Jackson-Stops & Staff, one of the UK’s leading estate agents, has released new information that suggestions as to the reform of stamp duty on second homes, may actually fail to achieve the goal of putting off buy-to-let investors. The information, in effect shows that inflation in housing prices may actually
Despite increasing market prospects for the property sector as a whole, concerns have been raised as the overall affordability of rental properties; this time, not solely within the reputedly-expensive London area. As of present, the majority of private sector landlords have a stated requirement of some four weeks’ worth of
As reported by Lloyds Bank, new data suggested that almost half of those individuals looking to relocate home within the upcoming three years are actually planning to downsize. In fact, beyond being a coincidental factor, downsizing has actually been dubbed the most popular reason for people to choose to move
Recommending that the Crossrail 2 project should move forward to the construction phase as soon as is possible, the National Infrastructure Commission (NIC) has urged for funding to be made accessible as soon as is possible to support the planned development. In line with this, it is also hoped that
Good news for those looking to pursue apprenticeships in the construction industry. Despite already being heralded the “way forward” for construction companies looking to overcome skill shortages within the industry, new figures released by the Federation of Master Builders (FMB) highlight how the opportunity truly does go both ways. The
Landlords are warned to take a closer look a t the upcoming EU Mortgage Credit Directive, the new piece of European Union legislation which, in effect puts a halt to “risky” mortgage lending. And placing an additional emphasis on landlords, the legislation also reassesses the definition of landlord mortgages as
Mixed feelings have been portrayed on the Edinburgh property market’s recent position. While, on the one hand, figures provided by Strutt & Parker have shown that premium property sales have successfully achieved yet another year of growth up to this January, it is also notable that the average sale price
A mixed positive and negative sign in the industry; the number of visits which the HSE has had to inspect over the past year has markedly dropped. Whilst, on the one hand these figures do suggest recognition that construction activities are more regularly incorporating effective health and safety measures (thus
With the present skill shortages oft reported across the construction (and related services) industry, apprenticeships are commonly seen as a way forward for organisations to bring in new blood and train them up to a standard suitable, firstly for their own operations, and secondly for the wider sector where they
It has been reported in a survey by Direct Line for Business that the UK’s yearly property service charge (on average) presently sits at a notable £1,863, with this number rising another 96% specifically for new-build properties, totalling in at £2,777 per year. Additionally it has also been revealed that
Jackson-Stops & Staff, one of the UK’s leading estate agents, has released new information that suggestions as to the reform of stamp duty on second homes, may actually fail to achieve the goal of putting off buy-to-let investors. The information, in effect shows that inflation in housing prices may actually offset the reform changes, and that the 3% surcharge placed on second homes may not yet be enough to actually deter potential investors from seeing buy-to-let investments as optimistic. And while it has been declared that there has been a surge in registrations made for buy-to-let properties up to April, it has also been highlighted that the majority of these investors will see greater returns from the inflation of property prices in the modern recovering housing market (potentially in under a year), thus positioning the 3% surcharge as nothing more than an inconvenience. In fact, Jackson-Stops & Staff has warned that those most affected by the surcharge will actually be tenants who will suffer from increased rental prices as reported previously. This, in effect, will likely deteriorate the market conditions for those looking to break onto the rental market as already previously highlighted, with landlords still seeing optimistic market conditions for at least some time. As explained by Jackson-Stops & Staff’s Chairman, Nick Leeming, the government’s attempts to even the playing field for property investors and first-time buyers, the situations does nothing to remove the spotlight which landlords should be seeing on investments into property as one of the most solid investments to this day. He added: “The idea that stamp duty tax will act as a deterrent is a fiction, as for most landlords it won’t amount to a significant figure.” Of course, with the impacts, once again, hitting the tenants of properties as opposed to the pockets of landlords, the growing debate on the depreciated affordability of rental housing stock is of even greater note. The question, however, is as to whether the government can find an alternative way to dissolve interest in buy-to-let investment in a way which won’t come down on the tenant.
