Tag Archives: middle-east
Development land prices fall in England apart from in key regional cities
Development land prices for greenfield land in England dipped in 2015, while prices in prime central London remained broadly flat, but urban brownfield site values, particularly in key regional cities, rose strongly during the year. After rising by 50% in the four years to September 2015, prime central London development land prices are starting to ease, falling by 2.7% over the last six months, according to the residential land development index from Knight Frank. It means that development land prices in the prime central London market has dipped for two quarters in a row while values for greenfield land overall in England are down for the fifth consecutive quarter. Greenfield development land values fell by 2.1% in the fourth quarter of 2015 and 4.9% year on year while prime central London land prices remained broadly flat in 2015. Urban development land prices, however, bucked the trend, rising by 2.5% in the final three months of 2015. The development land index, based on the valuations of actual development sites around the country, shows a multi speed land market. Prices of mainly brownfield land in key cities, including outer London, Manchester, Leeds, Birmingham and Bristol led the urban growth. A 2.5% increase in the final three months of the year took annual growth for urban development land sites to 11.9% and according to Grainne Gilmore, head of UK residential research at Knight Frank this reflects the highly regionalised nature of the housing market at present, with price performance in many key cities and commuter towns outperforming the wider average. ‘The price growth differential also reflects the strengthening appetite for land among developers and housebuilders in regional hubs. This demand has picked up significant momentum in the last 12 months, lagging the pick-up in demand seen in the wider greenfield market two years ago,’ she explained. She also pointed out that house builders active in the greenfield market have largely replenished their pipeline land supplies, although they are still active in the market for smaller, oven ready sites. ‘The length of the planning process means that taking on large speculative schemes is hard to balance against the cost of capital involved in doing so. At the same time, developers are operating in a period of higher build costs, and a key part of this is the difficulty in accessing skilled labour which still remains in short supply,’ Gilmore said. ‘On the other hand, better local economic growth in key regional cities, coupled with more buyer confidence has resulted in a resurgence of development, and this is reflected in competition for good brownfield sites,’ she added. Focusing on prime central London, the data shows that land prices dipped by 1.1% in the final quarter of the year, resulting in a marginal decline in prices of 0.2% over the course of the year. This echoes the slowing of price growth in this central area of London, with prime property prices rising by 1% over the year to the… Continue reading
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
Sellers reduce asking prices in Spain as the market become more realistic
Sellers in Spain are becoming more realistic about prices and have reduced asking values which is seen by experts as a good move in terms of keep in the real estate recovery going. Asking prices fell by 0.2% to €1,624 per meter in April, according to data from property portal Fotocasa, compared to a year ago. Meanwhile the latest house price index from the Government shows that prices were up 2.4% in the first quarter of 2016 year on year and up 0.2% quarter on quarter. The Fotocasa asking price index has been fairly stable for the last year, with prices never varying more than 1% either up or down. ‘House prices will continue to go in different directions during 2016,’ said Beatriz Toribio, head of research at Fotocasa. ‘Whilst in some areas of the country prices are stabilising or even rising, in others they continue to fall hard. This is a consequence of the crisis the sector has lived through, which has left a market of two or more speeds that is ever more obvious,’ Toribio added. Since the peak of the market in 2007 average house prices have fallen by 45% but there is some regional variation. Peak to present prices are down by 50.5% in Murcia, 47.5% in the Valencian Region, 47% in Catalonia, 43.9% in Madrid, and 42.6% in Andalusia. The Government figures, however, show that house prices are down 29% since the peak which it outs at the first quarter of 2008 and it adds that price bottomed out in the third quarter of 2014. Prices have increased the most in the Balearics with growth of 9.6%, followed by Catalonia up 4.9%, Madrid up 4.2%, Extremadura up 3.7%, Galicia up 2.6%, the Valencian region up 2.4% and the Canaries also up by 2.4%. The latest mortgage figures show that lending volumes are also up which means more people can buy a home. The data from the National Statistics Institute on Friday reveals that the number of new mortgages listed in the property registers in Spain stood at 22,983 in March, up 4.5% over the same month in 2015. In more good news for the Spanish property market the latest report from the General Council of Notaries show that foreign demand rose by 12.9% in 2015. More than half, 52%, were people buying a holiday home while 48% were foreigners living in Spain. The British were the biggest group of foreign buyers with 21% of the market, followed by the French at 9%, Germans at 7.5%, Belgians at 6% and Italians at 5.5%, the data also shows. The Balearics is the most popular part of Spain with overseas buyers with foreign purchases amounting to 44% of the market, with the Canaries at 39%, Valencia at 37% and Murcia and Andalusia both at 25%. Foreign demand growth was strongest in regions with small markets, where even a modest increase in foreign demand translates into a big increase in percentage terms. Growth was biggest… Continue reading
