brexit uk property market

#Brexit Impact on UK Property Market

In light of the LEAVE decision from the EU referendum there may be effects on the UK property market.

The headlines:

The immediate impact has been market uncertainty, the FTSE has dropped approx. 10% since the decision was announced and major house builders like Taylor Wimpey, Permission, Barratts, and Berkley Homes have all lost between a third and half their value.

Further the sterling has dropped against the dollar from 1.50 to 1.30 and that is still falling.

Interest Rates

The EuroZone base rate is already negative and some experts are expecting the Bank of England to drop the UK base rate to zero to boost the economy and this may be further pushed in order to keep inflation low in the light of the currency falls which will impact the cost of imports.

The Bank of England will want to encourage investment in the economy therefore rates will remain low.

Supply

There has been an increase in construction activity over the past 24 months, buoyed by relaxation of some planning laws and extension of permitted development rights.

Although the market impact on large house builders, they will still want to complete projects, even if new project starts are delayed.

Demand

There are many factors that influence demand and attractiveness for housing in the UK that are not EU related, such as depth of skills, education, lifestyle and language. Further to this, supply is always below demand with an increase in the number of households and smaller family units. The affordable end of the market will continue to have the highest demand.

High end property, in particular may see an increase in demand as Dollar based Middle east and Asian investors will now consider the short term buying opportunities within the property market and look to acquire residential property priced above £1million. The currency correction more than compensates for the changes in stamp duty which had previously discouraged high value property transactions.

House Prices

House prices will depend on regional factors and differences. Some regions may see a correction some may stagnate; however it is too early to speculate specifics.

Rental Market

Rental market is linked to employment as well as affordability and ability of renters to become home owners. The rental market especially in London and the South East is also heavily influenced by migrant workers and students, depending on how working rights and students will be impacted will determine long term effects.

Lending

The measures in the budget in April already discourage buy to let purchases, therefore banks currently have more than the usual surplus to lend, this is reflective in the record low rates on the market.

Lenders may tighten criteria especially on rental expectation but overall lending should not be adversely effected in the short run.

Investment

Investment especially in buy to let has slowed since the introduction of measures in the budget, however with lower interest rates expected, as well as the drop in sterling, investing in the UK is now cheaper, together with the low savings rates in banks, property investment is by far the better investment.

Conclusion

Overall Article 50 will only be exercised after a new leader is elected and then after 24 months will Britain actually leave, therefore uncertainty may remain till then end of 2018, however not much else will change.

The UK Property market will remain resilient and still a strong place to invest.

UK Property - Budget 2014

#Budget2014 – impact on UK property market

Chancellor George Osborne today showcased the UK Budget for 2014. The main question is how will it impact the UK property market and effect you, the investor. Points of interest are Stamp Duty, Help to Buy, new housing, savings and taxes.

 

Stamp Duty

Stamp Duty Budget 2014Nothing much changes for the average private homeowner, or small time landlord. The big announcement and change comes to close a loophole that many foreign investors used to avoid stamp duty by buying their properties through company ownership. Now there is a 15% stamp duty on purchases over £500,000. This will severely target foreign owned properties in particular in London and South East.

THOUGHTS – Will foreign investors now just flood the UK commercial property market? So is it a good time to get in now and sell in the near future?

Help to Buy

The equity loan scheme known as Help to Buy has been extended on new homes until 2020, with the aim to fill the shortfall in housing and encourage lending from banks and building societies.

In reality this will mean that the construction industry will be boosted until 2020 at the expense of young buyers, who end up buying an inflated prices, and find themselves in a lot of debt. This will keep pressures on house prices up until 2020 too. For the investor it means, get on the property ladder today or expand your portfolio, and if you want an exit do it before 2020. It also means new builds that are eligible for the scheme will be considerably higher priced than old builds, however this will drag the prices of old builds along too.

No mention of any extension to Help to Buy 2, the scheme that was available for non new builds up to £600k.

