Tag Archives: crisis
Discounted Starter Homes in UK will not help many families, research has found
Discounted starter homes could be out of reach for the majority of families in need of an affordable home in many parts of the UK, it is claimed. First time buyers will be able to buy 200,000 new starter homes over the next five years at a minimum discount of 20% of the market value with discounted prices capped at £450,000 in London and £250,000 elsewhere. However, according to an analysis by the Local Government Association while the national starter homes scheme could help some people onto the housing ladder it won’t help everyone who wants one of these homes. The LGA pointed out that crucial details of the scheme are yet to be confirmed but it is concerned it will help the fewest numbers of people in areas where the housing affordability crisis is most acute and will be out of reach for many people in need of an affordable home in the majority of local areas. Although house builders will be able to build and sell starter homes below the price caps, councils are concerned that this could be difficult for developers to achieve without compromising on quality, particularly in areas with higher house prices. Town hall leaders are calling for the system to be flexible regarding the number, type and quality of starter homes so that they meet the needs of local communities. Councils also need powers to provide affordable rented homes that are crucial for enabling people to save money towards a deposit, and the means to secure investment in vital infrastructure that new home buyers will expect and will rely on. The analysis by real estate services firm Savills for the LGA reveals that discounted Starter homes prices will be out of reach for all people in need of affordable housing in 67% or 220 council areas and are out of reach for more than 90% of people in need of affordable housing in a further 80 council areas. People in need of affordable housing are defined as those who would have to spend 30% of their household income to rent or buy a home. The research says that for the average earner with a minimal deposit of 5% looking to buy an average priced house, a 20% discount would make it possible to borrow enough to buy a starter home in just 45% of all council areas in England. This includes all average priced homes in the North East of England, 95% in the North West and 90% in the East Midlands. Being able to save a 20% deposit would make an average priced home with a 20% discount affordable to buy in a further 29% of local areas. This includes a third of council areas in Yorkshire and Humber and the West Midlands. The average earner living in 85% of London boroughs, 49% of council areas… Continue reading
UK property asking prices up almost 3% month on month
The price of property coming to the market in the UK increases by a substantial 2.9% or £8,324 in January, hitting a new record of £299,287 and surpassing the record set in October 2015 by over £2,700. Housing demand is higher than ever as the latest Rightmove report records that traffic to the property portal hits record levels, with visits up nearly 20% year on year in January. It says that there has been an encouraging 5% uplift in new properties coming to the market compared to same time last year resulting in the highest total number of newly listed properties at this time of year since the 2008 credit crunch. The firm is also predicting that 2016 will be the year of the first time buyer as Government initiatives and a low interest rate outlook are now aligning when there is more property choice for first time buyers, with a 10% year on year jump in the number of two beds or fewer coming to the market. ‘The new year’s market has hit the ground running in many locations, continuing last year’s momentum and resulting in the price of property coming to the market hitting a new high. Many agents reported high numbers of sales in November and December and properties selling more quickly, so it’s encouraging to see signs of replenishment of property, especially in the first time buyer sector,’ said Miles Shipside, Rightmove director and housing market analyst. ‘However, in spite of the apparent veneer of market buoyancy, those thinking of putting their property up for sale need to avoid being too optimistic with their initial asking price, as most buyers are still understandably being very selective about their future home,’ he added. The previous record price high was set in October 2015 but this has now been exceeded by £2,738, pushing the average new seller asking price to £299,287. Shipside pointed out that a continuing feature of the recovering market over the past few years has been the supply of property coming to market failing to keep pace with demand. There are now signs of fresh supply increasing with the volume of new properties coming to the market is at the highest level since the credit crunch of 2008. However, he added that it should be noted that this is patchy by region with only four regions above the 5% year on year average uplift, namely London, South East, South West and Yorkshire and the Humber. In the West Midlands new stock is actually down by 0.3% and Wales and the North West have seen an uplift of 1% or less, restricting fresh choice for buyers in these regions. ‘While more properties are coming to market there is little anecdotal evidence of tax shy landlords selling up. It is more likely made up of additional first-time sellers who are either hoping to bag a buy to let investor before the April stamp duty hike, or joining others who… Continue reading
Office buildings in Scotland face new energy efficiencies
Proposed new rules aimed at improving the energy efficiency of commercial properties in the UK which could have significant financial implications for owners of older buildings, have been published by the Scottish Government. The draft regulations, the Assessment of Energy Performance of Non-Domestic Buildings (Scotland), are scheduled to come into force in September this year and mean that properties must achieve a minimum energy performance level, most likely an E rating based on current Energy Performance Certificate standards. It means that commercial properties with an EPC rating of F or G may require expensive energy improvement works to meet the new minimum standard. A similar minimum energy efficiency standard is already in operation in England but the Scottish proposals differ in a number of key respects and some fear these inconsistencies will have a negative impact on the commercial property market in Scotland. Generally speaking, the Scottish regulations will apply to all commercial property with a floor area greater than 1,000 square meters. While detailed guidance on proposed exceptions is awaited, only buildings already requiring an Energy Performance Certificate are intended to comply. With few exceptions, a sale or grant of a new lease on a qualifying property will trigger the need to meet the new regulations, so the owner must provide a prospective buyer/tenant with a formal action plan detailing how the energy performance of the building can be improved to meet the statutory minimum rating, according to Liz Stewart, a partner in the commercial property team at Stronachs LLP. She explained that action plans, which bring another additional cost, can be produced by a qualified member of an approved organisation, and will assess greenhouse gas emissions and energy performance. Works needed to improve the energy performance of the property to the minimum standard must be identified in the plan which, once agreed, will be added to a statutory maintained register. If improvement works are needed, the owner has two options; to complete the upgrades within 42 months, or defer the works. In the interim, the owner must keep an accurate record of the property’s energy consumption via a Display Energy Certificate, which must be registered annually, with a view to reducing the energy consumption of the property concerned. ‘Responsibility rests with the property owner. Failure to comply can result in a penalty charge and responsibility for enforcement will lie with each local authority in Scotland. In most cases, it is hoped improvement works will reduce energy bills in the long term with the cost of upgrades recouped within five to seven years,’ said Stewart. ‘The environmental impact of older commercial properties should also be mitigated. Having said this, some older properties may require considerable improvement works to meet the minimum energy efficiency standard without any guarantee of payback. At least 40% to 50% of existing building stock pre-dates the 1940s,’ she pointed out. Detailed government guidance is anticipated in the coming months, and a number of issues including… Continue reading
