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UK annual house price growth slows for six month in a row
Annual house price growth in the UK slowed to 5.7% in February from 6.8% in January, the sixth month in a row that it has slowed, the latest index figures show. UK house prices fell by 0.1% in February, taking the average price to £187,964, according to the data from the Nationwide Building Society. According to Robert Gardner, Nationwide's chief economist, the broader economic backdrop has remained supportive of housing market activity. ‘Mortgage rates remain close to all-time lows and consumer confidence remains buoyant thanks to a further steady improvement in labour market conditions,’ he said. ‘Indeed, the unemployment rate has continued to decline and earnings growth has picked up, particularly in inflation adjusted terms, thanks in part to the sharp decline in energy prices,’ he added. But he pointed out that the pace of housing market activity remains fairly subdued. ‘There was a small increase in the number of mortgages approved for house purchase in December, up 2% from 59,000 in November to 60,300 in December, though it remains too early to determine whether this marks a turning point in activity,’ he concluded. The UK property market is undergoing a sustained reality check, according to Alex Gosling, chief executive officer of online estate agents House Simple. But he believes it is far too premature to suggest that the property market is running out of steam. ‘The strong jobs market, rising real wages and cheap credit are fuelling consumer confidence, and for many renters the home owning dream remains as attractive as ever. But the fillip provided by the Stamp Duty reforms announced late last year appears to be waning, and mortgage activity is fairly subdued,’ he explained. ‘Tightened lending criteria are forcing first time buyers to save much more and much longer before they can get a mortgage. The most recent English Housing Survey found that just 36% of 25 to 34 year olds own their home, compared to 59% a decade before,’ he pointed out. ‘Steady, not stellar, growth is likely to be the pattern for house prices in 2015. The double digit rises of 2014 are history,’ he added. Continue reading
Rents in Scotland up 1.3% in last 12 months, latest index shows
Residential rents in Scotland have increased by 1.3% in the last 12 months, just half the pace of rent growth in England and Wales, according to the latest sector index. It means that average rents stand at £536 per month following a 0.1% fall in January however rents in the east of Scotland reached a new record high in January after increasing 3.2% year on year. The Scotland Buy to Let Index from Your Move, one of Scotland’s largest lettings agent networks, also shows that despite a slight monthly improvement, tenant financed are worse than a year ago with 7.1% late paying their rent. The average monthly rent in Scotland is now 5.3% higher than at the time of the previous elections to the Scottish Parliament in May 2011. By contrast, the average residential rent across England and Wales has climbed 9.6% since May 2011, according to the index. Also, rents in England and Wales have risen 2.8% year on year. Scottish tenants are having a much smoother ride than their counterparts south of the border, with rental prices in Scotland climbing at a considerably slower pace, according to Brian Moran, area lettings director at Your Move. ‘Despite snowballing demand for homes to let, the private rented sector has managed to shelter tenants from the worst extremes of rent inflation, and rents have navigated an affordable route broadly trailing inflation,’ he said. But he pointed out that the overall story since the previous election papers over the different chapters we’ve experienced within this parliament. Scottish rents were largely on pause throughout 2011 and 2012, and it was the abolition of tenancy fees in November 2012 which jolted to life a sudden uptick in rents, as costs were recouped other ways. He believes that the majority of the rent growth falls in the last two years, and the tempo is just easing back into a more organic swing. ‘Housing is a policy area that impacts every one of us, and ahead of the general election tenants will have their ears on the ground to listen out for any rumbles of further changes to lettings legislation that might impact the sector. Investment in homes to let needs to keep pace with demand, and landlord confidence is an essential ointment to soothe the pains of the current housing shortage, and make rent rises an easier pill to swallow for tenants,’ added Moran. The index also shows that in the past year, rents have risen in three out of five regions of Scotland. Rents in Edinburgh and the Lothians have increased nearly three times as fast as across the rest of the country, jumping 3.8% in the 12 months to January 2015, compared to a 1.3% annual rise for all of Scotland. The East of Scotland has seen the second strongest annual rent growth, with a 3.2% year on year increase and in Glasgow and Clyde there was a 1.3% annual rise in average rents. In two regions, average… Continue reading
Consultation launched on speeding up UK planning change
UK planning and housing minister Brandon Lewis has proposed new measures to speed up the planning system and provide new homes more quickly. He explained that so-called section 106 agreements, which attach conditions on a planning permission being granted, can often lead to extended negotiations that delay the planning application process. Now Lewis is seeking views on plans to speed up the process, getting planning permission agreed and workers on site more quickly. He said they can add months to the planning process and stalling work on the homes communities want. ‘Section 106 planning agreements can bring great benefits to local communities but too often they drag out planning applications for months. I’m proposing measures that will speed up the process, get planning permissions granted quicker and workers on site earlier, all the while keeping the community benefits that these agreements can bring,’ he explained. Section 106 agreements put requirements on planning applicants to make the proposals suitable for the area. These include mitigating a scheme’s impact such as through requiring improved transport to service it, providing an affordable housing element or requiring contributions from the applicant to be spent on other local schemes. The proposals are now open for consultation and include setting clear time limits so section 106 negotiations are completed in line with the existing eight to 13 week target for planning applications to be processed rather than letting them slow the whole planning process down. They also include requiring parties to start discussions at the beginning of the planning application process, rather than the current system where negotiations can often start towards the end. There are plans for a dispute resolution process where negotiations stall preventing development, using standardised documents to avoid agreements being drafted from scratch for each and every application and potential legislation in the next Parliament to give the new measures teeth. Lewis pointed out that this is the latest in a range of measures the government has taken to improve the planning system. Others include introducing the National Planning Policy Framework to cut more than 1,000 pages of planning guidance to around 50 and making it easier to convert existing commercial and retail buildings for residential use. Also on the agenda is removing the requirement for affordable housing and other contributions from small developers, saving up to £140,000 per home and at the same time maintaining strong protections for the green belt, which continues to prevent urban sprawl. The consultation on these proposals runs until 19 March 2015 and also seeks views on removing the need to contribute to affordable housing where a developer is building student accommodation. Continue reading
