Tag Archives: house
Review of British development tax welcomed by property industry
The British property industry has welcomed a government review of one of the country’s biggest bugbears in the planning system. According to the Property Federation (BPF) the relook at the Community Infrastructure Levy (CIL), a development tax which is used to fund local infrastructure, is long overdue. The organisation, which is supportive of CIL in principle, has long advocated a review of the tax and says that it has become overly burdensome and inefficient. The BPF says that the review must not be the end of the story. In some cases, the evidence base used for the initial CIL setting is now fully out of date, and not fit for purpose. It is crucial that local authorities are encouraged to regularly review their own charging schedules against market signals and to test them against ‘real life’ projects that reflect market conditions. It pointed out that CIL simply does not work for complex or large scale strategic sites, and a more site specific and targeted approach to infrastructure funding and other contributions must be taken. It also wants to see clarity between CIL and s106. A fundamental premise of CIL was that it would be used to fund a set of identified infrastructure requirements, whilst s106 obligations should relate only to site specific mitigations and affordable housing provision. However, in reality, this has not happened, and there is considerable overlap between the two. This fundamental issue must be addressed and clarity provided in order for CIL charge setting to be at the right level and to make the process work properly. It is also calling for the integration of CIL with local plans. There is a disconnect between the preparation of local plans and the formulation of CIL charging schedules, which local authorities should prepare in tandem, in conformity with the National Planning Policy Framework. It is critical that emphasis is placed on delivery of infrastructure, rather than just revenue collection, it adds. ‘Many of our members cite CIL as one of the biggest bugbears of the planning system, and there are plenty local authorities who would agree. Whilst some would like to see it abolished altogether, we believe that with the right changes, CIL could be a useful tool for ensuring infrastructure delivery on development sites,’ said Melanie Leech, chief executive of the British Property Federation. ‘The creation of this group is a step in the right direction, but it must not stop here. It is crucial that Government take any recommendations on board, and works with both public and private sectors to ensure that the regime really works in the future,’ she explained. ‘CIL was supposed to provide a quicker, fairer and more efficient way of delivering infrastructure to support development and our members have always supported this principle, but we are concerned that in many places it is not working. We look forward to engaging with the review panel to ensure that CIL becomes less of a burden and more… Continue reading
Gross mortgage lending in UK jumps 8% month on month
Gross mortgage lending in the UK reached £21.8 billion in October, some 8% higher than the previous month, according to the latest estimates from the Council of Mortgage Lenders. In addition to the month on month rise, lending rose 19% year on year, from £18.4 billion in October 2014, the highest monthly figure since gross lending reached £23.6 billion in July 2008. ‘As lending in the regulated mortgage space picked up over the summer months, the pace of recovery has improved. This looks set to continue over the closing months of the year with the factors helping support this recovery continuing to be low inflation, strong wage growth, an improving labour market and competitive mortgage deals,’ said Bob Pannell, CML chief economist. ‘As a result lending this year is likely to exceed our forecast of £209 billion, though affordability pressures will limit business volumes for first-time buyers and movers meaning that we think the market has only modest further upside potential over the short term,’ he added. According to Peter Rollings, chief executive officer of Marsh & Parsons, lending levels are at an impressive seven year high. ‘We’re yet to clear the pre-crisis July 2008 benchmark but over the summer the mortgage market has really taken it up a notch, and month on month improvements are getting more cheerful as we approach the festive season,’ he said. He pointed out that London has seen a significant boost in mortgage buyers and first time buyers since June, as domestic activity intensifies in the housing market. Mortgage buyers accounted for 65% of London property purchases in the third quarter of 2015, a significant leap from 52% the previous quarter. In addition to this 26% of all third quarter sales were to first time buyers. ‘Overall competitive mortgage rates and low inflation have paved a smoother road for buyers, and this has shifted the dynamic in the capital towards British buyers, as key tax changes still act as a speed bump to some overseas buyers and investors,’ added Rollings. John Eastgate, sales and marketing director of OneSavings Bank, pointed out that a scarcity of supply of property remains an issue in a lending market that is still driven very much be refinancing activity. ‘Wages are still growing, while deflation is bolstering incomes in real terms, supporting borrower’s finances. Negative inflation is also kicking a rate rise into the long grass, which is enabling lenders to offer historically attractive rates,’ he added. Demand is being driven by continued interest from prospective house buyers and a surge in the remortgage market, and this is being matched by the availability of finance, according to Henry Woodcock, principal mortgage consultant at IRESS. ‘Eyes are now turning towards end of year targets, fuelling interest rate competition between lenders, further stimulating borrower demand. With interest rate hikes now unlikely until the first half of 2016 at the earliest, the cost of servicing a mortgage… Continue reading
Research reveals that almost half of UK tenants sublet their property
Almost half of tenants who sublet their property in the UK do so without their landlord’s consent, according to new findings from the National Landlords Association (NLA). The findings come as the government recently announced proposals to introduce minimum room sizes in order to crack down on problems with private rented accommodation such as unauthorised subletting, which often results in overcrowded and cramped properties. Of the 11% of tenants who say they have sublet all or part of their property before, just 5% did so with their landlord’s permission. Some 26% of tenants say they have approached their landlord about subletting but have had the request declined and 63% say they have never asked their landlord about subletting their property. Overall, the findings show that 32% of tenants have approached their landlord about subletting their property with 22% of requests being permitted by the landlord. ‘These findings indicate that subletting is not common in private rented homes, but worryingly that where it does happen, much of it takes place behind landlords’ backs, without their knowledge or permission,’ said Carolyn Uphill, chairman of the NLA. ‘This isn’t something apparently harmless, like putting your flat on AirBnB while you are on holiday. We are talking about individuals looking to deceive their landlord and maximise their personal gains at the expense of proper property management standards and the risk of others. It not only increases the cost of renting for the unwitting sub-tenants, it affects their rights and can reduce security of tenure,’ she explained. She also pointed out that subletting can also breach a landlord’s mortgage terms, the conditions attached to licenses granted for letting out shared homes and invalidate existing insurance products so they must be aware of the problems it presents. ‘The NLA advises all landlords to insert a clause into new tenancy agreements that makes clear sub-letting is only allowed with the landlord’s permission, which should not be unreasonably withheld. This would reduce their exposure to a whole host of unnecessary risks, including hefty fines and even a prison sentence,’ said Uphill. ‘Landlords who are worried that subletting may be occurring in their properties without their permission should seek advice from a professional organisation such as the NLA which can provide help and support,’ she added. Continue reading
