August 10, 2017
Housebuilding up as second steppers face challenges and Hackney leads the way
It’s time again for a round-up of the latest property news, with a particular focus on London. As politics (largely) continues to take a backseat ahead of party conference season, other things are dominating the news agenda. Property, as always, has been making some of those headlines…
Housebuilding figures at their highest since recession
According to new government data, housebuilding figures are now at their highest level since 2008.
Data recently released by the Department of Communities and Local Government showed that the number of new build homes that have started construction has surged this year, with 164,960 underway in the 12 months to June 2017, a rise of 13% on the previous year.
In addition, over 153,000 new homes have been completed during the same time period, up by 11% when compared with the year before.
Alok Sharma, who took on the Housing Minister brief after the recent general election, said he was encouraged by the figures.
“It’s vital we maintain this momentum to deliver more quality homes in the places that people want to live. Our Housing White Paper set out an ambitious package of long-term reforms to do just that,” he said.
In London, meanwhile, a business-led campaign group has suggested that London is in the perfect position to reverse decades of insufficient housebuilding. The Fifty Thousand Homes Campaign, launched by London First and supported by more than one hundred business leaders as well as CBI London and FSB London, says London should be building 50,000 new homes a year to keep up with rising demand and a rapidly growing population.
With a record number of requests to build new homes in London in 2017, and planning permissions also on the rise, there is hope that this could be a bumper year for the construction of new properties in the capital.
While the 50,000 figure is currently unlikely to be met, more than 15,000 new homes were completed in the first half of 2017 and, typically, the second half of the year sees a surge in construction. At the very least, the 23,019 new homes built in 2015 should be comfortably beaten.
Second steppers, not first-time buyers, face the biggest challenges
Existing homeowners looking to take their second step on the property ladder – known as the ‘second steppers’ – say that doing so is harder than getting a foot on the ladder in the first place, according to Lloyds Bank.
We often hear about the plight of first-time buyers and their struggles to purchase property, but second steppers rarely receive as much coverage. For some, major life events – such as having children – are being put off because of the difficulties they are having in moving on from a starter home.
In many cases, second steppers are young professionals ready to start a family and eager for a larger abode to make this feasible.
The research found that nearly a quarter of second steppers will now have children later in life than originally planned, while 12% said they will opt to have fewer children.
One in eight, meanwhile, said they have had to swap careers to help themselves move up the housing ladder.
A rise in stamp duty and moving costs, plus the difficulty in finding a suitable property, are all helping to put second steppers off, with more than half (52%) saying they had planned to move up the property ladder in the last year but have been unable to achieve this goal.
Historically low interest rates – which is making saving problematic – have also been a deterrent, with second steppers struggling to save the money required to take their next step on the ladder.
The survey also gave an insight into the wants and desires of second steppers – with just 9% saying they would lower their asking price to attract extra buyers, while 51% said they would remain in their current property until conditions make moving on more feasible and a further 27% are making improvements to their existing home rather than selling up.
For 35% of second steppers, a period home is the dream, while 34% said a new build property with three bedrooms would be ideal. Second steppers also plan to stay in their second home for, on average, a decade.
Just a third said they plan to never move again after their second splash in the property market, with the majority realising that their second home is unlikely to be their last.
Hackney leads the way
Rightmove’s latest house price index has revealed that hipster favourite Hackney has witnessed the largest year-on-year rise in house prices, up by 8.9% (or £10,308).
It has also bucked the trend of a summer holiday slowdown by registering growth of 1.5% between July and August, at a time when property prices are typically lower as everyone heads off on their summer breaks.
That’s all for now – we’ll be back in September for another property round-up.
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