TSI
Many parts of New Zealand seeing new home development boom
The home building boom in New Zealand is continuing to gather momentum with planning consents up 13% in the 12 months to July 2016, and up 2% month on month. p 52% in Bay of Plenty, up 37% in Waikato and up 21% in Otago. The value of residential and commercial building work is also booming and hit an all-time record of $18.5 billion for the year to July, up from $15.6 billion the previous year. Of this, $6.3 billion was non-residential, and half of that was for education buildings such as at Victoria, Canterbury and Otago universities. In Auckland, the total of all building work increased 32% to $6.9 billion for the year, while residential increased 29% to $4.4 billion. In Christchurch post-earthquake building is continuing with the latest $300 million development of 600 homes confirmed by Building and Housing Minister Nick Smith. The development adds to three set up under the Christchurch Housing Accord, between the Christchurch City Council and the Government, which aimed to increase the longer term supply and affordability of homes and are the final phase of the Government’s housing response to the earthquakes. ‘I am hugely encouraged by the progress we are making in Christchurch, where the market is now well recovered from the loss of 10,500 homes in the quakes. Housing in Christchurch was an acute problem two years ago, with costs rising rapidly and record numbers of people requiring emergency housing,’ said Smith. He pointed out that rents in Christchurch have declined by 7% in the past year as compared to a national increase of 3% and house prices have increased 2.6% compared to the national increase of 14.2%. ‘We are now well down the road of recovery. The completion of these four Government-initiated housing projects and the council’s new housing organisation will help give Christchurch a mix of social and affordable housing to meet future needs,’ added Smith. Continue reading
Cleaning is top issue for UK landlords and letting agents
Dirty properties are a growing problem for letting agents and landlords in the UK with cleaning becoming the top cause of disputes and it is getting worse, new research suggests. The latest data from the Tenant Deposit Scheme shows that cleaning continues to take the lion’s share of deposit disputes, up almost 50% over the last five years. Indeed, cleaning has consistently been the most common dispute in cases brought to the TDS and arises in 58% of the cases they deal with. According to Imfuna, agents and landlords are increasingly facing filthy properties at the end of tenancies. Many tenants claim their landlord or agent failed to make it clear that the property should be left clean at check-out,’ said Jax Kneppers, the firm’s chief executive officer. She pointed out that it is essential that landlords and agents conduct a thorough inventory, with photography and detailed descriptions on the condition of the property at the start of the tenancy. This ‘proof of condition’ should be shared with the tenant when they are issued with the tenancy agreement. The biggest problems that agents and landlords face are dirty ovens and fridges, stains and marks on carpeting and flooring, bathrooms which have not been cleaned for months and pet hair and excrement on floors, furniture and soft furnishings. ‘At the check-out stage, the tenant should be made aware of the areas requiring cleaning and the potential cost involved. It is important to remember that the tenant is only obliged to return the property in the same state of cleanliness as at the start of the tenancy, after allowing for fair wear and tear,’ added Kneppers. Howard Lester, director of Balgores Property Group, said he has seen a sharp rise in the number of properties that require professional cleaning services at check-out over the last 12 months. ‘There is a definitely a lack of respect for property amongst tenants and it appears that they are happy to live in dirty accommodation. Many tenants fail to leave their property in the same condition when they leave a property and we have seen many properties in a filthy state at the end of the tenancy,’ he explained. He pointed out a recent case where the property was left in a disgusting state. The tenants had not cleaned the oven for months and it was caked with grease and spills on the hob and on the inside. Bags of rubbish were left in the kitchen and the worktops were filthy with grime. The carpets were heavily marked with pet excrement and numerous spills. The garden was left with an old washing machine, rusty bikes and worn out tyres. It cost the landlord several hundred pounds to have the property professionally cleaned. ‘Tenants are often shocked to realise that professional cleaning can be costly, depending on the area and type of work required. Some tenants think cleaning issues… Continue reading
Finance access and VAT are key barriers to housing supply in Ireland
Access to finance and input costs such as VAT are the key barriers to increasing the housing supply in Ireland, according to new research from chartered surveyors. In particular they say that the introduction of rent certainty measures have forced private landlords out of rental sector and that treating residential investors on par with commercial property investors is needed. The Society of Chartered Surveyors Ireland (SCSI) is calling for a reduction of VAT to 9% for houses under €300,000 and the establishment of a finance agency to support house building. Over half of the 300 chartered surveyors who took part in the survey said the introduction of rent certainty measures by the government was one of the main reasons private landlords are exiting the sector. The other reasons cited were the indebtedness of private landlords and tax restrictions. SCSI president Claire Solon said that reducing VAT on affordable housing and establishing a Development Finance Agency with expertise in construction lending were measures the government should introduce in the upcoming Budget. She pointed out that the ESRI has estimated that Ireland needs to build 25,000 residential units per annum, with the bulk of them being required in the capital. However in the second quarter of 2016 planning was only granted for 2,590 units in Dublin, of which only 620 have commenced construction. ‘The VAT reduction for the hospitality sector has worked extremely well. We would like to see a similar reduction to 9% for a defined period focusing on houses under €300,000. We feel such a move, access to finance for builders and a Capital Gains Tax ‘holiday’ for a set period to free up development land, are three measures which would provide a much needed kick start to house building,’ she said. She explained that the return of boom era rents caused by the shortage of housing supply together with the slow gearing up of the construction sector meant Ireland might not be in a position to avail of any opportunities created by Brexit unless swift action was taken. ‘It is crucial for the Government to address the depletion in investor activity in the overall residential market. One solution would be to apply the principles of commercial property investment to residential development and investment. Specific measures which would help level the playing field would be to reinstate full mortgage interest relief and to remove USC and PRSI on rental income,’ she pointed out. The survey found that the most significant challenge facing provincial towns and villages in Ireland was the inadequate provision of broadband services. In its submission the SCSI calls on the Government to provide additional funding for the roll out of reliable, high speed broadband services in all rural and provincial areas, a doubling of the Town and Village Renewal Scheme Grant Scheme to €20 million and an overhaul of the regulations of the… Continue reading
