Real estate debt advisory specialists, Sirius Property Finance, has revealed that land plots account for just 1.4% of current for sale stock listed on the market and demand is high, with 55% of these already being snapped up by developers. As part of the most recent Budget statement, Chancellor Rishi
Managing Director of Barrows and Forrester, James Forrester, commented: “It’s to be expected that the astronomic rates of house price growth seen since the introduction of the stamp duty holiday will now start to subside as we approach the final deadline. But don’t be fooled into thinking the market will now
The latest research from Warwick Estates, has revealed which new-build features are currently the most in-demand amongst new-build homebuyers in the current market. Warwick Estates analysed current new-build stock listed on the market and which features offered across these properties were most in demand based on the number of homes
For property managers working in the UK rental market, times have changed dramatically since the pandemic hit hard. But, the good news is that many of the emerging trends are proving beneficial to the market. Demand for rental properties up Strong demand for rental properties has continued with economic uncertainty
Russell Quirk the Chief Executive Officer of property agency eMoov has released a few things to say regarding the current state of the housing market, which is apparently seeing homes in the country rise in value more slowly than they were before, suggesting that some form of stability seems to
Until relatively recently there was really only one way to sell your home – via a high street estate agent. A convoluted and sometimes frustrating system that also can be costly, in hindsight it was perhaps no surprise that online agents and latterly private sellers would have such easy pickings in
BDC 319 : Aug 2024
Real estate debt advisory specialists, Sirius Property Finance, has revealed that land plots account for just 1.4% of current for sale stock listed on the market and demand is high, with 55% of these already being snapped up by developers. As part of the most recent Budget statement, Chancellor Rishi Sunak announced £1.8 billion of government money to help fund the regeneration of brownfield land up and down the country as part of a mission to satisfy the ever-intensifying need for new homes. The research by Sirius Property Finance shows that the need for these additional land plots is clear, as current levels account for a very small proportion of overall residential sales listings. The research shows that across Britain there are some 677,533 residential property opportunities listed on the current market, with just shy of 10,000 of these coming in the form of land plots available for development – just 1.4% of the total market. What’s more, 55% of these plots have already gone under offer or sold subject to contract. Swansea is home to the highest level of land plot availability, accounting for 1.9% of current residential listings. Aberdeen (1%) and Bradford (1%) are the only other major cities where land plots account for at least one per cent of the current market. While land plot availability may be scarce, demand is high. In Bournemouth, 77% of all land plots listed on the market have already been marked as under offer or sold subject to contract, while Bristol (68%), Newcastle (67%), Cardiff (60%), Edinburgh (57%) and Nottingham (57%), are also home to above average levels of demand. Managing Director of Sirius Property Finance, Nicholas Christofi, commented: “Land plots currently account for a minute proportion of available property purchasing opportunities but the appetite for these plots is clear, with more than half of those listed already being snapped up across the nation. We need more homes and we need them quickly. Opening up the nation’s brownfield is just one step in addressing this shortage and while it will utilise land that has otherwise been overlooked for quite some time, it certainly won’t solve the problem in its entirety.” Table shows the availability of land plots as a percentage of all for sale stock in each area, as well as demand based on the percentage of land plots that are already sold subject to contract or under offer Location Land Plot Availability Land Plot Buyer Demand Swansea 1.9% 30.0% Aberdeen 1.0% 14.3% Bradford 1.0% 41.7% Nottingham 0.9% 56.9% Glasgow 0.7% 46.7% Plymouth 0.6% 52.6% Liverpool 0.5% 37.5% Sheffield 0.5% 40.9% Cardiff 0.4% 60.0% Sunderland 0.4% 33.3% Bristol 0.4% 67.9% Southampton 0.4% 41.7% Bournemouth 0.4% 76.9% Cambridge 0.3% 25.0% Leeds 0.3% 50.0% Oxford 0.3% 50.0% Newcastle 0.3% 66.7% Edinburgh 0.2% 57.1% Leicester 0.2% 37.5% Birmingham 0.2% 53.3% Manchester 0.2% 50.0% London 0.1% 34.0% Portsmouth 0.0% 0.0% Great Britain 1.4% 55.2% Source – Rightmove
