Category: Weekly Summaries

DATA: Nationwide reported UK house prices fell 3.4% in year to May 2023

They report a seasonally adjusted 0.1% monthly fall in house prices, with the annual rate falling to -3.4% from -2.7% last month.

DATA: Halifax reported UK house prices fell 1.0% in year to May 2023

With prices flat in May, their index reports the “First annual decline in house prices since December 2012”.

DATA(PDF): Zoopla reported house prices rose 1.9% in year to May 2023

They report house prices fell 1.3% over the last six months. They also report “Stronger growth in new sales brings more sellers into the market” but “The prospect of higher mortgage rates in H2 is likely to weaken demand and activity but the scale depends on how high rates move”.

DATA: BoE reported 48,690 mortgage approvals for house purchase in April

The seasonally adjusted figure was 5.4% lower than the previous month and 26.0% lower than last year’s figure. Approvals for remortgaging were 29.4% lower than last year.

DATA: HMRC reported 82,120 residential transactions in April 2023

This seasonally adjusted figure was 8% lower than the previous month and 25% lower than April last year. The data was 17% lower than the pre-pandemic average (2013-2019).

DATA: HMRC published quarterly stamp duty land tax statistics

See Chart of the Week for more detail on the data for Q1 2023.

DATA: BoE reported net lending turned negative in April 2023

Gross secured lending was £17billion in April, 40% lower than last year’s figure. The net change in secured lending was negative, at -£1.4 billion suggesting more mortgage debt was repaid than lent during the month.

DATA: BoE reported another rise in effective mortgage rates in April 2023

The average rate on new advances increased to 4.48% (4.44% last month) while the average rate on outstanding balances increased slightly to 2.76% (2.75% last month).

DATA: BoE reported quoted mortgage rates increased in May 2023

While lower than the peak back in December, average quoted rates increased compared to last month. The average two-year fixed-rate at 75% loan-to-value increased to 4.73% while the five-year increased to 4.29%. The average revert-to-rate was 7.44%.

DATA: DLUHC published planning applications in England for Q1 2023

The release shows a 13% annual decline in applications received and an 11% decline in decisions granted. Glenigan data also shows the number of homes granted planning permission in the year to Q1 was 269,000, down 11% on the figure for the previous year.

DATA: DLUHC published EHS housing stock by local authority modelling

The modelling of English Housing Survey data for 2019 presents experimental data on the non-decent and unsafe homes in each local authority including splits by housing tenure.

DATA: ONS published Family spending for the 2021/22 financial year

It covers “Average weekly household expenditure on goods and services in the UK, by age, income, economic status, socio-economic class, household composition and region”.

DATA: HomeLet reported average rents rose 10% in year to May 2023

The index shows rents in London were 11.3% higher than last year while rents across the rest of the UK were 9.5% higher.

REPORT(PDF): RICS published May residential market survey

They report “Forward-looking indicators again turn slightly less downbeat but clouds are gathering on the horizon”.

REPORT(PDF): UK Finance published Q1 2023 Household Finance Review

They report “For Q1 as a whole, lending to both first-time buyers (FTBs) and home movers fell to the lowest level since Spring 2020, when the housing market was largely closed during the first national Covid-19 Lockdown”. Meanwhile the increase in borrowers using longer mortgage terms appears to have peaked and they repeated some analysis from their Quarterly Trends report examining the characteristics of borrowers in arrears.

REPORT: CaCHE reported on leasehold reform proposals

The report investigates “the potential financial implications of leasehold reform from changing the extended lease length and eliminating the marriage value payment beyond the distribution of a premium reduction”.

REPORT: IPPR reported on planning for net zero and nature

The report sets out how “the planning system needs to change to deliver net zero and restore nature in England, while also delivering the services people need, including well-connected communities and housing, and supporting the development of renewable energy”.

REPORT: TwentyCi reported on the housing market in June

Unfortunately the report does not provide any particularly useful time comparisons, instead focussing on regional patterns which always show the South East as the largest market.

PRESS: MoneyFacts report withdrawal of mortgage products

On the 5^th of June they reported more than 200 mortgage products had been withdrawn since the previous Friday, continuing the trend in the previous week and average fixed mortgage rates have been increasing. Both are likely to have increased since this data was published.

CORPORATE: Crest Nicholson published half year results

They report “Sales per outlet week (SPOW) of 0.54 (HY22: 0.72) with average outlets at 48 (HY22: 58)” and “Average selling prices have remained robust”.

Chart of the Week

The latest quarterly stamp duty (SDLT) statistics highlight the slowdown in transactions during the first quarter of 2023. Although changes to SDLT bands mean we must group non-liable and transactions under £500k into one group, comparing the Q1 2023 figures to the same period in previous years shows relatively similar percentage falls for all price bands versus Q1 last year except for those paying higher rates on additional dwellings (HRAD). The current market appears to be hitting investors and second home buyers hardest. Comparisons with 2019 and 2020 are more variable with higher priced transactions still above previous levels, reflecting the previous weakness of those markets.

