There’s no denying that Brexit has been a divisive issue since the referendum vote of June 2016. And while we don’t formally leave the EU until March 2019, there have been various effects on the economy and, of course, property.
While the initial burst of doom and gloom predictions surrounding the economy didn’t come to fruition, there has been a surge of interest in property around the UK which has boosted regional areas. Continue reading →
Richard Carr, a Poole-based property developer, believes that investment into new housing should be spread fairly across towns, cities and counties in the UK. The Housing and Finance Institute believes more money should be given to councils in districts that are leading the way as they are currently under resourced.
According to the Institute, large cities in the UK receive higher amounts of investment, however they are responsible for only around 30% of new homes.
The HFI’s report found that around 70% of new homes and granted planning permissions are in the district and unitary councils, who are facing resource problems.
Mayor Sadiq Khan is building on his commitment to provide more affordable homes by launching a new tenancy scheme to help renters save money for their home deposit, writes property developer Richard Carr.
London Living Rent
Can the Mayor help improve the housing situation in London?
The London Mayor made making London more affordable to live in one of his commitments when he took over from Boris Johnson earlier this year. The early details of the London Living Rent outline proposals to help average earners in London save for a deposit by offering them a below market rent based a third of average household incomes in each borough.
Although the scheme is in its infancy, Khan has already began discussions with housing associations and boroughs to kick start the delivery of new homes.
On top of his tenancy scheme, the Mayor has also signalled his intention to protect London’s stock of social housing for those on low incomes.
Mayor of London Sadiq Khan has given the green light to plans for the single largest regeneration development site in the capital.
How the new scheme will look fully developed
The 10,000 new homes plan on a 180 hectare brownfield site in Barking will deliver approximately 5,000 affordable properties.
The affordable homes, located on the northern banks of the River Thames, will be available to rent and buy for first time buyers.
Khan is keen to offer more affordable homes in the capital and has agreed a scheme that includes a minimum of 35% affordable from the outset, but with provisions to raise this to 50% over time through additional investment and viability reviews.
Poole-based property developer Richard Carr is annoyed and disappointed to read that developers are being blamed for the country’s housing supply crisis.
Property Developers aren’t to blame for the housing crisis
Richard Carr has been in the industry for three decades and believes the problems start and end with the government and the restrictions that they place on developers, which slow down and prevent properties being built.
However, after analysing recent research independent think-tank Civitas has claimed that councils have granted enough planning consents to meet the government’s target of building one million new homes by 2020.
Civitas’ editorial director, Daniel Bentley, told planningportal.co.uk: “Local authority planning departments have been under enormous pressure in recent years and are frequently blamed by developers for holding up housebuilding.
There has been more good news for the property market this week with new data showing that the number of planning application approvals for new homes in London has increased by 46% on last quarter, writes property developer Richard Carr.
Planning approvals on the rise in the capital
Richard Carr believes this rapid increase shows that there is plenty of confidence in the market at the moment with planners putting more applications in and authorities working quicker and more effectively to get them approved.
If the government are to have any chance of getting the country out of the current housing crisis this has to continue.
In the second quarter of 2016 some 6,310 new homes were approved out of a possible 8,280 applications, an approval rate of 76%, according to the London New Homes Monitor from estate agents Stirling Ackroyd.
The current volatility of the UK’s economy sparked by the country’s decision to leave the European Union last month could provide profitable opportunities to foreign investors, writes Poole-based Richard Carr.
Post Brexit opportunities?
According to a report published by Arcadis, market conditions in the UK are ripe for opportunistic foreign investors by continuing to invest and store their wealth in prime property in London.
With property values stagnating and the sterling falling relative to the euro and the US dollar as a result of Brexit, latest reports suggest that buyers from Europe, Asia and the Middle East and ready to secure bargains in the London prime housing market.
Further falls are forecasted for the sterling before the year is out and some Banks don’t see it recovering until next year. Property agents are also suggesting that the recovery of prime London house prices might take a further year into 2018 meaning that those investing £2m into property may see their investments rise by as much as £250,000 in value.
Richard Carr reviews a new development project, which will look to offer affordable office space in the UK’s most prosperous city.
High office space demand
Does London have affordable office space?
London is the UK’s economic heart with its lucrative finance and technology industries. Figures show that London is one of the largest city-economies in the world, with a gross domestic product (GDP) of £565bn, which is roughly 17% of total UK GDP. Many companies have a base in this prosperous city, making demand for London office space extremely high.
Strong demand has pushed average London office rents to new heights. Prices in premier London commercial locations can be particularly high. According to Business Zone, for instance, the West End has the highest office rental prices in the world, at an average of £100 per square. For many firms, especially smaller enterprises, office space in some parts of London is simply unaffordable.
New figures suggest that one out of every five homes in the UK’s capital city of London is worth at least £1m, writes property developer Richard Carr.
Expensive housing market
London is the UK’s most populous and crowded city. People from around the world flock to London because it is the heart of the UK’s economy, as well as a premier global financial and technology hub. There is an increasingly strong demand for a dwindling supply of living spaces in London, meaning that its average house prices have experienced extraordinary growth in the past few years.
The latest index from the Office for National Statistics (ONS) reports that the average London house price grew by 14.5% in the year to April 2016. The ONS has implemented a new formula to determine its average UK residential property values, so the average London house price is actually lower for April (£470,000) than it was in March under the old system (£552,000). Despite this change, average London residential real estate values continue to hover around the half million mark.