Research from London lettings and estate agent, Benham and Reeves, has revealed that it’s not just London house prices that have climbed considerably in recent times, with the total paid in council tax by London homeowners and tenants hitting almost £5bn a year – £1.2bn more per year compared to just five years.  Last week it was reported that inflation has surged to a 30 year high and with gas and electricity costs set to climb higher yet, the cost of living has become increasingly difficult for many.  Those living in London already face some of the highest house prices and rental values in the nation, with the capital also home to the highest household expenditure and this squeeze on affordability has no different when it comes to the amount of council tax they pay.  Household council tax costs The research by Benham and Reeves shows that the average Londoner pays £1,374 in council tax per year, up 26.8% in the last five years,  Richmond is home to the highest council tax cost per property at £2,065 per year while Southwark has seen the largest increase over the last five years at 36.8%.  Total council tax costs In total, London’s current council tax bill is a huge £4,993,798,878 per year based on the average cost per household and the total number of dwellings across the capital.  Barnet is home to the highest sum of council tax paid on an annual basis, with £258.5m paid across the 146,730 homes in the borough. Croydon is also home to one of the highest total council tax bills at £252m per year, followed by Bromley (£225m), Ealing (£195m) and Lambeth (£1782m).   But it’s not just the increasing cost of council tax per household that is pushing up this total, in the last five years an additional 150,000 homes have been built within London which has contributed to a £1.2bn increase in the total sum of council tax paid across London.  Tower Hamlets has seen the largest annual increase in council tax costs over the last five years, with the total sum paid per year increasing by 48.6%. Southwark (45%), Barking and Dagenham (41.4%), Lewisham (41%) and Croydon (38.9%) are also amongst the boroughs to have seen the largest uplofts in the total sum of council tax paid.  Director of Benham and Reeves, Marc von Grundherr, commented: “Council tax is one of the core costs that many homebuyers fail to consider when looking to buy a home and the sum owed each year can differ drastically depending on where you choose to live.  Much like our home insurance or energy bills, it’s also subject to change and the average London homeowner has seen council tax bill increases squeeze their cost of living by a further £300 a year in the last five years alone. So it’s an important one to consider when it comes to the ongoing affordability of your home, as unlike an expensive phone contract or comprehensive TV package, it can’t be dodged.” Data on council tax costs per dwelling sourced from Gov.uk: Live tables on council tax Data on total dwellings in each borough sourced from Gov.uk: Live tables on dwellingsTotal council tax bill and change based on the current average cost of council tax per dwelling (2021/22) multiplied by the total number of dwellings vs five years previous (2016/17)

Property developers and intermediaries will collectively waste over 14,500 days searching and applying for loans in 2022, predicts development finance comparison site, Brickflow. Brickflow co-founder and head of lending, Ian Humphreys, says while it traditionally takes around 70 hours to search for lenders and complete a development finance application, his tech platform helps users perform the same task in 20 hours or less. Ian estimates developers and intermediaries spend nearly a third of their time searching for development finance; Brickflow uses algorithms, searching over 120 data points across 36 lenders, presenting finance options within two minutes. Developers are able to choose their preferable lending options, use online onboarding tools and access expert help, where necessary, to complete applications which can be sent to up to five lenders in the deal forum’ (similar to a competitive tender). Conversion rate from Heads of Terms to completion is over 90%. Ian comments: “Development finance lending topped £9.3 billion in 2020 and if we assume an average loan figure is £4 million, it equates to 2,325 development finance applications taking 50 hours longer than necessary. When you divide this by an 8 hour day, it’s a staggering loss of time. “Add to this the frustration of nearly one in three SME house builders citing a lack of finance as one of the biggest barriers to progressing projects and it’s clear Brickflow is a no-brainer.” He concludes: “According to YouGov research, saving money and spending more time with the family are popular New Year’s resolutions for Brits so I’m pleased we can help people achieve this.”