Housing supply

Ebbsfleet Garden City – 15,000 new homes to be built near the Ebbsfleet international rail terminal, to create a commuting hub. As PropVestment advised a few years ago Ebbsfleet was an investment hot spot and it will only increase more now. With great transport links it will become a thriving part of Kent. However we think the area will now be priced in.

Brent Cross and Barking Riverside in London will also receive new developments and improvements to help aid the capitals housing problems.
UPDATE – There will be 11,000 new homes in Barking Riverside and up to 10,000 in Brent Cross. The regeneration of the infamous Grahame Park estate near Brent Cross will also be brought forward. 

Right to build – New scheme to help people build their own homes. £1.5m allocated, that is pittance really, how many can be supported through this? Although it does sound like an interesting concept.

The chancellor’s target is 200,000 new homes to be built, however many critic suggest that this is still not enough and the housing supply deficit will keep growing. This means by simple economics demand will continue to out strip supply and prices will keep on rising.

Savings & Taxes

A few points are that the zero rate and 40p rate thresholds will rise, increasing affordability. ISA thresholds are increased to £15,000 per person and there are a few other measures to encourage savings. This could have impacts either way, one way is that it will encourage savings so people will be able to build up deposits for buying a property. On the counter if they have saved into ISAs that they do not want to break, it could mean that people will be more reluctant to invest into property. It will depend on person to person.

How will #Budget2014 impact the PropVestor?

UK Property - Budget 2014For the traditional investor it is a fairly positive budget and it will help discourage corporates and foreign investors with the Stamp duty ruling. This will leave more opportunities for private UK based investors.

Help to Buy is contentious but it will keep pressures on house prices until the end of the decade.

PropVestment’s top tip

Get on the property ladder today, do not wait until tomorrow

The rise of online estate agents

How important is the Estate Agent?

Is the role of the Estate Agent changing?

Over the last few years since the bursting of the property bubble in 2007 to now the role and business model of the estate agent has changed dramatically. We will discuss a few themes from the rise and reliance of the internet in property. Most prominently the rise and almost necessity of agents to list upon Rightmove and Zoopla. Are relationships with your agent still as important? The rise of volume of estate agents on every high street? Is it different if you are a buyer or a seller.

Internet-Only Agents, Rightmove & Zoopla

The rise of online estate agentsA few years ago there was a giant called Findaproperty.com, which has now disappeared after a merger with Zoopla in 2012. The giants are now Rightmove and Zoopla. Nearly every high street agent must now list on these two giants to get the exposure to potential buyers or letters.

In times gone by majority of the advertising for property was in the freely distributed local newspapers, and newspaper could get a large amount of their revenues from estate agents. Now many papers exist in only online form or only sold in selected stores. This has meant that all that revenue is diverted to these online property listing sites. Within minutes of receiving new properties agents are able to list them online and mailshot them to potentials. As a buyer this means you have quick access but also quick competition.

DID YOU KNOW: 95% property searches are done online!

There are now a rise of many online only estate agents such as such as eMoov.co.ukHousesimple.co.uk and Hatched.co.uk. Zoopla and Rightmove online allow estate agents to advertise, not private clients. Hence their is a market for online only agents. With minimal costs they can operate, some only charging £500 commission on property sales. Compared to the 2% average of traditional agents and London average house prices hitting almost £350,000. That’s a comparison of £500 vs £7000? What would you choose?

Are relationships with your estate agent important?

This question goes hand in hand with the debate of using online only estate agents or not. In years gone by your relationship with your local agents were of prime importance. Whether you were a seller or a buyer your agent could significantly improve your chances of succeeding in a transaction or even giving you first option ahead of others.

Recently working on a deal for a client we realised the importance of this relationship is still as valid as ever. You pay a price but you get that call ahead of a property being listed online. Or as a seller they personally take care of negotiations and vetting to squeeze every penny from the prospective buyer. It brings about a personal touch an art that is often lost in today’s technologically reliant world.

Spoilt for choice? But which one?