DATA: Rightmove reported asking prices rose 1.5% in year to 13^th May

The index showed a big monthly increase (1.8%) in the non-seasonally adjusted index though this possibly reflects the weighting of the index towards the upper end of the market. They also reported “Agreed sales numbers are currently just 3% behind the last more normal pre-pandemic market of 2019” and “The discount from final asking price to agreed sale price has steadied at an average of 3.1%, in line with normal market levels”.

DATA: ONS reported CPI rose 8.7% in year to April 2023

This was lower than last month’s figure of 10.1% as last year’s energy costs fell out of the comparison period but was above the previous two-year average annual rate of 8.5%.

DATA: ONS reported house prices rose 4.1% in the year to March 2023

The completions-based index reported a 0.9% seasonally adjusted monthly fall. London recorded the lowest annual percentage rise, of just 1.5%. This data may be heavily revised in the future due to the Land Reg lag.

DATA: ONS reported private rents rose 4.8% in the year to April 2023

The measure of all rents paid (rather than new lets) was slightly higher than last month’s figure of 4.7%.

DATA: ONS reported SDLT receipts of £1.1 billion in April 2023

The stamp duty land tax receipts, covering both residential and commercial property, were 33% lower than the same month last year.

DATA: ONS published long-term international migration estimates

The data shows net migration was 606,000 in 2022, reflecting the bounce-back in student numbers and people moving from Ukraine and Hong Kong.

DATA: DLUHC published 2022 council taxbase data for England

The release shows there were 25.2 million dwelling in England on the 12^th September 2022. This was an increase of 238,000 over the year. They also published dwelling stock estimates for the 31^st March 2022.

POLICY: FCA proposed to requirements to support borrowers permanent

They are consulting on their proposal to “make permanent requirements on lenders to support borrowers in difficulty, which were put in place during the pandemic”.

POLICY: Homes England published 2023-28 strategic plan

The plan sets out their mission, objectives, and how they’ll measure their performance.

REPORT: Geospatial Commission suggested new taskforce for land use

The report recommends: “Establish a Land Use Analysis Taskforce to bring together cutting edge data and scientific expertise to assess competing land use pressures, ensuring national priorities are delivered within the land available in the UK”.

REPORT(PDF): LUHC Committee reported on Funding for Levelling Up

They report “the method of delivering funding, the allocation process, and the extent to which different funds have been compatible with the needs of communities in the short and long-term is creating several obstacles for the policy’s success”.

REPORT: House of Commons Library on tackling the under-supply of homes

“This paper covers trends in housing supply and barriers and potential solutions to delivering more homes in England”.

REPORT: House of Commons Library on the growth in short-term lettings

“This paper examines the growth in short-term lettings and proposals for greater regulation of the sector in England” and it “provides a brief overview of the regulatory approaches in other countries”.

REPORT: Propertymark published April housing insights report

They report a 30% fall in prospective buyers compared to April last year and a 70% increase in available properties over the same period.

CORPORATE: Watkin Jones published half year results

They report “no new forward sales in the period” though have just announced one in Bristol. They also report the “Underlying residential for rent market continues to perform well with both strong tenant demand and rental growth in our core PBSA and BTR sectors”.

CORPORATE: Empiric Student Property published trading update

They report “Revenue occupancy for academic year 2023/24 now at 86% and continuing to track significantly ahead of prior year” and “Like for like growth in average weekly rents for academic year 2023/24 improving and now expected to exceed 7%”.

CORPORATE: Henry Boot published AGM statement

They report “Following a pause from buying land at the end of 2022, there are signs of housebuilders returning to the market” and “The Build-to-Rent (BtR) market remains strong in terms of customer demand and investors are again looking to fund development”.

CORPORATE: LSL published AGM statement

They report “market conditions remain challenging as expected in H1, albeit there have been some early signs of improved trading since then and we continue to expect an improvement in H2, supported by the remortgage market and increasing consumer confidence”.

Chart of the Week

Sometimes it can be a challenge to find something interesting to show as the Chart of the Week but this week there have been too many options. I started the week thinking I’d do something on how it appears the Rightmove asking price index is weighted to the top-end of the market (Twitter). Then we had the inflation figures resulting in interest rates shooting up again (investing.com) along with news of mortgage products being withdrawn and repriced. Following that was the latest Regulated Mortgage Survey data from ONS showing falling loan-to-income ratios in Q1 2023 (Twitter) which is exactly what we’d expect to happen given higher mortgage rates. However, it was today’s ONS retail sales that really grabbed my attention and especially the chart showing the divergence in the value and volume of food store sales. We’re paying a lot more for less.

DATA: ONS published UK labour market update

The early estimate of payrolled employees fell in April for the first time since February 2021. However, this data is provisional. The unemployment rate for Jan-Mar was 3.9% and total wages (including bonuses) rose 5.8% in the year to March. However, real (inflation adjusted) wage growth was negative at -3%.

DATA: UK Finance reported an increase in mortgage arrears in Q1 2023

They report the number of owner-occupier mortgage in arrears of over 2.5% of the balance was 1.9% higher than the previous quarter, though it remains low as a proportion of total mortgages (0.87%). Meanwhile, the number of buy-to-let mortgages in arrears increased by 16% over the quarter though the rate is also very low (0.34%).

