A succinct weekly take on the London property market and a roundup of headlines from the PropertyBrain team. Subscribe to the Friday Roundup here: http://pbra.in/pb-signup
Here’s a roundup of what we think are the big news stories this week:
* UK chancellor Philip Hammond is allegedly preparing a stamp duty cut for first-time buyers as a signal that the Conservative party understands the housing problem, exemplified by how younger people are struggling to follow in the footsteps of their parents by buying their own homes. They are considering other measures for inclusion in the Budget, for example, ways in which the government could commission the construction of more homes on state-owned brownfield sites. Interestingly, the Treasury has been considering a fresh tax raid on buy-to-let landlords, with Mr Hammond noting that the recent stamp duty surcharge has not dented the market.
* Official data from the Office for National Statistics added weight to the gloomy picture for London house prices on Tuesday, as annual growth slowed to 2.5% over the year to September from 2.7% in the previous month. Average house prices in the capital fell for the second month in a row, but homes values across the UK held up better, with prices increasing 5.4% in the year to September, up from 4.8% in August.
* Housebuilder Taylor Wimpey is on track to meet full year expectations, as demand for new homes continued to be supported by a competitive mortgage market and the government’s Help to Buy equity loan scheme. The company claimed that the UK housing market has remained positive over the second half of 2017, as high demand and favourable conditions outweighed potential political and economic risks. However, it warned building costs are expected to increase by around 3% to 4% in the full fiscal year, with greatest pressure coming from labour costs, followed by cost inflation in building materials.
* London West End property developer Great Portland Estates has edged back to profitability. It also said that international money was supporting asset values across London, and as a result it has not found many attractively-priced properties to buy. Worryingly, it is likely to be a net seller of property over the second half of the year, and already has £400m of property on the market.
* Housing associations are to be reclassified by the UK government as private organisations, in a move that ministers hope will encourage them to build more homes. Experts say Britain needs to build up to 300,000 homes per year to fix the housing crisis. Figures released by the Department for Communities and Local Government on Thursday morning showed that only 217,000 new homes were created in 2016/17.
* The National Infrastructure Commission has published its latest report on the potential of the Oxford Cambridge arc. This could add hundreds of billions of pounds to the national economy each year and lead to the first new towns in the UK for half a century.