Spoilt for choice for estate agentsSince the before the bubble burst till now there have been more and more new estate agents cropping up on every high street in the country. Even when the market for buying and selling was stagnant they were opening. Mainly for the high demand for lettings and the quick 6-10% that they could make by flooding landlords with sub standard tenants and then in an few months they disappeared. Estate agency requires no qualifications to open, so there is easy entry. But do not discount them all the new boys on the market. There are some very good ones. Best advise is to go and have a conversation, you very easily can weed out the all talkers and the ones with extensive local knowledge.

The best agents we find are ones that have been in an area for a while, they get the best properties first and they also have the ready clients who are looking.

Difference for Buyers and Sellers

For buyers:
Walk around the area you are looking and register interest with the local estate agents. They will give you inside knowledge of the happenings and developments locally and can give you first option. You are not generally paying anything so it makes no difference to you.

For sellers:
You are the one paying fees so this is the big dilemma. Also it depends on your circumstances, how long you can wait to find a buyer, can you handle viewings. A good agent can vet out prospects so there is less hassle for you, especially if you are selling your residential home and do not want hoards of random people turning up to see.

Conclusion

Estate Agents are massively important for the buyer and seller, however each situation is different. On the whole good relationships enable you to get preferential and personal service that can help you beat the market.

#AutumnStatement : UK Property Market

Property Highlights

  • Capital Gains Tax loophole closed

From April 2015, overseas investors will face a capital gains tax bill on any profits they make from UK property. It is only fair to make overseas investors pay capital gains tax (28%) on the profit they make when they sell their UK properties. That is what British second homeowners are required to do, so why not foreign investors too.

  • £1bn made available for property development loans

£1 billion of loan money is to be made available to councils wanting to fund new housing developments in Manchester, Leeds and elsewhere (expected to create 250,000 homes). House building is up by 29% on last year. It is a figure warmly welcomed by construction firms such as Persimmon, Barratt and Taylor Wimpey, though many large financial firms such as L&G insist house building should be a much higher and more urgent priority.

For Help to Buy, Virgin and Aldermore will be offering mortgages too.

  • Aim to keep interest rates low

The aim of many tight regulations in banking and financial industries is to encourage responsible lending and so it is possible to maintain low interest rates. This is vital to the general economy and must be fought against rising house prices. So house prices will need to be kept under control.

 What does this mean for a property investor?

Autumn Statement UK Property Capital Gains TaxFirstly if you are a foreign investor then much of the benefit you got have been diminished. However if you are not, this is great news. It will mean that foreign investors may start to put there money else where. This means there will be less competition from “Cash Oversea’s buyers” when you are after a property. Prices should also correct accordingly. Overall a good policy for UK property buyers and also the increased tax revenue will help the public too.

Funding for house building and developments will increase housing supply and keep construction jobs strong. However will this only benefit the house builders who sell at inflated prices? Possibly. The impact on the normal UK property investor will be minimal.

Low interest rates are welcome for investors, however it depends if new finance is available. Overall it will at least mean that investors’ current mortgage payments stay low.

Overall a good Autumn Statement for the UK Property investor.

 

 

Buy to Let mortgages

UK Property Market Update – Winter 2013

The UK property bubble is building

  • The average family home is up £5,583 and London properties have increased by more than £7,000.UK property prices went up by £7,430 in October
  • Average sale price in London is now £404,199
  • Help to Buy scheme is inflating prices
  • Rents increase 11% to £785pm, 41% of the average UK wage.

UK rents

UK property Sale prices

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average UK Property Prices In London, where the average sale price is higher than ever, 14 people compete for every property.

Mortgage applications rose by 6% in October, and almost double 2012 numbers. It comes as the Council of Mortgage Lenders said last week the number of homes sold this year will be more than one million for the first time since the financial crisis began in 2007.

The government Help to Buy scheme is pushing prices up.

Out of the 5,375 sold so far, the highest number of Help to Buy sales have been in Leeds, Wiltshire, Milton Keynes and Reading.

