Posts with tag: Ascend Properties

Is build to rent now the dominant force in London’s new build sector?

Published On: June 4, 2021 at 7:55 am

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Categories: Landlord News,Property News

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Build to Rent

Build to rent specialist Ascend Properties has seen an increase in build to rent properties being completed in London during the past year.

In Q1 2020, there were 1,600 completions, while in Q1 2021, there were 1,809 completions, a rise of 13%.

Comparing the success of London build to rent during the pandemic with the success of the wider new-build sector during the same time period, Ascend has found the data suggests Build to Rent is becoming the go-to choice for developers in the capital.

It states that while in London new build completions as a whole fell by -10% during the pandemic, the number of build to rent completions rose by almost 60%.

Ged McPartlin, Managing Director of Ascend Properties, comments: “This data shows, without question, that build to rent is now the premier choice for London developers. While the pandemic has brought about a marginal decline in build to rent completions at a national level, the sector has gone from strength to strength within the capital and now accounts for a far greater proportion of all new build completions.

“This is hardly surprising as build to rent lends itself perfectly to the mixed-use development schemes that are fast becoming a key focus for London developers and local authorities, who are looking to revive demand in urban areas that have suffered since people stopped commuting into work.

“It’s often the case that unexpected global events turn long-term visions into immediate actions – this is the case with COVID and build to rent. Build to rent was always destined to dominate the long-term vision of developers and residents alike, but the pandemic has now expedited that process of evolution.”

Latest quarterly build to rent completions
Location2020 – Q12020 – Q42021 – Q1Quarterly ChangeAnnual Change
London1,6001,6291,80911.0%13.1%
Regions2,0221,8261,447-20.8%-28.4%
UK3,6223,4553,256-5.8%-10.1%
Data sourced from BPF.org.uk
      

Note: The below data on pandemic build to rent completions (Table 1) includes the latest sector data for Q1 2021 (above). Therefore, the pandemic timeline includes five quarters of completion data and (Q1 2020 to Q1 2021), and compares to the previous five quarters (Q4 2018 to Q4 2019).

Table 2 shows how these completions compare to new build transactions. However, as the latest available data for new build transactions is Q4 2020, the timeline reflects this with a year on year look to give an accurate comparison. Q1 2021 build to rent completions have not been included, which is why the totals differ from those in Table 1.

Table 1 shows the change in build to rent completions since the pandemic compared to the same time period previous
LocationBefore pandemicSince pandemicDifferenceDifference %
London5,7677,3711,60427.8%
Regions10,2886,896-3,392-33.0%
UK16,05514,267-1,788-11.1%
Time Period(2018 Q4 to 2019 Q4)(2020 Q1 to 2021 Q1)  
Data sourced from BPF.org.uk
     
       
Table 2 shows the change in build to rent completions since the pandemic compared to the same time period previous
SectorBefore pandemicSince pandemicDifference
London New Build Completions21,28019,110-2,170
London Build to Rent Completions3,5285,5622,034
Time Period(2019 Q1 to 2019 Q4)(2020 Q1 to 2020 Q4) 
Data sourced from BPF.org.uk (BTR) and Gov.uk (New Build)

New records for UK house prices continue in Rightmove’s latest House Price Index

Published On: May 20, 2021 at 8:00 am

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The commuter belt rental markets where tenants can reduce their rent by as much as half

The latest House Price Index from Rightmove reports Wales and the North of England have seen continued growth.

The highlights of the index include:

  • New records continue to be set as the average price of property coming to market this month jumps by 1.8% (+£5,767), to a third of a million pounds (£333,564)
  • Average London house prices are 2.9 times higher than prices in the northern areas of Great Britain, and although still large this is the smallest ratio recorded by Rightmove since 2013
  • While London prices have stood still (+0.2%) since the first lockdown, areas further north have seen double-digit increases, due to the shortfall in supply that suits people’s changed needs and lives
  • Wales leads the way at +13.0%, followed by North West (+11.1%), and Yorkshire & the Humber (+10.5%)
  • The north sees greater imbalance between demand and supply than London, with people more likely to move locally and some more able to afford to upsize

James Forrester, Managing Director of Barrows and Forrester, comments: “Asking prices continue to climb at an alarming rate and this upward pressure is being driven by a number of factors. 

“Buyer demand remains extremely high and an appetite for larger homes is driving market activity. However, a lack of suitable stock to satisfy this demand is causing many to dig deep in order to offer above the odds and secure their desired purchase. 

“At the same time, savvy sellers are realising that buyers are not only entering the market with a budget boosted by the stamp duty holiday, but they’re doing so amidst an air of panic with the deadline fast approaching. Therefore, many are pricing far higher than the market value of their home to take advantage of this desperation. While they will inevitably reduce this expectation during the offers stage, this additional wiggle room still enables them to secure a higher price than they may have otherwise.”

Matthew Cooper, Founder & Managing Director of Yes Homebuyers, comments: “It’s clear that sellers are attempting to cash in on the stamp duty holiday themselves by reaching new highs where unrealistic asking price expectations are concerned. In doing so they’re also crushing the hopes and dreams of many would-be first-time buyers who will now find themselves well and truly priced out of the market.

“It certainly doesn’t help when this hysteria is being driven by the likes of Rightmove, who continue to pull ‘record’ market statistics out of their hat on a monthly basis, much like a cheap magician at a children’s party. 

“Those hard-pressed to reach the first rung of the housing ladder may well have the last laugh though, as an already weary market continues to overheat. When the end of the stamp duty holiday does come and causes buyer demand to evaporate, we’re likely to see property values fall at pace.”

