Tag Archives: government
New housing construction in UK rising, but output slowed slightly in March
New housing construction in the UK is rising, although there was a slight slowdown in output in March of this year. The latest figures from the Office of National Statistics show that new housing output fell by 0.3% in March month on month. Overall output in the construction industry was estimated to have decreased by 3.6% compared with February 2016 and in the first quarter of 2016 it was estimated to have decreased by 1.1% compared with the fourth quarter of 2015. And year on year between the first three months of 2016 and the first quarter of 2015 output was estimated to have decreased by 1.9%. However in the first quarter of the year there was an increase of 4.8% in total new housing output compared with the fourth quarter of 2015, the data also shows. Both public and private new housing reported increases of 4.2% and 4.9% respectively and all new housing has shown underlying growth since the second quarter of 2013, with the exception of the third quarter of 2015. When compared with the same period a year ago, there was an increase of 3.4% in total housing, with private housing increasing by 7.5% offset slightly by a fall in public new housing of 14.3%. The level of private new housing is the main contributor to the level of total new housing, with public new housing having a much smaller contribution, the ONS report says. The level of private new housing has been increasing gradually since early 2013 and in the first quarter of 2016 was at its highest since records began in 1997 at £6.3 billion, while the level of total new housing is also at its highest at £7.5 billion. Charles Holland, head of residential development and investment at Marsh & Parsons, pointed out that public and private sector housing are the only sectors to have witnessed an increase in construction output quarter on quarter. He does not believe that the slight fall in March is a major issue because home construction is heading in the right direction. ‘London needs to build more new homes than anywhere else in the country. But they also need to be delivered at the right price,’ he warned. ‘It’s not just enough for the new Mayor of London to pledge an annual quota for house building. While that’s challenging in itself, it needs to be coupled with affordability to truly work for everyday Londoners,’ he explained. ‘House building efforts in London need to cater for the £250,000 to £850,000 price range, as this is where we see the strongest and most urgent buyer demand from first time buyers and growing families,’ he added. The new Mayor Sadiq Khan has revealed that an audit of City Hall's preparedness to tackle the housing crisis has found that the delivery of affordable homes is at a near standstill. Last year saw the lowest number of new affordable homes since current records began in 1991with just 4,880 being built. He has… Continue reading
UK home buyers most concerned about prices and mortgages
Financial worries dominate the thinking of today's generation of prospective home buyers in the UK with prices and getting a mortgage the biggest concerns, new research shows. The survey from the Home Builders Federation (HBF) also highlights the change in attitudes to home buying between young and old, showing that whilst 84% of 18 to 34 years olds still want to own their own home, there are huge financial obstacles to realising their dreams. Indeed, some 73% cited the difficulty of saving for a deposit, for 69% it is property prices and 53% the difficulty of getting a mortgage. The survey also found that one in four 18 to 34 year olds are totally unaware of any government support available to them, such as the 5% deposit Help to Buy equity loan scheme or the Help to Buy ISA aimed at helping young people save for a deposit. And overall younger people today are more concerned than their elders about the running costs of homes with 67% of 18 to 24 year olds taking this into account when considering whether to buy compared to 40% of 35 to 44 year olds. Younger people are also much more likely to consider buying a new build, which are up to 50% cheaper to run than some second hand homes with 55% saying it is likely they would consider buying a new build compared to just 23% of over 45s. It also identifies the huge amounts of money second hand home buyers spend on their properties with 47% of people spending over £10,000, and more than half incurring the expenditure associated with replacing bathrooms or kitchens. Some 13% of people spent over £40,000 upgrading their home and the HBF estimates it costs around £45,000 to upgrade a second hand home to the standard of a new build. The HBF also believes that there are a number of misconceptions about new build homes. With 34% of people polled saying they have never visited a new build or a show home and a further 18% saying they hadn't for at least 10 years, it points out that the industry faces a huge challenge engaging with the public to explain the many benefits of today's modern, high quality new build homes. Some 84% of 18 to 34 year olds that don't already own their own home aspire to do so and when buying a new home, the most important factors house hunters consider are price and location, both cited by 80%. However a greater proportion of younger house hunters, some 67% of 18 to 24 year olds, take into consideration the running costs of a property, compared to 55% across all age groups. The main obstacles for first time buyers trying to get on to the property ladder are saving for a deposit at 73%, property prices at 69% and getting a mortgage at 53%. Similarly, the main put-offs to buying a home for everyone is the deposit for 72%… Continue reading
Netherlands has best buy to let yields in European Union
The Netherlands is the best location for buy to let properties in the European Union with the highest rental yields of 6.57% as of April 2016, new research shows. Belgium and Portugal are also attractive locations for buy to let investments, taking second and third respectively in the EU buy to let league table compiled from research by international currency firm World First. Average yields were 6.47% in Belgium and 6.29% in Portugal while Sweden was at the bottom of the list with the worst yield at 2.88% with the UK with 4.28% placed 21 out of 29 countries. With an average rental yield of 6.57%, the Netherlands came top due largely to the relatively low price of buying property. The average one bedroom apartment costs just over £110,000 and a three bedroom house costs around £211,000. In the UK, the average price of a one bedroom apartment is £179,000 and a three bedroom house is £343,000. The firm suggests that Sweden has such low yields due to rental controls and a market that favours tenants and this climate will deter seasoned buy to let landlords looking for a decent return on their investment. France at 3.22% and Italy at 3.55%, already established hotspots for holiday homes, also have lower rental yields than their European neighbours and whilst they may make a great retirement or summer home for sun seekers, they may not be ideal locations for buy to let investors. The research also reveals slight differences when investing in buy to lets in city centres compared to suburbs and rural areas. For buy to let in city centres, Belgium takes the lead with yields of 6.54%. This is partly due to the dominance of Brussels as an expat destination for those working at or within the European Parliament, European Commission, Council of the European Union, and the European Council. For properties outside the city centre, the Netherlands again has highest yields at 6.78%, closely followed by Turkey at 6.65% and Portugal at 6.57%. World First research also shows that currency fluctuations in the past year have significantly impacted the affordability of property on the continent with property prices in Sweden 12% more expensive in 2016 compared to April last year. It also says that the recent weakness of the pound has also added over 11% to the price of property in the Eurozone with the average one bed apartment in the Netherlands rising from just over £117,000 to over £130,000. ‘With the recent changes to stamp duty tax for buy to let landlords, UK property investors looking to add to their portfolio might want to consider looking further afield to get the best returns,’ said Edward Hardy, market analyst at World First. ‘Our research shows that within the EU, the Netherlands, with relatively affordable property prices, holds the highest level of returns in Europe. On the other hand, countries that have policies in place to regulate rental prices like… Continue reading