The average price of a UK property bought under the Help to Buy scheme was £194,167, with an average equity loan of £38,703.

UK property transactions

Critics warned the UK-wide second phase of the scheme, which began last month and is not restricted to new-builds, would cause a housing bubble.

It guarantees 15 % of the value of the home loan.

After almost coming off the market, Buy to Let mortgages are also being approved strongly. Landlords and investors are buying up and completing deals to keep up with the increasing rent demand and to cash in on the rental increases. This is a very encouraging sign for property investment.

However as the final graphic shows there is still not enough supply in the market, especially in London where there are almost 3 offers for every sale.

PropVestment’s thoughts

Offers and Sales

Yes the UK property market is picking up and in fact picking up a little too fast. But this is mainly due to the Help to Buy scheme which is resulting in unrealistic implications on price and the market. The only ones to benefit are the banks and house builders. First time buyers, buying under the scheme face higher interest rates compared to traditional mortgage products.   
The market right now is too competitive and sellers can take advantage. We do however have concerns that many first time buyers under Help to Buy will suffer from negative equity in years to come once the Government pulls the plug on the scheme and prices fall back to their realistic, natural and sustainable level.

Buy to Let mortgages

Source: Daily Mail
UK property market HS2

#HS2 – High Speed 2 implications on the UK Property Market

UK property market HS2With the announcement of the HS2 today, there has been much in the media, with a lot of criticism. We at PropVestment want to focus on the implications of HS2 on the UK property market.

Economically this will create jobs and provided technology is sourced within the UK will benefit us in the long run.

In terms of the thousand or so homes effected, we believe they have been offered 110% the market value of their property prior to plans announced. Home owners have got a good deal, especially in some northern reaches where the UK property market is almost non existent as UK potentially drops into a “triple dip” recession.

How does HS2 effect the UK Property Market?

  •   HS2 impact on UK Property MarketReduce Pressure on London
    As commuting becomes easier with journeys under an hour from Birmingham to London, similar to a journey from Zone 4/5 to Zone one within London. Therefore many will choose to locate outside London. Benefiting from lower property prices and potentially larger homes.
  • Revival of Northern Property Markets
    As from locations will be commutable to the major cities and London. Hence more people will choose to locate in those towns, boosting house demand and rentals too. Landlord’s and investors will find these areas as more attractive places to invest. First time buyers and young professionals out priced by London have the option of settling in Manchester, Sheffield, Leeds or Birmingham and able to travel more easily.
  • Revival of UK Construction
    It is inevitable that there will be need for new home and in the areas surrounding the HS2. Primarily for the construction workers and secondary for the end users who look to make use of the HS2 rail link.

 

Where to buy UK Property Top Tip: Totan, Nottinghamshire

Read more

PropVestment 2013 – UK Property Market Outlook

UK Property 2013 – House Prices, Lending, Supply, Rents…

There is always much speculation about how the UK property market will fair when we start a new year. How will the market correlate to the economy as a whole, and the biggest question of all is whether its recovering from the credit crunch?

  • House Prices
  • Lending
  • Supply
  • Rents

UK House Prices in 2013

House prices are low currently and the advise from PropVestment is that property prices will not stay low forever. Simple demand and supply, population is growing faster than new supply, together with smaller family units means shortage. Further lending is still tight but there is major pressure to improve. If you can afford to buy now, do it.

Today Rightmove are claiming that sellers are pricing 0.2% higher in 2013

UK Property Lending in 2013

Investment property services

Lending to first time home buyers in the UK increased 11% in 2012 compared to 2011, however this is still considerably lower than pre credit crunch. There is constant pressure on lenders to lend more but the criteria remains tight. Hopefully 2013 will mean more realistic and universal schemes rolled out by lenders, with more scope than last years NewBuy and FirstBuy.

