16 Aug Residential Property Review- July 2021
Our monthly property market review is intended to provide background to recent developments in property markets as well as to give an indication of how some key issues could impact in the future. We are not responsible or authorised to provide advice on investment decisions concerning property, only for the provision of mortgage advice. We hope you will find this review to be of interest.
Building Safety Bill published
Claiming “the biggest changes to building safety in nearly 40 years’’, Housing Secretary, Robert Jenrick, said that the Building Safety Bill will set out a clear pathway for the future as to how residential buildings should be constructed and maintained. The Bill was published on 5 July to set out new and more stringent requirements for residential buildings, following Dame Judith Hackitt’s review of building regulations and fire safety after the Grenfell Tower tragedy in 2017. New measures include:
– Identifying people responsible for safety during the design, build and occupation of a high-rise residential building
– Establishing a Building Safety Regulator to hold to account those who break the rules and are not properly managing building safety risks, including taking enforcement action where needed
– Giving residents more routes to raise concerns about safety, and mechanisms to ensure their concerns will be heard and taken seriously
– Extending rights to compensation for substandard workmanship and unacceptable defect
– Driving a culture change across the industry to enable the design and construction of high-quality, safe homes in the years to come.
Scarcity of new listings
In its latest UK Residential Market Survey, the Royal Institution of Chartered Surveyors (RICS) has indicated that new listings are becoming increasingly scarce. The RICS Survey points to a continuing excess of demand over supply, with a net balance for new instructions of -34% (down from -24% in May) during June, which is a third consecutive monthly fall in new listings. Knight Frank has also reported strong demand, with figures showing a ratio of new prospective buyers to new instructions to sell, being 10.4 in June, which is 56% above the five-year average. James Cleland, Head of Knight Frank’s Country business commented, “Stock is still low but building. There will be a gradual restocking over July and August and good houses will sell well over the summer. It actually feels like we’re moving towards a better place as a rebalancing of the market is underway.”
Property prices in Scotland continue to rise
The property boom is continuing in Scotland – an annual growth figure of 12.1%, in the year to May 2021, has been recorded. This is the highest increase in house prices in over a decade in Scotland and has occurred without the benefit of the Stamp Duty holiday, which has continued to offer buyers a significant discount elsewhere in the UK, fuelling the growth in house prices. According to Savills, the average house price in Edinburgh rose to over £300,000 in May, for the first time. John Forsyth, a Director of Savills commented, “The sales market, particularly for family homes, has been very active in the first half of the year. Nearly 80% of the properties we have sold have attracted multiple bidders and premiums of up to 15% to 20% over valuations have been achieved by our Edinburgh city office. Our registered buyer inquiry levels were up 30% in June when compared with June 2019, which has resulted in more competition, particularly for family homes throughout the city.”
All details are correct at the time of writing (20 July 2021)
It is important to take professional advice before making any decision relating to your personal finances. Information within this document is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK.
If you have any queries, please contact the team at Howard Mortgages on 01803 554455 or contact us here.
Your home may be repossessed if you do not keep up repayments on your mortgage.