New £1 billion fund announced for building new homes in England

The Government and Barclays have announced a £1 billion housing development fund to help deliver thousands of new homes across England.

Under the agreement loans ranging from £5 million to £100 million, which will be competitively priced, will be available for developers and house builders who are able to demonstrate the necessary experience and track record to undertake and complete their proposed project.

Funding is open to new clients as well as existing Barclays clients, and will put greater emphasis on diversifying the housing market, as at present almost two thirds of homes are built by just 10 companies.

A key priority of The Housing Delivery Fund is to support small and medium sized businesses to develop homes for rent or sale including social housing, retirement living and the private rented sector, whilst also supporting innovation in the model of delivery such as brownfield land and urban regeneration projects.

‘There is a vital need to build more good quality homes across the country. This £1 billion fund is about helping to do exactly that by showing firms in the business of house building that the right finance is available for projects that help meet this urgent need,’ said John McFarlane, Barclays’ chairman.

Housing Secretary James Brokenshire said that it will see Barclays in partnership with Homes England also help to see more design and innovation introduced to new home building.

‘It is a further important step by giving smaller builders access to the finance they need to get housing developments off the ground. This is a fantastic opportunity to not only get more homes built but also promote new and innovative approaches to construction and design that exist across the housing market,’ he added.

According to Sir E Lister, chairman of Homes England, the organisation will play a more active role in the housing market and do things differently to increase the pace, scale and quality of delivering new homes.

‘The Housing Delivery Fund demonstrates Barclays’ commitment to the residential sector and will provide a new funding stream for SME developers to help progress sites and deliver more affordable homes across England,’ he said.

Brokenshire added that it will move towards the target of 300,000 new homes being built a year by the mid-2020s and that with 217,000 homes built last year, England has seen the biggest increase in housing supply for almost a decade.


More Londoners Buying Property in the North and Midlands

The number of homeowners from London buying properties outside the capital has increased, according to new research from Hamptons International.

Just over 30,000 of Londoners looking to buy a new property left the capital in the first half of 2018, some 16% more than H1 2017 and an increase of 61% over the last decade.

The majority of homeowners moving, around 38%, moved to the South East, a modest 3% fewer than the first half of 2017, followed by 30% moving to the East of England.

However, the number of movers leaving London and buying property in the North and Midlands has more than tripled in the last decade, with over a fifth (21%) moving to these regions compared to just 6% ten years earlier.

First-time buyers are also buying outside of London, with around 31% buying their first home beyond the capital. Whilst this is nearly double the number recorded five years ago, it is a 2% decline on last year’s figures, due to savings from stamp duty relief and the Help-to-Buy scheme.

Although the vast majority of first-time buyers, some 85%, moved to East of England or South East, Hamptons notes this is 10% fewer than four years ago. On the other hand, more than one in ten (12%) buying their first property in the North or Midlands, four times the number recorded in 2010.

“With affordability stretched, more Londoners are moving out of the capital to find their new home,” said Aneisha Beveridge, research analyst at Hamptons International.

“More people are making a bigger move and buying a larger home sooner to avoid having to pay stamp duty on additional moves as they trade up. But for many, this means heading further North.”

Beveridge goes on to note that despite more first-time buyers staying in the capital, “raising a deposit remains a hurdle for many, which helps explain why increasing numbers of first time buyers who leave London are heading North.”


Brexit is Least Concerning Issue for Majority of UK Landlords

Almost two-thirds of landlords have no plans to sell their buy-to-let properties over the coming year…

Landlords remain optimistic about the buy-to-let market despite recent regulatory and tax changes, according to the latest Landlord Sentiment Survey by lettings agency Your Move.

In a survey of over 1,000 landlords, more than half (52%) felt positive about current market conditions, with almost two-thirds (64%) stating they were unlikely to sell a buy-to-let property in the next 12 months.

Just 16% expressed negative feelings towards the market, whilst 30% responded to the survey as being “indifferent”.

The poll also revealed that for 83% and 80% respectively, the most important considerations for landlords are the costs of upkeep and property maintenance, and the ability to make a long-term profit.

Brexit was the least pressing issue for landlords, with just 32% expressing concerns towards it, whilst under half (43%) regarded the upcoming tenant fees ban in England & Wales as a potential problem.

“Given the number of regulatory and tax changes in the buy to let market over the last few years, it wouldn’t be surprising if landlords felt some trepidation about the future,” said Martyn Alderton, national lettings director for Your Move and Reeds Rains.

“However, it’s great to see that the landlords we surveyed do, for the most part, remain positive about the future.”

He concluded: “Our research shows the majority of landlords are in it for the long term and that’s important for the well-being of the private rental sector, providing much needed homes for those who cannot yet afford, or do not wish to purchase due to lifestyle choices.”


What an interest rate rise means for you

A borrower with a mortgage of £100,000 will see an increase of £12 in their repayment, according to the Nationwide.

