built in England, latest data shows
There were over 33,300 new homes started in England in the 12 months to March 2016, excluding parts of London, of which the majority were affordable properties but fewer than the year before. Overall there were 33,332 housing starts on site and 25,315 housing completions delivered through programmes managed by the Homes and Communities Agency (HCA) in England, excluding London for all programmes except those administered by the HCA on behalf of the Greater London Authority between 01 April 2015 and 31 March 2016. The data shows that while the majority, 21,304 or 64%, of the housing starts on site in 2015/2016 were for affordable homes, this is a fall of 19% on the 26,458 affordable homes reported in 2014/2015. The data also shows that of the 16,544 affordable homes started in 2015/2016 were for affordable rent, a decrease of 24% on the 21,879 started in 2014/2015 but the number for shared ownership sand other affordable schemes at 4,158 rose by 25%. The remaining 602 were for social rent, a decrease of 52%. Some 17,394 or 69% of housing completions in 2015/2016 were for affordable homes, a fall of 57% on the 40,864 affordable homes completed in 2014/2015 but the report says that this reflects the normal peaks and troughs in delivery between programme periods, as the AHP 2011/2015 drew to a close in March 2015. And 13,100 affordable homes completed in 2015/2016 were for affordable rent, a decrease of 58% on the 30,834 completed in 2014/2015 while 2,801 were for intermediate affordable housing schemes, including shared ownership, a decrease of 60% and the remaining 1,493 were for social rent, a decrease of 50%. Of the affordable homes completed in 2015/2016, the AHP 2015/2018 accounted for 37%, the Affordable Homes Guarantees programme for 30% and the Affordable Homes Programme for 19%. Richard Connolly, chief executive officer of Rentplus, described the figures as disappointing. ‘Given investment from the Homes and Communities Agency helps to build around half of new homes in England each year, today’s data makes for a disappointing read,’ he said. ‘Affordable housing starts have been on a steady decline over the last three years and in view of population growth and the endemic housing affordability crisis in the UK, this is the wrong track to be heading down. Our belief is that mixed tenure communities, offering a range of housing options to suit different needs, including rent-to-buy, are crucial to building a strong and sustainable UK property market,’ he explained. ‘Completions of homes for affordable rent also fell 58% annually which will put more pressure on an increasingly diminishing resource for people in housing need. Affordable rent to buy homes provide a viable and complementary alternative to traditional rented homes, helping the many people struggling to save for a deposit to buy due to rent now consuming around half of young people’s salaries,’ he added. He also pointed out that the recent vote for the UK to leave the European Union… Continue reading
Residential property price growth in Australian capital cities slowing
The pace of growth in residential property prices across Australia’s eight capital cities is slowing amid signs that sales momentum is waning, the latest data shows. In the March quarter of 2016 prices were 6.8% than 12 months previously, according to the figures from the Australian Bureau of Statistics (ABS). But this was slower than throughout 2015 when growth averaged 9% per annum. ‘This deceleration is largely being driven by developments in the Sydney residential property market, where annual price growth eased back into single figure territory in March this year. Sydney prices grew at an annual rate of 9.7%, beating the national average, but are also the city’s slowest pace of growth in almost three years,’ said Diwa Hopkins, Housing Industry Association economist. ‘This deceleration in price growth has occurred against a backdrop of waning momentum in property transfers, particularly amongst non-detached housing. The volume of attached dwelling transfers across Australia grew strongly in 2013 and 2014. The volume of transfers was virtually unchanged in 2015 and signs of a pullback in 2016 are now emerging,’ she explained. A breakdown of the figures shows that price growth remained strongest in Melbourne with an increase of 9.8%, followed by Sydney up 9.7%, then Canberra up 4.6, Hobart up 4.2%, Brisbane up 4.1% and Adelaide up 3.1%. In other capital cities prices growth has fallen, led by Darwin with a fall of 4.9% and in Perth prices fell by 4.5% in the year to the March 2016 quarter. Meanwhile, the HIA’s latest bi-annual Housing Scorecard shows that there were over 220,000 dwellings commenced in Australia during 2015, a new annual record. However, there were significant divergences in conditions for residential building around the country. The eastern seaboard states have been the strongest performers, the mining states are sliding down the order, while South Australia and Tasmania are facing the most challenging conditions, according to said HIA economist Geordan Murray. The report shows that there is little to separate the top two ranked states, but it is Victoria that has edged out New South Wales to take the top spot. With nearly 70,000 dwellings commenced in 2015, it is not all that surprising that Victoria was number one, but Victoria also ranked as the strongest market for renovations. Western Australia is off the pace of the top two states, but still ranks third. But Murray pointed out that the high ranking for Western Australia belies the challenging conditions emerging for residential building, as evidenced by nearly 18 months of falling home prices. ‘The state’s overall ranking is propped up by strong performances in indicators of residential building that is already underway. The leading indicators highlight the recent deterioration in conditions and the prospect of weaker conditions ahead, which the HIA has been warning of for a considerable time,’ he explained. He also explained that Queensland is not performing as strongly as Victoria and New South Wales, but the housing recovery is being tempered by the… Continue reading
Should be business as usual for Brits buying property in the EU
British people seeking to buy a property in the European Union should not be downhearted by the referendum decision that the UK should leave, according to overseas real estate experts. Those who are looking to purchase a holiday home overseas, for example, are likely to see that owning a property in the EU will only be marginally more complex than it is currently, according to Andy Bridge, managing director of A Place in the Sun. He pointed out that citizens of the United States, Canada, Russia and many other nationalities own properties throughout Europe, so while it may become slightly more complex for British buyers than currently, they are not going to be prevented from owning property in Europe. Erna Low Property, French Alpine property specialists located in London and in the French ski resort of Les Arcs 1950, say that buyers must resist the urge to panic as there will be no change to buyers conditions and they state that right now buyers should focus on risk assessment and limitation of potential future damage. ‘We are sure that there will be no change in buying costs for those looking to buy property in France, and there are no planned changes in taxations for the income made from property rentals, as well as no difference in capital gain tax as since January 2015 a single rate was applied for EU and Non-EU members,’ said director Francois Marchand. ‘In time, UK residents might be limited regarding the amount of GBP investments and the amount of wealth that can be sent abroad when a new government is in. A safe investment risk strategy has always been to diversify your portfolio. It will make no difference for our clients investing in a French property whether they have bought, are planning to buy, or are currently in the process of buying a property in France. The mountains were there before EU existed, and will be there tomorrow to welcome any international property investors, part of the EU or not,’ he added. However, Alejandra Vanoli, managing director of Mallorca Sotheby's International Realty, believes that the real impact Brexit will have on European property markets will be hard to determine until the negotiations between the UK and the EU are finalised. ‘This of course will be most prevalent in the Spanish market due to the high concentration of British expats. However, these changes will undoubtedly need some time to take effect. Despite this, the Balearics are still a very attractive second home destination to British buyers due to our short flight time from the UK, secure lifestyle, warm climate and favourable legal framework for expats looking to invest in the property market,’ he said. One possible effect is that prices could rise in popular locations if real estate investors move away from the UK to other EU countries to buy property. Camille Letuve Partner of Athena Advisers said that some foreign investors might turn away from London… Continue reading
