Tag Archives: finance
New generation of skilled builders needed to fulfil UK’s new housing plans
A new generation of skilled builders will be needed to fulfil the UK government’s latest pledge to build hundreds of thousands of new homes, according to industry experts. The house building industry has welcomed the announcement of a £7 billion fund to prioritise home building with 200,000 starter home with 20% discount for those aged under 40, 135,000 shared ownership home, 10,000 rent to buy homes and 8,000 specialist properties for the elderly and disabled. But the Federation of Master Builders (FMB) pointed out that already developments are being stalled or held up due to the cost of hiring skilled tradesmen and with a shortage of apprenticeships the skills problem is not about to go away. ‘Unless we see a massive uplift in apprenticeship training in our industry, there won’t be enough pairs of hands to deliver more housing on this scale. The Chancellor clearly recognises that the crisis of home ownership is inextricably linked to a crisis in house building. We therefore hope that in order to address both, the Government will do everything it can to increase house building capacity,’ said Brian Berry chief executive of the FMB. ‘SME developers will have an important role to play in delivering the smaller scale sites across the country. The last time we built in excess of 200,000 homes in one year was in the late 1980s when two thirds of all homes were built by small developers,’ he pointed out. ‘SME house builders now only build little over one quarter of all new homes which points to another serious capacity issue as we need more small house builders to enter the market and also for SME house builders to crank up their delivery of new homes in order to build the Chancellors 400,000 new affordable homes,’ he added. There was much in the Autumn Statement for the construction industry to be excited about but some of the fundamental barriers to house building and, in fact, construction of any kind, remain in place, according to Simon Craven, director at Tower8. ‘If we are to see spades in the ground, then we need to see more of skilled workers to deliver these grand schemes. Further funding for a skilled workforce is required if the construction industry is to match the potential projects that the Chancellor is so keen to encourage,’ he explained. ‘Pressure on the construction industry comes from project costs such as staffing, materials inflation and other key factors that affect delivery. The Chancellor has left many of the problems of supply side and skills to the private sector to resolve which is a potentially exciting move. But the grey area occurs where the private sector works with local authorities, planners, education and divergent goals between these parties mean that the progress required is simply not made,’ he added. 'Furthermore, we have been interested to speak with many of the firms that are looking to deliver PRS schemes in the… Continue reading
New standard format mortgage charge tariff launched in UK
A new tariff of mortgage charges has been launched in the UK that introduces a standard format for how lenders communicate their fees, to make it easier for customers to understand charges and compare deals. Following a campaign by consumer organisation Which? to end the confusion around mortgage costs, the Chancellor of the Exchequer George Osborne asked the Council of Mortgage Lenders and Which? to work together to find ways to make it easier for consumers to understand and compare the costs of different mortgages with different lenders. Since then they have worked jointly to address this problem and believe that the new tariff to help make it easier for people to understand mortgage fees and charges. There are two key improvements within the tariff. Firstly there will be standard terminology. Different lenders will now use the same names for fees, as Which? research previously found consumers find the existing range of names for similar fees too confusing. Secondly it introduces a new common format. Each lender will list fees in the same order, and with the same descriptions, to make it easier to compare between lenders. The new tariff has been tested on consumers, and results show that they found it much easier to understand and compare costs than when they used existing versions. Lenders representing 85% of the market have already committed to introducing this tariff and putting it on their website by the end of the year, and we anticipate that other lenders will also choose to adopt it. Continue reading
More supply sees residential property rent growth slow in the US
Annual rent growth in the United States has slowed for the third month in a row but rents are still rising faster than historical norms, according to the latest index data. Rents appreciated 4.5% year on year in October, down from 5.3% in September, down from a high of 6.6% in July and it is mostly due to more properties, specifically apartments, coming onto the market, the Zillow real estate market report shows. A breakdown of the figures shows that tents in large multifamily buildings rose 3.9% annually, while single family home rents grew 4.5%. Overall, newly built apartment buildings are finally opening for new residents and slowing the rate of rental appreciation across the country, but rents are still rising much faster than the historical norm and continue to rise faster than incomes, according to the report. The report points out that multifamily housing starts have been increasing since late 2009, and as units become available, the pace of rental appreciation is slowing. Lack of inventory has been a leading cause of the ongoing rental affordability crisis, especially in fast growing markets. Even the hottest rental markets, which have seen double digit rent appreciation for the past five months, are growing at a slower pace although rents are still rising there more than twice as fast as the national average. The San Francisco metro has the fastest rental appreciation among the nation's 35 largest markets. Rents there are up 15.2% from last year, but they were growing as fast as 19% annually in June and July. ‘Rental appreciation has started to slow down in part due to more rental supply. Many of the bigger multifamily rental projects that were begun a couple years ago in cities nationwide are finally starting to open for occupancy, easing pressure on rents somewhat,’ said Zillow chief economist Svenja Gudell. ‘But despite this recent slowdown in rental appreciation, the rental affordability crisis we've been enduring for the past few years shows no signs of easing, especially as income growth remains weak. It will take a lot more supply, and a lot more renters turned home owners, to fully reverse this trend,’ Gudell added. As rents have grown and rental affordability continues to suffer, the stability and relative affordability of homeownership may be pushing some qualified renters to make the jump to home ownership. A widely expected December rate hike from the Federal Reserve could be an additional incentive for buyers to enter the market while rates remain low. Reflecting this, home values are growing at their fastest pace since November 2014, up 4.3% to a Zillow Home Value Index of $182,800. Continue reading