Marc von Grundherr, Director of Benham and Reeves, comments: “With the London property market moving at a steadier pace than the rest of the UK, we’re simply not seeing a spike in asking prices driven by home seller greed. Instead, the market is moving at a far more sustainable pace and while activity is starting to build, transactions are being agreed in a more sensible manner. 

“With the cost of buying at its highest in the capital, those that are transacting are in a strong financial position and so they simply aren’t as motivated by the incentive of the stamp duty holiday. While it’s certainly a nice cherry on top, it isn’t going to make or break their aspirations of homeownership and this more natural return to form will ensure a greater degree of long-term market health.”

Ged McPartlin, Managing Director of Ascend Properties, comments: “The Northern Powerhouse continues to drive overall market performance with the North West and Yorkshire, in particular, steaming ahead with some of the highest increases in property values. 

“The property market balance has well and truly tipped in favour of the North in recent months, driven by the fact that northern regions continue to offer a far more affordable foot on the ladder for homebuyers. 

“While the difference in property prices remains vast when compared to the likes of London, the north-south divide is certainly closing in terms of overall market pedigree.”

Read Rightmove’s full report here: https://www.rightmove.co.uk/press-centre/house-price-index/may-2021/

UK house prices continue to reach record high, Halifax House Price Index shows

Published On: May 11, 2021 at 11:03 am

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Average UK house price rises again, Halifax House Price Index reports

Halifax has released its April 2021 House Price Index, showing that house prices were 8.2% higher than the year before. The average UK house price is now £258,204.

The report findings also show:

  • House prices were 1.4% higher in April 2021 than in March 2021
  • House prices were 0.9% higher in the latest quarter (February to April) than in the quarter before (November to January)
  • House prices were 8.2% higher than in April 2020

Property industry reactions to Halifax House Price Index

Marc von Grundherr, Director of Benham and Reeves, comments: “Rishi’s rabbit out of the hat in the form of a stamp duty holiday really has been magic where the revival of the UK property market is concerned. House prices are booming, driven by a surge of buyers keen to save while also taking advantage of the continued low rate of borrowing.

“The question is, of course, whether this clever trick will help rejuvenate the market in the long term, once the curtain finally falls on Mr Sunak’s tax reprieve”

Ged McPartlin, Managing Director of Ascend Properties, comments: “Yet more mammoth rates of house price growth as the market continues to run red hot in the wake of the stamp duty holiday extension. While this has certainly been the touchpaper, we’re now seeing a number of other contributing factors helping to boost market activity. 

“The lifting of lockdown restrictions and the vaccine rollout has further buoyed market sentiment, causing more buyers and sellers to enter the fray with confidence. As we enter the busiest time of year for property sales, expect more of the same as transacting remains very much on the agenda for the UK.”

James Forrester, Managing Director of Barrows and Forrester, comments: “The UK property market is currently set to warp speed, make no mistake about it. We’re not just seeing a market recovering from last year’s pandemic paralysis, these current rates of house price growth are exceptional against any backdrop. 

“With the fuel tank full to the brim, it’s likely that any natural correction to this explosive rate of growth will come many, many months after the stamp duty holiday deadline and the likelihood is, this current rate of growth will remain throughout 2021.”

Matthew Cooper, Founder & Managing Director of Yes Homebuyers, commented: “Yet further record rates of house price growth might seem like good news on the face of it, but this is far from the case. The UK property market is currently buckling under the pressure of yet another Government initiative to artificially fuel demand, without as much as a thought as to addressing supply.

“Not only this, but many sales are hanging in the balance due to a considerable market backlog which has added further uncertainty to an already archaic and unpredictable transaction process. 

“These aren’t the foundations of a strong and stable housing market and come the end of the stamp duty holiday, we can expect the gloss to come off quickly revealing what is likely to be a considerable mess.”

Lucy Pendleton, property expert at independent estate agents James Pendleton, comments: “This market isn’t standing still for a second. The feeding frenzy for property was already feeling pretty ferocious but then along comes another big leap in the annual rate of growth. The new record high also leaves clear water behind it and the previous peak. 

“In a blazing hot seller’s market like this, most buyers don’t even compare prices locally to make their offer, they work out what can afford and they go for it. Timing is crucial and not wasting time is essential.

“At times like this, personality counts too. If a seller knows they’re going to get the price they need, then striking up a rapport with a vendor can really pay dividends. 

“First-time buyers are unfortunately seeing the market run away from them but, in their price bracket, the significant amount of accidental savings many will have accumulated over the past year will count for as much as the stamp duty relief, which has already been swallowed up by price increases since last summer.” 

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, comments: “The air is thin up here and, even though all buyers know in their hearts that things will calm down and growth will slow later this year, they are still frantically bidding up prices. Buyers need to be incredibly determined to succeed in a market like this. 

“Growth over 8% on an annual basis is always a massive vote of confidence in the country, its economy, its ability to create and protect jobs and its housing market. 

“Incredibly, the stage is set for this rally to continue and the market may be about to get its own vaccine bounce, like the one delivered to Boris Johnson this week. That broader optimism is still being complemented by improving weather, the imminent loosening of Covid restrictions, low interest rates, a yearning for more space and the fact that many homeowners have saved thousands of pounds not being able to go anywhere. 

“This won’t be the last record high we’ll see this year by a long stretch, and the figures next month will start to compare more impressively with the lull in growth caused by the first lockdown.”