Despite increasing market prospects for the property sector as a whole, concerns have been raised as the overall affordability of rental properties; this time, not solely within the reputedly-expensive London area. As of present, the majority of private sector landlords have a stated requirement of some four weeks’ worth of rent before handing over the keys which, given increases in the average rental price of such properties, is beginning to raise similar concerns of affordability as have been seen in those relating to getting onto the property ladder. In fact, the average rental deposit has been predicted to increase by approximately 40% by 2026, hitting a colossal value of £1,111 which, though seemingly far smaller than the costs of getting onto the property ladder, may put people off approaching the rental ladder, even as a temporary measure. With the average monthly rental deposit then, based off these predictions, sitting at around 70% of the average monthly wage, the difficulty of individuals getting their own property in any shape or form is seemingly on the rise. Yet, there are considerable regional variations in this percentage, as reported by the Centre for Economic and Business Research. In London, where affordability has always been of great concern, it has actually been reported that the average rental deposit may reach up to 120% of the average monthly wage, serving as a stark 99% increase on last year and no-doubt putting concerns in the minds of many individuals looking to move or break away from home. Additionally, research has also highlighted that more and more landlords will expecting deposits to be of closer to six weeks’ worth of rent in the coming times, this then adding to the burden of those looking to get onto the rental ladder. With these growing prices, reduced affordability and barrier to enter onto the rental market, it begs the question how the market will react. Will getting onto the rental market be too much of a burden for some? As the major benefit of rental over purchasing a property lies within the affordability, these changes may very well change the landscape of the rental and property sectors entirely. Only time will tell, however.
As reported by Lloyds Bank, new data suggested that almost half of those individuals looking to relocate home within the upcoming three years are actually planning to downsize. In fact, beyond being a coincidental factor, downsizing has actually been dubbed the most popular reason for people to choose to move house as of present. Encouraged by the anticipated returns of moving to a smaller property, there has been a considerable surge in interest for such moves over the past few years. This, primarily can be attributed to the average windfall which individuals may be in receipt of should they relocate from a detached to semi-detached home. The average age cited for those looking to downsize sits at around the age of 53, where many of the homeowners had previously lived in their property for an extended period of 11-20 years. Of course, with people around this age beginning to consider their future and plans for upcoming retirement in many cases, relocation to a smaller, more cost-efficient property serves as one way for them to prepare as such. Moving to better suit changing circumstances was reported to be the number one reason for moving, followed by a want to reduce bills, free up equity and, as aforementioned, provide extra funds for retirement. This, of course, is further enhanced when considering the traditionally lower costs of heating and powering a smaller property in contrast to a larger, more spacious one. Of those downsizing, some 20% of people stated that they are moving far earlier than they had originally planned, with key reasons such as health, changing relationship status and the provision of amenities in certain geographic areas being key factors of concern. Additionally, geographic affordability also contributed, especially when taking into account the concept of requirement, where relative location for employment opportunities is no longer of prime concern. With almost three quarters of people expecting to make a profit from downsizing, the question begs as to whether property downsizing in the later stages of life will now become the norm for those looking to prepare for retirement, or invest in key financial products – a popular product naturally proving to be pensions.
Recommending that the Crossrail 2 project should move forward to the construction phase as soon as is possible, the National Infrastructure Commission (NIC) has urged for funding to be made accessible as soon as is possible to support the planned development. In line with this, it is also hoped that the submission of a hybrid bill can then be placed in 2019, with the scheme then reaching the completion of construction by 2033. As a stated ambition, Crossrail 2, expected to cost some £32bn, is hoped to offer the city of London a brand new rail artery to effectively to provide a link between the south west and north east network lines. This will see the line operating through a new tunnel between Wimbledon and Tottenham Hale, which will expand the capacity for people to access London city centre by approximately 270,000 in morning peak times. This will effectively take a great deal of the strain presently on the London rail networks off, as well as facilitating extra capacity as a whole. When asked for its opinion on the scheme last year, the National Infrastructure Commission also suggested for the Department for Transport to property identify key proposals in a bid to maximise both the benefits and deliverability of the scheme. As part of this, a number of suggestions were made to reduce the costs of the scheme and improve affordability of it, as well as developing funding strategies and the placement of homes along the route to develop usage of the line itself. Lord Adonis, Chairman of the National Infrastructure Commission commented that: “By the 2030s London will be a megacity of more than 10 million people.” He then highlighted the importance for planning ahead for Crossrail 2 as early as possible as, even when considering planned investment and the addition of the east-west Crossrail line, the impact of reduced infrastructure in comparison to population density and commerce would be undeniable in holding the capital back.
