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Em

Em Morley

Housing developers should be fined for slow work-LGA

Published On: January 7, 2016 at 10:16 am

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Categories: Property News

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In the face the ongoing housing shortage, the Local Government Association has called for sterner penalties for slow housing developers.

Builders that fail to construct new housing promptly when planning permission has been granted should be punished, according to the body. It has called for builders to pay full council tax on homes that are not built before the planning permission expires.

Delays

The LGA said that 475,000 with planning permission were not completed in 2014-15, adding that councils were not to blame.

Further research is said to have uncovered a bumper backlog of homes waiting to be built in the UK. This, the LGA said, has, ‘grown at a rapid pace over the past few years.’[1]

In 2012-13, the total number of unimplemented planning permissions was 381,390. However, in 2013-14, this figure rose to 443,265 and to 475,647 in 2014-15.

‘To tackle the new homes backlog and to get Britain building again, councils must have the power to invest in building new homes and to force developers to build homes more quickly,’ believes Peter Box, LGA housing spokesman.[1]

Mr Box went on to say, ‘skills is the greatest barrier to building, not planning. If we are to see the homes desperately needed across the country built and jobs and apprenticeships created, councils must be given a leading role to tackle our growing construction skills shortage, which the industry says is one of the greatest barriers to building.’[1]

Housing developers should be fined for slow work-LGA

Housing developers should be fined for slow work-LGA

Building again

A spokesman for the Department for Communities and Local Government was bullish about the comments, stating that there has been a, ‘25% increase in the number of new homes delivered over the past year alone.’ He went on to say that the government had, ‘got Britain building again.’[1]

‘Alongside this, we’re working closely with developers to ensure Britain has the skills it needs-and saw 18,000 building apprenticeships started in 2014. We’re also directly commissioning thousands of new affordable homes and recently doubled the housing budget,’ the spokesperson added.[1]

Misleading

However, Sadiq Khan, Labour’s candidate for Mayor of London, commented, ‘under the Tories, the UK and London in particular, has been falling far short of building the number of homes we need. We need powers to get developers building-alongside support for councils and housing associations which are building too.’[1]

John Stewart of the Home Builders Foundation, said, ‘speeding up the rate at which permissions are granted,’ was one of the keys to, ‘significant and sustainable,’ increases in property construction.

He went on to say that, ‘too many sites are stuck in the planning system, with an estimated 150,000 plots awaiting full sign-off by local authorities.’[1]

[1] http://www.bbc.co.uk/news/uk-35245313

 

 

Stop Interfering in Private Rental Sector, Says Belvoir Boss to Government

Published On: January 7, 2016 at 9:27 am

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Categories: Landlord News

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A major figure in the property industry has spoken up about the Government’s interference in the private rental sector.

The Director of Commercial and Franchising at chain Belvoir, Dorian Gonsalves, warns that tax changes for private landlords could discourage investment in the sector.

Stop Interfering in Private Rental Sector, Says Belvoir Boss to Government

Stop Interfering in Private Rental Sector, Says Belvoir Boss to Government

He also urges the Government to “dramatically” increase the supply of social housing in order to reduce pressure on the private rental sector.

However, ministers’ plans currently go against Gonsalves’ wishes, as the Housing and Planning Bill is now heading towards its third reading in the House of Commons.

Propositions under the bill include extending the Right to Buy scheme to housing association tenants; opponents describe the bill as the end of social housing.

Gonsalves also believes that landlords may have “second thoughts about buying properties”, due to Chancellor George Osborne’s mortgage interest tax relief cuts and further 3% Stamp Duty charge on buy-to-let investments.

Referring to the Housing and Planning Bill’s focus on homeownership, Gonsalves says: “Whipping the public up into a home buying frenzy is not very sensible, as prices rise when the population feels they need to acquire a must-have commodity. If the opposite happens and prices stagnate, builders will not build.”

He continues: “With net immigration currently at over 300,000, over 1.5m people on council waiting lists, population forecasts as high as 85m by 2050 and 10m people already renting, it is clear that much more social housing is required.

“The Government has pledged 400,000 new builds in the next five years, but it is likely that 200,000 of these will be in and around London, and locations won’t be ideal due to lack of building land at sensible prices.

