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New buyer enquiries increase again

Published On: June 12, 2015 at 9:57 am

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The latest RICS UK Residential Market Survey has been released and reveals that property prices rose again during May.

34% more surveyors saw prices increase during the month, with the Nationwide Building Society suggesting that the average price of a property is now over £195,000. However, supply was found to have dropped for the fourth consecutive month, with 19% of surveyors reporting a dip in new instructions.[1]

In spite of the fact that new buyer enquiries increased by 14% during May, many people questioned for the report said that they felt surprised of the lack of supply following the Tory election win. With the North West and London seeing the most increased slide in May, the bigger picture points to the fact that UK listings have not seen any substantial growth since mid 2013.

There was a different story in the lettings market, where tenant demand continued to increase. After a fifth straight month of growth, respondents feel that rents will rise across the UK during the next three months. In addition, the survey found that the most substantial rises are thought to be in the East Midlands and in the South West.

New buyer enquiries increase again

New buyer enquiries increase again

Unaffordable

RICS’’s Chief Economist Simon Rubinsohn commented that, ‘there had been some hope that the removal of political uncertainty would encourage more properties onto the market but the initial indications are that this is not proving to be the case. As a result, it is hardly surprising that prices across much of the country are continuing to be squeezed higher with property set to become ever more unaffordable.’[1]

Rubinsohn continued by saying that,’ the feedback we are getting in the survey, which points to prices at a headline rising by another 25% over the next five years, suggests that there is no real confidence that the measures necessary to deliver a meaningful boost to new supply will be put in place anytime soon.’ He feels that, ‘away from the South East, the strongest price growth is anticipated in the North West which is envisaged to benefit economically from the focus of the government on developing the Northern Powerhouse centered on this area.’[1]

 

 

[1] http://www.propertyreporter.co.uk/property/new-buyer-enquiries-increase-at-fastest-rate-in-over-a-year.html

 

 

London Councils Building Homes Outside Capital

Published On: June 12, 2015 at 9:18 am

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The housing crisis has reached new levels in London, with borough councils planning to build homes outside the capital, as “there isn’t enough space.”

London Councils Building Homes Outside Capital

London Councils Building Homes Outside Capital

Westminster City Council has drafted a housing strategy, explaining proposals to partner with other councils and build property outside London in an attempt to keep up with demand for affordable housing.

The document says that the City Council hopes to work alongside other town halls to build homes out of the capital, “helping address London’s chronic housing shortage.”1

Cabinet Member for Housing, Regeneration, Business and Economic Development, councillor Daniel Astaire, says: “We cannot meet all our housing needs within the city’s boundaries – there isn’t enough space and what there is, is among the most expensive in the UK.

“Pressure on housing in central London is unprecedented and enormous. No one local authority acting alone can solve this very complex problem.

“We will take a lead in working with other boroughs and the Mayor to develop some fresh ideas, and I hope this draft strategy will start the debate.”1

In April, The Independent revealed that over 50,000 households were secretly sent out of London boroughs in the last three years.

Wandsworth Borough Council was recently accused of social cleansing after sending a letter to tenants encouraging them to move from London to Birmingham. Read more here: /london-council-accused-of-social-cleansing/.

Astaire continues: “We are a council of action, not words. This year we’ll lay foundations for 350 new homes as part of an investment of over £60m to provide more high quality homes. We can, and will, do more.”1

1 http://www.independent.co.uk/news/uk/home-news/london-borough-councils-building-homes-outside-the-capital-as-there-isnt-enough-space-10312566.html

C of E Urged to Sell its £2bn Land Estate for Housing

Published On: June 11, 2015 at 4:44 pm

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The Church of England has been urged to sell off some of its land to help Britain’s housing crisis. The Church is one of the country’s biggest landowners.

The Centre for Theology & Community and the Christian campaigning group, Housing Justice have proposed this measure in a new report.

They warn that the shortage of affordable homes poses a fundamental threat to the identity of communities and cities in the country.

The report says: “Unless we act now, it may be too late and the poorest will be pushed to the geographical margins. We need to build on the success of campaigns for a Living Wage and responsible lending, otherwise they will be undermined by the consequences of the housing crisis.”

The Church has a huge estate, including properties in villages, towns and cities around the country and over 100,000 acres of land in England and Wales. Its property portfolio is worth around £2 billion and accounts for almost a third of the £6.7 billion in assets it holds.