This month Andrea Fawell, Sales & Marketing Director of award-winning property developers Kebbell, gives us a very honest account of the market factors that are likely to affect house buyers and housebuilders in 2022. What are the biggest factors impacting the property market at the moment? The long term impacts of problems with the global supply chain and the availability of materials and labour means it is increasingly difficult to build to a normal time scale and I can’t see that changing for a while. Brexit has meant the loss of many European site workers in particular, there is a huge HGV driver shortage and the costs of container ships bringing materials and finished items in has dramatically increased. Procurement departments are desperately trying to get materials to finish off homes. There is also not enough stock on the secondhand market. We are hoping that people can have the Christmas they didn’t have last year and will then put their house on the market because until there is more secondhand stock there is almost an over demand for new homes which is a funny thing for a housebuilder to be saying! Prices are not currently changing but developer’s margins are being squeezed with a 15-40% increase in costs of materials. There are roughly six month delays at some of our developments, but for some developers I understand there are delays of 12-18 months. Supply is simply not able to meet demand, even more so having had such a buoyant market post lockdown. All these factors are having a huge impact on deliverability and the cost of building. Timescales are stretching beyond what can be programmed for, so it comes down to managing expectations of the delivery of new homes. How is the current market for new home-buyers? It is a very difficult time for home-buyers. I have been in the industry for 36 years and I have never seen anything like it. People are committed to buying and to moving home, intensified by the pandemic, but developers simply can’t deliver to normal timelines or even promise when they will definitely be able to deliver because of all of the shortages. Homebuyers are still reserving anyway! Purchasers are frustrated but grateful that we are being so transparent and up front about the market problems. We are constantly looking for solutions and alternatives and we are keeping buyers in the picture with what is happening. Last week we had tiles stuck in a Liverpool port and further supplies stuck in Felixstowe. Neither port had the staff to get the tiles off the containers and there weren’t any lorry drivers to get those materials to site. We sent a van to Liverpool to retrieve the tiles and when they arrived, they were all broken. The purchasers had to choose a different tile that was available. We are in this together. By having a collaborative approach homebuyers trust and work with us but it is a huge upheaval in their lives with many having to go into temporary accommodation whilst developers wait for the right parts to come in. Once they put their own homes on the market, in their heads they have already moved out. Are there any landmark trends or announcements coming up in the industry in 2022? The new Deposit Unlock scheme which has piloted for over a year will start to be a consideration, especially as this will be the last year of the Help to Buy scheme which ends in March 2023. I think part exchange will be increasingly attractive as it means you can stay in your house until the new home is ready for you which is the solution to the delays being seen across the industry. Assisted Move, will continue to help new home buyers sell their property and developers pay the agents fees if they want to sell their house in the shortest time possible. How are housebuilders tackling sustainability? In preparation for my trek across the North Pole in April 2022, I recently went on a trip to stand on Europe’s biggest glacier in Iceland and I was blown away by the impact of climate change. We need to be all over this as an industry and championing sustainability, heightening awareness and being mindful of green credentials and what we need to do to play our part. Small changes add up. We don’t put in wood-burning stoves because it has an unnecessary carbon footprint. We work very closely with sustainability consultants across all disciplines from looking at what is going into our skips to sourcing the best ground source heat pumps, but it is hugely complex, there are no easy solutions and there is a lot of work to still be done as an industry. We face a lot of difficult conundrums about sustainability. For example, will existing homeowners be able to afford and physically put in air source and ground source pumps in their current homes? It is easier for new builds to have these planned in but whilst we are trying to future proof, the technology is moving so fast it is hard to keep up. Our commitment is everyone will have a car charging point or an ability to fit a car charger but in Norway wireless chargers are being piloted so in say two years’ time will we charge our cars wirelessly in which case will car charger ports be obsolete? Or is the future actually hydrogen powered cars? The industry can and must do better, but it is far from easy. Are off-plan sales growing? The nature of our developments next year means we are able to offer off-plan sales for our new developments; Milestones, an 18 luxury apartment development in Ascot and Meadow Court in Iver which comprises 39 two and three bedroom apartments. As a result, we are prioritising sophisticated online marketing tools such as html experiences, interactive screens for colour choices, and many more. We are investing in the online experience that we think will

