Popular Help to Buy scheme scraped by the government

185,000 UK home owners had benefitted from government Help to Buy schemes, which will now be scrapped by the end of 2016, writes property developer Richard Carr.

Prices

richard-carr-first-time-buyers-help-to-buy

How will scrapping the Help to Buy scheme effect first time buyers?

Despite the schemes proving popular amongst first time buyers, the initiatives haven’t helped solve the country’s growing housing crisis, which the new government led by Theresa May are keen to do.

According to one estate agent emoov.co.uk, the average house prices across half of the country’s 326 districts will exceed the Help to Buy threshold by March next year.

As a result, Chancellor Philip Hammond confirmed that the scheme will close to new mortgages on 31st December 2016.

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UK Rents Rise Significantly in July 2016

New figures indicate that average British residential property rental values rose significantly within the year to July 2016.

Renter’s culture

Many Britons are finding it increasingly hard to step onto the property ladder. According to Letting Agent Today, Tony Williams of property consultancy Building Value recently noted that at present, “the house price to earnings ratio remains around 5.5 times against a long term average of 4.25 times.”

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Strong Fundamentals to Support UK Property Growth

Previous research shows that despite Brexit, the UK’s housing market remained strong in June 2016. A new study from CBRE, a leading commercial property adviser, indicates that sturdy economic fundamentals will support British house price growth throughout 2016.

Encouraging price growth

Property Wire writes that CBRE sees current British house value growth of 5.1% as encouraging. The commercial property adviser added that UK residential property prices should expand by an average of 3% in 2016. In the second quarter of 2016, house price growth was strongest in the Outer Metropolitan area (12.4%) and London (9.9%), but weakest in the North (1%), year-on-year.

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The country needs a stable planning system

The majority of property planners believe that a more stable planning system would provide greater certainty for developers and communities and help get the country building again.

Changes

According to recent research from the Royal Town Planning Institute (RTPI) an overwhelming majority of planners blame decades of planning changes for their ability to work effectively and deliver new homes.

The Delivering the Value of Planning report showed that a massive 73% of planners believe “constant changes” to planning rules have “hindered their ability to deliver good places”. Richard Carr, a property developer in the south of England, understands the problems and believes the government needs to loosen its grip on the system and make it easier for planners to deliver new developments.

Over half of respondents said that government policy changes had provided obstacles to the delivery of new homes, whilst almost 75% said that the profession had a reduced capacity to deliver.

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Who is to blame for the UK’s housing crisis?

The finger has been pointed at many possible reasons, but who or what is responsible for the current state of the country’s housing shortage?

Planning

Richard Carr New Build Homes

Who is to blame for the housing shortage?

Poole-based property developer Richard Carr has worked in the industry for 30 years and has seen just about everything. He’s currently managing a number of high profile developments in the south of England including the £100m redevelopment of Salterns Marina in Poole.

New analysis produced by the London School of Economics has pointed the finger squarely at the government for the housing crisis, explaining that decades of planning policies that constrain the supply of houses and land and turn them into something like gold is to blame.

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Could the private and public sector team up to improve the UK’s housing market?

The Royal Institute of British Architects (RIBS) believes that the private and public sector could work in harmony to improve the current situation of the country’s housing sector.

Quality

Richard Carr new housing developments

Private & Public sector – a winning partnership?

RIBS believes that housing policy along isn’t enough to solve the UK’s problem as the demand for homes continues to outstrip the supply. They believe that as one the private and public sector can promote, enable and finance new homes and improve the final quality.

Along with the crippling shortage of homes, homebuilders have come under pressure for the standard to which new homes are being produced.

RIBS’ report said that high quality design needs to be at the heart of the solution: “Without it, we’ll be solving one problem by storing up further challenges for the future,” they said.

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Could Community Infrastructure Levy be paid directly to residents?

New PM Theresa May is believed to be considering paying Community Infrastructure Levy (CIL) directly to local residents in a bid to gain support for new developments, writes property developer Richard Carr.

Shale Gas

Richard Carr CIL

Is CIL damaging house building?

The news comes after she announced proposals for cash from a scheme to share the proceeds of shale gas revenues to be handed straight to households.

The move is a step away from the first announcement in last year’s Autumn Statement when it was understood that shale revenues would go to community trusts and local authorities.

But Number 10 said that the new government has “changed the consultation to ensure a greater focus on control for local communities – including insisting on proposals to transfer funds directly to households rather than local authorities”.

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Planning application approvals on the up in London

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.

Momentum

Richard Carr London Homes

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.

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Has Brexit created investment opportunities in UK farm land?

Real Estate firm Savills believes that the UK’s decision to leave the European Union has potentially opened up profitable opportunities for overseas investors, writes property development expert Richard Carr.

Farm land

Richard Carr Farm LandAlthough Brexit created some uncertainty for farm land values in the UK, Savills believes that the weak pound creates a favourable buying environment for overseas investors, whilst the reduction of supply may help to support values.

“The full impact of Brexit on all of the UK’s property markets will be very dependent on the macroeconomic background and the evolution of the story over the next two to three years. We must stress it is early days and there are many unknowns,” said Ian Bailey, head of rural research at Savills.

“Uncertainty is the key factor and it is very likely that farmland market activity in the second half of this year will be more subdued as potential sellers wait and see. Our research shows just over 100,000 acres were publicly marketed across Great Britain in the first half of 2016, which was on a par with activity for the same period of 2015.”

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