Managing Director of Barrows and Forrester, James Forrester, commented: “It’s to be expected that the astronomic rates of house price growth seen since the introduction of the stamp duty holiday will now start to subside as we approach the final deadline. But don’t be fooled into thinking the market will now deflate like a cheap birthday balloon. Buyer demand is extremely high and property prices will remain robust, largely driven by second and third rung buyers upgrading to larger, higher-value homes.” Director of Benham and Reeves, Marc von Grundherr, commented: “We’re heading into an extremely busy period where the property market is concerned and so the expiry of the stamp duty holiday and its impact on the market is going to be far less pronounced than first feared. With the stamp duty holiday causing manic market conditions and long delays to transaction times, many homesellers and buyers chose to retreat until the rush had subsided, having long given up hope of a stamp duty saving. However, we will now start to see them emerge from their boltholes and this additional stock will help rejuvenate the market throughout the remainder of the year. The London market, in particular, is poised for a strong finish with an abundance of stock now available and a sharp uplift in domestic and foreign demand being driven by pandemic restriction lifting both where the workplace and travel are concerned.” Founder and CEO of GetAgent.co.uk, Colby Short, commented: “It’s fair to say that the process of selling first to improve your buying position has long been a tactic utilised by UK homebuyers and so we’re not seeing the ‘rise of the power buyer’ as such. That said, a high level of competition for a limited level of stock has highlighted the importance of a strong buying position when it comes to securing your ideal home. Unfortunately for the nation’s first-time buyers, those with an existing property to fund their onward purchase are in a far stronger position when it comes to placing an offer and this has pushed up the cost of buying quite considerably. As a result, those looking to buy their first home are now paying 12% more compared to just 12 months ago. However, the cost of borrowing remains very favourable and given current market delays, some sellers will place the stronger position of a first-time buyer above that of a few thousand pounds extra.”
The latest research from Warwick Estates, has revealed which new-build features are currently the most in-demand amongst new-build homebuyers in the current market. Warwick Estates analysed current new-build stock listed on the market and which features offered across these properties were most in demand based on the number of homes already under offer or sold subject to contract as a percentage of all available stock. UK new-build buyer demand Across the UK, there are currently 51,282 new-build properties listed for sale. With 18,095 already sold, demand for new-build homes currently sits at 35.3%. Most in-demand new-build property type Despite pandemic lockdown restrictions causing heightened demand for detached homes offering more space, the research by Warwick Estates shows that it’s terraced homes that are currently most in demand. 45.5% of all terraced home new-builds have already gone under offer or sold subject to contract, with the second most in-demand new-build property type being semi-detached (44.7%). Most sought after property features When studying the most in-demand property features for new-build buyers in the UK, Warwick Estates has discovered that affiliated buying schemes are what buyers want most. 42% of new-build homes providing the additional help of a buying scheme have already been snapped up across the UK market. Parking spaces are also in high demand. 39.6% of new-builds offering this feature have already been sold, with garden space also remaining popular with demand at 37.2%. COO of Warwick Estates, Bethan Griffiths, commented: “New-build homes remain a popular choice amongst many homebuyers and it’s not just flats that are proving popular, with the sector also satisfying the pandemic uplift in demand for larger homes. Of course, a new-build home naturally carries a price premium when compared to existing housing stock and, with the stamp duty holiday causing a house price boom, it’s no surprise that demand is high for homes offering the additional help of a buying scheme. Above and beyond this financial incentive, buyers continue to value homes with garden space having spent months in lockdown, as well as the more traditional feature of a parking space.” Table shows UK sales demand % for new-build and existing properties Category Demand Existing properties (excl NB) 67.2% New-build properties 35.3% Source – Rightmove Table shows demand for types of new property in the UK Category Demand New-build – Terraced 45.5% New-build – Semi detached 44.7% New-build – Detached 36.9% New-build – Flat 27.0% Source – Rightmove Table shows most in-demand features for UK new-build homes Category Demand Buying scheme eligible 42.0% Parking 39.6% Garden 37.2% Source – Rightmove