DATA: MoJ published mortgage and landlord possession stats for Q1 2023

The release shows increases in claims, orders, and repossessions compared to the same quarter last year though levels are still relatively low and at least some of the increase will reflect the backlog in court activity following the pandemic.

DATA: ONS published “Families and Households in the UK: 2022”

The release, based on Labour Force Survey data, estimates there were 28.2 million households in the UK in 2022. This was a 6.1% increase since 2012.

DATA: ONS published “Household characteristics by tenure”

Based on 2021 Census data, this analysis investigates “Variations in tenure by household size, household family composition, multi-generational households, and household level information on the age, ethnic group, religion, employment status and occupation of household members”.

DATA: ONS published assessment of subnational tenure estimates

The release compares results from the 2021 Census with the ONS estimates of subnational dwellings and household by tenure. The estimates using the GSPREE were found to have a  strong correlation with the 2021 Census results.

DATA: DLUHC published EWS1 data on mortgage valuations for flats

The data shows “During the January-March 2023 quarter, an EWS1 form or equivalent was required by lenders for 8% of mortgage valuations for flats in the UK, a slight increase on 7% in October-December 2022”.

POLICY: The Renters’ (Reform) Bill was introduced to Parliament

DLUHC state “Eleven million tenants across England will benefit from safer, fairer and higher quality homes thanks to a once-in-a-generation overhaul of housing laws”.

REPORT: Resolution Foundation reported on further mortgage pain

Their analysis finds “Despite interest rates nearing their peak, only half of the households that will eventually be impacted have been impacted so far and only a third of the mortgage pain they will collectively bear has been felt”.

REPORT: Nesta reported on financing green home upgrades

The report tested options to help homeowners decarbonise and found “55% of people would make green home upgrades in the next three years if they had some financial support”.

REPORT: Bayes Business School reported on flood risk

The report finds “one out of six properties in England are at risk of flooding and around half of those affected properties can be characterised as high risk”. It also reports “Between 2050 and 2080, property-level flood risk is projected to increase further by 8%. Our empirical model suggests that one percentage point increase in properties’ flood risk is associated with a decline of 0.11-0.19% in both sold and asking price” and “confirms that the effect of flood risk is asymmetric and buyers of lower-priced properties are more sensitive towards flood risk compared to buyers of more expensive properties”.

REPORT(PDF): IMLA published intermediary mortgage market tracker

The data for Q1 2023 shows the conversion of Decision in Principles to completion fell to 34%, down from 44% in Q1 last year.

REPORT: Savills reported on the Build to Rent market in Q1 2023

They report “The first quarter of 2023 saw £820m transacted”. This was the lowest Q1 figure since 2018.

CORPORATE: Savills published AGM statement

They warn “As capital values progressively adjust to higher interest rates global capital transaction volumes for the year to date are at the lowest levels seen for a decade” and this is impacting their commercial transaction business but “Although volumes are lower than last year, as expected, prime residential markets have performed well with a particular emphasis on the London market”.

CORPORATE: Vistry published trading update

They report the “Group sales rate continues to improve with the average weekly private sales rate per site per week at 0.83 for the year to date” but “Excluding bulk sales in Housebuilding, the Group sales rate in the period was 0.65”.

Chart Map of the Week

We’ve been busy doing work using Built-Up Areas this week and we should hopefully have something to share soon. There are loads of fascinating things that appear when exploring them, especially when looking at areas with zero or very low resident populations such as military bases and weapon testing sites. However, we’ve spotted something a bit different in the 2021 Built-Up Areas. The map below shows the 2011 areas in blue with the 2021 areas in pink. You can see the expansion of some markets like Milton Keynes (centre-right). However, there’s clear line emerging between London (bottom-right) and Birmingham (top-left). At first we wondered if it might be our own version of the Saudi line city (Wikipedia) but closer investigation suggests HS2 building sites have been picked up as built-up areas in the most recent release. You can explore them on the ONS Open Geography Portal.

DATA: Halifax reported UK house prices rose 0.1% in year to April 2023

They reported(PDF) a 0.3% monthly fall, leaving prices relatively unchanged over the year.

DATA: ONS estimated monthly GDP fell 0.3% in March 2023

This left GDP just 0.3% higher than the same month last year and 0.5% lower than the pre-pandemic peak in January 2020.

DATA: Bank of England reported further falls in quoted mortgage rates

The average quoted five year fixed rate mortgage at 75% loan-to-value fell to 4.17% in April (4.27% previously). However, the average revert-to-rate increased to 7.41%.

DATA: DLUHC reported falls in Help to Buy equity loan completions

The data for Q4 2022 shows the number of completions fell 8% compared to the same quarter in 2021. However, the number of completions in London increased by 54% over the period.

DATA: HM Treasury published mortgage guarantee scheme statistics

The release covers the period up to the end of 2022 and shows the scheme has covered “1.9% of all residential mortgage completions in the UK from the beginning of April 2021 to the end of December 2022”. The success of this scheme is not measured in its actual numbers but in the availability of higher loan-to-value mortgage products.

DATA: DLUHC published leasehold dwellings estimates for 2021/22

The estimates for England report 4.98 million leasehold dwellings, 20% of the housing stock. 70% of these homes are flats with the remaining 30% houses.

