The UK’s communities Secretary, Sajid Javid has launched a new £2.3 billion funding to unlock 100,000 new homes in areas of high demand.

Key focus of the Fund

• Fund vital physical infrastructure projects like the building of roads, bridges, energy networks and other utilities.
• Bids for local authorities across England to come forward with proposals to help get homes built faster.
• Funding will also be available to help build new schools, healthcare centres and digital infrastructure to accommodate growing communities.
• Once proposals have been approved, it is expected that local authorities would begin building the necessary infrastructure immediately and for the homes to follow quickly afterwards.
• HIF is part of the government’s wider £23 billion National Productivity Investment Fund, which targets spending on areas critical to boosting productivity, including on housing, transport and digital communications.

Sajid Javid, Communities Secretary, said: “To build the homes this country needs, we need to deliver the right infrastructure in the right place at the right time.

By investing in local infrastructure, we can help unlock building thousands of new homes in the areas where they are needed most. The Housing Infrastructure Fund will also make sure we have better public services in place for local communities.

Andrew Jones, Exchequer Secretary to the Treasury, said: “Where we live plays a huge part in our lives; from the distance of our commute to the local facilities available. By ensuring we have enough housing in areas where it is needed the most, we can boost productivity and support new communities to grow and thrive.

This money is part of our £23 billion National Productivity and Investment Fund, which will ensure Britain is match fit for the future.”

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House price growth 2.6%

According to the latest research from Halifax, house prices in the three months to June were 2.6% higher than in the same period of 2016.

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New housing sales account for 1 in 10 property sales each year but this varies across the country

Outside of London Zoopla analysed data from Hometrack to reveal which areas of Britain have the next highest concentration of new build properties as a share of all property sales.

Key Findings

• Outside of the London and with new homes accounting for 33.2% of property sales, the fast growing, ex-new town of Milton Keynes has the highest proportion of new builds in Britain.
• Crewe came in second with 29.6%, which joins Middlesbrough in Teeside as one of only two areas in Northern England to have made it into the top 10
• Greater London town of Ilford (28.8%) was in third place.
• The data reveals that areas which have a new build concentration of 25% or more have grown in value on average by 29.7% over the past five years, six per cent above than the national average property price growth rate which stands at 23.6%.
• Regionally, the research also reveals that the highest concentration of new build homes are found in Southern England (five of the top 10) and The Midlands (three of the top 10), with only Crewe (29.6%) and Middlesbrough (20.3%) representing Northern England at the top of the table. 

Lawrence Hall, spokesperson for Zoopla comments: “New housing sales account for 1 in 10 property sales each year but this varies across the country. These new findings give us a useful overview of where new builds are most common around the country, outside of London. Clearly, areas such as Milton Keynes and Crewe are benefiting from new investment by developers.

While there is a correlation between a large proportion of new builds and higher property price growth, new homes are typically developed in areas of high demand, which has already contributed to a rise in property values.”

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Can BTL really deliver better returns than a pension?

Despite the government’s recent tax hikes and tougher criteria for mortgage lending, over the long term, the right property investment can provide an enviable pension pot.

Though pensions will beat a portfolio of just one property, those investors who are willing to take more risk, by taking out a mortgage and managing multiple properties, have the potential to exceed a pension pot.

Data from AJ Bell reveals how much £100,000 would grow (in capital and returns) over 10 and 20 years in three scenarios. Using historic and housing stats, the projections compare investing in a pension (assuming a basic rate taxpayer) with someone buying a single buy-to-let property without a mortgage and with someone buying three properties with a total mortgage borrowing of £300,000.  The original £100,000 is split into three where each third becomes a 25% deposit on a property. Stamp duty, tax and other costs are factored in with the property investments

Peter Armistead, Director of Armistead Property comments: “The research shows that three buy-to-let properties produce £42,000 more than a pension over the 10 years.  However, property investment comes with greater risks such as fluctuating house prices and capital growth; void periods; fluctuating rents, maintenance issues, tenant management issues etc.  Property is definitely a long term investment and does have many drawbacks as an asset class which a pension doesn’t, the most notable one being lack of liquidity.

In an ideal world, people should be investing in both a pension and property from as early an age as possible and ideally from your 30’s.  It is advisable to spread the risk and have investments for the future in more than one pot.

I would definitely advise having both a pension fund and investing in real estate, but it’s important to consider the two in separate terms.  If you are using a managed pension fund then you don’t need to be hands on with that investment.  Property on the other hand, requires you to actively manage it and treat it like a business not just an asset class.  If you don’t want to take up the day-to-day issues with the property, then you can (as most investors do) instruct a lettings agent to do all of this work for you, but you will still need to manage the lettings agent.”

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Naturally, it will take a while for the dust to settle following the election result, but it’s crucial that the focus on housing supply solutions are not derailed in the meantime

The latest data and analysis from ONS and Land Registry has revealed that average house prices in the UK increased by 5.6% in the year to April, up from 4.5% in the year to March.