The UK's wealth disparity has been reveaeled
Image: People with a standard variable rate mortgage of £100,000 will pay £12 more a month

The Bank of England has raised interest rates to their highest level in almost a decade but what are the effects of an interest rate increase on day-to-day finances?

:: Who are the winners and losers?

It is a modest increase of 0.25 percentage points to 0.75%. Households can expect the cost of their loans and mortgages to go up as banks and lenders lift their interest rates.

Savers, who have had the most to complain about in the low-interest rate environment, may see a modest gain.

:: What will be the impact of my mortgage?

Skipton Building Society chief executive David Cutter told Sky News that most new mortgages are fixed for two- to five-years.

“The vast majority of new loans, 90% are on fixed rates. Back book (older mortgages) about 66% so there is going to be no immediate impact regarding affordability,” Mr Cutter said.

This is why interest rates have been raised by the Bank of England

This is why interest rates have been raised by the Bank of England

As the bank took its decision today, the mood could hardly have been more different from the crisis days in 2009

“On an average mortgage, if they do increase by a quarter of a percent, then I think your monthly payment will go up by £16 or about £190 a year.”

According to the Nationwide Building Society, anyone on a standard variable rate will see an increase of £12 on a mortgage of £100,000 and on a £200,000 mortgage, £25.

:: Why will savers benefit?

“The good news, of course, the rest of our membership, we have a million now, is the saving side because they have really suffered for ten years now. If rates do go up to 0.75% that will be highest since early 2009. So hopefully some relief is coming down the line as well,” Mr Cutter said.

Asked by business presenter Ian King whether the full rate increase would be passed on to savers, Mr Cutter responded: “Yeah, we’ll see what the reaction is in the market.”

While savers may be hoping for better returns, Bank of England statistics show that the average interest rate on UK current accounts increased by only 0.09% in the seven months since rates were increased by 0.25% last year.

:: Will this bring down prices at the shops?

While the Bank of England has raised interest rates partly to tackle inflation, this move will not be reflected in everyday prices for some time to come.

It took six months for the effects of the Brexit-hit pound to raise prices as imports became more expensive.

Retailers fear rate rises as higher mortgage and other bills for consumers mean they will have less money to spend.

The BoE predicted that inflation would be 0.1 percentage points higher this year and next at 2.5% and 2.2% respectively.


Value of UK property market falls £26.9bn as house prices stagnate

he value of Britain’s housing market has fallen by £26.9bn, or 0.33pc, since the start of the year, as growth in the North East and Wales has failed to counteract falling prices in many other regions across the country.

The nation’s homes decreased in value by an average of £927 each between Jan 1 and June 30 this year, and are now worth a collective £8.2 trillion, according to figures from property site Zoopla.

While the value of the housing market in the North East has risen by 3.31pc, and Wales’ by 1.4pc, poor-performing regions such as the South West, which endured a decline in value of 2.51pc, and Yorkshire and The Humber (-2.12pc), has dragged the overall market value down.

It marks a reversal of fortunes for the UK housing market, which registered an increase in value of 3.5pc in 2017, despite a slowdown in London and the South East.

Zoopla’s most recent data found that on a local level, the English town of Barrow-in-Furness in Cumbria was the top-performer in terms of house price growth, with prices rising 6.7pc in the past six months. Holt in Norfolk experienced second-best growth of 6.27pc, followed by Pontypool in Torfaen (6.06pc).

By comparison, Reigate in Surrey saw price growth in the first half of 2018 decline in value by 6.7pc. The second and third largest reductions were seen in Lydney in Gloucestershire, and Sturminster Newton in Dorset, which reduced in value by 6.69pc and 6.64pc, respectively.

Despite property prices in London falling at their fastest rate since February 2009, the capital’s homes collectively rose in value by an average of 0.75pc in the six months to June 30.

Zoopla’s Laurence Hall said it was “not surprising” to see a small drop in values since the start of the year.

“Uncertainty around Brexit is a very real factor in the market, however on the positive side, the drop is creating a potential opportunity for first time buyers to get a foot on the ladder in some regions across Britain,” he said.

Analysts have blamed Brexit for the slowdown in the UK’s property market since 2016. House prices have risen more slowly than before the EU referendum, which hit consumer confidence and spending as the pound’s fall pushed up inflation.

According to figures from Nationwide in April, house prices were growing by about 5pc a year around the time of the Brexit vote, but in 2018 growth has consistently hovered around 1pc.

A buoyant property market depends on the UK’s economic health, so if the pound weakens further, inflation surges, and interest rates are raised, the capacity for house price growth would be reduced.

Equally, if Brexit negotiations are successful, economic growth continues to remain positive, and confidence is boosted, house prices could increase faster than initially thought.

Source The Telegraph

https://www.telegraph.co.uk/property/house-prices/value-uk-property-market-falls-269bn-house-prices-stagnate/