The report says that the Church should lead by example in helping to tackle the housing crisis: “The Church cannot speak out on this or any other issue without putting its own house in order. If churches are to call for others to make housing a priority, we will have to consider how we steward our property and how congregations might offer practical support to housing associations.”

Selling off some land to build homes is one way it can help, as various denominations own a “surprising amount of land.”

C of E Urged to Sell its £2bn Land Estate for Housing

C of E Urged to Sell its £2bn Land Estate for Housing

“Where land for housing is scarce, Church land can be particularly useful to housing associations,” says the report.

A large vicarage in Gloucester is an example of this, when land was leased to a housing association and used to create 14 new homes.

The Church could also provide volunteers for housing associations and meet the “spiritual needs of residents”1, as well as campaigning for housing.

Thee are 12,000 parishes in England, however, many churches have been hesitant to consider developing their land, often keeping unused land for years. However, charity law allows them to sell land below market value for social housing if it falls within their charitable objectives.

The Venerable Rachel Treweek, Archdeacon of Hackney and Bishop-Elect of Gloucester, writes in the foreword: “I have seen at first hand what the Church can do in partnership with others: How it has been at the heart of initiatives which have secured a Living Wage for low-paid workers, challenged exploitive lending and supported ethical alternatives. I believe the Church can have the same transformative impact on the issue of housing.”1

Chief Executive of the National Housing Federation (NHF), David Orr, says: “By bringing together our assets and skills, churches and housing associations can go further in creating lasting change in our communities.”1

Chief Executive of Shelter, Campbell Robb, responds to the report: “At a time when our housing shortage is leaving thousands of families struggling to keep a roof over their heads, it’s inspiring to see a proposal encouraging integral parts of the community to help provide the genuinely affordable homes we need.

“But ultimately, the Government needs to meet initiatives like these halfway by investing in building the homes we need, because without the Government rolling up its sleeves as well, we won’t fix this crisis.”1 

A spokesperson for the Department for Communities and Local Government states: “We welcome this report, particularly the proposal on releasing land for social housing.

“Housing is an important issue for us all, and while house building is at a seven-year high, with construction starts up 5% over the last year alone, we must maintain this momentum.”1

Only 6% of land owned by the Church has been reserved for development for housing. A spokesperson for the Church of England says: “The Church Commissioners own 105,000 acres of rural let land across England and Wales.

“Approximately, 6,000 of these acres have been identified for strategic development, including the provision of new market and affordable homes delivered in conjunction with house builders and housing associations.”1

Land and property belonging to the Church is owned and managed by 41 dioceses, making it difficult to determine how the plans would work. Its assets include 16,000 churches in England and 105,000 acres of land in England and Wales.

Alongside large parts of land in cathedral cities such as Canterbury, York, Peterborough and Ely, the Church has investments in commercial and residential property, such as the Hyde Park Estate in London. Its overall property portfolio is worth around £2 billion.

The Church continues to buy land, acquiring 121 acres in Carlisle, 50 acres in Peterborough and 765 acres in Kent last year, as well as 17,000 acres of forestry in Scotland and Wales.

The land owned by the Church is not confined to Britain. Last year, it bought a share of an empty office building in Burbank, California and land in Michigan for retail and residential development. It also purchased 27,000 acres of forest in Virginia and land in the Northern Territory, Australia for sandalwood plantations.

1 http://www.independent.co.uk/news/uk/home-news/church-of-england-must-sell-some-off-of-its-land-in-response-to-housing-crisis-says-report-10311182.html

 

BSA calls for supply to meet demand in Wales

Published On: June 11, 2015 at 4:43 pm

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With demand for property in Wales rising, the Building Societies Association (BSA) has made a plea to the Welsh housing market to work as a unit to ensure significant supply.

The BSA represents all 44 building societies within the United Kingdom and made the call to the Welsh market during its Housing for All conference in Cardiff. Invitees to the conference included local authority members, developers, estate agents, housing associations and building societies.

Sufficient supply

Opening the conference, Paul Broadhead, head of mortgage policy at the BSA, said that he wanted the various parts of the market to look at the issues and find opportunities to supply sufficient housing for future generations.

