Buyer demand remains high across the housing market

Many sectors have suffered dramatically during the past 12 months, but one that continues to bounce back stronger than before is the housing market. Recent figures by Rightmove’s monthly House Price Index show that, even during a pandemic, new records have been set within the industry, with the average price of property jumping up by 1.8% (£5,767). With the market continuing to experience extremely high buyer demand and an appetite for larger homes, one thing is true — confidence in the market continues to be at an all-time high.

It is no surprise, really. With people having spent more time in their homes in the last year than ever before, we’re experiencing a growing trend of people looking for more space and better surroundings, leading to frequent moving becoming the norm. This need for ‘better’ has seen a boom across the industry, so much so that the prices of homes in the north of the country have seen double-digit increases, with prices up by 11.1% in North West and 10.5% in Yorkshire. This section of the country has had the greatest potential for growth for many years now, and the change in buyer’s needs (more working from home, less commuting), means a spotlight has been shone on this part of the market.

Many will look at the extension of the stamp duty holiday, paired with the continued low costs of borrowing as the real savior for keeping confidence in the housing market. In some ways, they may be right, but it is clear that confidence has been there long before this. With Nationwide reporting that three-quarters of the homeowners they surveyed at the end of last month saying they would have moved even if the stamp duty hadn’t been extended, we have to appreciate that the market is already in an extremely buoyant place.

On that same thread, 25% of homeowners surveyed by Nationwide said that they were either in the process of moving or considering a move as a result of the pandemic, the expectation is that the industry will continue to accelerate in the coming months. If the month-on-month house prices remain flat, it is thought we might even see its annual rate of growth reach double digits — a continued welcome boost to our economy.”

‘Buyer demand remains high across the housing market’ first appeared on my Medium profile.

Improving the energy efficiency of your building

Reducing the energy consumption of your building should be a high priority for any landlord or freeholder. As well as lowering running costs, conserving energy will make it easier to comply with tightening environmental regulations, give you sustainable credentials and ultimately impact the property’s long term value. There are multiple ways in which you can improve the energy efficiency of your building, from the development process to bolt on changes.

If you are investing in a new-build property, there are three main things to consider: the bioclimatic architecture, insulation and ventilation.

Bioclimatic architecture adapts the building’s design to the natural conditions of the environment in order to reach thermal comfort. The location, orientation, shape, size and interior design of a building all must be considered in order to best protect the building from its local environment. For example, the shape and orientation of a building will determine the quantity of sunlight and wind it is exposed to.

Energy efficient buildings will all have high performing building envelopes. This includes thorough insulation, premium glazing and windows, and air-sealed construction. Thermal insulation is a low-cost proven solution that begins saving energy and money as soon as it is installed. Ground decks, roofs, lofts, walls and facades must all be well insulated for maximum efficiency. Air leakages result in heat loss, meaning that your heating system may be working in overdrive to meet temperature demand. An airtight building is essential to conserve energy.

For both new builds and renovations, making improvements to the building envelop will ultimately bring returns for the landlord.

High performance insulation goes hand in hand with a suitable ventilation system. Ventilation will not only provide fresh air, it will also direct CO2 and moisture outside of the build and save energy by recovering heat.

For landlords wanting to improve the energy efficiency of their buildings, replacing doors and windows can be a great investment.

There are multiple upgrades within your existing buildings that you can make. Installing energy saving LED light bulbs could help you reduce your energy use by 75% compared to incandescent lighting. Installing daylight controllers which only switch on when natural light is insufficient, or infrared sensors which switch off lights in infrequently used spaces such as corridors and stairwells would also make a difference.

There is a host of “green” gadgets on the market from smart thermostats and smart wall socket plugs to solar-powered outdoor lighting. Upgrading to certified energy efficient appliances such as refrigerators, dishwashers and washing machines is an investment that will offer significant savings in operation.

For individual properties there are numerous measures like solar panels and ground source heat pumps that can provide alternative renewable sources of hot water that reduces the overall burden on the grid. Landlords must carefully consider the cost/benefit returns from these investments and investigate sources of funding such as the Government’s Renewable Heat Incentive scheme.

Growing environmental awareness, tightening energy regulations and increasing energy prices, mean that going forward, reducing your building’s energy consumption will be essential to comply with regulation, attract tenants and increase your profit margins.

Written by Israel Moskovitz,

“Improving the energy efficiency of your building” first appeared on my Medium profile.

Planning reform — helping build Britain’s future

The Government has announced a major planning reform — a shakeup that is long overdue. Out of date planning regulations have not been reformed in the UK since the Second World War, with successive governments instead opting to alter the existing system. This has led to a process that is plagued by inefficiency and, given the current housing demands, is unfit for purpose. These proposed reforms will give the property sector a renewed sense of purpose as we begin to get the economy moving after Covid-19.

