Tag Archives: industry
Home building starts in England up 6% in 2015, but planning system sluggish
More than 143,500 new homes were started in England last year, up 6% year on year, nearly double the low point of 2008 and the highest level since 2008, but concerns remain over slowness of planning system. The figures from the Department for Communities and Local Government also show that in the final quarter of 2015 some 37,080 homes were started, a rise of 23% on the same quarter a year earlier and up 91% when compared to June 2009. Completions for the fourth quarter of 2015 are estimated at 37,230, some 6% higher than the previous quarter and up 22% on the same quarter in 2014. Annual housing completions totalled 142,890 in the 12 months to December 2015, an increase of 21% compared with the previous 12 months. Seasonally adjusted starts are now 116% above the trough in the first quarter of 2009 but 24% below the peak in the first quarter of 2007. Completions are 23% below their peak also in the first quarter of 2007. It means both starts and completions for new build homes are at their highest level since 2008 with more than 700,000 new build homes started since April 2010. Meanwhile, the latest figures from the Home Builders Federation show planning permission for 59,875 homes was granted in England during the third quarter of last year, up from 53,409 in the same quarter in 2014, a 12% rise. The data also shows that 242,819 permissions were granted in the 12 months to October, the highest moving annual total since early 2008. However, many of the homes identified in the report still have a significant part of the planning system to navigate before any construction work can start, a process that could still take two or three years. ‘Our reforms to the planning system are delivering the permissions needed and schemes like Help to Buy have given builders the confidence to invest and build, with starts and completions now at their highest since 2008,’ said Communities Secretary Greg Clark. A breakdown of the figures show strong regional growth with Cambridgeshire, Northamptonshire and Leicestershire experiencing high levels of starts along with areas in North Oxfordshire and the Thames estuary. The current projection is to deliver a million new homes by 2020/2021 and Housing Minister Brandon Lewis pointed out that proposals published last week will speed up the planning process. They include dedicated fast track application services. However, the industry remains concerned that the lag of turning permissions into homes is becoming lengthier and the HBF hopes that the planning proposals will have an effect as it says that efficient planning is the best way to ensure that local people have an early say in the future shape of their communities and are able to benefit from the wealth of social and economic benefits that house building brings with it. ‘The house building industry has delivered an unprecedented increase in build rates over the past two years. The largest companies have… Continue reading
Residential rents in England and Wales up 3.6% year on year
Rents in England and Wales increased by 3.6% year on year in January with the East Midlands and the East of England lead rental growth, up 5.9% and 5.8%. This means that rents re growing quicker in these two regions in London and landlords overall have seen total annual returns reach 12% or £21,988 in absolute terms since November 2014. The data from the buy to let index from Your Move and Reeds Rains also shows that the average rent is now £790 per month and the proportion of late rent fell in January to 8.2% compared to 9.3% in December 2015. In London rents rose by 5.7% on an annual basis, marginally slower than 6.3% recorded in December. At the other end of the spectrum rents are lower than a year ago in the South East and North East regions, both seeing a 1% annual fall. Meanwhile the slowest annual rent rises are in Wales, up just 0.6% since January 2015. Six out of 10 regions have witnessed monthly falls in rents, in line with the overall month on month trend across England and Wales. This is led by London, with rents in the capital 0.7% lower than in December. Taking into account both rental income and capital growth, the average landlord in England and Wales has seen total returns of 12% over the 12 months to January, up from 11.2% in the 12 months to December, a 14 month record since total returns stood at 12.3% in the year to November 2014. In absolute terms this means that the average landlord in England and Wales has seen a return of £21,988 over the last 12 months, before any deductions such as property maintenance and mortgage payments. Of this, the average capital gain contributed £13,594 while rental income made up £8,394 over the 12 months to January. Rental yields have so far proved resilient in the face of price rises, the report also shows. The gross yield on a typical rental property in England and Wales, before taking into account factors such as void periods, is steady at 4.9% in January, the same as in December 2015. On an annual basis, this is fractionally lower than the 5% gross yield seen a year ago in January 2015. ‘Buy to let returns are building and property prices are picking up as the housing shortage across the UK intensifies. Landlords’ balance sheets are looking healthier than at any point since 2014, and property investors are looking at an excellent rate of return from their portfolios,’ said Adrian Gill, director of estate agents Reeds Rains and Your Move. ‘With house prices rising rapidly into the New Year, this acceleration will be a welcome addition to the wealth of landlords on paper, while solid rental yields are underpinning total returns pushing well into the double digits,’ he added. He believes that the current fuss over the… Continue reading
New home sales and lending in Australia ended 2015 strongly
Seasonally adjusted new home sales in Australia finished last year strongly, recording a 6% increase in December, according to the latest data from the Housing Industry Association. The growth has bee driven by both the detached house and multi-unit segments of the market. Data shows detached house sales increased by 2.2% while multi-unit sales were up by 21.1%. HIA chief economist Harley Dale said the current healthy national construction volumes are expected to continue throughout the first half of 2016 but there are likely to be very large differences in new housing conditions across States. ‘The updates we receive for leading indicators in coming months will be closely watched to determine the magnitude of any risk that the second half of 2016 is materially weaker for new home building than the first half of the year,’ he added. A breakdown of the figures show that detached house sales increased in three of the five mainland states, up 5.2% in Queensland, up 5% in Western Australia and up 1.1% in Victoria. Sales fell 2.1% in South Australia and by 0.1% in New South Wales. During the December 2015 quarter detached house sales increased in Queensland by 4.3% and by 0.3% in New South Wales. Sales fell 15.4% in Western Australia, 10.2% in South Australia and 4% in Victoria. Meanwhile, the latest figures from the Australian Bureau of Statistics show that the monthly volume of new home loans to owner occupiers hit a six year high during December 2015. That means that the pipeline of new home building is likely to remain strong during early 2016, according to HIA senior economist, Shane Garrett. He pointed out that the December data is the best since November 2009. ‘This time around, new home building is benefitting from record low official interest rates, strong demographic demand and resurgent labour markets in New South Wales and Victoria,’ he added. During December, the number of owner occupier loans for the construction of new homes increased by 1.8% with growth of 12.4% in loans for newly constructed homes. Compared with a year earlier, total owner occupier loans for the construction and purchase of new dwellings are 5.3% higher. ‘During November, the major banks unilaterally increased their variable mortgage interest rates. While the figures seem to suggest no immediate impact on new home lending, the risk remains that such tactics could undermine our industry’s ability to meet Australia’s long term housing needs,’ Garrett explained. A breakdown of the figures shows that the number of new home loans increased, in annual terms, most strongly in the Northern Territory with growth of 29.3%, up 21.7% in New South Wales and up 12.3% in Victoria. New home lending volumes also rose in Queensland by 4% but lending volumes fell in Tasmania by 29.6%, in Western Australia by 19.8% and in the Australian Capital Territory by 0.5%. Continue reading
