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Research shows over 35,000 high end home to be built in London in next decade
Over 35,000 prime homes are set to be built in London over the next decade, a rise of 40% compared to 2014, new research shows. The combined sales value of these properties is estimated at over £77 billion, and when combined the total floor space of these homes comes in at over 40 million square feet, far greater than the area of the whole of the City of London at 30.7 million square feet. These new homes, well out of the affordable range, will be built on 196 sites that span the breadth of the city, according to a report from global design and consultancy firm for natural and built assets Arcadis. It says that this ‘significant growth’ on the previous year demonstrates the extent to which the capital’s high end residential market is still viewed favourably in spite of the rapidly evolving UK housing market. The report also says that rising construction costs and growing land values have seen input costs rise, while a softening in demand due to successive stamp duty reform combined with economic slowdown in countries such as China has seen buyer interest ease. As a consequence, some investors may eventually reposition these assets away from prime housing and into premium office space, mixed use or even a greater number of smaller homes as they look to markets that offer a greater margin, it suggests. In terms of location, it is Chelsea and Fulham that have seen the greatest level of investment, followed by the Southbank and around the City, and the report says that this is evidence that the prime London property market is not confined to the West End but is now widely diffused across the capital. Some 10,914 homes are due to be built in Chelsea and Fulham, followed by 8,863 in Southbank, 5,898 in City and Fringe, 1,960 in Victoria and Pimlico, 1,754 in Midtown, 1,600 in Docklands, 1,104 in Kensington, 933 in Bayswater and Paddington, 589 in Mayfair and 427 in St John’s Wood. The total sales value of the homes to be built in Chelsea and Fulham is estimated at £20 billion, in City and Fringe at £7.3 billion, in Mayfair at £6 billion, in Belgravia at 5.6 billion, in Victoria and Pimlico at £5.1 billion, in Midtown at £4.7 billion, in St John’s Wood at £4 billion, in Kensington at 3.7 billion and in Knightsbridge at £2.4 billion. ‘Since around 2009, the value of prime residential property in central London has seen dramatic rises, making it one of the hottest markets in recent memory. So, it is hardly surprising that we have seen ongoing interest from investors all over the world,’ said Mark Cleverly, Arcadis head of commercial development. ‘What is interesting, though, is the continuous geographical spread we are seeing. Prime housing is springing up around regeneration areas and on the outskirts of the financial district, suggesting the days of the West End… Continue reading
Irish property market recovery leads to boost in planning applications granted
In yet another sign that the residential property market in Ireland is recovering, planning permission for new dwellings increased by over 95% in the final quarter of 2015. The data from the Central Statistics Office show 4,017 applications were permitted compared with 2,057 units for the same period in 2014, an increase of 95.3%. A breakdown of the figures shows that the permissions were granted for 2,754 houses in the fourth quarter of 2015 and 1,905 in the fourth quarter of 2014, an increase of 44.6%. In terms of apartments some 1,263 units were granted compared with 152 units for the same period in 2014, an increase of 730.9%. One off houses accounted for 22.7% of all new planning permissions granted in the final quarter of 2015, the data also shows. The total number of planning permissions granted for all developments was 4,470. This compares with 3,504 in the fourth quarter of 2014, an increase of 27.6%. Total floor area planned was 1,468 thousand square metres in the fourth quarter of 2015. Of this some 40.9% was for new dwellings, 46.8% for other new constructions and 12.3% for extensions. The total floor area planned increased by 94.7% in comparison with the same quarter in 2014. Planning Permissions for new buildings for Agriculture increased to 420 on the quarter compared to 165 permissions in the same quarter of 2014. Continue reading
Poll reveals pensioners with buy to let worried about tax change
Almost three quarters of pensioners in the UK who have an investment property said they would struggle to make ends meet if they didn’t have the income from their buy to let, new research shows. Overall 72% would struggle and 81% of those aged over 65 said that their properties provide an important, even vital, boost to their retirement income, according to a poll carried out by Responsible Equity Release. The poll also found that 92% are worried about the changes to mortgage interest tax relief and the impact on the profit they make from their investment property. The buy to let tax changes coming into force have left many pensioner landlords considering whether it’s worth holding onto their property and 41% said although their buy to let property was a valuable income generator, they are now thinking seriously about selling it. ‘For many pensioners, having a buy to let property has been a life saver in this low interest environment. While their savings have languished, earning very little interest, and pension income has been hit hard by falling share prices, property income has remained strong,’ said Steve Wilkie, managing director at Responsible Equity Release. ‘Without the income boost from their buy to let, many would really be struggling to make ends meet. But the Chancellor has yet again ignored UK’s retirees when he announced changes to the way buy to let would be taxed,’ he pointed out. ‘George Osborne was so focused on taxing the rich, he forgot that a new tax on buy to let won’t just hit the wealthy, it will also hit those honest, hardworking people, who may have a single buy to let property and were just hoping it would earn them a little extra income in retirement,’ he added. Continue reading