Good news for those looking to pursue apprenticeships in the construction industry. Despite already being heralded the “way forward” for construction companies looking to overcome skill shortages within the industry, new figures released by the Federation of Master Builders (FMB) highlight how the opportunity truly does go both ways. The figures, which form part of research undertaken by the federation for National Apprenticeship Week, showcase that almost 60% of small and medium enterprise owners actually started their career as an apprentice. Even more startling, it was also shown that over 50% of such owners actually managed to break off and start up their construction firm within a mere seven years of completing their apprenticeship; a true builder to business-owner transformation. Not only does this highlight the opportunities available to would-be apprentices should they give it their all, but also provides a welcomed spotlight on how success within the construction industry can be achieved by just about anyone, should they have the willpower and know-how. Brian Berry, Chief Executive of FMB even went as far as to say: “The construction industry is ideally suited to a young person with heaps of ambition and an entrepreneurial spirit.” Nodding to the way in which apprenticeships aren’t necessarily how often perceived, as low entry level into the industry, but actually serve as a springboard for those with the determination to succeed, effectively removing key boundaries to enter into a construction career and allowing such individuals to show their talents. And even for those not specifically looking to become their own boss, Brian Berry explains that, even for those staying in the industry the opportunities are grand, with a bricklayer of just five years’ experience traditionally earning up to £31,000 in many areas of the country, and up to £52,000 in the London area. Perhaps now, both organisation and individual may slowly begin to recognise the opportunities available through apprenticeships in comparison to those from university studies.
Landlords are warned to take a closer look a t the upcoming EU Mortgage Credit Directive, the new piece of European Union legislation which, in effect puts a halt to “risky” mortgage lending. And placing an additional emphasis on landlords, the legislation also reassesses the definition of landlord mortgages as a former of consumer lending, thus bringing down harsher boundaries for receiving mortgages (specifically in cases where they may not be able to afford them). With new affordability checks in place, mortgage lenders will have to ensure that all borrowers can afford repayments, not today, but onto and into the future, taking into account predictions of rate increases of up to six or seven percent. And while this is something which may actually be deemed as common sense, it yet remains something which has been overlooked with regard to landlord mortgages, most specifically because of their classification as not being consumer lending; until now, that is. Additionally, the new regulation will have a particular effect on those remortgaging their properties too, where homeowners looking to consolidate and reduce their monthly payments may actually be told that the rates they would wish to remortgage to (naturally, lower than they are presently paying) are too high and unaffordable to them – a peculiar situation indeed, but one which may see a reduction in remortgaging, putting a little extra strain on those struggling to pay off their mortgages at present rates, yet also potentially encouraging people to take alternative methods of consolidating their outgoings. Most specifically, the change is expected to have a considerable effect on what are known as “accidental landlords”; those who have had no intention of renting out a property they have purchased, but, for a variety of reasons, have decided to do so – likely due to the need for extra income and asset utilisation. Yet, starting in 2017, landlords will no longer be able to claim tax relief on their mortgage repayments and, as opposed to extracting mortgage interest repayments from their taxes, will instead be charged a rate of 20% on the amount. In effect, this could result in taxes actually being paid on losses..
Mixed feelings have been portrayed on the Edinburgh property market’s recent position. While, on the one hand, figures provided by Strutt & Parker have shown that premium property sales have successfully achieved yet another year of growth up to this January, it is also notable that the average sale price of such properties did, in fact, fall markedly. 148 premium properties (of values above £300,000) were reported to be sold in Edinburgh over the course of January, which represented a nice increase from the figures last year, which came in at 131, which also built upon from the previous years of 136 for 2014, and 109 for 2013. In total, some 535 premium properties were sold across Scotland this January, which is a considerable increase from last year’s figures of 494 sales. Again, 5,330 traditional properties valued at less than £300,000 were also sold, which was, again a considerable increase on last year’s figure of 4,144. And while these two increases show an improved market for the purchase and sale of properties, suggesting a buoyant market sector, it has also been reported that the average house value for Scottish properties fell as low as £163,610, a reduction as opposed to last year’s figure of £166,682. In line with the falling value of Scottish properties, the average sale price of premium properties also fell, clocking in a £227,899 this year, as opposed to £236,696 last. Additionally, the share of the market which premium properties made up also fell, from 23.9% to 21.1% specifically. Yet, Strutt and Parker’s Blair Stewart stresses that this is nothing to be worries about, with the price drops only being of a marginal amount, while the considerable increase in the number of sales is very encouraging. Highlighting that the market for premium properties has actually enjoyed sustained growth over the last few years, Blair Stewart went on to comment that, “It has shown strength in the early months of 2016.”
