Tag Archives: london
Survey reveals how prospective UK first time buyers worry they will never own a home
Almost half of people in the UK who have not bought their own home by the time they are in their mid-30s doubt that they will ever be able to do so. First time buyers are increasingly being squeezed out of the housing market despite a strong desire to own a new home which is regarded as a sign of social and financial security. New research commissioned by Yorkshire Building Society has found that 49% of non-home owners aged 35 to 40 who aspire to home ownership think that it is ‘unlikely’ or ‘very unlikely’ that they will ever own a property. The survey, conducted by NatCen Social Research, found that 69% of young adults aged 18 to 40 felt that owning their own home was crucial to feeling that they had succeeded in life, as well as a source of social and financial security. However, the importance that young adults placed on home ownership was not matched by equal levels of optimism about their ability to achieve this milestone, particularly among older respondents. The research thus suggests that an inability to buy a home is leaving many young Britons facing an ‘early life crisis.’ ‘It is very sad to see how the hope of owning a home is fading for so many, especially as people approach their mid-thirties. For most people, owning a home is not just about security, it is also evidently integral to their feelings of self-worth, success and self-esteem,’ said Andy Caton, executive director of Yorkshire Building Society. ‘Hundreds of thousands of adults across the UK feel unable to reach this important milestone in their lives, with many reaching the conclusion that they will never be able to buy their own home like their parents and grandparents did,’ he added. The survey found that while 69% want to own a home some 45% didn't think they were earning enough money to be able to buy their own place, while 46% worried they wouldn't be able to afford mortgage repayments and 38% can’t afford required deposit. One in 10 people claimed that lack of job security was preventing them from pursuing their dream of owning their own home. Some 31% of non-home owners aged 35 to 40 have given up on ever buying, saying that they don’t think they will ever be able to afford to buy. This is equivalent to around half a million people across the UK expecting never to be able to afford to own their own home, unless there is a dramatic downward shift in house prices. Latest UK house price figures show that property values have risen to a record high, with the typical first time buyer paying 7.1% more than they would have a year earlier. Indeed, the average price paid for a starter home in the UK is now around £219,000, meaning that, with a deposit of 10% buyers would need a salary of around £45,000 a year to get their first step on… Continue reading
Index report shows Swiss property markets provided strong growth for investors in 2015
Switzerland’s property markets are currently providing strong growth for investors with the latest data showing total returns of 6.6% in 2015. This was up from 5.2% in 2014, which the index report from investment support tools firm MSCI says reflects continued strong growth in the Swiss properties sector. It also says that the strength of Swiss property market signals that the sector benefited from the Swiss National Bank’s (SNB) move last year to scrap the franc’s peg to the euro and lower interest rates. The figures showed that government bond yields and property yields both declined in 2015 from 2014, to -0.04 from 0.38%, and to 4.4% from 4.8%, respectively. The spread between the government yield bonds and property yields increased to 4.45% in 2015 from 4.4% the year before. The strong total return was fuelled by robust capital value growth, which rose to 2.4% from 1% in 2014. This capital value growth marks the second highest growth in the three, five and 10 year average. Residential properties remained the strongest sector in 2015, representing 47% of the measured universe in the index. Total return in this segment rose to 8.4% from 6.1% from the year before. The capital value growth in residential properties reached 4.1, marking the best performance since the index began. Moreover, office property returns recovered in 2015, achieving total return of 5.0%, compared to 4.2% in 2014. However, office property total returns remained below the five year average of 5.1%, and the 10 year average of 5.8%. Across the different sectors, rental growth weakened slightly. Net income return dropped to 4.1%, from 4.3% in 2014. ‘The Swiss property market enjoyed another robust year as the market continues to attract capital. The strong capital growth is a result of increased yield compression following investor demand. This is especially true for the major cities of Switzerland, such as Zurich, Bern, Basel or Geneva,’ said Justus Vollrath, MSCI executive director. ‘What’s particularly interesting is that the move by Swiss central bank to unpeg the Swiss franc and lower interest rates led to slight widening of spreads between government bond yields and property yields. This created an additional incentive for investors,’ he explained. ‘We also see that the residential market showed particular resilience and enjoyed exceptionally strong capital value growth,’ he added. Continue reading
Views sought on UK Government’s Starter Home regulation
The UK government is seeking views on regulations surrounding its flagship Starter Home programme in England and has issued a consultation document. Under the regulations, which will form part of the Housing and Planning Bill, the government plans to allow build to rent developers to build Starter Homes off-site. ‘We propose that private rented sector developments could contribute to starter home provision and the requirement should be met through an offsite contribution for delivery of starter homes,’ the consultation document says. Overall it proposes a new statutory framework for Starter Homes that will include a general duty on local planning authorities to promote the supply of Starter Homes when carrying out their planning functions. The Bill would include a clause that sets a Starter Home requirement which means that local planning authorities may only grant planning permission for residential developments if the Starter Homes requirement is met. There would be reporting arrangements to ensure local communities, and especially first time buyers, are aware of what action local planning authorities are taking to support the delivery of starter home; and powers for the Secretary of State to intervene if local planning authorities fail to carry out their functions related to Starter Homes. ‘We are taking forward ambitious measures to increase the supply of housing and improve prospects of home ownership for many. We aim to deliver one million new homes to boost housing supply significantly. We want to ensure young people are not denied that which their parents took for granted, the opportunity to buy their own home, settle down and enjoy the security that home ownership brings,’ said Housing and Planning Minister Brandon Lewis. ‘That is why we have committed to building 200,000 high quality Starter Homes exclusively for young first time buyers under 40, to be sold at a minimum of 20% below the open market value. We want to see Starter Homes built on housing sites across the country,’ he explained. ‘The Housing and Planning Bill sets out the statutory framework for the delivery of Starter Homes, and will be supported by changes to national planning policy,’ he pointed out. The Government has already announced a £2.3 billion funding package to support the delivery of up to 60,000 Starter Homes. Of this funding £1.2 billion will, in the first instance, be made available to remediate or assemble brownfield land to deliver at least 30,000 Starter Homes through the Starter Homes Land Fund. The technical consultation document seeks views on the details for the regulations to be made under powers contained in the Housing and Planning Bill, including options for the Starter Homes requirement on reasonably sized sites. ‘We want to hear views so the resulting regulations are feasible, proportionate and effective. I am confident that these reforms will help a generation of young people into home ownership,’ Lewis added. The British Property Federation has been calling for build to rent developments to be exempt from providing an on-site Starter Home provision throughout the… Continue reading