Broadhead said, ‘in Wales, there are encouraging signs but the ultimate goal has to be a significant increase in the number of new homes completed each year. As mortgage lenders, building societies play their part in fulfilling borrowers’ housing aspirations and as the Help to Buy Wales scheme shows can have a positive effect. But we need action to be taken now to ensure we have sufficient homes for the population of tomorrow.’[1]

iStock_000023744590_Large

 

On track

Lesley Griffiths, Minister for Communities and Tackling Poverty, made the headline speech at the conference. Griffiths used this platform to ensure that the Government is fully committed to backing the supply of homes across Wales.

‘We are on track to meet our target of providing 10,000 additional affordable homes, while good progress is also being made on our ambition of supporting the construction and sale of 5,000 homes through Help to Buy Wales,’ Griffiths stated. ‘The sector plays a key role in helping us fulfill our vision for housing in Wales. Through continued partnership working between private, public and third sectors organisations, I am confident we can meet the challenges we face and deliver the additional,’ she added.[1]

[1] http://www.propertywire.com/news/europe/wales-new-homes-demand-2015061110618.html

 

 

 

Worst Housing Shortage for Four Decades

Published On: June 11, 2015 at 3:43 pm

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Property price growth in the UK accelerated for the fourth consecutive month in May, as the shortage of homes for sale hit the worst level in around four decades, a study revealed.

The Royal Institution of Chartered Surveyors (RICS) said that its price gauge rose to 34 from 32 in April. Economists at Bloomberg had expected a reading of 36. In London, the measure leapt

Worst Housing Shortage for Four Decades

Worst Housing Shortage for Four Decades

to the highest in almost a year.

Price rises were fuelled by the continuing pressure on supply that many estate agents expected to see improved after the Conservative general election win.

Chief Economist at RICS, Simon Rubinsohn, says: “There had been some hope that the removal of political uncertainty would encourage more properties onto the market, but the initial indications are that this is not proving to be the case.

“It is hardly surprising that prices across much of the country are continuing to be squeezed higher, with property set to become ever more unaffordable.”1

Property sales were down 14% in May from the previous year, LSL Property Services and Acadata discovered in a separate report. The average house price in England and Wales rose 0.4% to a record £277,178, up 4.5% on the year earlier.

Estate agent Adrian Gill comments: “The general election did ruffle some feathers, but as we return to smoother ground, it’s becoming clear that there’s a more structural problem holding back the market and that the lack of properties on the market is starting to choke off activity. Price rises will only speed up if housing supply doesn’t put pedal to metal.”1

In May, the price index for London increased to 27% from 24% in April, RICS uncovered. The expectations measure for the next three months also grew to 49 from 12.

Aside from the South East of England, the strongest price growth is forecast for the North West, which is expected to benefit from George Osborne’s northern powerhouse plans to devolve powers to the region.

1 http://www.bloomberg.com/news/articles/2015-06-10/u-k-house-price-growth-quickens-as-supply-shortage-intensifies

Student’s pay £140,000 per year in rent-claim

Published On: June 11, 2015 at 3:34 pm

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A London letting agent has made the astonishing claim that some students in the capital pay £140,000 per year in rents.

Prime central London agency Napier Watt signalled that start of the international student letting period by claiming that certain overseas scholars pay £12,000 per month.

Staggering high

Jonathan Adams, director of Napier Watt, said that, ‘enquiries from overseas students keen to rent an apartment for the new academic year are starting to come in. As the current wave of students come to the end of their tenancies, those who have rented before know it makes sense to take over a tenancy during the summer.’[1]

‘These students are prepared to pay £6,000 to £8,000 per month for a nice two-bed flat in Mayfair, Marylebone or Belgravia, rising to £12,000 per month in Knightsbridge,’ Adams surprisingly suggested.[1]

Student's pay £140,000 per year in rent-claim

Student’s pay £140,000 per year in rent-claim

Reluctance

Despite the chance to achieve such large returns, landlords are still wary of letting to students, according to Adams. He believes however that landlords and agents should not be hesitant when letting to young academics. Adams said, ‘students often get an unfair press for being rowdy and excessive partying but there are many real and distinct advantages of letting to them. Firstly, on the whole they tend not to be badly behaved. Secondly, in central London they tend to be overseas students and will typically pay their rent half yearly in advance and occasionally, annually in advance.’[1]

Adams also said that students, ‘often pay a deposit equal to eight weeks’ rent on top.’[1]

 

[1] http://www.lettingagenttoday.co.uk/breaking-news/2015/6/agent-claims-some-students-in-london-pay-140k-in-rent-per-year