DATA: ONS published 2021 Census data on families

They also released analysis on adults living with their parents, showing a 13.6% increase since the 2011 Census.

POLICY: Bank of England increased bank rate to 4.5%

The Monetary Policy Report suggests: “Confidence in the residential housing market had recovered a little, but it remained depressed in the commercial property market.

REPORT(PDF): RICS published April residential market survey

They report: “Feedback on new buyer enquiries and agreed sales remains relatively downbeat” and “”National house price indicator still in negative territory although marginally less so than in prior months”.

REPORT: House of Commons Library briefing on SME housebuilders

The report provides a summary of small and medium-sized housebuilders. Unfortunately there is limited data available on their output and historic statistics published by NHBC are compromised by their market share issues.

REPORT: Savills reported on the purpose built student housing market

They report “Global investors continue to target UK PBSA, with a shortage of supply and rising student numbers resulting in strong rental performance”.

REPORT: TwentyCi reported on the state of the housing market

Unfortunately the report does not give any useful trend data and, as the largest region, the South East will almost always have the most market activity.

CORPORATE: Grainger published half year financial results

They report “6.9% like-for-like PRS rental growth” in H1 with 8.2% on new lets and 6.1% on renewals. They also report “98.5% occupancy in our PRS portfolio at the end of March”.

Chart of the Week

Homes England has recently published detailed data on the repayment of Help to Buy equity loans including the original and repaid value (RFI4175). The data finally allows us to understand how consumers have fared when using the scheme. The chart below shows the percentage return on the original equity loan (repaid value/original value – 1). Although there is no regional data, we can use the equity loan share (>20%) to isolate the London scheme. As the chart shows, those loans with 20% equity loan share or less have generally seen a positive return, though perhaps less than underlying house price inflation. However, the majority of London loans repaid have seen a fall in value. There are some with very large percentage falls reflecting the impact of the cladding crisis, but the majority have seen falls in value of up to 10%. This probably reflects both the lack of price inflation for flats in London over recent years and the erosion of the new build premium.

DATA: Nationwide reported UK house prices fell 2.7% in year to April

This was a smaller annual fall than last month (-3.1%) thanks to a 0.5% monthly rise.

DATA(PDF): Zoopla reported UK house prices rose 3.0% in year to March

They report “Annual house price growth slows but the worst of the month-on-month price falls are now behind us” and the “Greater availability of homes for sale is boosting choice and the number of new sales being agreed is 6% up on 2019 but in line with the 5-year average”.

DATA: Bank of England reported a recovery in mortgage approvals in March

Mortgage approvals for house purchase increased 18% compared to the previous month to 52,000. However, this was still 22% below the pre-pandemic average (2014-2019).

DATA: Bank of England reported a rise in average effective mortgage rates

The average rate on new lending rose to 4.44% in March compared to 4.26% last month.

DATA: ONS published analysis on housing insulation and energy efficiency

The analysis of energy performance certificates shows progresses in insulation and energy efficiency over the last decade but there is still scope for improvement.

REPORT(PDF): Knight Frank reported on the development land market

They report greenfield land values fell by 3% in Q1 and “Dealmaking resumes after mini-budget fallout, but activity remains thin with housebuilders deferring land payments in a challenging market”.

REPORT(PDF): Savills reported on private capital and affordable housing

They report for profit registered providers “now own more than 28,150 affordable homes”, a 33% increase since March 2022.

REPORT: NHBC reported a 40% fall in new homes registered in Q1

Their data should be used with caution as there are issues with market share that affect both the total numbers and any changes over time.

CORPORATE: Barratt published trading update

They report “the net private reservation rate from 1 January to 29 January had bounced back from 0.30 in the final quarter of 2022 to 0.49 per active outlet per average week (2022: 0.90). We are pleased to report that over the subsequent 12‐weeks of trading through 23 April 2023 activity improved again with the net private reservation rate at 0.71 (2022: 0.94)”.

Chart of the Week

This week’s chart shows the net change in secured lending to individuals and highlights the sharp fall over the last six months. While gross lending was still positive in March, at £20.6 billion, the seasonally adjusted net lending figure fell to just £18 million. This suggests most current mortgage lending is the recycling of existing debt rather than lenders growing their books. This could be a key metric to keep an eye on in coming months.

DATA: Rightmove reported asking prices rose 1.7% in year to 15^th April

They report “Sales agreed numbers recover to be in line with the more normal pre-pandemic market of March 2019” with smaller properties leading the recovery.

DATA: ONS reported £16.7 billion in stamp duty receipts during 2022-23

This was a record high for nominal SDLT receipts (both residential and commercial). It was 8.3% higher than the previous financial year though receipts have fallen in recent months.

DATA: HMRC published residential transactions data for March 2023

They reported an estimated 89,560 transactions across the UK, 1.3% higher than last month but 18.9% lower than last year. See Chart of the Week for more detail.

DATA: HMRC published ATED statistics for 2021-22

The release shows Annual Tax on Enveloped Dwellings (ATED) receipts increased 8% to £119 million. This was the first annual rise in receipts since 2015-16.

