Tag Archives: real estate
Brexit could create opportunities for UK farm land market
The decision by the UK to leave the European Union has created uncertainty for farm land values but it could also create opportunities, according to new research. In the short term the effect could be muted, according to the initial analysis from real estate firm Savills. It says that a weak Pound creates export opportunities and if this continues into September there will be a significant increase in farm subsidies to British farmers in 2017. It also points out that a weak Pound creates a favourable buying environment for overseas investors and this, along with the potential of reduced supply due to uncertainty may help to support farmland values. However, according to Ian Bailey, head of rural research at Savills, in the event of a significant reduction in farm subsidies, and therefore incomes, the negative effect is likely to be greater on rents than land values. ‘The full impact of Brexit on all of the UK's property markets will be very dependent on the macroeconomic background and the evolution of the story over the next two to three years. We must stress it is early days and there are many unknowns,’ said Bailey. ‘Uncertainty has to be the key factor and this will principally be around those factors that have direct impact on farm incomes. It is likely that farmland market activity in the remainder of this year will be more subdued as potential sellers wait and see,’ he explained. The report is Savills’s first analysis of how the change might affect rural markets in the UK and this is likely to be updated on a regular basis over the following months as hard data, anecdotal news and forecasts evolve. ‘Uncertainty is the key factor and it is very likely that farmland market activity in the second half of this year will be more subdued as potential sellers wait and see. Our research shows just over 100,000 acres were publicly marketed across Great Britain in the first half of 2016, which was on a par with activity for the same period of 2015,’ Bailey said. ‘Historic trends suggest uncertainty creates a lull in market activity and this appears to be the case across England, where supply in the first half of this year, at 68,000 acres, was 10% lower than the same period last year,’ he pointed out. However, in Scotland and Wales the opposite pattern was recorded. ‘Anecdotal evidence suggests that, in Scotland at least, there has been a degree of referendum fatigue which has not hindered activity. In Wales the market is very small and a few farms can make a difference either way,’ Bailey added. Savills also suggests that the uncertainty will principally be around those factors that have direct impact on farm incomes. These will include the UK’s international trade relationships and the level of farm support that will replace the Common Agricultural Policy (CAP). Currently subsidy represents about 67% of the average UK farm income. However, farming subsidies under the… Continue reading
Poll shows over half of UK landlords refuse requests to improve energy efficiency
Over half of UK tenants claim their rental property is cold and draughty and 58% say their landlords has refused to make energy efficiency improvements, a new poll shows. Since the beginning of April 2016 tenants living in F and G rated homes have been able to request improvements, such as more insulation and landlords are legally bound to bring the property up to the minimum of EPC (Energy Performance Certificate) E rating. Under the new legislation, if a tenant requests a more efficient home and the landlord fails to comply, the landlord could ultimately be forced to pay a penalty notice. The survey, conducted by online letting agent PropertyLetByUs, found that seven out of 10 tenants have indeed made requests to their landlord to make improvements to the property but over half have been refused. The survey also found that 76% of tenants claim the property they rent has an old gas boiler, which is unreliable and 48% say their property does not have double glazing. According to data from the European Union it is estimated that over 10 million British families live in a home with a leaking roof, damp walls or rotting windows. Damp, condensation and mould is a big problem in many rental properties as a result of older, single glazed homes. Jane Morris, managing director of PropertyLetByUs, said it is very disappointing to see that so many tenants have been refused when they have requested their landlords make improvements to the property. ‘Landlords that are trying to rent cold, draughty and damp accommodation should immediately start improving their properties. Otherwise, they could be falling foul of the legislation that requires them to bring their properties up to an E rating,’ she explained. ‘It is estimated that around one million tenants are paying as much as £1,000 a year more for heating than the average annual bill of £1,265. These excessive costs are mainly down to poorly insulated homes, many of which are thought to be the oldest and leakiest rental properties in Europe,’ she pointed out. ‘Landlords that are currently renting out F and G rated properties should be looking at the improvements they can make and researching costs and available help, through the Energy Saving Advice Service (ESAS) or Home Energy Scotland,’ she added. Continue reading
First time buyers in UK not impacted by Brexit vote
Buyers in the UK seemed largely unperturbed in the run up to the European Union referendum in June with sales to first time buyers increasing. According to the latest monthly report from the National Association of Estate Agents (NAEA) demand for housing increased as well while supply of available properties and the number of sales going through were stable. However, immediately following the result to leave the EU, agents witnessed uncertainty from sellers, and supply fell momentarily. Overall in June, estate agents saw an increase in demand which the NAEA says suggests that buyers weren’t fazed by the risk of Brexit in the lead up to the vote. There were an average 330 house hunters registered per member branch last month, up 9% from May when 304 buyers were registered, the lowest number recorded since November 2013. However, although June saw growth in the number of prospective buyers, demand still remains low in comparison to June last year. Meanwhile, some 57% of agents reported a drop in demand from prospective buyers and 58% saw supply fall in the week immediately following the vote. However, it is expected this will level out in July. First time buyers in particular were not impacted by the Brexit result. Immediately following the result only 28% of NAEA agents witnessed uncertainty from this group of buyers, while 30% of total house sales in June were made to first time buyers, the highest number of sales since October last year. The Brexit vote did not affect the number sales that completed in June either, with a total of eight sales completing per branch last month, a figure which has not shifted from May. Further to this, the supply of available housing also remained the same with an average of 37 properties registered per member branch in June. ‘In periods of extreme political and economic uncertainty, the housing market will always respond. However, it’s a relief to see that looking at the whole month overall, buyers were still keen to buy, sellers were still keen to sell and sales were still going through at the same level as we’d expect,’ said Mark Hayward, NAEA managing director. ‘It’s only natural that immediately following the vote supply fell but our figures show that the lead up to the vote wasn’t all doom and gloom, which should be a good indication of the months to come,’ he explained. ‘We remain upbeat and need others in the industry to do so as well. The new Housing Minister confirming his commitment to building £1 million new homes will be encouraging for many buyers, especially those looking to buy their first home. Hopefully we should soon see housing market confidence bouncing back to the levels seen pre-Brexit,’ he added. Continue reading
