UK housing market ‘flatlines’ ahead of Brexit - Plus a daily roundup of all the key property news
Posted by The Oracle Group on 8th August 2019 -
INDUSTRY
UK housing market ‘flatlines’ ahead of Brexit
The housing market is "pretty much flatlining" amid growing concerns about Brexit and political uncertainty, the Royal Institution of Chartered Surveyors' said in its report for July. Some 69% of property professionals said that sales prices were coming in below asking prices for homes marketed at more than £1m. Meanwhile for properties on the market for up to £500,000, 59% of surveyors reported that sales prices were at least level with asking prices. A net balance of 9% of surveyors reported house prices falling rather than increasing. Across the UK, prices rises were at a "solid pace" in Northern Ireland, Scotland and Wales, while prices continued to fall in London, the South East of England and East Anglia. Demand for rental homes picked up to the strongest levels since late 2016, the Rics said, although the volume of new properties being listed for rent decreased. Separate data from Halifax showed that average house prices were "treading water" in July, slipping 0.2% month on month with an annual growth rate at 4.1%. The average price of a home in the UK now stands at £236,000.
PLANNING
Mayor backs plan for including green space in London planning rules
The mayor of London is considering a radical overhaul of planning rules that would make green space as vital as access to water or energy. Sadiq Khan has signalled he will support a scheme by the Fabian Society that demands that future developments should guarantee that every resident is no more than 1,000m away from green land not covered in concrete or tarmac. A new report from the society shows that a fifth of London is more than a kilometre from areas of nature, despite the fact that green space accounts for nearly half of the city (47%).
L&G wades into green belt plan
Legal & General, Britain's biggest investment manager, has been dragged into a row after it agreed to pay to build homes on the green belt. The firm has backed Oxford University's plan for 2,000 homes at Begbroke, a village with a science park just outside the city, with L&G saying it will be a blueprint for similar proposals elsewhere. But it faces opposition from nearby residents who say it will carve up protected green space and lead to urban sprawl. The university and L&G insist the proposals would provide much needed housing as well as more high-tech jobs, and L&G boss Nigel Wilson said that Whitehall could do more to support councils which want to “modernise cities”.
Planning rules too snobbish over green solutions
Derek MacDonald, joint Managing Director of Newton Property Management, criticises current Scottish planning rules for being too inflexible and archaic when it comes to listed buildings. He says rules should be eased to make more sustainable solutions such as solar panels, easier to incorporate into redevelopments. “The planning rules should take into account the significant benefits this represents for the planet - not what may be to the detriment of the ocular sensitivities of the highbrow beholder,” he says.
1,000 new homes approved despite opposition
Harrogate Borough Council's planning committee has approved a development of 1,000 new homes on the edge of Knaresborough, despite fears the latest housing scheme would lead to harmful levels of over-development. While councillors were largely unified in speaking out against the proposals, council officers gave legal advice and pointed out that blocking the application would contradict the authority's draft Local Plan, which will shape long-term development in the district over the next 20 years.
FIRMS
Morgan Sindall delivers H1 profit growth
Infrastructure and regeneration company Morgan Sindall delivered strong profit growth in the first half of 2019 with adjusted operating profit rising 18% to £37.5m. The firm reported a secured order book of £4.2bn, up 19% from the year end, with the regeneration and development pipeline now £3.3bn, up 6% from the year end position. With adjusted earnings per share up 15% to 64.2p and the interim dividend up 11% to 21.0p, the group said it is confident of a strong performance in the second half of 2019.
Peabody in record investment
Social landlord Peabody has reported record investment of £440m in new and existing homes in its latest annual financial accounts, a year-on-year rise of £122m. The 157-year-old trust made a surplus of £148m on turnover of £565m, and its development pipeline investment also broke the £1bn level for the first time.
Appointments
Property developer Henry Boot has announced plans to hire Tim Roberts as its next chief executive officer. Mr Roberts, formerly chief of British Land's office team, will take over the role in January 2020, following the departure of current chief John Sutcliffe, who is set to retire and step down from the board. Elsewhere, Knight Frank has hired three graduate surveyors: Tom Wright, Victoria and John Jarman - all with first-class university degrees. And property consultancy Rider Levett Bucknall has promoted Jo Reynolds as its new managing partner in its Birmingham office.
TAX
Delay reverse charge VAT introduction, builders urge
Introducing planned changes to VAT before Brexit could be detrimental to builders, industry bodies have warned. In a joint letter to chancellor Sajid Javid, a dozen construction sector trade groups, including the National Federation of Builders and the Federation of Small Businesses, warned that reverse charge VAT could lead to "a loss of productivity, reduced cashflow and, in the worst cases, lead to a hit on jobs, tipping some companies over the edge". They called on the chancellor to delay its introduction until April 2020.
RETAIL
High street stores making way for eateries
According to research from Direct Line, restaurants and fast-food takeaways are taking over from shops on Britain’s high streets. Direct Line found that a third of change-of-use applications in 2018-19 were to turn a shop into an eatery. More than eight in 10 applications were approved. The research also revealed that retail outlets now account for just one in four high street businesses.
Jack Wills rent cut negotiations begin
Sports Direct has begun to negotiate with landlords over rent cuts at Jack Wills stores, which could see some branches marked for closure by the end of this week. Stores will be shuttered if a new deal is not reached, the paper claims. CBRE is advising Sports Direct.
LEGAL
Estate agent jailed for defrauding potential renters
A serial fraudster who conned renters into paying thousands of pounds for deposits on flats he advertised on Gumtree has been jailed. Estate agent Zhaker Darvesh lured victims with adverts for flats in Canary Wharf and Leyton for rent. The six victims each paid between £950 and £3,200 to move into the flats. Darvesh was jailed for 13 months and two weeks at Snaresbrook crown court and ordered to pay back the money he stole. Between April 2014 and March 2018, victims of property scams lost more than £22m, Action Fraud said.
ECONOMY
Shortages of skilled staff triggering pay rises
New research from the Recruitment and Employment Confederation and KPMG has found that workers are in high demands and are taking home a bigger chunk of the economy’s earnings than thoughts – about 10% more hours of work than a decade ago. Official data showed regular pay in June was up 3.6% on the year - the fastest rise in 11 years. The IT and computing industry has the most vacancies for permanent jobs. In contrast, the number of jobs in the retail and construction sectors has fallen.
OTHER
Data reveals household demographics
The ONS has published data showing the number of same-sex couples recorded as living together in the UK rose by more than 50% in the three years to 2018 to 232,000. The report also showed that the number of cohabiting couple families is growing faster than married couple families; 8m people are living alone, more than ever before; and 3.4m people aged 20-34 are living with their parents, up from 2.7m in 2008.
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