DATA: DLUHC published energy performance certificate data for Q1 2023

The number of new build EPCs provides a leading indicator for net additional dwellings in England. The release reports 246,752 new build EPCs during the 2022-23 financial year though data for recent weeks suggest a slight slowdown.

DATA(PDF): Rightmove reported asking rents rose 9.4% in year to Q1 2023

They report average asking rents outside London have reached a new record of £1,190 per month and “the number of available properties to rent is still 46% below 2019’s level”.

DATA: Scottish Government published Scottish Household Survey 2021

The telephone survey has some issues given the challenges of the pandemic but provides a wealth of information on housing and other topics.

POLICY: DLUHC published consultation outcome on CPO reforms

“The consultation sought evidence and examples of how paying closer to existing use value for land could be in the public interest”.

REPORT: Resolution Foundation published “Hoping and coping”

The research on how families have been affected by the cost of living crisis found “three-quarters (75 per cent) of adults reported cutting back on the amount they consume and almost half (44 per cent) of adults used their savings to make ends meet”. It also found “The younger middle-aged (aged 35-44) were the most likely to turn to formal lending – such as credit cards, overdrafts or other formal loans – to make ends meet over the winter”.

REPORT(PDF): Create Streets Foundation reported on “The Case for Place”

The report “explore[s] how and why England has such entrenched patterns of economic imbalance” with a focus on the North East of England.

REPORT: CaCHE reported on adopting domestic heat pumps in the UK

The report reviews the factors than encourage or hinder the adoption of heat pumps in the UK’s housing market.

REPORT: Knight Frank reported on their student housing survey

They report “Students are satisfied with their accommodation, particularly those in purpose-built schemes” and “Cost and value top of the agenda”.

CORPORATE: Persimmon published Q1 trading statement

They report the net private sales per outlet was 0.62 in Q1 2023, down from 0.98 in Q1 last year. The figure was 0.58 if bulk sales were excluded.

CORPORATE: Taylor Wimpey published trading update

They report “Our net private sales rate for the year to 23 April 2023 was 0.75 (2022: 0.97), with a cancellation rate of 15% (2022: 14%)”. Excluding bulk sales, the rate was 0.66.

Chart of the Week

Mortgage approvals for house purchase might be around one-third lower than pre-pandemic levels according to the Bank of England but total residential transactions have not seen anywhere near the same scale of falls. The seasonally adjusted data for the UK shows they were just 9.8% lower than the pre-pandemic average in March. However, there are issues with the HMRC monthly estimates due to delays in data and we’ve seen some significant revisions in the past. To provide more detail, we have just considered the non seasonally adjusted data for England in the chart below. It shows recent transaction levels have been consistently below last year’s figures but well within the typical range prior to the pandemic. The difference between mortgage approvals and transactions suggests cash buyers and investors have been very active in the market though we will have to wait to see if that is the case or if there’s some other explanation for these robust transaction levels.

DATA: ONS published UK labour market overview

They reported the number of payrolled employees continued to increase while the unemployment rate was still well below pre-pandemic rates at 3.8%. Nominal total earnings (incl. bonuses) rose 5.9% which was a 3% fall when inflation adjusted.

DATA: ONS reported the Consumer Price Index rose 10.1% in year to March

This was slightly lower than last month’s figure of 10.4%. The rate should fall next month as last year’s big rise falls out the calculation but the underlying rate is still high.

DATA: ONS reported UK house prices rose 5.5% in year to February

They reported this was lower than last month’s figure of 6.5% and was the third consecutive monthly fall in the completions based index. The West Midlands was the English region with the highest annual growth (8.6%) while London had the lowest (2.9%).

DATA: ONS reported UK private rents rose 4.9% in year to March

The experimental index records the average of all rents paid rather than new lets. It therefore lags the very high growth rates recorded by indices measuring new lets agreed.

DATA: ONS published 2021 Census data on international students

The pandemic affected data shows there were “373,600 non-UK-born, non-UK passport holding international students in England and Wales at the time of Census 2021” and “India (11.6%), China (11.2%), Romania (9.5%) and Nigeria (5.3%) were the top four individual countries of birth of international students”.

DATA: ONS published 2021 Census data on people with second addresses

The release shows “In England and Wales, 5.3% of people (3.2 million) stayed at a second address for 30 days or more”. The most common second address was “another parent or guardian’s address” with “student’s home address” the second most common.

POLICY: DLUHC launches “Four Million Homes” programme

The programme will provide social housing residents with “Guidance and training on resident rights and how to stand up for them”.

POLICY: DLUHC threatens shareholders of cladding companies

The Housing Secretary has warned shareholders in three cladding companies that there will be “severe consequences” for the companies if they do not bring forward comprehensive financial remediation package.

POLICY: Scottish Government on tax changes for second and empty homes

They have launched a consultation to “give councils powers to charge up to double the full rate of council tax on second homes from April 2024” and “seek views on further powers to charge more than double rate on both empty and second homes in future years”.

REPORT: DLUHC published “Independent Review of the Construction Product Testing Regime”

As Dame Judith Hackitt says in the foreword: “This report marks a major step forward in mapping the complexity and opacity of the current construction product regime and also identifies ways in which significant improvements can and should be made”.

