Tag Archives: government
UK real estate sector upbeat for the next 12 months
The UK real estate sector is upbeat over the short term with a new survey finding that 88% are confident about the next 12 months. But the position is less certain in the longer term with just over half, 54%, confident of the real estate sector’s performance in the next five years, according to the survey commissioned by the British Property Federation (BPF) and Grosvenor Britain and Ireland. A majority of property owners and investors, 60%, said their company’s development activity would increase in 2016, although the survey also identified a number of barriers to property supply which central and regional Governments could lower. In London, this included a call for the Mayor to assemble and sell developable land and encourage investment in the burgeoning ‘build to rent’ sector, which sees developers retain ownership of newly built rental homes. According to the survey, Greater London is the most favoured area for planned investment, with 53% saying their company plans to increase investment levels and 23% planning to maintain them over the next 12 months. In the Midlands some 60% expected to increase investment, 23% to maintain current levels while in the North West of England it is 25% and 23% respectively. In Scotland just 16% expect to increase investment and 16% to maintain levels. ‘The real estate industry is a vital contributor to the UK’s economy and crucial to bringing about regeneration and growth across the country. It is therefore welcome to see that sentiment over the next year is positive,’ said Melanie Leech, BPF chief executive. ‘Wider economic circumstances and political uncertainty are outside of our control, but there are a number of things that Government can do to ensure that the outlook remains bright. The next London Mayor has a clear mandate from the industry to assemble and sell public sector land, if they really want to boost development early on in their tenure,’ she explained. ‘It is good to see that investment is flowing into all parts of the UK however, and not just London and the South East. We hope to see this increase as devolution deals continue to be rolled out across the country,’ she added. According to Peter Vernon, chief executive of Grosvenor Britain and Ireland, the findings are a reminder of the real estate sector’s willingness to invest in the UK’s long term economic future. ‘The sector’s ability to boost supply will rest in part on Government lowering the policy barriers. In London, getting more developable public land to the market and unlocking new rental homes to meet growing demand will be key to success,’ he pointed out. Continue reading
Need for affordable housing not likely to be met by Starter Homes scheme
The vast majority of councils in England do not think that Starter Homes should be classified as affordable housing and only 7% of councils think they will address the need for affordable housing in their local authority areas. Indeed, new research shows that local councils, of all political parties, believe that the Government's Starter Homes policy will hinder rather than help to tackle the growing need for genuinely affordable housing in England. They have also raised concerns about the impacts of the Government's plans to reduce social rents by 1% a year for the next four years and the extension of the Right to Buy to housing association tenants, according to a survey commissioned by the Town and Country Planning Association (TCPA) and the Association for Public Sector Excellence (APSE). It found that over two thirds of councils, 69%, anticipate that they will be building less social and affordable housing as a result of the Government's plans to reduce social rents by 1% a year for the next four years. Only 3% say they plan to build more social and affordable homes as a result. ‘Low cost home ownership, such as starter homes, may help some people get a first step on the housing ladder, but as the survey of council's highlights this will not address the need for genuinely affordable homes,’ said Kate Henderson, chief executive of the TCPA. ‘We need a housing strategy for the nation that provides decent homes for everyone in society, including those most in need in the current housing crisis. Our survey has revealed that four out of five councils do not think starter homes should be classified as affordable housing because they are simply not affordable for essential low paid workers or for many people on average incomes,’ she added. Almost three fifths of councils described their need for more affordable housing as severe and 37% as moderate, and 89% of respondents think that the extension of Right to Buy will lead to less housing available for social rent, with only one council thinking that it would be beneficial. ‘What is clear from these survey results is that the headlong rush to extend Right to Buy to housing associations is an ill-thought out measure which enjoys little support, and this is reflected across the different political parties at a local level,’ said Paul O'Brien, chief executive of APSE. ‘With Nine out of 10 councils genuinely concerned that the extension of the Right to Buy to housing association tenants will further diminish the already short supply of socially rented homes, available in their local communities, we say to Government now is the right time to listen on Right to Buy,’ he added. Continue reading
January saw highest total approvals for home buying in UK for a year
The number of loan approvals for house purchase in the UK increased by 22% in January with the month seeing the highest number of total approvals since the beginning of 2014. The data from the Bank of England also shows that the number of remortgage approvals increased by 33% year on year. A breakdown of the data shows that purchase approvals reached 74,581 in January compared to the average of 70,221 over the previous six months while those for remortgaging was 42,228, compared to the average of 40,306 over the previous six months. According Peter Williams, executive director of the Intermediary Mortgage Lenders Association, the threat of a rate rise is no longer driving the remortgaging uplift and instead it is being supported by home owners looking to improve their financial situation through cheaper monthly repayments. ‘In particular, landlords are preparing for fewer tax reliefs like the loss of the wear and tear allowance and restriction of mortgage interest deductability. Accessing cheaper deals through remortgaging will help offset these when they come into place,’ he said. ‘With rising home owner equity and a range of competitive deals in the market, home owners have also been determined to capitalise on currently low rates and intense market competition amongst lenders,’ he explained. He also pointed out that the stability in lenders’ mortgage funding continues to improve. ‘While the government and the Bank of England have supported funding the market, an increase in retail deposits over mortgage balances is underpinning improved mortgage lending, with the savings inflow exceeding that lending by £215 billion or 17% in the last quarter of 2015,’ he added. Adrian Gill, director of Reeds Rains and Your Move estate agents, believes it signals a strong spring buying season ahead. ‘Interest rates aren’t going anywhere fast and while cheaper mortgage deals stick around, buyer demand is chomping at the bit. With all the various government initiatives now in place, many first time buyers consider this their best shot at making the finishing line and purchasing their own home and they are upping the ante to make sure they don’t miss out,’ he said. But in reality, he pointed out that the market currently favours sellers. ‘Those looking to put their home on the market haven’t been in such a strong position since before the recession. House price growth is gaining strength on both an annual and monthly basis, and with an army of eager first time buyers it’s a brilliant time for existing home owners to be advancing up the property ladder. Ultimately, activity levels won’t be able to keep up the pace unless there’s a steady stream of homes for sale entering the ring,’ he added. But Martin Stewart, managing director of the independent mortgage broker, said that the forthcoming referendum on the UK as a member of the European Union could slow the market. ‘The beginning of 2016 has been far busier than usual in the… Continue reading
