Musings of a London Property Search Agent

The Royal Institution of Chartered Surveyors (RICS) have warned that construction of new homes could drop below 100,000 per year by the end of this year, missing the government’s target by more than 50%.

As recently as 18 months ago, the government’s pre-occupation with housing centred on creating more homes in order to stabilise house-prices and enable more people to buy a roof over their head.  In 2003 the government commissioned Kate Barker to conduct an independent review of housing supply which led to the government setting housing targets based on projected need which was partly intended to satisfy demand and stabilise the property market.

But in a country where land is at a premium, many councils, particularly in London and the South East have found it very difficult to meet local new housing targets set.  The credit crunch has exacerbated the problem as builders struggle to get finance and sell existing stock.

RICS Senior Economist Oliver Gilmartin said: €œWith finance for projects becoming increasingly difficult to obtain, the Government€™s ambitious target of 2 million new houses a year by 2016 is likely to fall well short. At current levels of production the number of new homes built will fall below 100,000 in the coming year.”

The RICS reports that the Government needs to build in excess of 200,000 new homes each year in order to reach their target of 2 million homes by 2016.  To date, only 66, 220 new homes have been built in 2008, with a fall below 25,000 per quarter likely by the end of the year. 

It would be rather ironic if missing the government target initiated to increase supply and stabilise the property market kick-starts the housing market due to the ongoing problem of low supply and high demand.  But if the outcome, stabilisation of the property market is achieved, then the means is irrelevant.  Until the market overheats again.

Perhaps local councils will apply section 106 agreements more flexibly over the coming months to help developers make the margins and councils to meet their targets.  This has already happened in many London boroughs to date.  If you are cash-rich developer, get those planning applications in.  Seek the services of a London Property Search Agent before it is too late!

Technorati Tags: credit crunch, House Prices, housing targets, Kate Barker, London House Prices, London Property Search Agent, New homes, property developers, property market, RICS

Tags: credit crunch, House Prices, housing targets, Kate Barker, London House Prices, London Property Search Agent, New homes, property developers, property market, RICS

Musings of a London Property Search Agent

Bigwigs from the RICS (Royal Institution of Chartered Surveyors), the NAEA (National Association of Estate Agents) and others have called on the Chancellor to clarify any changes to stamp duty payments asap, reports The Telegraph today. August is traditionally a slow month in the world of property sales and this year is particularly bad but some property professionals fear buyers will fail to complete before September to avoid missing out on any concessions.

Ideas mooted have included lengthening the deadline for payment of stamp duty. This would be of particular help to first time buyers who routinely pay in excess of £250,000 for their first property, incurring a stamp duty liability of over £7,500.
 

The mid-market would also benefit, as many people who want to move up the property ladder prefer to improve than to move to avoid the tax which works out at £40,000 on a £1,000,000 property – a good-sized family home within zone 2 in London.
 

Stamp Duty Liability as of 07.08.08

• 0% for residential property priced up to £125,000
• 1% for residential property priced between £125,001 and £250,000
• 3% for residential property priced between £250,001 and £500,000
• 4% for residential property priced over £500,001

To take advantage of this period of stamp duty relief contact this London Property Search Agent.

Technorati Tags: London Property Search Agent, NAEA, property ladder, RICS, Stamp Duty

Tags: London Property Search Agent, NAEA, property ladder, RICS, Stamp Duty