Almost a third (30%) of credit managers ‘guess’ their bad debt reserve requirement  Less than one in ten (9%) are given any steer/model by their auditors  Construction businesses seeking to take the guesswork out of bad debt provision at Financial Year End could benefit from a new free service being provided by Debt Register, a global payment accelerator. Or, businesses can use an individual involuntary arrangement to help them seek financial stability and freedom. Loading a company’s five largest outstanding debts onto the automated Debt Register collections platform, with a very high chance of collecting those debts, could significantly improve the accuracy of bad debt provision. This will in turn improve the visibility and accuracy of a company’s true financial position and its bottom line, with all the inherent advantages this brings in terms of access to future lending and credit.  The proposal follows research that suggests that almost a third (30%) of credit management professionals guess at a figure when assessing the level of bad debt reserve they require at Year End, while less than one in ten (9%) are able to look to any financial model provided by their auditors. More than a third (35%) opt for generic, age-based percentages to arrive at a figure while a quarter (26%) look to their experience of similar debt.  Gary Brown, Founder of Debt Register, believes the survey proves what he has long thought: that the current process of providing for bad debts is invariably guesswork: “Speaking to firms and accountants, many companies have no clear picture of how collectable or otherwise certain debts are, and make provision simply by taking a best guess,” he says.   “By passing the five oldest or longest-standing debts through our platform, however, there is a very real chance that those debts will be settled. This means the actual bad debt figure being provided for will be more accurate. because there would be no need to reserve for those invoices at all.  “Indeed, even if the money is not collected, then that also helps takes the guesswork out of the process and gives the company and the auditor something more tangible to refer to than a vague model. Either way, Debt Register gives companies a tool that supports a more accurate financial position.”  Real case scenarios with current Debt Register clients have already proven the point and the age of the debt appears not to be a barrier to its collectability. One customer uploaded a debt that was 888 days overdue, and the debt was settled in 27 hours. In a more remarkable example, an uploaded debt that was 1499 days overdue was paid within 45 minutes.   Debt Register is, first and foremost, a global payment accelerator that enables a business to identify late invoices on their ledger and allow the platform to do the rest. This includes validating the customer contact’s email against a database of some 90 billion addresses to a 93% degree of accuracy. The platform contacts the debtor automatically and in the appropriate language, requesting that the payment is settled, and ensuring the invoice is correct and not in dispute.   By leveraging its relationships with leading credit reference agencies (CRAs) to report unpaid and overdue debts, debtors are encouraged to settle any overdues promptly to avoid their credit scores being negatively impacted. In short – there is now a tangible and direct consequence for those companies should they continue not to pay an undisputed, overdue invoice.  Along with shortening the timeframe of remittance, Debt Register provides a series of tools to credit managers including auto-translation for use within multiple territories. The system is intelligent, recognising different time zones, working days and cultural nuances including national holidays or religious festivals, and schedules the dispatch of any communications accordingly.  To date it has successfully recovered debts in 71 different countries and six out of the seven continents   “Using the free service means a business has nothing to lose and everything to gain,” Gary concludes, “and converts a guess into something closer to the truth.”  For a free trial, go to: https://debtregister.com/freetrial/ 

The UK’s largest British designer and manufacturer of premium radiators and towel warmers, Vogue (UK), look ahead with renewed enthusiasm as new development opportunities are expected following investment by Kartell UK, one of the largest and fastest-growing suppliers of heating and bathroom products to the independent merchant and showroom sector in the UK.  “Vogue is something I am very proud of, offering a renowned history which has been developed by a highly skilled and knowledgeable workforce over the last 30 years. In this post-pandemic environment, I am confident the investment from Alex and Kartell will enable future growth and secure an exciting future for Vogue, all its staff and the Kartell Group,” explains Raymond Tunks, one of the founders. Kartell’s investment in Vogue (UK) will support further growth across the UK and internationally, adding to the market presence Vogue already has in the US, as well as enable a more comprehensive range of products and services to be offered by both brands. “When the opportunity to partner with the team at Vogue arose we immediately identified the strategic fit this acquisition represents and we are delighted to announce the deal. Everyone at Kartell is excited about working with Ray, Rob and the team at Vogue to address the multiple market opportunities in the UK, Europe and International export markets. Our shared focus of best-in-class quality and service will bring added value to all of the group’s customers and stakeholders,” says Alex Norford, CEO of Kartell. Vogue (UK) will continue to operate autonomously, remaining a stand-alone manufacturing and design business within the Kartell group under the guidance of the existing, highly experienced management team. This will all be supported by ongoing integration and leadership support from the founders of Vogue (UK), Raymond Tunks and Rob Kelley, respectively. “Vogue’s success can be attributed to the continual endeavour to provide the best in class service and high quality products to our markets and customers. We wanted to find the ideal home for the business to complement and accelerate the work we have done as a team over the last 30 years and believe that Alex and the wider Kartell group are the right people to take Vogue forward,” adds Robert Kelley. Vogue (UK) is the UK’s leading designer and manufacturer of quality towel warmers, designer radiators and heating accessories, with market leading eco-credentials since 1990 and here’s to the next 30 years!