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Local Authorities Urged To Build More Private Rental Sector Properties

Local Authorities Urged To Build More Private Rental Sector Properties

Local Authorities Urged To Promote Institutional Investment In Private Rented Sector Over Home Ownership

According to the report “Making Renting Viable“ commissioned by the British Property Foundation (BPF) and conducted by a leading London law firm; more UK local authorities should focus on building new residential properties for the private rented sector to encourage institutional investment instead of promoting local homeownership.

The British Property Foundation and Addleshaw Goddard who conducted the survey, reckon that UK local authorities should earmark land within their council boundaries for private rented sector (PRS) properties and set housing development targets to encourage pension funds and other institutions to invest more in the private rented sector.

Partner at Addleshaw Goddard, Marnix Elsenaar, said: “It’s vital councils recognise both the need for an institutional private rented sector that’s not the same as buy-to-let, while ministers should update planning guidance to make building for rent economically viable. Residential property was seen as more difficult than renting out a commercial office block, but the landscape has changed. Institutions want reliable, long-term returns and they should see a good degree of income growth in the private rented sector.

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Funding Boost For Government Build-To-Rent Plans

Funding Boost For Government Build-To-Rent Plans

Finance Secured To Build Thousands Of
Affordable Properties For Rental Purposes

Government housing minister Kris Hopkins has welcomed a deal that will release £500 Million (GBP) of additional funding to build new affordable residential properties in the UK.

The new investment finance has been secured through an agreement with the European Investment Bank (EIB), that will help deliver up to 4,300 new and affordable homes to rent in areas of the UK.

The funding is set to form part of the £3.5 Billion (GBP) Affordable Housing Guarantees programme, which enables housing associations to use Government guarantees to secure private investment at more competitive rates than they would otherwise be able to secure.

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Government Seek Bids For Build-To-Rent Scheme

Government Seek Bids For Build-To-Rent Scheme

Build-To-Rent scheme seeking bids from property developers to help bring about the fastest rate of affordable residential property construction for two decades 

UK Government Housing Minister, Mark Prisk, last week announced a second round of funding for the construction of new rental properties and the government are seeking fresh bids for a share of at least £400 Million (GBP) to build new properties specifically for the private rental sector (PRS).

The funding is part of the flagship £1 Billion (GBP) Build-To-Rent fund, which offers support for property developers and property investors who want to get into the private rental sector for the first time.

Mr Prisk said the new Build-To-Rent scheme would encourage investment in the UK’s private rental market and offer prospective tenants a greater choice of rental property. The scheme is intended to run alongside up to £10 Billion (GBP) in government housing guarantees.

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Dutch Property Market Avoided By Property Buyers

Dutch Property Market Avoided By Property Buyers

Property investors are avoiding buying property in the Netherlands because they fear the property market is yet to hit rock bottom

The Netherlands are the only country in Europe that is still creating its own new land, however, property prices in the Netherlands are continuing to fall alarmingly, putting off purchasers and investors alike.

Property prices of residential properties in Holland are at the same level as they were 10 years earlier, and are still falling, reflecting the stagnant housing market in the country.

According to a joint publication by Statistics Netherlands and the Land Registry Office, prices of existing owner-occupied residential properties in The Netherlands were on average 7.6% lower in April 2013 than they were in April 2012 and 19.5% down from the peak of the global property market of August 2008.

Residential property prices are falling as a consequence of ultra low demand from property buyers.

Official figures reveal that only a total of 29,644 residential property sales were registered in the country during the first four months of 2013, compared to the same period last year.

The Financieele Dagblad reported recently that Dutch banks’ housing market specialists would no longer be making predictions over the decline in residential property prices.

Last year, the banks predicted a further fall in Dutch property prices in 2013 between 7% and 10%.

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Planning Minister Slams Irresponsible Councils

Planning Minister Slams Irresponsible Councils

Government Planning Minister Claims Planning Laws are sending UK housing back to the 19th Century

Planning Minister Nick Boles has stirred up a real hornets’ nest by claiming that local authorities that save green fields instead of building residential properties are irresponsible, and building new homes must be prioritised above preserving fields.

Nick Boles argued that homes create more human happiness than fields, whilst revealing the Government is determined to speed up the rate of residential house building, despite strong opposition.

Mr. Boles slammed local authorities in an interview with the Daily Mail stating:”Deeply irresponsible councils and communities that refuse to co-operate with the government’s expansion plans will risk losing their hospitals and high street shops as their populations shrink. I understand that rural campaigners are very worried when green-field land is replaced by the sheer ugliness and soullessness of housing estates. However, current planning laws are sending Britain back to the 19th century when only the well-off could afford their own home. The sum of human happiness that is created by the houses that are being built is vastly greater than the economic, social and environmental value of a field that was growing wheat or rape.”

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More UK Property Investment Needed according to a new study

The UK needs a Housing Revolution say FHC

The UK needs a Housing Revolution say FHC

A study by the Future Homes Commission (FHC) reckons that 3 times the current amount of new houses being built is needed in Britain in order to stop the blight of poor housing.

The FHC, set up by the Royal Institute of British Architects (RIBA), is calling for a housing revolution in the UK and wants another 300,000 houses each year to be built on brownfield land in areas close to almost all cities, towns and villages.

The FHC study states that such a proposal would create tens of thousands of new jobs and promote UK property investment and the plan would not cost the UK Government a penny so long as the dysfunctional way we build homes is radically overhauled.

The FHC’s recommended plan of action would see local authorities start rental housing developments for taxpayers by bringing their funds together to give the UK better houses.

Five main modifications are recommended which would see a radical improvement in UK housing, with the first being a rise in the amount of new houses built each year increasing from 100,000 to 300,000.

Future Homes Commission chairman, Sir John Banham, said: “There is no better time to tackle the UK housing crisis. After a year-long national inquiry, the Future Homes Commission has concluded a housing revolution is entirely possible and will lead economic growth.”

Sir Adrian Montague’s review of how best to encourage greater investment in the UK private rental sector properties

 

Property Investors Set To Cash In Following Montague Report

Property Investors Set To Cash In Following Montague Report

Property investors across the UK are buzzing recently after the long awaited release of the Montague review, which set out to review the barriers to institutional investment in private rented sector properties.

Despite the reassurance of Sir Adrian that his report would be relatively short, at 28 pages it isn’t really light reading material.

Here are some of the statistical highlights to give you a flavour of the review.

  • Today the UK private rented sector (PRS) houses 3.6 million households – this compares to 2 million in the early 1980s. (An increase of 56% over 30 years)
  • Around a third of households in the private rented sector are families with dependent children
  • 20% of households in the private rented sector have been at the their current address for more than 5 years
  • 1% of landlords own more than 10 properties
  • Every £1 million of new housing output supports 12 additional jobs per year – 7 directly and 5 indirectly
  • For every £1 invested in the construction industry, £2.60 is generated elsewhere in the supply chain
  • The number of households will grow by an average of 232,000 per year until 2033
  • Mortgage lending across the board has roughly halved since 2006-07
  • Returns on residential property have totalled 9.6% on average over the last 10 years – in comparison, commercial property ranges from 7.3% to 5.7%
  • Capital growth delivered an average of 5.9% annually over the last 10 years compared to 3.5% in income return
  • Britain has enough surplus land to build 100,000 homes by March 2015

All statistics taken from the Montague Review

 

Read the Montague review of the barriers to institutional investment in private rented homes in full.

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