Uk
UK vote on future in EU could have major impact on housing markets
If the UK leaves the European Union there is a risk that the move could have a long last and damaging effect on the country’s residential property markets, according to a new report. It could affect current plans to build hundreds of thousands of new homes, compromise London’s position as a safe haven for property investment, but could also have positive effects for first time buyers. The report from the National Association of Estate Agents (NAEA) and the Association of Residential Letting Agents (ARLA) compiled with the Centre for Economics and Business Research (Cebr), highlights a number of short and long term implications potentially arising from the upcoming vote. While the impact Brexit will have on migration policies is unconfirmed, imposing greater restrictions on foreign workers coming into the UK may compromise the UK’s ability to build homes with the Government having pledged to build one million new homes by 2020. It points out that construction based jobs are decreasing in popularity among UK nationals, and as 5% of current construction workers were born in other EU countries and workers from the are becoming more important than ever in filling the skills gap to boost housing stock. A leave vote could mean that in 10 years’ time there would be a severe skills shortage of construction workers, according to Mark Hayward, NAEA managing director. ‘Even if we then had planning permission, investment and materials to build more housing, we simply wouldn’t have the resource to put the bricks and mortar together. It has the potential to have a very damaging effect on the future housing market,’ he explained. But he added that a leave vote could provide first time-buyers with breathing space as demand for housing would be expected to ease off. The report also says that non EU businesses are currently attracted to the UK’s status as a gateway to the single market as it allows them to establish and grow their presence across Europe. In 2014 some 19% or £5.3 billion) of total FDI inflow into the UK came from EU sources and in 2013 some 17% of sales in London’s prime property market made to non-UK buyers were to European nationals. It suggests that in the event of Brexit, a portion of FDI would be re-directed to EU countries, freeing up housing units, particularly in London, previously purchased through FDI for British buyers. Also, if the UK does not maintain free movement of labour, the total population of the UK could decrease by 1.06 million and the report argues that with fewer people, demand will ease, making the market more accessible for first time buyers, as well as second steppers and last and last time buyers and this is will be especially apparent in London. Reduced migration would also affect the private rental sector. Currently, private renting is a more… Continue reading
Buy to let stamp duty rush sees increase in supply of rental properties in UK
There was an increase in the number of new rental properties in the UK following the rush by buy to let landlords to beat the introduction of additional stamp duty tax on homes in April. New research has found that Worcester saw new rental listings shoot up by almost a half with a rise of 48.9% in April while there was a rise of 38% in Chelmsford and 36.4% in Stevenage. Overall there was a national rise of 11.5% but in London it was just 9.1%, according to the study which looked at the number of new rental properties being advertised last month compared to March in 90 towns and cities from property crowdfunding platform Property Partner. Other locations that saw significant increases included Southport, Telford, Bath, Newport, Woking, Gloucester, Milton Keynes, Oxford, Oldham and St Helens with rise of between 34.4% and 22.5%. ‘The rental market experienced a much-needed boost in April. Unfortunately, this was created by investor frenzy to beat the stamp duty hike, and supply is unlikely to continue on an upward trajectory,’ said Dan Gandesha, chief executive officer of Property Partner. ‘If anything, options for tenants could become more limited in the next couple of months as traditional landlords balk at the prospect of paying the surcharge now, and losing mortgage interest tax relief from next year,’ he pointed out. ‘There is still strong tenant demand, but the Government has changed the traditional buy to let landscape, and this will have ramifications for the rental market longer term. That demand will increasingly have to be met by professional landlords offering tenants a better product, and investors a better deal,’ he added. Continue reading
New research identifies property hotspots in Australia
The Australian housing market currently has 602 property hot spots spread out across the country’s eight states, according to a new report. All areas apart from Tasmania and South Australia appear at least once in the national Housing Report from the Housing Industry Association (HIA) with six top 20 in Victoria, five in Western Australia, four in New South Wales, two in Queensland and ACT and one in the Northern Territory. Nationally, a hotspot is defined as a local area where population growth exceeds the national average and where the value of residential building work approved is in excess of $100 million. The final ranking of the hotspots is determined by their respective population growth rates. ‘A total of more than 220,000 new dwellings were commenced last year, so it’s no surprise there was a strong performance among housing hotspots across Australia,’ said HIA economist Diwa Hopkins. Based on its performance during 2014/2015, ACT’s South West area was the country’s top hotspot yet again, with $216.5 million worth of new residential building approved and its population more than doubling. In second place was Cranbourne East in Melbourne’s southeast, where the population increased by 32% and some $328.7 million worth of new residential building was approved and in third place was Cobbitty-Leppington in the southwest of Sydney. This year’s hotspots report again identifies a set of areas where momentum remains very strong according to latest data. These areas are likely to perform well in next year’s rankings if the pattern of this year is anything to go by. ‘In the final analysis, the fact that 10 of the top 20 hotspots are located in New South Wales and Victoria speaks volumes. These two states have been the engines of the strong upturn in new home building over the last few years,’ Hopkins explained. ‘It is also encouraging to see Western Australia still perform strongly this time at the national level, considering the difficulties arising from the natural resources downturn,’ she added. Continue reading