REPORT: Resolution Foundation reported on people living in poor quality housing during the cost of living crisis

They found “10 per cent of people (6.5 million people) live in poor quality housing”. They also found “People living in poor quality housing are twice as likely to have poor general health than those who don’t” and “Over half of people living in poor quality housing felt that the stress caused by rising living costs had worsened their health or that the money they had to spend on rising heating costs made their health worse”.

REPORT: Crisis reported on the case for ending homelessness with homes

The report, published with Lloyds, proposes “A significant increase in new supply of social rented home” and “Unlocking access to more homes in the PRS by making sure housing benefit levels cover the true cost of rents in the cheapest 30 per cent of the market”.

REPORT: NHF reported on overcrowding in England

They found “More than 310,000 children (313,244) in England are forced to share beds with other family members” and “Over two thirds (70%) of overcrowded families say they have experienced both poor mental and poor physical health as a direct result of overcrowding”. See Chart of the Week for more on overcrowding.

REPORT: JRF reported on deepening poverty in Scotland

They find “In the last 20 years or so, while overall poverty levels (and particularly those for children and pensioners) have fallen, the proportion, and number, of people in very deep poverty has risen dramatically”.

REPORT: Savills reported on the residential development land market

They report “The residential land market continues to be slow with limited activity and further softening of land values”.

REPORT: TwentyCi published Q1 property and homemover report

They report “Sales are down 7.5% in Q1 2023 compared to Q1 2019” and “The availability of Residential Property Stock has improved and is only 9% below pre-pandemic levels”.

CORPORATE: The Property Franchise Group published final results

They report the “Seasonally quiet Q1 has been slightly ahead of management’s expectations with regards to both revenue and profitability” and the “Residential market is expected to align with that of 2019 as we move through the year”.

CORPORATE: M Winkworth published final results

They report “we expect the property market to perform towards the higher end of expectations, albeit at transaction levels more closely aligned to historic averages than the boom levels of the last two year”.

COPORATE: Foxtons published Q1 trading update

They report “Sales revenue declined 16% to £8.1m (Q1 2022: £9.6m), driven by a reduction in exchange volumes in the quarter” but they have seen an increase in “instruction market share” and “completed the highest number of quarterly viewings in the last 5 years”.

Chart of the Week

DATA: ONS reported no change in monthly GDP estimates

The estimate for GDP in February was 0.5% higher than the same month in 2022 but still 0.3% below the pre-pandemic peak in January 2020.

DATA: Halifax reported UK house prices rose 1.6% in year to March 2023

This was slightly lower than last month’s figure of 2.1% but was the third consecutive monthly rise, with prices now 2.2% higher than their December trough and 2.1% lower than their August peak. The full PDF is available here.

DATA: Bank of England reported further falls in quoted mortgage rates

The average two year fix at 75% loan-to-value (LTV) fell to 4.27% in March, down from 4.38% the previous month. Last year the figure was 2.5%. The average revert-to-rate was 7.22% in March while the 2 year variable rate was 4.75%.

DATA: DLUHC published data on social housing lettings in England 2021/22

The data provides detail on new social housing lettings by local authorities and registered providers. There were 267,000 new lettings during the financial year, 13% lower than the pre-pandemic 2019/20 figure. They report this continues the long-term fall in new lettings.

DATA: DLUHC published self-build and custom housebuilding data

They report 63,662 individuals were on the register of those seeking to acquire serviced plots of land for self and custom build. This was an increase of 8% from the previous year. They also report 6,374 planning permissions were granted for self and custom build.

POLICY: DLUHC proposed planning permission for holiday homes

The consultation proposes requiring planning permission to use existing homes as short term lets through the introduction of a short term let use class.

POLICY: Councils allowed to retain right to buy receipts for next two years

Apparently they will be allowed to retain 100% of receipts for 2022/23 and 2023/24 rather than having to pay a proportion to HM Treasury.

REPORT(PDF): RICS published March residential market survey

They report “Sales market activity remains subdued although some forward-looking indicators turn less downbeat”. New buyer enquiries, agreed sales, and new instructions are all still negative with falling national house prices.

REPORT: Bank of England published Q1 Credit Conditions Survey

They survey findings show lenders report the availability of secured credit was unchanged in the Dec-Feb period but they expect it to decrease over the next months. Meanwhile, demand for house purchase lending decreased in the previous period but was expected to increase in the Mar-May period.

REPORT: DLUHC published two research reports

The two reports (1/2) “presents the results of research undertaken to support analysis for assessments of the additionality of the impacts of public sector supported housing developments” and “values for the impact to surrounding areas from particular types of redevelopment on previously developed land”. The reports are not new but appear to have been published for the first time.

REPORT: CaCHE reported on modern methods of construction

The research investigates the potential for modern methods of construction to “address systemic housing supply problems”. It finds that “state leadership is crucial in promoting and incentivising MMC as a mainstream form of housing provision. Furthermore, while MMC offers unique processes, they are often considered risky due to project complexity and a fragmented supply chain”.

REPORT: HBF published housing pipeline report for Q4 2022

The report for England finds the number of homes granted planning permission in 2022 was 323,416, 12% lower than 2021, and the number of projects granted permission fell below 3,000 for the first time.

