Property Briefing - all of the key property news
Posted by The Oracle Group on 14th June 2019 -
INDUSTRY
London housing market improves after Brexit deadline moved
The housing market in London has been boosted after sentiment rose to its highest level since April 2017, with negative trends in agreed sales, prices and new instructions all easing last month after the Brexit deadline was extended, according to the Royal Institute of Chartered Surveyors’ (RICS) latest housing market survey. RICS chief economist Simon Rubinsohn noted: “Some comfort can be drawn from the results of the latest RICS survey as it suggests that the housing market in aggregate may be steadying.”
Leasehold house owners pay extra £319 every year
Leasehold house owners face additional ground rent costs of up to £319 every year, totalling £447m, NAEA Propertymark has found. It’s ‘Leasehold: A Life Sentence’ report revealed that one in 10 (9%) leasehold house owners said the cost affects their quality of life and more than a third (36%) said they wouldn’t be able to afford to live in their home if their ground rent was to increase. An additional 6% already felt like they can’t afford it because of the cost. “Even though many leasehold contracts include a ‘10-year ground-rent freeze’, most developers sell the freehold onto a third party within a few years of completion and those terms go out the window, meaning homeowners are faced with unexpected and escalating costs,” said Mark Hayward, chief executive.
MORTGAGES
Mortgages boosted by first-time buyers
Figures from UK Finance show the number of loans issued to first-time buyers rose by 7.9% in April compared to the same month last year. There were 27,000 first-time buyer mortgages completed in the month, with a total value of £4.6bn. Mortgage approvals for existing homeowners also increased. There were 25,450 new home-mover mortgages completed, 6.4% more than last year. Buy-to-let mortgage approvals steadied, with 5,100 new ones - the same as this time last year.
TSB cuts interest rates on homebuyer and remortgage loans
TSB has cut interest rates on mortgages for home buyers and for remortgage borrowers by up to 0.10%. The bank has also made further reductions of up to 0.05 percentage points on selected three-year fixed (0-75% LTV) on remortgage rates.
HOUSING
Khan’s record on affordable housing rated
A London Assembly housing committee, analysing Mayor Sadiq Khan’s affordable housing record during his first three years in the role, has concluded: “There is room for the Mayor to go further.” It was found that the number of families on waiting lists has barely moved since 2016, despite Mr Khan receiving £4.82bn in government grants to fund the construction of 116,000 subsidised homes by 2022, of which some 41,704 have been begun.
MSPs blame Universal Credit for rent arrears
Universal Credit has led to a huge increase in rent arrears a Scottish Parliament committee has said, before urging the government to take immediate action to tackle the issue. Holyrood’s social security committee has recommended that the DWP pay the housing element of Universal Credit directly to landlords as a default, and said the minimum five-week delay for tenants receiving their first UC payment must change to help combat rent arrears.
Integrated health and housing needed for Scotland
The Scottish Federation of Housing Associations’ annual conference has been told how the country could progress the integration of health and housing, in a bid to reduce the £135m that poor housing is costing NHS Scotland. Salutogenesis – the highlighting of factors which create and support physical and mental health – was a possible driver for Scottish social housing policy, delegates were told during a session on the sector in 2040. To incentivise integration, Matthew Gardiner, chief executive of Trafford Housing Trust, suggested that housing associations employ their own GPs.
Housing priority for Manchester’s most vulnerable
Manchester's "most vulnerable people" are to be given priority for rehousing under new plans. Manchester City Council is reviewing its social housing policy, which it said currently allows anyone to apply for housing, "regardless of their need". As a result, 15,000 households have applied for the estimated 2,200 homes expected to become available by 2020.
FIRMS
Onthemarket closes in on rivals
Shares in Onthemarket edged higher after it reported a rise in homes advertised on its site and progress in converting more estate agents to paying contracts. The platform displays 650,000 properties on its site and has contracts with more than 12,500 estate agent branches. Its shares were issued at 165p but have since fallen to a little over 100p. It reported an operating loss of £14.5m for the year to the end of January, compared with a £10.8m loss last year. The loss relates to its costs as it tries to boost market share, offering estate agents free trials on its portal. Ian Springett, the chief executive, said it aimed to "put agents in a position where they are no longer beholden to Rightmove"The Times, Page: 45
Estate agents 'formed fee-fixing cartel'
Four estate agents in Berkshire have been accused of illegally fixing fees for seven years as part of a cartel. The Competition and Markets Authority said it had provisionally found that Michael Hardy, Prospect, Richard Worth and Romans broke competition law by setting minimum commission fees. They have until September to respond before the CMA makes a final decision.
INFRASTRUCTURE
Fortem wins £330m repairs contracts
Property repair firm Fortem has agreed maintenance contracts with five housing associations across England worth up to £329.9m. The contract wins have allowed Fortem to expand into new geographical areas providing services to residents living in an additional 34,000 homes, located between the Isles of Scilly in the South West and Berwick-upon-Tweed in the North East.
REGENERATION
The health of a seaside town can be judged by its pier
The Daily Telegraph features a report on how to tell if coastal towns are successfully regenerating, with the pier said to be the main indicator of whether such a town is on the right path. Dr Anya Chapman, a lecturer in tourism management at Bournemouth University, noted: “The pier is the flagship attraction in a seaside town,” continuing: “When it is refurbished, other businesses cluster around it and they form a nucleus of growth.” She cites Southport in Merseyside as an example, while Swanage in Dorset, Colwyn Bay in North Wales, Torquay in Devon, and Clacton in Essex, have all experienced growth after investment.
LEISURE
UK fund completes largest regional hotel transaction
The Index Linked Income Fund, which is backed by UK pension schemes, has completed its largest UK regional hotel transaction to date. The fund has acquired the ground rent on the De Vere Beaumont Hotel in Old Windsor in a £40m deal. “The quality of the property and position close to London provides confidence this asset will maintain its position as one of the leading conference hotels in the UK with significant scope for further growth in trading,” said Hugo James, partner and head of long income at Alpha Real Capital.
COMMERCIAL
Prestwich airport up for sale
The Scottish government has put Prestwich airport up for sale. Transport Secretary Michael Matheson said: "Since the Scottish government bought Glasgow Prestwick Airport in 2013, we have been clear that it is our intention to return the business to the private sector when the time is right.
OTHER
‘Cartel’ of landlords converting homes in Lewisham
The mayor of Lewisham has described the “cartel” of London landlords buying properties to convert to one-bed flats in Whitefoot, Downham and Bellingham – with 50 family homes lost to flat conversions. As a result, Lewisham Council plans to make landlords apply for planning permission before they convert houses into micro units from March next year. “In my view we should have gone through this process a lot earlier. I think it’s absolutely scandalous,” added Damian Egan.
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