For property managers working in the UK rental market, times have changed dramatically since the pandemic hit hard. But, the good news is that many of the emerging trends are proving beneficial to the market. Demand for rental properties up Strong demand for rental properties has continued with economic uncertainty and tighter mortgage lending driving people away from house purchase. At the same time, shortage of new rental properties has kept rent levels up. UK rental income in June was on the rise — up 1.1 percent on average compared with equivalent figures for June 2019. However, the difference in rental variations was quite significant. In the North West, for example, average rents in June were up 6.6 percent on the same period in 2019. In contrast, the South West saw an increase of just 1.8 percent for the same period. The East of England saw no change, while the North East and South East saw decreases with Greater London experiencing the biggest fall of 1.8 percent. There was a surge in demand for rental properties in May, but supply was not keeping up, in contrast to the boom in build-to-let. . Build-to-let increasing Build to rent (BTR) is one of the fastest growing sectors in the UK property market. According to recent figures from the British Property Federation, there are now 167,853 BTR homes in the UK, up from 157,512 in Q1 2020. BTR properties are owned by companies and custom-designed for rental by multiple occupants. They carry strong branding, making them easier to market than individual properties. Unlike private accommodation, BTR properties provide management services and offer shared facilities such as gyms. They are designed to appeal to long-term renters who may not be able or interested in buying a home and provide long-term stable revenue streams compared to private fluctuating short-term income. House prices more affordable Demand in the wider housing market has been stimulated by the Chancellor’s Stamp Duty holiday, which has made house purchase more affordable, particularly for properties under £500,000. As an example, Bromley in South East London saw an astonishing 83 percent rise in enquiries following the announcement. Rightmove calculated that a buyer in London would save around £15,000 on average. That lower cost is also encouraging landlords to increase their portfolios to take advantage of sustained demand for rental properties. Technology adoption increasing The pandemic and the subsequent lockdown have accelerated the adoption of technology in the rental market -a sector that has traditionally lagged behind the rest of the property market. That can make it easier for property managers to do business. The ability to put property details online and integrate sophisticated search functions can make it easier to match tenants and property owners. It also improves convenience for tenants, giving a competitive advantage to property managers offering online search. The wider availability of online data on trends makes investment planning and resource allocation more accurate and effective, helping property managers improve ROI on rental properties. For property managers with smaller rental portfolios, online tools are available to simplify property valuation. Adding information on details of the property – the number of bedrooms, whether the property is larger or smaller than average and an estimate of its condition – into the tool provides a professional valuation in minutes. Arranging and conducting viewings in person can be very time consuming. The lockdown forced landlords to offer virtual viewings by video and this is now recognised as a practical alternative by both tenants and landlords. There is a cost to produce the initial video, but this can be used for multiple viewings and may be more cost-effective than the same number of personal viewings. Landlords lifes are also being made easier. Letting agent comparison sites like Rentround help landlords save on their agent fees and recoup more rental property profits Going online to speed up processes Access to online databases can simplify and speed up processes like tenant identity verification or credit checks, which are essential elements of the letting process. Similarly, landlords or property managers are now able to customise tenancy agreements online before digitally sending them to the tenant and having them electronically signed. One of the main aims of property technology is to create ‘frictionless transactions’. Creating online rental documentation, accepting digital signatures on contracts exchanged online and online payment systems to simplify rent collection are examples of the way technology is changing the traditional property management/tenant relationship. As well as saving time and money, online transactions improve customer service and convenience for tenants. Communication with tenants can be improved by making greater use of videoconferencing tools like Zoom or Cisco Webex, which has been widely adopted during the pandemic. Those tools also improve communication with colleagues and other property professionals such as lawyers, letting agents and surveyors. Property managers who want to work with letting agents can make significant savings by using online services. High street agents’ fees cost 8 percent or more of the rental price for advertising, interviewing and credit checks. Online agents’ charges for a similar service attract an average set fee of around £50, with Portico Direct charging just £1 to advertise on Rightmove, Zoopla and On The Market. Navigating the new landscape Continuing change in the rental market coupled with economic uncertainty poses many challenges for property managers. However, adopting the many innovations and benefits of property technology can help managers maintain greater control and improve the efficiency of their operations.