REPORT: Knight Frank reported on residential landlords upgrade costs

They report the “Proposed minimum energy efficiency standards regulation in England could leave residential landlords facing a £17.9 billion bill”.

NEWS: Rightmove reported sales agreed back to pre-pandemic levels

They report this is the first time since September and “The recovery is being driven by sales of flats which are now 10% higher than March 2019, improving from being 11% down at the start of the year, and is most pronounced in London”.

CORPORATE: Unite Students published trading update

They report “We have seen continued strong progress in sales since our preliminary results with 90% of rooms now sold for the 2023/24 academic year (2022/23: 78%). Demand remains strong from both University partners and students booking accommodation on a direct-let basis with reservations ahead of 2022/23 in almost all markets.”

CORPORATE: Watkins Jones published trading update

The report “Underlying residential for rent market continues to perform well with both strong tenant demand and rental growth in our core PBSA and BTR sectors.”

Chart of the Week

This week’s chart shows the increase in both number and proportion of first time buyers using very long mortgage terms to buy as mortgage rates increased in the second half of last year – it is based on UK Finance data from my latest FT article.

The housing market has been more resilient than I thought possible in recent months and it appears first time buyers are responsible. This is not surprising given the terrible state of the private rental market but it had raised the question of how they were able to afford it given much higher mortgage rates. It appears they have done so through a combination of just accepting higher repayment costs (though still cheaper than renting), buying smaller properties (see above Rightmove news), and using much longer mortgage terms – as per the chart below. Longer mortgage terms are not immediately dangerous but how they work out for borrowers and the wider housing market will be very dependent on future economic conditions. There is also the risk that, like dual income mortgages, these longer terms become a permanent feature of the mortgage market and become necessary for all borrowers looking to buy their first home.

DATA: Nationwide reported UK house prices fell 3.1% in year to March

Following the 0.8% monthly fall, they reported this was the seventh fall in a row with seasonally adjusted prices down 4.6% since August (non-seasonally adjusted down 6.1%).

DATA: Bank of England reported another rise in effective mortgage rates

The data for February showed the average rate on new lending was 4.26% and the average rate on outstanding balances was 2.65% (3.89% and 2.55% last month respectively).

DATA: Bank of England reported a monthly increase in mortgage approvals

The number of mortgage approvals for house purchase was 10% higher in February than the previous month but was still 34% below the pre-pandemic average.

DATA: DLUHC published Q4 2022 planning applications in England release

The data shows the number of applications for planning permission in Q4 last year was 13% lower than the same period in 2021 while the total number of homes granted permission in 2022 was 287,000 – 9% lower than in 2021.

DATA: ONS published 2021 Census data on dwellings

See Chart of the Week for more.

DATA: Scottish Government published quarterly housing supply data

The release shows housebuilding completions increased 10% in the year to September 2022 though starts fell 12% over the same period.

DATA(PDF): Zoopla reported on the UK private rental market

They report “Rental inflation has slowed to 11.1%, from a high of 12.3% in mid-2022” but the stock of homes available for rent is 33% lower than the five year average.

DATA: Building Societies Association published Q1 property tracker

They report “Housing market sentiment improves but remains negative”. Their survey showed 18% of people thought it was a good time to buy a property in March but 43% disagreed. This slightly improved the net figure to -24% from -33% in December.

POLICY: Humza Yousaf selected as First Minister of Scotland

POLICY: BoE FPC warns on risks in market-based finance

While confident “UK banks are resilient and are strong enough to support households and businesses”, they warn “There remain vulnerabilities in market-based finance” and “There is an urgent need to increase resilience”. There are several that could affect housing.

REPORT: Registers of Scotland on the location of property owners

The report found that at the end of 2022, the location of  land and property title ownership addresses were “93.4% Scotland, 5.0% UK outwith Scotland, 1.4% outwith UK, 0.2% Government and Crown”. The release provides more detail on the type of property and location of the owners’ addresses at the time of purchase.

REPORT: SMF reported on the barriers to energy efficiency uptake

They report “Cost may be the biggest barrier to installing energy efficiency measures, but poor awareness and tenure type are also significant”.

REPORT(PDF): HBF reported on SME housebuilders

The survey shows 92% of respondents are “unhappy with the Government’s current approach on housing” and 93% thought securing and processing planning permission was a major barrier to growth but only half (52%) though the availability of land was a major issue.

REPORT(PDF): Sigma Capital published research on private renters

The survey of all renters rather than Sigma’s looks at who is renting, what does an ideal renter’s property look like and what makes a good landlord or agent.

BLOG: James Gleeson looked at the number of empty homes

He suggests the rate of vacant homes in England may be higher than indicated by council tax data, but many aren’t available to house people due to several different reasons.

CORPORATE: Belvoir Group published preliminary results

They report “Whilst we have seen a bounce-back in our mortgage activity for the year to date, up around 20% on Q4 2022, with house transactions taking up to five months to complete from agreeing a purchase, the increased market activity so far in Q1 will take until H2 to flow through to our financial performance”.

