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More than 50% of UK developers and builders plan to increase construction this year
More than half of developers and builders in the UK are planning to increase housing starts and completions over the next 12 months, according to a new survey report. Some 56% said they were planning to recruit more skilled workers in the next three years but many want to see more resources in local authority planning departments, the House Building Report 2016 from real estate consultants Knight Frank shows. Indeed, some 30% said making the planning process for public sector land more streamlined would help boost development numbers and 57% said they had not seen an increase in access to public sector land. On top of this 73% said the cost and availability of labour will have a negative impact on future housing supply at a time when it is at the centre of the national and local political debate. The expanding UK population, a structural historical undersupply of new housing and a slowdown in movement up and down the housing chain is now injecting a sense of urgency into the need to deliver more new build property, the report points out. . Over the last five years, the UK Government has made significant changes to the planning system, introduced schemes to boost development and put pressure on local authorities and public bodies to sell surplus land. While there has been an increase in housing delivery, but the supply of new build homes is still lagging demand on an annual basis, disregarding the historical shortfall. The country’s largest housebuilders, along with the Home Builders Federation (HBF), have recently pledged to help deliver one million homes by 2020, recognising that there needs to be ‘significant further action from the housebuilding industry’. The report assesses the next steps required to address the need for housing over the coming years. For example, the need to address the increasingly onerous levels of pre-commencement conditions applied in some planning permissions and the length of time taken to sign them off. The report points out that official house building data released each quarter from Department for Communities and Local Government (DCLG) shows that some 152,440 new homes were completed across the UK in 2014/2015 and Knight Frank estimates that this will rise to around 172,000 in 2015/2016. New quarterly data on English new build completions show a 12% rise in 2015/2016 to just under 140,000. However, separate retrospective data published by the DCLG shows that 155,080 new homes were completed in 2014/2015. ‘This suggests that the quarterly data is underestimating total house building across England,’ said Grainne Gilmore, head of UK residential research at Knight Frank. ‘Whatever data is considered, there has been a significant step up in the delivery of new homes over the last few years and large house builders are now constructing 60% more homes than in 2010,’ she added. She explained that on an annual basis, Knight Frank estimates a 12% rise in new build completions in the last year. However, on both… Continue reading
One if five homes for sale in London is priced at £1 million or more
With property prices in London continuing to rise new research shows that one in five homes for sale are listed at £1 million or more. London is one of the most expensive cities in the world for property and the research from estate agent eMoov shows that 20% of all London properties currently listed for sale are priced at over a million pounds. The firm analysed current stock levels across all of the major portals, recording the total levels listed for each London borough, before comparing this to the level of stock listed for £1 million or more and also researched the same percentage of stock across the capital as a whole. The borough with the highest number of properties for sale at over £1 million was Westminster with 63%, followed by South Kensington and Chelsea at 62%. There is a considerable gap to the next highest which is Camden with 43%. In contrast in the boroughs of Barking and Dagenham there are no properties for sale for a £1 million or more and surrounding boroughs have very few. For example in Newham, Bexley and Waltham Forest only 1% of homes for sale are prices at £1 million or more and in Redbridge and Havering it is 2%, in Lewisham 3% and Greenwich 5%. ‘When people think of London they accept prices are through the roof. Even though the average house price in Barking and Dagenham is considerably lower than the London average at £253,000, it still trumps the UK average by tens of thousands of pounds,’ said eMoov chief executive officer Russell Quirk. ‘In a market as inflated as London where stock is scarce and demand is overwhelming, it's quite remarkable that there is still an entire borough without even one property at the £1 million mark or over,’ he pointed out. ‘With prices across London continuing to rise, surely it won’t be long before Barking and Dagenham will see some of its properties priced at £1 million or above. Despite this, our latest research shines yet another spotlight on how unaffordable London is from a property point of view,’ he explained. ‘When you consider that across a city as vast and as populated as London, one in every five properties will cost you a six digit price tag, it really is disheartening for the aspiring London home owner,’ he added. Continue reading
Research reveals a surge in residential investment in Lisbon
Lisbon has seen a surge in residential investment and development activity in the last two years, according to new research. The city is emerging from economic difficulties in a nation which underwent an European Union and International Monetary Fund bailout in 2011 and various initiatives are helping to revive its property markets, says the report from international real estate firm Savills. It points out that reform of Portugal’s residential tenancy laws, coupled with inward investor incentives, has spurred wide scale regeneration of the built environment, helping Lisbon to foster economic recovery faster than other parts of the country. Indeed, some €1.56 billion has been injected into Portugal’s residential markets since the golden visa programme was launched in 2012 and the bulk of this has gone into Lisbon. New apartments are being constructed and historic buildings are being redeveloped to meet modern day occupier demands. The report also points out that Portugal is now emerging from recession and the national economy grew by 1.5% in 2015, and is forecast to grow by a further 1.4% in 2016, just below the Eurozone average of 1.6%. Unemployment now stands at 12%, down from a high of almost 18% in January 2013. As part of its bailout package, Portugal was required to implement structural reforms to improve long term growth, productivity and competitiveness while reducing its deficit. Portuguese companies have increasingly focused efforts to grow their business abroad. This has fuelled exports, which are up 29.3% since 2010. New incentives for inward investment into Portugal’s residential markets were developed, helping to revive the residential sector and one effect of the financial crisis was to foster greater entrepreneurship, and Lisbon has emerged as a centre for tech companies and start-ups. The report explains that historically Portugal’s leasing market was protectionist, pro-tenant and gave little incentive for landlords to enter the market. As a result, Portugal’s home ownership rate is high, with an owner occupation rate of 75%. In 2012, the government introduced reforms to the leasing market, leading to greater flexibility in lease terms and, making the investment market more appealing to investors. This quickly attracted the attention of new developers and institutional investors. Improved market conditions have also fuelled big ticket commercial investment volumes. In total, $1.96 billion (€1.71bn) was invested into Lisbon’s commercial markets in 2015, of which $1bn (€0.87bn) came from the United States. Investors from the UK, Spain, Singapore, Switzerland and Germany, among others, have also been active in the last four years. Portugal launched one of the world’s most successful golden visa schemes in 2012. A minimum investment in real estate of €500,000 grants the non-EU buyer a visa and, in the longer term, a route to an EU passport. Foreigners need only be resident in Portugal for seven days in the first year of residency. By January 2015, the scheme had brought €1.56 billion of new investment into Portugal’s residential markets, the bulk into Lisbon. Some 2,697 golden visa residence permits have been… Continue reading
