Tag Archives: development
More people in UK want to buy a home but ownership levels are falling
The appetite amongst people in the UK to own their home has risen steadily over the past four years but ownership levels have also been falling, new research shows. Some 73% of non-home owners now say they would like to own their home compared to 69% last year, 68% in 2014 and 65% in 2013, according to the annual survey from the consumers group the HomeOwners Alliance. But despite more people wanting to own the roof over their heads, home ownership levels have been declining for the past decade after peaking in 2002 at 69.7% and the report says this is because the high demand for homes is pushing house prices to unaffordable levels. It explains that the mismatch between house prices and wages is worsening, average house prices have risen five times more than wages in the last five years and this is exacerbated by an inadequate supply of new homes. It also points out that despite a series of measures announced by the government aimed at supporting first time buyers, such as the Starter Homes Initiative, extension of the Help to Buy loan scheme and introduction of a new Help to Buy ISA there are still difficulties in first time buyers finding affordable homes. One issues is that in dealing with the housing crisis, much of the focus has been on helping first time buyers, but there is growing recognition that solutions need to go further, it suggests, adding that with availability of homes for sale at a record low, last time buyers in under occupied homes have become a focus for freeing up housing stock for younger families. ‘Despite a blizzard of government initiatives aimed at helping homeowners, the housing crisis is deepening across the country, with ever more non-homeowners wanting their own home, and ever greater concern about the lack of housing,’ said Paula Higgins, chief executive of the HomeOwners Alliance. ‘Many government policies have boosted demand for homes, but what this survey shows is that the real problem is the desperate shortage of houses. Until the government tackles the fundamental issue that we just don’t have enough good quality homes, the housing crisis will continue to deepen and a generation will continue to have their dreams of home ownership crushed,’ she added. It explains that so-called last time buyers, could help ease the housing crisis in the UK freeing up under occupied properties. There are an estimated 11.4 million home owners age 55 and over and 10% of them have considered a move in the past two years but did not. Some 23% of home owners aged 55 or over who considered moving say lack of suitable housing was the main reason they did not do so, this equates to more than 500,000 home owners. Stress and upheaval of moving is also more likely to be a barrier for those moving later in life with 30% saying so compared to 21% of home owners… Continue reading
Cost of land to build prime homes in Asia still rising
Prices of residential sites in Asia increased by 1.9% in the first half of 2016, down from 2.8% in the preceding six months, put office land increased from 1.9% to 2.2%. Overall development land investment volumes in Asia matched the level registered in the corresponding period last year, according to the Prime Asia Development Land Index from international real estate firm Knight Frank. As compared to the preceding six months, however, they were 40.4% lower and the index report explains that land markets tend to be more active in the second half of the year, which accounts for 60% of the transactions historically. With state owned enterprises purchasing land aggressively, China, which accounts for more than 90% of the deals in Asia, saw a 6% year on year increase in volumes while in Thailand some major deals boosted volumes by 190.4%. However, cross border land investment volumes fell by 11.5% year on year. ‘Part of the reason is that while Chinese developers have previously snatched up land in Hong Kong and Singapore, they now appeared to have joined their local counterparts to become more cautious amid the ongoing correction in housing prices in these markets,’ the report explains. As a result, China bought 88.8% less land year on year in the rest of Asia. In China, among the cities tracked, Shanghai experienced the strongest growth in prime residential land prices. ‘While the government raised the down payment requirement on second and subsequent properties as well as tightened non-locals’ purchase eligibility, shadow banking and peer to peer financing helped home buyers circumvent these rules, although authorities are closing the loopholes,’ it adds. According to the National Bureau of Statistics, residential prices in Beijing, Guangzhou and Shanghai surged by 15.3%, 12.8% and 19.5% respectively in the first half of 2016 and the report says this emboldened developers to bid for land aggressively. In particular, Shanghai saw the average premium over reserve price in residential land auctions soar to 154% in the first six months of the year from 60% in the corresponding period last year. As a result of an overhang of unsold prime housing inventory in Mumbai and New Delhi that requires an estimated four and seven years to clear respectively, the Knight Frank indices registered a decline in prime residential land prices. It adds that strong office leasing demand boosted the prices of prime office development sites in Bengaluru, which grew the fastest in the region. Similarly, prices of commercial land in Mumbai and New Delhi outperformed those of residential sites. Tokyo registered the largest increase and the report says that the negative interest rate introduced by the Bank of Japan has brought mortgage rates down, supporting housing demand. Indeed, recent condominium launches with hefty price tags were met with much enthusiasm from home buyers, with one development in Minato ward even fetching a record high average price of US$33,800 per square meter. Sites for office development in Asia also… Continue reading
Architects set out what needs to be done to improve UK housing market
Housing policy alone is not enough to solve the UK’s housing crisis whose roots are as complex as they are varied, according to architects. The Royal Institute of British Architects (RIBS) says that as demand for new homes continues to outstrip supply successive governments have failed to keep up and it believes that the only solution lies in bringing together the public and private sector to promote, enable and finance new homes, and improve the quality of homes. In a new report it points out that high quality design needs to be at the heart of the solution. ‘Without it, we’ll be solving one problem by storing up further challenges for the future,’ it says in a anew analysis report and calls for housing policy to be added to the remit of the National Infrastructure Commission and for future infrastructure schemes to include details of their impact on housing supply. It also calls for the establishment of a Chief Built Environment Adviser and better use of public resources. ‘With interest rates at historic lows, more can be done to use the balance sheets of public and private sector bodies to boost housing supply,’ the report suggests, adding that the cap on Housing Revenue Account receipts should be lifted to allow councils to borrow to build social housing. Other possibilities include central and local governments setting up public sector investment vehicles and a national housing investment bank to issue bonds and ISAs, recycle right to buy receipts and attract long term institutional investment. RIBA believes that local authorities should set up Local Housing Development Funds, with initial capital for investment provided by local authority pension funds. Once such schemes are up and running, they would be able attract secondary institutional investment and the Government should transfer responsibility and resources for housing and planning to local and regional authorities. ‘This transfer needs to be accompanied by greater autonomy over policy setting. The regeneration of housing estates should be based on an approach which makes the most of the strengths of existing communities and addresses the challenges exacerbated by the urban environment such as anti-social behaviour or high rates of obesity,’ the report says. ‘Local leaders should be empowered to shape their local housing market by taking control over requirements for affordable housing, including the tenure composition for new developments such as social rent, affordable rent, living rent, shared ownership, and Starter Homes, based on local housing need, rather than fixed national targets,’ it adds. It also points out that self build and custom build add value to a locality, can be an affordable routes to home ownership, and are valuable as delivery mechanisms for new, high quality homes. It acknowledges that the Self-Build and Custom Housebuilding Act and the Housing and Planning Act aim to identify land and provide planning policies to support custom build but says that unless local authorities have sufficient resources they will struggle to implement their duties… Continue reading