A mixed positive and negative sign in the industry; the number of visits which the HSE has had to inspect over the past year has markedly dropped. Whilst, on the one hand these figures do suggest recognition that construction activities are more regularly incorporating effective health and safety measures (thus not needing as regular monitoring), concerns have also been raised as to the reduced “fear factor” that employers will experience – effectively, pushing them to ensure complete site safety in case of a random, spot inspection. In total, it was reported that the total inspections taken out over the course of 2014/2015 was 9,656, an 8.7% drop from the visits undertaken across 2012/2013. Though this figure might not seem like a drastic drop at first glance, it is also key to factor in the present, and former economic state in which construction companies have been operating. With companies increasingly benefiting from the recently improved economic climate, there has been a markedly improved rate of enquiries and associated projects which should, in theory have suggested an increase in the number of visits undertaken – as opposed to the drop which has been reported. The most significant drop in site visits has been perceived in Scotland, with a 55.7% drop in the number of inspections. This, most aptly can be attributed to the reduced incident rate for non-fatal injuries in Scotland, therefore requiring less site visits to double check on those already performing well. However, the HSE has yet highlighted the fact that, with risks remaining the same across Scotland and England, the same levels of support is available to Scottish construction companies, with the same level of commitment provided across the board. Yet, the big question is how construction companies will take this news and how it will change the safety landscape. On the one hand, should construction companies take the reduced visits as a pat on the back, it is possible that the recognition could drive a continued focus on safety as a key area of best practice, yet, at the same time the scales could fall on the other side, with slackness and an uneasy lack of importance placed upon safety as a result of the reduced visits – only time will tell, of course, but we surely hope for the former.
With the present skill shortages oft reported across the construction (and related services) industry, apprenticeships are commonly seen as a way forward for organisations to bring in new blood and train them up to a standard suitable, firstly for their own operations, and secondly for the wider sector where they may eventually venture out into. In support of this, a new apprenticeships resource pack has been announced to pre-empt celebrations of the benefits which both individuals and employers receive from on-the-job training. Assembled for the build-up to National Apprenticeship Week, the pack, available directly from the Skills Funding Agency, is poised to support organisations in communicating their activities over the course of National Apprenticeship Week – a clear nod to the importance of spreading understanding and awareness as a driver for the sector. In total, the event is expected to see hundreds of different events across England, between the 14th and 18th of March to celebrate apprenticeships and raise awareness, hopefully increasing further the level of interest on both sides of the fence; employer and apprentice. For the 20-14-2015 academic year is has been reported that some 871,000 people undertook funded apprenticeships over the period, sporting the highest values yet reported in the history of the study. This, highlights a keen (and important) interest in the pursuit of apprenticeships both from a career perspective and from the perspective of employers bringing in new blood to solve the skill shortages they are presently facing. With increased workloads also being reported across the industry, it’s certainly a good sign to see, with employers in dire need of addressing the shortage so as best to support the delivery of their service to an ever-expanding client base. Additionally, an additional area of focus is set to be traineeships, which is intended to be a stepping stone up to apprenticeships, encouraging people to get involved in this line of progression yet further. The main aim of such traineeships is, as to be expected, to give individuals the opportunity to undertake work experience and training in advance of an apprenticeship so that they can come better prepared, more confident and more capable to suit the requirements of their future employer.
It has been reported in a survey by Direct Line for Business that the UK’s yearly property service charge (on average) presently sits at a notable £1,863, with this number rising another 96% specifically for new-build properties, totalling in at £2,777 per year. Additionally it has also been revealed that approximately one third of property managers have inflated their service charge rates over the last 48 months, with rates presently varying between £1.55-£7 per sq ft of space. The most shocking of the results of the survey, however, is the highlighting of the fact that the average service rates which leaseholders need to pay for their share of building maintenance actually sits at a value which is greater than two months of the average landlord’s monthly rents (£906). Further to this, additional charges exist, including tax and mortgage payments, agency and management fees, and ground rent fees (on average between £327 and £371 depending on when the property was built). Additionally, it isn’t simply a case of the wide charge differentiation between newer and older properties, but even quite vastly between the nature of specific developments. This can see homeowners paying circa £1.55 per sq ft for a new-build in Croydon this year, yet £7 per sq ft for one in Lambeth next year – a shocking increase in charges. Part of the price differentiation, however, can be attributed to the very nature of what a traditional new-build may incorporate. With new-builds increasingly coming integrated with additional facilities not present in older buildings, there is at least some explanation for the vast property difference. Such additions may include things such as gyms, cinemas, libraries and more which is used to add value to the property for potentially interested investors. Increasingly, service charges are something which landlords are urged to take note of and factor into the longevity of their investment plans. With differentiation in, firstly the different areas which may be incorporated into the charges (such as shared services) as well as the potential for such charges to change rapidly in given cases, monitoring these costs is becoming increasingly integral.