Tag Archives: crisis
US home prices growth set to send first time buyers into the suburbs, says new research
Deteriorating housing affordability will the main drive factor of residential property trends in the United States in 2016, according to a new analysis report. A lack of affordable homes near city centres will push new and first time buyers to suburbs that feel like walkable, amenity rich mini-cities, says the study from real estate form Zillow. It also explains that rising rents will force more young renters to wait longer before buying a home. And the looming threat of rising mortgage interest rates will slowly erode some of the terrific mortgage affordability the market has enjoyed for the past few years. Zillow's 2016 Housing Market Predictions report says that the median age of first time buyers will reach new highs in 2016 as millennials put off home ownership and other major life decisions. Growth in home values will outpace incomes, especially for low income Americans. In 2016, those whose incomes fall in the bottom third of all incomes will be priced out of home ownership and unable to afford even the least expensive homes on the market, it suggests. Rising rents won't let up in 2016, and will continue to set new records. The next year will bring the least affordable median rents ever, the report also predicts. As affordable housing close to city centres grows increasingly scarce, people will move farther out. Dense, walkable suburbs with an urban feel, especially those that offer good access to the city will be 2016's new hot spots. The median expectation of more than 100 economic and housing experts surveyed in the latest Zillow Home Price Expectations Survey suggests that home values are set to grow about 3.5% in 2016. ‘Rents will continue to increase at a brisk rate in 2016, but many potential first-time buyers are living in hot markets where buying a home is really expensive,’ said Zillow chief economist Svenja Gudell. ‘In 2016, we'll start to see more people in hot coastal markets forced to move farther from the core of the city to find housing. When they get there, they'll be looking for amenity rich suburbs like mini cities, with walkable cores and an urban feel,’ she explained. ‘As renters gradually transition into homeowners, the historically low home ownership rate should stop falling quite as quickly as it has been. However, the median age of first time buyers, already the highest it has ever been at about 33, will climb higher. Millennials want to buy, but they are waiting longer than previous generations,’ she pointed out. ‘All of this will happen against a backdrop of slowly increasing interest rates. That will make some homeowners think twice about selling, and many of them will decide to remodel their current homes instead,’ she concluded. Continue reading
New housing commission launched in UK
A new Housing Commission has been launched in the UK to explore new routes to house building so councils can enable the construction of more desperately needed homes. Councils built nine times more homes between 2010 and 2015 than between 2000 and 2005 and are desperate to dramatically increase the availability of new homes in their local areas, according to the Local Government Association. The LGA said this is vital to building the 230,000 new homes the country needs each year as private developers have not built more than 150,000 homes a year for more than three decades. The Housing Commission will also explore the importance of effective housing in boosting jobs and growth, helping meeting needs of an ageing population, saving social care and the NHS money, and helping people into work. It will look at new ways that councils can enable investment in new homes, the role of councils in shaping homes within prosperous places and communities, the role of housing in supporting tenants to find and progress in sustained employment and the role of housing in adapting to an ageing population and preventing onward costs onto social care and health services. Evidence is sought on the key issues for communities, partners and councils, on good practice that has successfully addressed those issues, and what is needed to build on those successes. Councils, partners, organisations and individuals are invited to contribute their issues, evidence, and examples of effective housing and ideas to the Commission's Advisory Panel, made up of experts and academics. The Commission will take a medium term view incorporating current housing reforms but will look beyond them in making the case for councils to be able to deliver the homes our communities and places need. Findings will be brought together in a report in Spring 2016 and presented at the LGA Annual Conference in June 2016. ‘We're working with government to ensure housing and planning reforms support council efforts to build more homes and the Housing Commission we are launching today will investigate how the government and councils can help deliver houses to solve our housing shortage,’ said Peter Box, LGA housing spokesman. ‘Councils must be able to play a lead role in building the homes we desperately need, and building the homes in a way that create prosperous places and growth, help people into work and positively adapt to an ageing population,’ he explained. ‘This is the best way to meet local and central government ambitions for our communities, to reduce waiting lists and housing benefit, keep rents low and help more people live long and happy lives,’ he added. Continue reading
London announces more council owned land for new home building
London is leading the way in the UK in terms of releasing land for new housing development and encouraging institutional investment in the city’s residential property market. Boris Johnson, the Mayor of London has pledged to release all City Hall-owned land for development by the end of his Mayoral term in 2016 and almost all these sites are now up for development. They include the regeneration of four former hospital sites and industrial land at Greenwich Peninsula and Barking Riverside. Around 50,000 homes will be delivered on City Hall's land interests. In the latest announcement a total of 3,500 new homes, a school and a park will transform a disused Parcelforce depot in east London on a 10 hectare site in Stephenson Street, Newham. It will also include nearly 30,000 square feet of retail space. The development will provide homes to buy and rent, including a significant proportion of shared ownership and purpose built private rented homes. More than 1,200 of the 3,500 homes will be affordable. It is part of the Johnson's wider push to strengthen institutional investment in the residential market in London, with City Hall initiatives aimed at boosting both shared ownership and purpose built private rent. ‘This huge chunk of disused land will be put to the best possible use, creating a whole new neighbourhood including 3,500 much needed new homes, a new school and a park. This ambitious development will help to further the continuing transformation of east London as part of our Olympic legacy,’ said Johnson. Chairman of the Berkeley Group Tony Pidgley, said that the Stephenson Street development will be a new village for London. ‘It will have all the qualities that a successful community needs: shops, workspaces and a school, links between neighbours, a beautiful park where people can play and great transport connections. Above all, this site will create homes for people regardless of their age, background or income. It will be a place for everyone,’ he added. A key part of the Mayor's Housing Strategy is to encourage institutional investors, such as pension funds and insurance companies, to invest in housebuilding. This includes efforts to support extended leases and more stability for tenants as well as top quality, well designed, new developments. Some 132,000 properties have now signed up to his London Rental Standard, which sets out basic duties for landlords to ensure a higher-quality experience for the city's tenants. These plans sit alongside efforts to boost home ownership for low and middle income households, with the Mayor exceeding his manifesto commitment by helping 52,000 Londoners into low cost home ownership through his First Steps scheme with plans to help a quarter of a million Londoners over the next decade. The latest development is subject to planning approvals. Following a planning application in 2016, a site start is targeted for early 2017 which would see the first homes delivered in the summer of 2018. Stephenson Street was acquired by the Mayor through… Continue reading
