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Em Morley

London rents up as sales slow

Published On: July 13, 2015 at 12:34 pm

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New research has indicated that as a result of changes to stamp duty rates, restrictions on borrowing and the rising value of the pound, property sales across the capital have cooled.

According to Benham and Reeves Residential Lettings, the much-expected post election surge in sales has not happened and as a result has led to stale prices and a dip in transaction numbers.

Rental rise

On the other hand, the lettings market in the capital was found to be growing, with values increasing sharply across the majority of London postcodes. Data from the report shows that rental values rose by between 2%-4% in London during the last quarter, with particularly strong growth recorded in the centre of the capital.[1]

Kensington saw rents rise by just over 7% in the period, with Chelsea almost matching this substantial growth rate. However, even better rises were recorded in parts of East London with growth of 11% in both Bethnal Green and Bow.[1]

London rents up as sales slow

London rents up as sales slow

Lettings Director of Benham and Reeves Residential Lettings Marc von Grundherr, commented, ‘George Osborne reformed the stamp duty system in his Autumn Statement last December, it had a huge impact on the property market in London. Most homebuyers in London are paying considerably more in stamp duty with the top rate now standing at a staggering 12%.[1]

‘Inevitably, people are choosing to rent rather than buy and even those who are hoping to buy will end up renting for longer to save for this additional cost. The stamp duty changes have been a gift horse for many landlords who have seen rents stagnate over the last few quarters,’ von Grundherr added.[1]

[1] http://www.propertyreporter.co.uk/landlords/rents-rocket-as-londons-sales-market-finally-cools.html

 

Injuries in Camden’s Anti-Gentrification Protest

Published On: July 13, 2015 at 11:58 am

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A protest on Saturday 11th July in Camden against the gentrification of London ended in violence.

A man was allegedly hospitalised with a head injury and two police officers were injured after 20 people threw bottles and wood.

Police revealed that five people have been arrested on suspicion of disorder-related offences.

The protest began in Camden on Saturday night.

On the Facebook event page for the protest, organisers said: “The heart of Camden is being ripped out, pubs are being converted to luxury flats no one can afford, venues are under threat, the market is flogged off to be a casino (and yet more unaffordable flats). Rents are rising… fast.

“Soon this community will be unrecognisable, bland, yuppie infested wasteland… Camden is a unique place and worth defending against the onslaught of dog-eat-dog economics.”1

1 http://www.independent.co.uk/news/uk/politics/man-injured-as-antigentrification-protest-in-camden-ends-in-violent-clashes-with-police-10383707.html

 

 

 

 

 

Half a million home owners property millionaires

Published On: July 13, 2015 at 11:40 am

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An interesting survey has revealed that in excess of half a million people are now thought to be so called, ‘property millionaires,’ following a rise of almost double in the last three years.

Property website Zoopla suggests that the total number of people now living in property worth more than £1m now stands at 524,306, according to their rich list. This equates to almost 11,000 streets where the average price of a home is more than a seven-figure sum.[1]

Regional wealth

The survey from Zoopla found that more than 4,700 of these streets were in the capital, with 3,700 in the South East. 121 were north of the border, 17 in Wales and 53 in the North East.[1]

According to Zoopla’s research, the areas outside of London with the greatest of £1m-plus streets are in all Surrey. Guildford, Leatherhead and Richmond have 158, 154 and 144 of these streets respectively.[1]

Kensington Palace Gardens was found to be the country’s most expensive street, with home values here averaging £42.6m. The Boltons and Grosvenor completed the top three.[1]

The top ten most expensive streets in Britain were found to be:

  1. Kensington Palace Gardens, London, W8, £42,591,972
  2. The Boltons, London, SW10, £30,288,586
  3. Grosvenor Crescent, London, SW1X, £22,752,425
  4. Courtenay Avenue, London, N6, £19,609,231
  5. Ilchester Place, London, W14, £13,718,746
  6. Compton Avenue, London, N6, £12,049,363
  7. Manresa Road, London, SW3, £11,600,920
  8. Grosvenor Gardens, London, SW1W, £11,321,413
  9. Cottesmore Gardens, London, W8, £11,037,133
  10. Frognal Way, London, NW3, £10,702,421
Half a million home owners property millionaires

Half a million home owners property millionaires

By average price, Britain’s most expensive towns were revealed as:

  1. Virginia Water, Surrey, £1,208,638
  2. Cobham, Surrey, £1,037,825
  3. Beaconsfield, Buckinghamshire, £982,660
  4. Keston, London, £976,354
  5. Esher, Surrey, £969,337
  6. Richmond, Surrey, £939,652
  7. Chalfont St Giles, Buckinghamshire, £920,797
  8. Radlett, Hertfordshire, £843,814
  9. Gerrards Cross, Buckinghamshire, £828,974
  10. Weybridge, Surrey, £799,828

Capital growth

Lawrence Hall of Zoopla stated that, ‘London continues to be the epicentre of the million-pound property market in Britain, but our property rich list reveals a number of high-value property areas outside the capital, particularly in Surrey and Buckinghamshire, that are very attractive to professionals seeking to live outside yet within easy reach of the city and enjoy low crime rates coupled with good schools.’[1]

Data from another report shows there has been a distinct rise in house price growth following the general election. Research from the Halifax indicates that the annual growth rate increased from 8.6% in the year to May to 9.6% in the twelve months to June. Experts feel that this is due to the stability offered by the new Conservative Government.[1]

[1] http://www.telegraph.co.uk/finance/property/house-prices/11733228/Half-a-million-home-owners-are-property-millionaires.html

 

 

More Homeless Young People than Government Suggests

Published On: July 13, 2015 at 11:03 am

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There are believed to be three times more homeless young people in Britain than official Government data suggests, reveals a new study.

Cambridge University estimates that around 83,000 homeless young people had to rely on councils and charities for shelter in the last year.

This is over three times the 26,852 young people recorded as homeless by the Department for Communities and Local Government.

The research says that this “worryingly high” level of youth homelessness is “a minimum estimate and it is likely that in reality more homeless young people access support across the UK.”

The study used official figures alongside examinations of 40 local authorities and a national poll of over 2,000 16-25-year-olds.

It observed homelessness over the course of a year, including rough sleeping, staying in hostels and sofa-surfing.

Chief Executive of homelessness charity Shelter, Campbell Robb, says: “This research paints a grim picture of youth homelessness in the UK and it demonstrates that the Government’s current plan to cut housing benefit for 18-21-year-olds could be nothing short of catastrophic, as it’s this which helps to pay for the hostel beds that keep young people off the streets.

“If the Government really wants to help young people, its first priority should be to invest in the safe, secure and genuinely affordable homes that are so desperately needed, rather than stripping away the threadbare safety net they have at the moment.”1

ComRes conducted a survey for the study, which found that over one in seven young people (17%) have slept rough, including in cars or squats, in the last year.

The research states: “When the poll data was scaled up to reflect the wider population, an estimated 1.3m young people aged 16 to 24 have slept rough during the past year.”1

A Government spokesperson comments: “Since 2010, we have increased spending to prevent homelessness, making more than £500m available to local authorities and the voluntary sector.”1 

1 http://i100.independent.co.uk/article/the-youth-homelessness-figures-that-shame-britain–Z1ovOi0DGe

Government Funds £100m Initiative for Small House Builders

Published On: July 13, 2015 at 9:54 am

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The Housing Minister, Brandon Lewis, has announced that small house builders will benefit from a £100m cash initiative to support them in solving the country’s housing crisis.

The Housing Growth Partnership will help smaller builders invest in new developments, provide finance to grow their businesses, help get workers onto sites and increase housing supply.

The Partnership will also aim to develop a network of builders, selecting experienced firms to act as mentors and advisers to smaller companies that wish to expand.

In the past 25 years, the amount of firms building between 1-100 units per year has declined from over 12,000 to less than 3,000.

The Government has highlighted house building as the core of its long-term economic plan, hoping to build the homes that communities want and need, and create jobs in the construction industry.

Government Funds £100m Initiative for Small House Builders

Government Funds £100m Initiative for Small House Builders

Recent house building data reveals that starts have more than doubled since the same period in 2009. Starts and completions have increased in the last year and the amount of homes granted planning permission is at its highest rate for eight years.

The Housing Growth Partnership, launched last Monday, will support small builders in driving even more success.

The Government has matched a £50m investment from Lloyds Banking Group to form the Partnership.

The Partnership hopes to make around 50 investments and provide a further 2,000 homes.

Brandon Lewis says: “The 2008 economic crash devastated our army of small builders, with delivery falling from 44,000 homes to just 18,000. Seven years on, companies are getting back on their feet but we’re determined to give them all the help they need.

