Tag Archives: development
Developers call for land to be set aside in UK for Build to Rent
A group of developers and real estate investors have revealed a three point action plan which they say could see more than 250,000 extra homes built for rent. Called the Better Renting campaign, they have written to the housing minister saying that Build to Rent, where corporates build clusters of homes that are rented and not sold, could help the government deliver its pledge to build a million homes by 2020. The letter claims that traditional house builders are at full capacity and that support for corporate landlords could bring £50 billion of new money into the sector. The letter asks ministers to set aside an agreed proportion of public land for Build to Rent development. Councils and public land owners could generate long term rental income from buildings or land, allowing them to fund under pressure public services. The group also calls on the Chancellor George Osborne not to apply an additional 3% stamp duty charge to professional Build to Rent developments. Last December, he promised to only apply this to buy to let investors, but subsequently reversed this pledge. The group claims the move will dampen investor appetite to build more homes. It could deter further investment which could build more than 250,000 new homes. Finally, the campaign’s letter calls for recognition of Discount Market Rent (DMR) homes as an accepted form of affordable housing. This would allow developers to create subsidised rental homes as part of their development commitments, following successful use of the policy in the London boroughs of Ealing, Greenwich and Brent. A nationwide recognition would deliver more affordable housing. Signatories to the letter include Grainger Plc, Essential Living, LaSalle Investment Management, HUB, Fizzy Living, Real Star, Hermes Investment Management as well as Mishcon de Reya, a leading city law firm. ‘Until we face up to the fact that promoting home ownership at all costs will lead us nowhere, Britain will not overcome its housing shortage. The housing minister has been very supportive of Build to Rent, but what’s crucial is that the prime minister and chancellor recognise the contribution this could make to helping them keep their promises on building a million homes by 2020,’ said Martin Bellinger, chief operating officer at Essential Living. According to Helen Gordon, chief executive at Grainger Plc, pointed out that the form wants to invest in the Build to Rent sector. ‘Our vision is for a better rental market, underpinned by good value for money for our customers, supporting economic growth and housing supply,’ she said. ‘We are looking to invest hundreds of millions of pounds into new rental homes, designed specifically for the renting, which we will directly manage for many years to come. It is important that the Government does all it can to allow us and companies like us to build more homes,’ she added. Chris Taylor, head of private markets at Hermes Investment Management, explained that experience from the United States, Germany and Holland demonstrates the potential capacity… Continue reading
UK’s fledgling Build to Rent sector dealt stamp duty blow
The UK’s fledgling Build to Rent sector has been dealt a blow with the announcement that large investors will not be exempt from a new extra stamp duty surcharge that is introduced in a few weeks’ time. From 01 April there will be an extra 3% stamp duty payable on additional homes and it has been hoped that those investing in more than 15 properties would be exempt, and Chancellor George Osborne had indeed hinted at this. However, in his Budget announcement he confirmed that large scale investors in buy to let properties will pay the extra 3% which will apply equally to purchases by individuals and corporate investors. Melanie Leech, chief executive of the British Property Federation, said the move would hit the private rented sector. ‘The government’s decision to not include an exemption for investors who are purchasing large portfolios of properties for rent is extremely disappointing, and deals a huge blow to the build to rent sector,’ she pointed out. ‘This is going to be a significant deterrent to the institutional investment currently poised to settle in the purpose-built rented sector, which has the opportunity to deliver a significant number of new, quality affordable homes,’ she added. The failure to give relief from the additional stamp duty levy for large investors could inhibit the development of a much needed institutional private rented sector, according to Lucian Cook, Savills UK head of residential research. ‘While purchases of six or more residential properties can be treated as a non-residential transaction, the reform of stamp duty on commercial properties is likely mean greater entry costs for large scale residential investors one way or another. Our recent analysis suggests there will be demand for another one million private rented households in the next five years despite policies to boost home ownership,’ he explained. Investors could be put off, according to several experts, including Steve Sanham, development director at HUB. ‘A threshold on how many homes the stamp duty surcharge applies to is also crucial for institutional landlords and investors. The aim of delivering more homes will not be achieved if investors are put off from creating large developments of new homes to begin with,’ he said. Elizabeth Bradley, head of the corporate tax team at international law firm Berwin Leighton Paisner, also believes investors will be discouraged. ‘Much of the British property industry will be very disappointed with the Budget changes,’ she said. ‘The Chancellor has acknowledged the need to build more homes but the extension of the extra SDLT rate on buy to let to large investors will discourage investment in the private rented sector,’ she added. Continue reading
Deal could see fast broadband for new homes in UK
A fast internet connection is one of the top must haves for home buyers in the UK and is set to become a standard for new homes, it has been announced. A new agreement between provider Openreach and the Home Builders Federation (HBF) aims to deliver superfast broadband connectivity to new build properties in the UK. The new deal will see fibre based broadband offered to all new developments either for free or as part of a co-funded initiative. It is estimated that more than half of all new build properties can be connected to fibre broadband free of charge to developers. As part of the agreement, Openreach is introducing an online planning tool for home builders. This will tell them whether properties in a given development can be connected to fibre for free, or if a contribution is needed from the developer to jointly fund the deployment of the local fibre network. The housing industry will have access to a ‘rate card’ from Openreach which details the fixed cost contributions required by home builders in those cases where joint funding is required. Openreach will make a significant contribution itself before seeking any funds from developers. HBF said that it will promote and support uptake of the co-funding offer amongst their members, and emphasise the need to plan for connectivity early in the development. ‘Broadband connectivity is just one thing that home buyers now expect when buying a new build, so this industry-led push to make superfast, or indeed ultrafast, broadband speeds available by default in new homes represents a very important step in meeting the UK’s digital needs,’ said Digital Economy Minister Ed Vaizey. Clive Selley, chief executive officer of Openreach, said it is an important step towards bringing fibre broadband to as many new build properties as possible. ‘We recognise that high speed broadband connectivity is a major factor for home owners when deciding to buy a house. That’s why we’re offering to deliver fibre to all new build developments either for free or as a co-funded model,’ he explained. ‘With the support of the HBF we’ve delivered a series of measures to give developers greater clarity, choice and more funding. This underlines Openreach’s commitment to further extend its fibre network, which reaches more than 24 million premises, to benefit even more communities across the country,’ he added. According to Stewart Baseley, executive chairman of the HBF, said it will help meet home buyers expectations. ‘House builders are constantly striving to deliver on and surpass the expectations of customers as we continue to see housing supply grow,’ he pointed out. ‘Broadband speeds are an increasingly important factor in the home buying process and this offer to developers will see more new build purchasers benefit from the very best connectivity to go alongside the many other advantages of purchasing a brand new home,’ he added. Continue reading
