How will leaving the EU affect the property industry?

With the UK voting to leave the European Union the debate has started on how cutting ties with the EU will affect differing industries. Richard Carr has been in the property market for over 30 years and has looked at the pros and cons.

Pros of leaving the EU

  • Reduction in red tape for builders
  • Increase in opportunities for UK workers
  • Reduction in regulation
  • No EU constraints

Cons of leaving the EU

  • Many construction workers are from the EU
  • Potential skills crisis

Outlook

Richard Carr image of Leeds

What affect will Brexit have upon the property market?

On the face of it, if the government can ensure that migrant workers are still able to work in the UK and they also provide extra funding to get British people into workforces then the industry willflourish.

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Construction industry defies EU referendum uncertainty

Fears that the uncertainty created by EU referendum could negatively affect markets in the UK was dispelled by the construction industry which was an almost 8% rise in contracts during May, writes Property Developer Richard Carr.

Projects

China 57-story skyscraper

Construction industry maintains strengh

According to Barbour ABI, £6.1bn worth of new contracts were awarded during May, which is 8% higher than the same month last year. The number of construction projects agreed in the UK was also over 10% higher than the same time 12 months ago.

Scotland led the way in terms of contracts awarded, with its Beatrice offshore wind farm project in the Moray Firth valued at £1.3bn.

London followed closely behind with its largest project being the £325.8m project with the Canary Wharf Group to build new office building Ten Bank Street.

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Is the government’s £1m new homes by 2020 target achievable?

The government pledged in the recent Housing and Planning Bill that it would build a million new homes by 2020, a target that property developer Richard Carr felt was slightly ambitious.

Achievable

Richard Carr 200,000 homes image

Is the government’s target achievable?

However, land agent Aston Mead has hit back at doubters claiming that the target is based on current figures and is a reality.

In contrast, a recent survey of owner and directors of 389 house builders across England found that a small majority (51%) thought that the target would not be met.

Current output of homes is increasing rapidly, with build rates on large sites doubling since 2010. There were more than 180,000 new homes delivered in 2014/2015, with this year’s figure expected to be higher still.

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Richard Carr supports councils’ calls for the government to provide more affordable homes

96% of local councils in the United Kingdom have claimed that their need for affordable housing is severe or moderate and have called upon the government to do more to tackle affordable housing prices, writes property developer Richard Carr.

Action

Richard Carr's affordable housing

Affordable Homes

The Association for Public Service Excellent (APSE) and the Town and Country Planning Association (TCPA) have published a report calling for urgent government action to deliver the homes needed in the UK.

The report reveals:

  • 72% of councils think the National Planning Police Framework (NPPF) hinders building of affordable housing
  • 96% of councils say that their need for affordable housing is severe or moderate
  • 7% think starter homes will help address affordable housing

“With 96% of councils describing their need for affordable homes as severe or moderate, and 89% worried that the extension of Right to Buy will lead to less affordable homes, it is clear that there is a real crisis,” Kate Henderson, chief executive of the TCPA, told propertywire.com.

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Is the government using property to warn people off Brexit?

Poole-based Property Developer Richard Carr believes that the government is using the property industry as a tool to sway UK residents into staying in the European Union.

Vote in?

Richard Carr image of Leeds

Are the government right to use property in their Brexit argument?

Richard Carr believes that the property industry and the country’s economy as a whole would benefit from leaving the European Union.

However, he understands that there are pros and cons to the argument.

He’s disappointed by the government’s current tactics though, which are currently based around the property market and the effects leaving the European Union would have upon it.

According to the Chancellor of the Exchequer George Osborne leaving the EU would see house prices hit significantly and make mortgages far more expensive.

Speaking on ITV’s Peston on Sunday Politics he revealed that the Treasury is set to release an important piece of research into how Brexit would affect the UK economy and specifically the real estate market.

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Government pulls 50% of funding for Planning Advisory Service

The Department for Communities and Local Government (DCLG) have added extra pain on the planning system by reducing its annual government grant to the Planning Advisory Service (PAS) by half, writes property developer Richard Carr.

Cuts

Richard Carr planning policy image

The PAS is set to be hit by 50% cuts

The Planning Resource revealed earlier this week that the Local Government Association, which runs PAS, received a letter from Planning Minister Brandon Lewis explaining the changes to the funding. As a result, the DCLG has reduced its funding by 50%, which means that PAS will along receive £1m in government grants.

According to Planning Resource, the reduction is a knock-on effect of the substantial reduction the DCLG’s resource budget from 2016/17 onwards.

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MPs support increase in planning fees

A poll conducted by the British Property Federation (BPF) has found that they majority of UK parliamentarians support a rise in planning fees to help under resourced local planning authorities.

Increases

Richard Carr Planning Permission

Planning fees set to rise

61% of MPs agreed that fees should increase, whilst 47% say they should increase but with stronger guarantees on planning performance. The feeling was supported by the country’s two main political parties. Labour MPs voted in favour by 65% and the Conservative’s by 61%.

In a survey conducted by the BPF and GL Hearn in 2015, 55% of local planning authorities cited under resourcing as a major challenge, whilst 65% of applicants said they would be happy to pay extra to reduced waiting times.

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Is the first timber frame skyscraper set to be built in London?

Plans to build the capital’s first timber skyscraper took a step closer to reality earlier this month after researchers presented Mayor of London Boris Johnson with theoretical plans for an 80-storey building.

New heights

Richard Carr Timber Frame London

An architects image of the 80-storey building

Property developer Richard Carr is pleased to see the UK leading the way in new construction techniques, having felt that it had been left behind by the likes of China and Dubai.

Currently, Bergen, Norway is the home of the world’s largest tallest timber building, which is a 14-storey apartment block.

The plans shown to Boris Johnson are for an 80-storey, 300m high wooden building, which would easily take that title!

Researchers from Cambridge University have teamed up with a group of engineers and architects to develop the plans for the building, which would integrate with the Barbican.

The building certainly does push the boundaries of construction and if the plans are approved it would become the second tallest building in London after The Shard.

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Recruitment website launched to aid construction industry

Finding skilled workers has proven a major stumbling block for construction firms over the last couple of years, which has been a factor in the industry’s lack of growth.

Website

Richard Carr Construction Lack of workers

Website launched to aid construction worker employment

Property developer Richard Carr has called on the government to do more to help attract men and women into the industry, claiming a growing construction sector is hugely important for the economy.

A fund has been set up to help train new workers and now a recruitment website has been launched to help construction firms find tradesman through an app and web-based service.

Nationaltradesmen.co.uk acts in two ways; firstly it will allow operatives to search jobs and apply and secondly it will allow companies to find tradesman with specific skillsets.

The website has been built by tradesmen for tradesmen acting as a middle man for workers and employers for building sites and large construction projects.

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Could women help fill the skills gap in the construction industry?

The skills gap in the construction has been widening over the past couple of years as the industry struggles with little help from the government to attract new workers.

Women

Richard Carr pleased to see more women in the construction industry

Richard Carr is pleased to see an increase of women in the construction industry

An interesting article was published in the Daily Express last month which suggested that women could be the answer to filling the dire skills gap.

UK apprenticeships have enjoyed a huge growth spurt over the past five years, rising by 57%. However, this rise hasn’t helped the construction industry, in fact construction apprenticeships have fallen by almost a quarter with females making up just 1.7%.

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