“Access to finance is one of the biggest challenges they face, so that’s why today [Monday 6th July] I’m launching this £100m commitment, which will help our smaller builders fund new projects, expand their businesses, create more jobs and build more homes.

“With housing starts at a seven-year high and climbing, and homes granted planning permission at 261,000 – the highest since 2007 – this work will ensure we maintain this momentum and keep the country building.”1 

Group Director and Chief Executive of Commercial Banking at Lloyds Banking Group, Andrew Bester, comments: “The challenge of housing supply and affordability is one of the biggest issues facing Britain today, so we at Lloyds Banking Group welcome the Government’s announcement of support for the Housing Growth Partnership, which will double the capability to support SME [Small and medium-sized enterprises] house builders. It will provide SME house builders with much needed equity to support residential development projects, to stimulate growth in their businesses and facilitate access to conventional property development finance.

“We believe building both a greater quantity and mix of homes will help Britain prosper and this Partnership will help address the issue of housing supply in the UK.”1 

Brian Berry, Chief Executive of the Federation of Master Builders, adds: “There has been a sharp decline in the numbers and output of SME house builders over the past eight years. One of the biggest obstacles these firms have faced is a severe difficulty in accessing finance. Without adequate access to finance, they cannot bring forward the number of new homes they would otherwise.

“The new Housing Growth Partnership will directly help to address this issue and the additional £50m greatly increases the scale of what can be achieved. We commend Lloyds Banking Group and the Government on their trailblazing approach, and we hope this marks a real turning point in the fight to provide adequate finance to the SME house building sector.”1

The Housing Growth Partnership will investment alongside: small and medium-sized house builders who have evidence of a strong history in delivering residential development schemes and house builders who create an average of 10-100 single unit completions annually over the last three years, and have a proven track record of land buying, design, construction, marketing and sales of new homes.

The Partnership will support residential development projects with a gross development value of between £750,000-£12m and will provide investments in the range of £500,000-£5m for each project.

1 https://www.gov.uk/government/news/100-million-boost-for-small-housebuilders?utm_content=buffercf79f&utm_medium=social&utm_source=twitter.com&utm_campaign=buffer

 

 

Landlords fearful of rising rent following Budget

Published On: July 13, 2015 at 9:36 am

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Changes announced in Wednesday’s Budget concerning limiting the amount of tax relief landlords can claim on their mortgage interest costs continues to divide opinion. Leading industry figures are split on whether they believe private rents will rise as a result of the changes.

Alterations

Chancellor George Osborne announced that landlords will be restricted to claiming tax relief on their interest payments at only the basic rate. From 2017, this change in legislation will be phased in during the following four years.

The Residential Landlords Association has suggested that the move brings with it, ‘damaging uncertainty,’ to the private rented sector and feels that it is inevitable that landlords will increase rents as a result of the changes. According to the landlord body, the HM Revenue and Custom’s impact assessment of the alterations refers to the exact proportion of landlords that will ultimately receive less relief as a direct result of the measures.

What’s more, the RLA believes that it is not the landlords but instead the number of properties affected that matters the most. HMRC suggest that 20% of landlords will be affected by the change and the majority will have more than one property with an interest charge against each.

Rising rents?

RLA chairman, Alan Ward, commented said that the firm, ‘will look in detail at the Government’s measures, but on the face of it, the impact could be to push up rents as landlords have to recover their extra costs.’[1]

‘With many contradicting assessments of the number of private rented properties and the number of landlords, HMRC impact assessment is scant on detail. The reality is that this measure will hit many more tenants than landlords,’ Ward continued.[1]

Landlords fearful of rising rent following Budget

Landlords fearful of rising rent following Budget

Concluding, Mr Ward said, ‘we urge the Government to hit the pause button on these proposals and undertake a comprehensive and open consultation to assess what its measures will mean.’[1]

However, Betsy Dillner, director of Generation Rent, feels that rents are already at the highest that tenants can take. ‘Because of the housing shortage, landlords are already charging the highest rents they can get away with, so the market won’t bear any attempt to push them up any further,’ she commented.[1]

‘Plus, only a third of landlords have a mortgage so there’ll be plenty of others who won’t be hit by the changes. However, if some landlords find they have to sell up, their tenants could be kicked out. Renters need protection from no-fault eviction, and in the meantime, councils and housing associations need to be ready to buy up homes with sitting tenants.’[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2015/7/landlords-warn-of-higher-rents-tenants-in-denial