“The remaining 200,000 will be spread across the other 1,000 or so towns and cities across the UK, so there will probably be just 200 new affordable properties in each town or city.”

He adds: “The private rental sector has always existed to provide a choice for those people who need flexibility and is a good solution for people who do not wish to commit to purchasing a property.” 

He insists that the private rental sector should no longer be expected to bridge the “immense gap”1 between demand for social housing and its low supply.

1 http://www.propertyindustryeye.com/stop-meddling-in-private-rented-sector-belvoir-boss-tells-government/

 

Renter Offered £450 a Month Bathroom to Sleep in!

Published On: January 6, 2016 at 3:50 pm

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A hopeful tenant searching for a home in Glasgow’s fashionable West End was left alarmed after a landlord offered him a bathroom to sleep in for £450 per month.

Danny Andrews, 32, replied to an advertisement for a “small but cosy living space” on Pride Flatmates, a website that sources gay-friendly accommodation.

The advert stated that the two-metre by two-metre room was “unconventional” and “needing some TLC”, but did not admit that the space is actually a bathroom.

When Andrews went to view the property, the landlord led him into the run-down bathroom, informing him that he was expected to sleep in the bath.

On Twitter, Andrews expressed his horror: “A nutter tried to rent me a bathroom in Glasgow for £450 a month. He even suggested I sleep in the bath!”

The advert said that the landlord plans “to put new flooring down and buy furniture as soon as I get confirmation that someone would like to rent”.

He explained that the “property has two toilets, and I have an en suite bathroom, you will have access to your own personal facilities” but that “viewing is advised”1.

Although Andrews could laugh off the viewing, the advert highlights the awful state of the private rental market in the UK, as prices are surging for small spaces.

In London, the average rent on a flat or house hit £1,500 per month last summer, with the typical rent outside of the capital reaching £751 a month.

Prices are usually cheaper in Glasgow, with some homes advertised on SpareRoom.co.uk for as little as £500 per month.

Pride Flatmates, which is free to users, responds to the advert: “We do our best to make sure that they are genuine, but we will explore other options to see if it is possible for us to make improvements to this process.

“We would like to take this opportunity to apologise for any inconvenience that the recent issue has caused and we will do our very best to make further improvements to the website.”1

1 http://www.prideflatmates.com/listing/living-space-glasgow

Quarter of house sales fell through in final 3 months of 2015

Published On: January 6, 2016 at 2:00 pm

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Data released today by Quick Move Now has indicated that the house sale fall through rate increased in the final quarter of 2015.

Figures from the report suggest that there was a house sale fall through rate of 27.94% in the last quarter, rising by 8.32% on the 19.62% recorded in quarter three of last year.

Consistent

Additionally, Quick Move Now revealed figures for the annual fall through rate, offering a better overview onto how the property market is performing in general.

The yearly fall through rate was revealed to be fairly constant throughout the whole in 2015, hovering around the 29% mark. As the year drew to a close, the fall through rate was 29.26%.

‘2015 was an interesting year for the UK property market and the fall through rates reflect that,’ observed Danny Luke, Business Manager at Quick Move Now. ‘Tougher lending criteria was introduced as a result of the Mortgage Market Review, which meant some prospective buyers found it challenging to secure a mortgage, or found they were able to borrow less than they had anticipated. In fact, nine percent of sales that fell through did so as a result of not being able to secure a mortgage.’[1]

Luke believes that, ‘the two biggest reasons for house sales falling through in Q4 2015 were buyers changing their mind (27.2%) and problems identified at survey or failed renegotiation following a survey (27.2%) which is unsurprising in the current market.’[1]

Quarter of house sales fell through in final 3 months of 2015

Quarter of house sales fell through in final 3 months of 2015

Lack of supply

‘A lack of properties coming to market has led to prospective buyers having to move very quickly in order to secure a property and may mean they put an offer in on a less than ideal property through fear that they’ll be unable to find anything else,’ he continued. ‘Some inevitably get cold feet about such a large investment, or find that a survey confirms their fears and pull out before the sale completes.’[1]

Mr Luke went on to say, ‘chain collapse still featured prominently, with 22.7% of property sales falling through as a result of chain issues and it’s definitely an issue very much on sellers’ minds. We get calls every day from sellers keen to secure a guaranteed sale so they don’t risk missing out on their onward purchase due to a chain collapse.’[1]

‘Seller pulling out for a higher offer (9%) and buyer health issues/personal problems (4.5%) make up the remaining failed completions,’ he concluded.

