Uk
UK needs to build 300,000 homes a year to meet current housing shortfall
The UK Government must lift its home building target by 50% and build 300,000 new homes each year to tackle the current housing crisis, according to a report from the House of Lords Economic Affairs Committee. The report suggests that local authorities and housing associations must be freed to build substantial numbers of homes for rent and for sale and points out that the current targets will fail to meet the demand for new homes or moderate the rate of house price increases. It also says that current policy is restricting local authorities' access to funding to build more social housing and creating uncertainty in the already dysfunctional housing market by frequent changes to tax rules and subsidies for house purchases, reductions in social rents, and the extension of the Right to Buy. All of these changes reduce the supply of homes for those who need low cost rental accommodation and a narrow focus on home ownership neglects those who rent their home, the report adds. The Committee makes wide-ranging recommendations to address the housing crisis, including charging council tax on development that is not completed quickly and not relying solely on private developers to meet the target which the report describes as misguided. Indeed, it points out that the private sector house building market is ‘oligopolistic’ with the eight largest builders building 50% of new homes and their business model is to restrict the volume of house building to maximise their profit margin. To address this the Committee recommends that local authorities are granted the power to levy council tax on developments that are not completed within a set time period. It also suggests that the Government must take decisive steps to build on the very substantial holdings of surplus publicly owned land and that a senior Cabinet minister should be given overall responsibility for identifying and coordinating the release of public land for housing, with a particular focus on providing low cost homes while the National Infrastructure Commission should oversee this process. It also wants local authorities to be given the power to increase planning fees. Local authorities should be able to set and vary planning fees to help fund a more efficient planning system and the upper cap on these charges should be much higher than the current limit. ‘We are facing an acute housing crisis with home ownership, and increasingly renting, being simply unaffordable for a great many people. The only way to address this is to increase supply. The country needs to build 300,000 homes a year for the foreseeable future,’ said Lord Hollick, Chairman of the Committee. ‘The private sector alone cannot deliver that. It has neither the ability nor motivation to do so. We need local government and housing associations to get back into the business of building,’ he pointed out. ‘Local authorities are keen to meet this challenge but they do not have the funds or the ability to borrow to embark on a… Continue reading
US housing market growth expected to be steady in 2016
Housing market growth in the United States is holding steady with a rise of 0.6% quarter on quarter, according to the latest real estate analysis report. The annual spring housing boom has been beneficial to most regions across the nation, with most markets outside of the Northeast seeing a small bump in quarter on quarter growth in the last month. The data from real estate firm Clear Capital also shows that in the West quarterly growth has increased by 0.2% to 1.3%, while quarterly growth in the South and Midwest have increased to a modest 0.8% and 0.3% respectively. However, growth figures in the Northeast are concerning with the firm’s models showing an average of zero price growth in the region over the last quarter. ‘This is especially alarming when considering that the spring season is a time when markets typically gain momentum leading into the busy summer season,’ said Alex Villacorta, vice president of research and analytics at Clear Capital. He pointed out that while prices in the region as a whole have appeared to stagnate, there are markets in the region that are performing positively, such as New York and Hartford, where prices have increased by 0.5% and 0.7% respectively over the last quarter. The regional year end forecasts may also be a cause for concern, with the West and North-eastern regions projected to fall potentially into negative territory over the next six months. The analysis predicts that by the end of 2016, the nation may see a new leader in terms of regional growth as the South and Midwest are predicted to have the highest price growth over the next six months, around the 0.5% mark. ‘While these six month growth rates are lower than what we have seen in recent years, slower growth does not necessarily spell disaster and instead could be indicative of markets that are finally beginning to moderate and even stabilize in these regions,’ Villacorta explained. On the MSA level, southern cities are dominating the top spots in our forecast, with six of the top 10 markets located within the region. Home prices in Dallas and Nashville are predicted to see growth throughout the remainder of 2016, increasing to the tune of 3% to 4% by the end of the year. Major Florida markets are also predicted to continue to rise, with Jacksonville and Orlando growth forecasts around 2.5% by the end of 2016, while homes in Tampa may increase by almost 4% over the next six months. ‘Overall, our forecasting models are predicting the second half of 2016 to be much slower than its start, with all regions forecasted to see very little price change by the end of the year,’ said Villacorta. ‘The Federal Reserve won’t be raising interest rates this summer, and while this will help keep the cost of mortgage lending to a minimum, at least in the short term, there are other key global factors that could spell… Continue reading
Petition launched to scrap EPCs in UK which were imposed by EU directive
A Parliamentary petition has been launched in the UK to scrap energy performance certificates for residential properties now that the country has decided to leave the European Union. The certificates, known as EPCs, were introduced in 2007 after the Housing Act 2004 made it a mandatory requirement that an energy assessment is made on all properties listed for sale in Britain and later this applied to rental properties too. This was done to comply with a European Directive and EPCs were seen as bureaucratic consequence of being a member of the European Union which means all countries had to introduce the certificates. This means that every home that is put on sale or for let needs to be inspected and a certificate issued before it can be advertised. It is estimated this amounts to an annual cost of £100 million to sellers and landlords. It is widely regarded that the resulting energy rating that the certificate assesses is of little help to either buyer or seller and has not proven to reduce energy consumption in any attempt to assist in mitigating the effects on the environment, as was the intention when first conceived by the European Commission. Now, Russell Quirk, chief executive officer of hybrid estate agent eMoov, has launched a Parliamentary petition to bring about the scrapping of EPCs which he believes will streamline the home moving process and save the country millions of pounds. ‘This petition will be the first shot to be fired by the property industry in achieving swift benefit from the EU exit,’ he said, pointing out that if 100,000 signatures are achieved this would mean that Parliament has to debate the issue. Quirk has also contacted the Housing Minister Brandon Lewis MP to ask for his support. Since inception, it is estimated that over 16 million EPCs have been produced and at a consumer cost of over £800 million. ‘I have launched this national petition in order to get rid of EPCs and the unnecessary cost to the consumer of paying for them. When introduced as part of the failed Home Information Pack in 2007 they were widely criticised as pointless and wasteful by the property industry,’ said Quirk. ‘Thousands of inspectors have had to be trained and then re-trained under adapted legislation, forced upon us by an EU directive that, now that we have voted for Brexit, can be unwound. EPCs are of no benefit to anyone and have created a bureaucratic burden on home sellers, landlords and estate agents,’ he added. Continue reading