The existing system, in which councils vet planning applications on a case by case basis, will be overhauled, replaced with a three-tiered zonal system. Councils will be given the power to divide up land into three sections: “growth”, “renewal”, and “protected”. Under the plans, growth areas will be earmarked for big development project. If these developments are based on pre-approved design codes, they will automatically receive approval, cutting out years of red-tape from planning oversight. Renewal areas will see “gentle densification”, adding more homes to existing residential areas. Finally, protection of green belt land and areas of outstanding natural beauty will be bolstered.

The widespread reform aims to go further than any government has gone for decades by removing the time consuming and inefficient planning process. The Government said that it would require local planning applications to be developed and agreed in 30 months, a significant reduction from the current average of five years.

This is a welcome move for the property sector. The existing planning system was entirely unfit for purpose. As well as the painstaking and time-consuming process it took to get approval, the appeal process exposed extreme levels of bureaucracy within local councils. Under the old system, applications that were rejected the first time around for minor infractions would subsequently be passed six months later. Indeed, a third of applications went through on appeal after a refusal. Reform was essential.

The new regulations will enable the Government to finally realise its ambition to build more houses, something that previous reforms have manifestly failed to do. Government targets for new houses have consistently been missed, an appalling record that has blighted the UK’s property sector for years.

Along with the recent extension to permitted development right (PDR), that enables existing residential flats to be expanded by up to two floors, the planning reform demonstrates real intent by the Government to build beautiful houses in smart ways.

The removal of red tape will also help SME developers to bring new and exciting designs to local areas. The emphasis on developments that match the surrounding area demonstrates a connected thought process that realises local communities must be expanded whilst retaining their essential features. If the housing crisis is to be defeated once and for all, we must realise that innovation has to take precedence.

Of course, not everyone will be happy with this reform. However, the residential property sector has faced a crisis of missed targets for years. By building more properties, more people will be able to access houses in the long run.

For SME developers such as myself, this reform comes at a time where the removal of red tape is essential not only for the property sector, but for the country in general. Covid-19 has taken its toll on virtually every sector; it is important that the Government creates the right opportunities to stimulate jobs and investment to help the country back onto its feet.

Written by Israel Moskovitz,

“Planning reform — helping build Britain’s future” first appeared on my Medium profile.

New PDR for residential buildings offers an opportunity for freeholders to get the sector moving after Covid

The Government has announced a plan to expand Permitted Development Rights (PDR), allowing residential blocks to be expanded by up to two storeys without prior planning permission. With the PDR for residential buildings set to come into force in August, freeholders have a great opportunity to kickstart the property and construction sectors after coronavirus.

Post-Covid opportunities

Covid-19 has forced the entire sector to adapt rapidly to stem the spread of the virus. As I wrote recently, the residential sector is coming out of hibernation after three long months in hiatus. New ideas about how to market and sell properties will be needed. But, for freeholders, it is important to consider ways to take advantage of the opportunities already in play.

The new PDR allows residential apartment blocks over three storeys tall to be expanded by a further two storeys without planning permission. In effect, this gives freeholder the ability to significantly increase their existing assets without needing to go through lengthy and costly new planning applications.

The recent announcement by the Government offers freeholders a first tentative step into the brave new world of post-Covid. As we begin to emerge from lockdown, we must ensure that we maximise any and all opportunities.

Dual housing crisis

The housing shortage has existed in this country for years, with limited substantial effort being made to rectify it. In recent months, this crisis has been compounded by Covid-19. In order to respond to this dual housing crisis, there is a need to move quickly and efficiently to build affordable new houses. This sentiment was elucidated in a recent speech by the Prime Minister, who pointed to the housing sector’s role in getting the UK’s economy back on its feet.

The new PDR enables freeholders to do this by removing limits on block expansions, meaning more residential properties can be created quickly and easily. Likewise, by avoiding the need to build new developments, the PDR provides freeholders with a greener and more environmentally friendly way of increasing housing.

Considerations

When embarking on a new development, it is of course important to make certain considerations. Any redevelopments will inconvenience top floor leaseholders and tenants in the short term. Measures should be taken to prevent the disruption caused or, if disruption is unavoidable, alternative arrangements should be made available.

Furthermore, current top floor flats might lose some value in redevelopment. It is important to have these conversations with leaseholders and tenants early to explain the situation.

There are also strong benefits to this new announcement that will help both freeholders and leaseholders. Old roofs will be fixed with no cost to the leaseholders and lifts replaced. Likewise, construction work will provide freeholders the opportunity to carry out other important maintenance work.

Conclusion

Of course, this new PDR only offers us with a first glimpse into the post-Covid property sector. But it is increasingly clear the Government intends to stimulate the economy through construction. While freeholders must continue to search for new and innovative ways to adapt to the new normal, the PDR also offers a promising first step as we move out of lockdown.

Written by Israel Moskovitz,

“New PDR for residential buildings offers an opportunity for freeholders to get the sector moving after Covid” first appeared on my Medium profile.