[1] http://www.propertyreporter.co.uk/property/1-in-4-house-sales-fell-through-in-q4-2015.html

 

 

Conservative Peer Attacks Buy-to-Let Tax Changes

Published On: January 6, 2016 at 12:46 pm

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Howard Flight, a Conservative peer, has attacked his own party’s changes to the buy-to-let sector.

Conservative Peer Attacks Buy-to-Let Tax Changes

Conservative Peer Attacks Buy-to-Let Tax Changes

Lord Flight, a former Conservative shadow chief secretary to the Treasury, has voiced his concerns over the forthcoming reforms to landlord taxes.

“I hope the Government will re-think its sudden attack on buy-to-let this summer and autumn,” he begins. “Otherwise, it risks the very crisis in the buy-to-let housing and lending markets of which the Governor of the Bank of England has recently warned.”

Flight warns that buy-to-let tax changes could cause a sharp decline in property prices, “if not a crash”.

He explains: “The only buy-to-let ‘tax advantage’ has been the ability for the interest cost [on buy-to-let mortgages] to be offset against an individual’s income to determine their tax bills – the very thing which the Finance Act measure has hit by limiting the tax deductibility of mortgage interest to a 20% tax rate.

“This will hit more modest buy-to-let investors the most, while many of the more sophisticated have their buy-to-let properties held via a company.”

Under the Finance Act 2015, buy-to-let mortgage interest tax relief will be cut, but landlords operating through a company will not be hit.

Additionally, from April, buy-to-let investors and second home buyers will be charged an extra 3% in Stamp Duty on properties worth over £40,000.

Flight warns that these two tax changes together could “put thousands of tenants’ security at risk”, as landlords rush to evict tenants and sell their properties.

He explains the significance: “Buy-to-let has provided some three million homes for those not able yet to afford to buy their homes – especially in London.”

The article, published on the Conservative Home website, arrives just days after a major accountancy firm, KPMG, warned that these tax changes could push rent prices up.

It believes that developers could struggle to sell new build property due to high Stamp Duty costs for investors, causing the supply of rental homes to drop and therefore driving rent rises.

Read Lord Flight’s full article here: http://www.conservativehome.com/thecolumnists/2016/01/howard-flight-the-government-is-wrong-to-attack-buy-to-let.html

New survey shows tenants’ top wish for 2016

Published On: January 6, 2016 at 11:24 am

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An interesting new survey has given landlords food for thought when considering their home improvements for 2016.

PropertyLetByUs questioned tenants on their main priorities for the new year. One-fifth replied by saying that cost-effective central heating is an absolute must.

Warm

A large majority of tenants said that they felt concerned over keeping their properties warm and damp-free over the coming months. In excess of 80% said that double glazing was their top priority for the next rental property.

In general, UK homes are some of the most expensive to heat in the whole of Europe, according to official EU figures. Estimates suggest that over 10m British families currently live in a property with a leaking roof, damp walls or rotting windows. Older, single glazed homes bring with them more chance of condensation and mould.

Jane Morris, Managing Director of PropertyLetByUs.com noted, ‘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.’[1]

New survey shows tenants' top wish for 2016

New survey shows tenants’ top wish for 2016

Demand

Morris continued by saying, ‘clearly, double-glazed properties are highly sought after by tenants and landlords that offer this will be in large demand. However, landlords that are offering draughty, damp accommodation should not delay in improving their properties, as new legislation will see landlords banned from renting out England and Wales’ draughtiest homes from 2018, in a bid to cut energy bills and carbon emissions.’[1]

‘Landlords with properties rated F and G will be unable to let them out from April 1st 2018. The regulations also mean that from 1st April 2016, tenants living in F and G rated homes will be able to request improvements, such as more insulation. The landlord will then be legally bound to bring the property up to a E rating. As a matter of urgency, landlords that are currently renting out F and G rated properties should be reviewing the improvements that can be made together with researching costs and available help, through the Government’s Green Deal,’ Morris concluded.[1]

[1] http://www.propertyreporter.co.uk/landlords/what-is-the-top-priority-for-tenants-in-2016.html