Tag Archives: development
EU future uncertainty hitting prime central London sales and lettings
Sales and lettings in the prime central London property market have been hit by uncertainty over the UK’s position in the European Union ahead of the referendum vote on 23 June. After a period of increased activity, as buyers rushed to beat the April stamp duty deadline, the prime central London area is experiencing a subdued time, according to a new report from estate agency WA Ellis. ‘April saw the government collect a record of nearly £1.2 billion in stamp duty, as landlords rushed to beat higher stamp duty rates on second properties. These national figures are reflected by transaction levels within prime central London which have halved since March,’ said Richard Barber, director at WA Ellis. He believes that various apocalyptic visions of what may or may not happen if the UK voted to leave the EU have continued to confound the electorate over the last two months. ‘As a result, it would appear that buying a new property has been put on hold by the majority of potential purchasers until the future of the UK is determined,’ he added. Landlords in prime central London are being hit hard by the uncertainty, according to Lucy Morton, head of agency at WA Ellis and JLL, with rents being adversely affected. ‘There are reports of recruitment freezes across the city and firms delaying relocating staff to London to see what awaits the UK post referendum. This, of course, has had an impact on prices, and the unprecedented surplus of stock has put further downward pressure on the rental market,’ she explained. ‘With this in mind, we have been advising landlords to reduce rents, and this has yielded positive results with enquiry levels up, and a substantial increase in lettings being agreed. In this sort of market, minimising vacant periods is more important than waiting for a slightly premium rental offer,’ she pointed out. ‘For example, over the course of a year, a 5% higher rental offer is negated if it means that a property stays vacant for an extra two and half weeks. As always our message is clear: accurate pricing and pristine presentation should be a landlord’s main consideration in volatile market conditions,’ she added. Continue reading
Landlords in UK want their tenants to be happy, new research suggests
With more people renting a home in the UK new research has found that there is increasing competition for landlords to attract the best tenants. The survey from Endsleigh found that 90% landlords surveyed have gone out of their way to make their tenants welcome and 41% say they would unreservedly go the extra mile to keep their tenants happy. The research also found that 50% of landlords are very happy with their current tenants. The positivity is reflected by tenants as 83% of those surveyed said they were happy with their current landlord. Landlords are trying their best to keep tenants happy, with 28% of landlords saying they would absorb the cost of rental increases to keep reliable tenants in their property for a longer period and 40% saying they would redecorate at their tenants’ request. After a realistic rental price for the area, landlords believe that the most important thing to their tenants is a professional clean prior to moving in while for tenants think it is reliable Wi-Fi installed before moving-in. When it comes to the Government, landlords and tenants clearly feel hard done by. Almost half of landlords, 47%, believe that the Government is not doing enough to protect landlords, saying that the Government favours tenants, with 17% feeling that current rental contracts do not adequately protect them. However, some 78% of tenants do not feel that the Government are doing enough to protect them either from landlords who may put them at unnecessary risk, particularly at occurrences of unexpected costs or legal proceedings. Poor tenants and damages’ ranked as the biggest current concern to landlords with 20% saying so, followed by 19% citing having their property vacant for too long and 15% the rising cost of maintenance. Despite all this, some 67% of landlords surveyed agree that the benefits of being a landlord outweigh the time and hassle involved in processes, with 12% of landlords surveyed using rent as a main source of income and 36% using this as a way of planning for their future after retirement. ‘Despite their ongoing differences about who is treated more fairly, tenants are showing more authority than they previously did and expecting more too. It’s obvious that landlords are doing what they can to create the best accommodation possible,’ said David Hadden, head of property at Endsleigh Insurance. He pointed out that’s most important is open communication, a clear understanding of who holds which responsibilities and a level of appreciation between each party so everyone can get along. Continue reading
Development land prices fall in England apart from in key regional cities
Development land prices for greenfield land in England dipped in 2015, while prices in prime central London remained broadly flat, but urban brownfield site values, particularly in key regional cities, rose strongly during the year. After rising by 50% in the four years to September 2015, prime central London development land prices are starting to ease, falling by 2.7% over the last six months, according to the residential land development index from Knight Frank. It means that development land prices in the prime central London market has dipped for two quarters in a row while values for greenfield land overall in England are down for the fifth consecutive quarter. Greenfield development land values fell by 2.1% in the fourth quarter of 2015 and 4.9% year on year while prime central London land prices remained broadly flat in 2015. Urban development land prices, however, bucked the trend, rising by 2.5% in the final three months of 2015. The development land index, based on the valuations of actual development sites around the country, shows a multi speed land market. Prices of mainly brownfield land in key cities, including outer London, Manchester, Leeds, Birmingham and Bristol led the urban growth. A 2.5% increase in the final three months of the year took annual growth for urban development land sites to 11.9% and according to Grainne Gilmore, head of UK residential research at Knight Frank this reflects the highly regionalised nature of the housing market at present, with price performance in many key cities and commuter towns outperforming the wider average. ‘The price growth differential also reflects the strengthening appetite for land among developers and housebuilders in regional hubs. This demand has picked up significant momentum in the last 12 months, lagging the pick-up in demand seen in the wider greenfield market two years ago,’ she explained. She also pointed out that house builders active in the greenfield market have largely replenished their pipeline land supplies, although they are still active in the market for smaller, oven ready sites. ‘The length of the planning process means that taking on large speculative schemes is hard to balance against the cost of capital involved in doing so. At the same time, developers are operating in a period of higher build costs, and a key part of this is the difficulty in accessing skilled labour which still remains in short supply,’ Gilmore said. ‘On the other hand, better local economic growth in key regional cities, coupled with more buyer confidence has resulted in a resurgence of development, and this is reflected in competition for good brownfield sites,’ she added. Focusing on prime central London, the data shows that land prices dipped by 1.1% in the final quarter of the year, resulting in a marginal decline in prices of 0.2% over the course of the year. This echoes the slowing of price growth in this central area of London, with prime property prices rising by 1% over the year to the… Continue reading