Read more

First time buyers face scarce supple due to council property

London’s housing problem for First Time Buyers

Why First Time Buyers find it hard to buy in London

  • High Prices
  • Shortage of Properties
  • Difficult lending
  • SOLUTION – Sell council properties in Zone 1 & 2

This article discusses the various issues in the London housing market, addressing high property prices, housing shortages and high rentals. Linking these factors to the reasons why first time buyers are facing an uphill struggle.

I have lived in London my whole life and professionally work in the property industry with my company PropVestment. The aim is to provide information, analysis and property related services for investors. From my experiences in this field and from living in London my whole I make some observations.

First Time Buyers Problem:

Too high prices and shortage of properties

First time buyers should be able to buy ex- councilThe first thing that caught my eye this week was an article titled “London councils breaking B&B stay limit for families” on the BBC News website. The main thing I understood from this article is that Westminster council has broken the law by not housing 134 families into housing and not B&Bs within 6 weeks. The main take on the article as reported is housing shortage.
However, why are there so many demanding housing in Westminster, arguable the most expensive borough. Surely if you are in need of accommodation you should take or be given where available and not be given location preferences.

Read more

PropVestment in Telegraph Property

Ex-council homes: how to buy a bargain – Telegraph

PropVestment mentioned in the Telegraph Property section: Why Council homes are a bargain

By  7:00AM BST 03 Sep 2012

A new proposal to sell off council housing in some of Britain’s best postcode areas could be a once-in-a-lifetime investment opportunity. It is no time for snobbery, says Graham Norwood.

Ex-council house in Essex

This 17th-century former hunting lodge in South Ockendon, Essex, used to be three council homes, and is today a six-bedroom house. It’s on the market through Fine (fine.co.uk) for £449,995.

It is one of the biggest property stories of the year, and an opportunity for bargain hunters like no other. When the Telegraph published an article about selling off council houses, by Neil O’Brien, the director of Policy Exchange, it had no idea what a storm it would create.

Last week’s report argued that if councils sold all the homes which become free in an average year, they could raise £4.5bn in revenue. This money would then be ploughed back into 170,000 new-build properties in cheaper parts of the country. The story provoked plenty of debate. Grant Shapps, the Minister for Housing, called the idea “blindingly obvious”. David Cameron said the proposal was “certainly something [councils] should look at”. Not everyone was happy: some Labour MPs warned that it risked creating ghettoes and ruining local diversity.

But aside from the political to-ing and fro-ing, what does it all really mean for homeowners? If cheap houses become available in some of Britain’s best areas, it could provide golden opportunities for canny investors. Certainly, it is time to end the snobbery and acknowledge the truth. Many local authority homes are fashionable, built to last and brilliantly located. For every hideous tower of cheaply built flats requiring demolition, there are spacious low-rise mansion blocks. These date from the public sector heyday of the Thirties, now considered retro-chic.

Then there are thousands of Victorian and Georgian houses, originally built for private sale. Councils bought them as part of grandiose regeneration schemes, many of which came to nothing. But a sprinkling of 21st-century TLC would return them to their former glory, or even better.

There are substantial profits to be made, as has been seen in areas where council properties have been sold in the past. Camberwell is a good example. A two-bedroom council flat bought here for £44,000 in 1994 recently sold for £214,000. During the intervening years, the area has come up in the world. Where once it was slightly grubby, it is now a fashionable village, home to the musician Florence Welch, as well as actresses Lorraine Chase and Jenny Agutter. If a new sell-off becomes policy, there may be thousands of homes coming on the market in the most desirable parts of the country. Often at bargain-basement prices.

In the London borough of Kensington and Chelsea, for instance, the average flat costs at least £967,000 and a typical semi-detached house costs more than £12.5m, according to Land Registry figures. Even in this salubrious enclave, however, a quarter of homes are categorised as social housing: owned directly by the council or through housing associations. In Brighton and Hove, there are similar opportunities. A typical detached house costs almost £461,000, and a flat will set you back £197,000. Yet one in every seven properties is in the social sector. Here and elsewhere, a sell-off would mean ex-local authority properties being marketed at prices lower than those for comparable private homes. There would be rich pickings, for those in the know.