Russell Quirk the Chief Executive Officer of property agency eMoov has released a few things to say regarding the current state of the housing market, which is apparently seeing homes in the country rise in value more slowly than they were before, suggesting that some form of stability seems to have returned to the market. Quirk explains that one must accept a slowing down of rate levels in any case, due to the stagnation expected around the seasonal Christmas period. Things are therefore to be expected to have slowed themselves down somewhat in any case due to the simple fact that less people are likely to want to invest time and effort in the housing and property market around the Christmas season when they want to spend time with their families and friends. The slowing down overall thus seems to reflect this, but Quirk adds that things will certainly pick up again soon now that the tinsel season is over and business is opening up again as usual. Therefore it seems evident that the springtime season will show a rise once again because more people will be wanting to activate themselves again to get the year going with their plans to invest and change homes. Russell Quirk also adds that in any case the survey itself that has found this out (Rightmove) bases its data and results on the asking price of those whom it interviewed, and this is therefore not the same as the sold price itself. What it does however unarguably show is the expectations of people who believe that the market is at a lower rate than it actually is. Confidence is not what is used to be but the Rightmove survey did indicate a 3% rise in the amount of traffic that agencies are experiencing, showing that there is still much be said about the construction industry and housing development projects in the future months to come.
Until relatively recently there was really only one way to sell your home – via a high street estate agent. A convoluted and sometimes frustrating system that also can be costly, in hindsight it was perhaps no surprise that online agents and latterly private sellers would have such easy pickings in the past decade and the present. In 2015 the government relaxed the rules on selling homes over the internet to give sellers more flexibility in the amount of work they can put in, enabling them to save money but also exert more control over the process. Several of the laws governing the housing market concerning street trading dated back to the 19th Century, and it was time for change. The laws allowed private sale websites to take on people wishing to sell their homes. So many of the jobs that formerly fell to an estate agent, and therefore hit your wallet, can now be done easily online – these include staging the photographs of the property, arranging visits and showing buyers around the property, and other aspects of the sale for which you need no formal qualifications. Ideally, the more work you put in, the swifter and easier the sale will be, at a fraction of the cost of a local agent that could take an average of 1.5% commission. The change in the law means that private listing sites don’t even have to visit the property. At the time the changes were proposed seller David Dexter told the BBC: “I think that an estate agent is a service that I can do. And I think it’s a really great opportunity to get the house out to as many people as possible. And essentially, to save a lot of money.” The private sales websites are probably necessary to get the home listed, on several hundred sites including giants such as Rightmove and Zoopla. A listing might cost around £500, or you might have to go down the route of an online estate agent depending on which sites you wish your property to appear. You might even wish to forgo the listing completely and market it yourself on social media, although this could be limited by your reach and the number of followers you possess. So for listings, private or online agents are probably the way to go. The main drawback of such sites is that you might pay the fee upfront but not sell the home; something that doesn’t happen with high street agents. You could conceivably create floor plans, or a video of the property and its surroundings, but first impressions count and a sloppy effort could be detrimental to your chances. You might also have to negotiate prices yourself, and even decide on a valuation – quite a task if you have no experience in this field. If you’re selling through a private firm there’s a lot more work you’ll have to put in, and if speed is important for the sale this could be a tough task (a company such as We Buy Any Home could help). Ultimately the decision is yours and relies on a large range of considerations that only you can make. No matter how you decide to proceed, the decision is not set in stone and you can always revert to another method.
