In the last two years, we have seen more and more residential developers look for sites outside of London.
The build cost, plus the uncertainty of the sale has encouraged developers to move further afield, with the likes of Berkeley Homes looking at the Midlands, St Joseph and St Modwen are building more in the Midlands or the home counties. The risk of building spec properties without knowing where the market will sit in the next year or so has been heightened by Brexit, economic uncertainty and has slowed down private development for some.
- 40,735 energy Performance Certificates (EPC) in the last 12 months in London
- The most significant rise was in the North-West, up 56 per cent
- It’s estimated that we need 65,000 new homes per year and at the moment we are falling short of this.
The uncertainty in the housing market is also affecting existing properties and those looking to sell. The asking price for the average UK home fell by 0.2%, or £730, in September compared with August, as the housing market failed to pick up after the summer, according to property website Rightmove. The market usually has an uplift around September time but with a new PM, more uncertainty over a no-deal, we do not see the improvement in the market that Estate Agents and sellers would like, the last time this happened was September 2010.
What we are now seeing is a change in the mindset of a younger generation who are becoming frustrated with the lack of new home opportunities. The staggering deposits that one needs to get onto the property ladder. In addition to this the “live for the moment” mindset means that more and more people are willing to look at rented accommodation as a long term option, hence the massive increase of Build To Rent (BTR) properties. Invesco Asset Management has recently completed a £98M forward-funding deal as it expands its Birmingham BTR portfolio. With developers springing up like Court Collaboration, giving a young ambitions approach to shared living we could see more and more private developers changing their approach from selling properties to renting properties, like Strawberry Star in the South.
There needs to be more synergy with private/public developers, and planners need to look for new ideas and talk to the developers about what they need to do. Aaron Higgins, Head of Division, recently met with a developer who is not alone in his frustration with planners who have a “computer says no” mentality and who appear not to want to help them build more homes.
Aaron Higgins added, “I am happy that there are people and companies who are changing tact and by being more diverse, employing different people with different thoughts who are coming up with new ways to build, who listen to the public and build properties that are inspirational, practical and loved.”
Over the next few weeks, as we move closer to October 31st we might see the scariest Halloween in some time, but hopefully, there won’t be too many skeletons coming out of the closet and whether we are in, out, have a deal or not the housing market will be back with a bang and there will be fewer tricks than treats.
Source: https://www.bisnow.com/birmingham/news/build-to-rent/invescos-98m-punt-on-birmingham-btr-100831