“Even in prime condition, ex-council properties sell for 20 per cent less than a similar home next door because of the stigma,” says Geoff Tanner, a private property consultant based in Cambridgeshire. “If it is in poor condition, it could be 30 per cent less. The proposed sell-off would represent a great deal for buyers who get in quick.” Some councils are already encouraging tenants to free-up larger properties. In Devon, more than £700,000 worth of cash incentives have been paid to tenants. This has released 330 homes in areas such as Exeter, Plymouth, rural Devon and the coastal South Hams.


This one-bed, ex-council flat is in Drury Lane in Covent Garden. It is being sold for £437,000 through Chesterton Humberts.

Westminster Council, in central London, has set up CityWest Homes Residential, a service specialising in marketing council homes. Its website, cwhr.co.uk, advertises flats to rent in areas such as Bayswater and says homes for sale are “coming soon”.

With all this activity already ongoing, it’s no surprise that estate agents have greeted the prospect of a sell-off with open arms. They highlight the advantages of council-owned buildings compared with those which have been squeezed by the private market. “Council properties are often well-built with good-size rooms and communal gardens,” says Christopher Saye of Chesterton Humberts. “Red-brick period blocks don’t even look like council properties and generate plenty of interest. They are cheaper than comparable private developments, with far lower service charges.”

During the Eighties, Margaret Thatcher’s Right To Buy initiative allowed tenants to purchase their homes with a discount of up to 70 per cent, if they had lived there for two years or more. Many councils also offered 100 per cent mortgages to encourage buyers. The scheme boosted Britain’s home ownership level from 57 per cent in 1980 to 68 per cent in 2000.

But the sort of sell-off proposed by Policy Exchange would be even more dramatic. It would be an open field, with anyone entitled to buy the flats. Not just those already living in them. “It’s simply good asset management. Some local authorities do this already. We’ve sold properties in high-value areas at auction on behalf of authorities,” explains Yolande Barnes, head of research at Savills and one of Britain’s leading housing experts.

Clearly, there is no shortage of enthusiasts for the quality and good value offered in ex-local authority housing. Nirav Shah, 24, bought a three-bedroom apartment in Waterloo, central London, in 2008 when he was a student. “My father and I looked at lots of properties and none even came close to the former council flat for location, space or condition,” he explains. He now runs a property investment firm called propvestment.com. “I no longer live in the flat, but I rent it to other students. It has been let permanently since I left. Ex-council is a perfect investment,” he adds.

His apartment was one of many built to Parker Morris standards, a planning regime which until the Eighties imposed minimum sizes on public-sector architects and builders. Parker Morris stated that a one-bedroom council flat built for up to two people should have a minimum of 495 sq ft. Try finding that in a modern private flat today. The standards have even got a thumbs-up from London Mayor Boris Johnson, too. After taking office, Johnson promised to “re-establish space standards promoted by the visionary planner Sir Parker Morris”. He argued that this was the only way to “build for the long term. Buildings that people will want to keep for 100 years and not tear down in 30.” Space, location and value: the council-house dream seems almost too good to be true.

But while many are in favour of selling council homes, there are still issues to resolve. “One concern might be tenant displacement,” says Jennet Siebrits of CBRE, a consultancy advising developers and public bodies on housing. She fears new homes built with money from a sell-off would have to be in cheaper areas. “We would need careful analysis about which parts of the UK have the highest demand for social housing,” she says.

There are also concerns that moving council tenants away from their places of work could create pockets of unemployment, and ruin the mix of people which makes Britain so vibrant. Policy Exchange believes, however, that these short-term problems would be outweighed by the benefits of creating half a million new homes in three years.

So will it actually happen? With a Cabinet reshuffle imminent and a relaunch of the Coalition likely at this month’s party conferences, there is an appetite for radical initiatives. And no sector needs them more badly than housing. A boom of new construction would create homes for the needy and jobs for builders, as well as opportunities for people looking to get on the property ladder.