Key Findings

• According to the UK HPI, the monthly price change for a property in the UK was recorded at 1.6% with the average UK house price now standing at £220,000.
• The figures also revealed that the East of England showed the highest annual growth, with prices increasing by 8.1% in the year to April 2017
• This was followed by the South West at 6.8%. The lowest annual growth was in the North East, where prices increased by 0.6% over the year.

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The latest analysis and data from Your Move has revealed that, despite uncertainty surrounding the General Election, the average price of a home in England and Wales reached a new high in May , with a rise of 0.3% to £303,200.

Key Findings

• According to the report, the value of the average home has now increased £13,934, or 4.8%, in the last 12 months.
• The data shows that activity also remained relatively strong, with transactions slightly lower than usual for the season but still up 6% on April, with an estimated 62,500 sales.
• Transactions in the North East (up 10%), North West (6%), Yorks & Humberside (7%), East Midlands (4%), West Midlands (6%) and Wales (13%) are all higher in the three months to the end of April 2017 than the same period in 2015.
• Conversely, transactions in high-priced areas such as Greater London and the South East are down by 19% and 7% respectively.
• West Midlands remains the region with the highest growth in prices, but Liverpool has been named the ‘city to watch’.
• The North West set a new peak in April, largely as a result of strong growth in Merseyside where prices are up 6.2% in the last year.

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Homeowners expect to be connected in a way that wasn’t envisaged even 10 years ago

New research out today reveals that although the estate agents’ traditional refrain of ‘location, location, location’ still matters to a degree, it is not the be all and end all that it used to be.

A new study by GoCompare Home Insurance has found that when it comes to choosing a new home homebuyers are increasingly looking for ‘connection, connection, connection’.

The survey found that the most desirable properties are located in good neighbourhoods, with low crime rates, near local shops and GP or dentist surgeries.  But, the survey also found that potential home-hunters increasingly value superfast broadband, clear mobile phone signals, satellite TV and transport connections over pubs, schools and recreation facilities.

Ben Wilson, from GoCompare Home Insurance, said: “Location will always be a key factor for homebuyers. After all, while you can improve a property – you can’t move it.  But it is too simple these days to say that it is the only consideration.  Homeowners also expect to be connected in a way that wasn’t envisaged even 10 years ago. They will want to know about the transport infrastructure and communications as much as the schools, shops and amenities.

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Annual house price growth 3.3%

The latest data and analysis from Halifax has revealed that house prices in the three months to May were 3.3% higher than in the same period of 2016.

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Despite both of the UK’s major parties’ stated ambitions to tackle the housing crisis, their manifesto plans fall short given the scale of the problem

Analysis of the the Conservative manifesto pledge to build a million homes by the end of 2020 has revealed that this will result in an increase of just 9,000 a year.

Using ONS projected household growth and the current rate of housebuilding, England is predicted to face a housing shortfall beginning in 2025 with an initial deficit of 877 homes and just over 25.2m households.  From that point on, the country is expected to face a widening deficit, reaching 452,598 homes or 1.6% by 2039. England will then be home to an estimated 27,551,000 dwellings and 28,003,598 households.

In London, a shortfall has existed since 2014 when it reached 24,057 homes or 0.7%. It reached 3.8% or 139,919 homes this year and by 2022 it is predicted the deficit will reach 7.3% or 288,623 homes, even with the Labour and Tory manifesto pledges factored in.

At current housebuilding rates, London’s deficit will climb to an estimated 731,724 homes or 15.1% come 2039 as the capital grows to an expected 4.8m households

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The latest research from Lloyds Bank has discovered that homes within easy reach of a local supermarket  are, on average, £21,512 higher than in nearby regions.

Key Findings         

• Properties in areas with a Waitrose, Marks and Spencer, Sainsbury’s or Iceland are most likely to command a higher house price premium when compared to the wider town average.
• The average price for properties within easy reach of a Waitrose is typically £36,480 higher than the wider town average (£429,118 versus £392,939).
• Those living close to a Marks and Spencer have the second highest premium, with properties worth an average of £29,992 more than homes further away.
• Sainsbury’s (£26,081)
• Even discount chains like Iceland (£22,767) command a strong premium.
• Homes within easy reach of all four above supermarket chains are trading at an average premium of 9%.
• Areas close to budget supermarkets have seen biggest house price rises, with growth of 11% in 3 years
• House prices close to an Aldi, Lidl, Morrisons or Asda have grown by an average of 11%, or £21,400, since 2014. This is a faster increase than for all supermarkets (9%) and marginally higher than for all areas in England and Wales (10%)
• In postal districts with an Aldi, the average house price has grown from £178,809 in 2014 to £198,810 in 2017 – an increase of £20,000.
• The largest price increases remain in postal districts with a Waitrose – £33,015 (from £396,104 to £429,118) or 8%.

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