A social housing revolution may be just the economic shot in the arm the country wants. And for keen-eyed individuals, it could be the investment of a lifetime.

Buying an ex-council property: the pros and cons

Pros: 
Price – they usually sell at 20 per cent less than comparable private properties, says the Royal Institution of Chartered Surveyors.
Investment – ex-council houses are good for buy-to-let landlords wanting more for their money.
Location – ex-council property is often very central, perfect for transport and nightlife.

Cons:
Outside – tower blocks can look daunting from the street.
Communal areas – there can be disputes over charges and responsibilities if some flats in a block are publicly owned and others private.
Ceiling price – until the stigma dies, ex-council homes will sell at a discount compared to private homes.

Original article link http://www.telegraph.co.uk/property/9508685/Ex-council-homes-how-to-buy-a-bargain.html

OTHER MUST READS: PropVestment in Daily Mail

 

Sell off expensive council property beneficial to UK property market

Why selling expensive council property is beneficial for the UK property market & economy

Policy Exchange Proposal will boost UK Property Market

Policy exchange proposal for UK property marketLast week the Policy Exchange think tank issued a proposal for councils to sell expensive properties on their asset sheet, and utilise the money raised to build new affordable housing.
Here is a summary of the main points in their report. Expensive housing is categorised by above the average house price.

THE FACTS: Property market & economy benefits

  • – Generate £4.5Bn a year
  • – Create 340,000 jobs
  • – 170,000 new homes, halving the council waiting list
  • – 816,000 houses that are above the national average
  • -The total value of expensive social housing is £159bn (£71.9bn of it in London)

However despite all these positive benefits there has been much protest in the press over the last week. Here are PropVestment’s counter-arguments in favour of this proposal

Sell off expensive council property beneficial to UK property market

Council House worth £2 million

1. Frees up houses for young buyers

If the council sells up certain properties in areas, often they are still reasonably priced than private sector properties. This way younger people can more easily get on the property ladder.
Here is our own example as featured in the Daily Mail a couple years ago. Click here

2. Jobs will be created in the construction sector.

As long as there is a minimum requirement for locally employed people in the construction of the new houses, many jobs will be created, in turn boosting the local economy from the multiplier factor. In essence this proposals releases trapped money stuck in bricks into the local economy, taking funds from private sector into the local economy.

“In essence this proposals releases trapped money stuck in bricks into the local economy, taking funds from private sector into the local economy. “

3. Increase Housing supply

As building a new house is cheaper than buying a new house, this will mean that the money raised from selling one property will mean more than one property being built. Hence relieving the pressures on the housing market. It will mean private landlords having less opportunity to rent to council tenants and therefore, increase supply on the private market reducing the rents in the process. This will benefit the average person who is not a home owner.

4. Argument of disrupting communities is wrong!

New build developments will create new communities with modern facilities too.
There will be more environmentally friendly estates, planned better to provide for the community better.

5. Argument that it will create ghettos is wrong.

There will be new development. It only becomes a ghetto if we make it a ghetto. That is not a flaw in proposal, but one in the people. As long as users respect each other and the community there will be no ghetto created. This is an issue for not for property divisions of government or councils but one for community support and education.

6. Argument that in HMO cases you can not leave a building half used- Wrong

HMO (Houses of multiple occupancy) mean that under the policy as people move out, their rooms will not be refilled as council will want to sell off the property. The argument goes that leaving rooms empty is waste. The rooms can be let on AST style contracts or used for temporary housing. The council uses expensive B&Bs for this currently, why not utilise empty spots in HMOs.

PROPVESTMENT CONCLUSION:  – UK Property Market

This new proposal by Policy Exchange think tank is highly beneficial to the UK property market and economy. It may need refining in a few areas, but the benefits of housing and job creation far outweigh any counter-argument raised so far.

PROPVESTMENT were featured in the TELEGRAPH newspaper on this very topic

READ http://www.telegraph.co.uk/property/9508685/Ex-council-homes-how-to-buy-a-bargain.html

Sources : Public Service