CORPORATE: Bellway published interim results

They report “In the six weeks since the 1 February, the overall weekly reservation rate was 192 (2022 – 291) and the private reservation rate was 135 per week (2022 – 239)”. They also state “If the reservation rates since the start of calendar year are sustained through the spring, Bellway is well-placed to deliver volume output of around 11,000 homes in the current financial year (31 July 2022 – 11,198 homes)”.

Chart of the Week

This week, the ONS published data on the number of dwellings. This is useful data as it is used to check the DLUHC dwelling estimates and make adjustments to the net supply data.

At a headline level, the DLUHC estimates weren’t that far off – not surprising given the renewed focus on housing supply over the last decade. The 2021 Census reported 24.93 million dwellings while DLUHC had estimated 24.87 million, a difference of just 54,000. When comparing the data at a local authority level, there are the usual variations that will need further investigation. For example, the Census figure for Nottingham was 5% lower than the DLUHC estimate while the figure for Tower Hamlets was 4% higher. However, there was one clear outlier: East Lindsey in the East Midlands (map). Here, as the chart below shows, the Census figure was 28% higher than the DLUHC estimate and 36% higher than the 2011 Census figure. For comparison, that’s the equivalent to net supply across England of over 800,000 homes per year!

It is not exactly clear why the number of dwellings in East Lindsey has increased this much but the latest Census release offers some clues. The increase appears to reflect a substantial increase in the number of unoccupied caravans, other mobile, or temporary structures. A quick look at Google maps around the lower super output areas with high concentrations suggest it is static holiday caravans that are responsible. However, it is not clear if the massive increase in caravans reflects an actual increase in number, an undercount in earlier data, or some sort of classification issue: perhaps the homes were previously owned by a business and not classified as residential dwellings but have been sold off to individuals over the last decade and now fall within the Census classification.

DATA: Rightmove reported asking prices rose 3% in year to March 2023

They reported sales agreed in their “first-time buyer type” properties were just 4% lower than 2019 levels in the last two weeks while “top-of-the-ladder” properties were 10% lower and “second-stepper” properties were 13% lower.

DATA: ONS reported a 6.3% annual increase in UK house prices

The completions based index is reporting prices are down 1.7% since their November peak.

DATA: ONS reported CPI rose 10.4% the year to February 2023

This was an increase from the 10.1% rate the previous month. Inflation is expected to ease in the coming months as last year’s effects fall out of the annual figures.

DATA: HMRC reported 90,000 residential transactions in February

The estimates for the latest month show transactions were 18% lower than the same month last year and 9% lower than the pre-pandemic average.

DATA: ONS reported SDLT receipts fell 28% in February

The data covers both residential and commercial stamp duty land tax receipts.

DATA: DLUHC reported English quarterly housebuilding data for Q4 2022

The release, which undercounts actual housebuilding, shows Q4 housebuilding starts were 7.5% lower than Q4 2021 while completions were 9.7% higher over the same period.

DATA: ONS published housing affordability data for 2022

They report the average house price to earnings ratio was 8.3 in England and 6.2 in Wales. Alongside this, they also published the latest house price statistics for small areas.

DATA: ONS reported on changes in PRS price change behaviour

Their longitudinal analysis of rental prices found 50.6% of properties in their study had seen a rent increase in February 2023 compared to 36.0% in February 2022. They also found a third of properties in London had seen a 10% plus rental increase over the period.

DATA: DWP published Family Resources Survey for 2021/22

See Chart of the Week for more detail.

POLICY: Bank of England increased Bank Rate to 4.25%

The MPC voted 7-2 to increase the rate by 0.25 percentage points. This is the highest the rate has been since 2008.

POLICY: DLUHC launched new infrastructure levy consultation

The level will replace section 106 contributions for most developments and “the amount developers will have to pay will be calculated once a project is complete, instead of at the stage the site is given planning permission”.

POLICY: DLUHC published Responsible Actors Scheme details

The scheme for residential developers will be implemented through the Building Safety Act.

REPORT: BoE published Q1 2023 Agents Summary of Business Conditions

They report “Contacts reported a modest pick-up in secondary market activity and requests for valuations but said that demand was broadly equal to the supply of properties available” and “House builders reported scaling back construction plans and said they were having to offer more incentives to secure sales. Buyers were reported to be opting for smaller properties due to higher borrowing costs”.

REPORT: UNU-WIDER Academic Paper on “The end of Londongrad?”

The paper investigates the impact of requiring offshore companies to register their beneficial owners and finds that purchases by tax haven based companies have fallen.

REPORT: UCL Academic Paper on “The London Housing Market”

The authors “develop a novel quantitative system dynamics model to explain long-term developments in London’s housing market from 1980-2020”.

REPORT(PDF): Lichfields and HBF on “Nutrient Neutrality Solution Finding”

“The focus of this report is on the implications of the statutory duty on the delivery of new housing over the short to medium term”.

REPORT(PDF): HBF published new home customer satisfaction survey

The survey shows “88% of respondents said they were satisfied with the quality of their home” and 85% would buy from the same builder again.

REPORT: Savills reported on the development land market

They suggest the “pick-up in sales rates suggests activity is likely to return to the land market by the second half of the year”. Alongside this, a consultancy report investigating the “importance of sales outlets in a market without Help to Buy” was released (PDF).

REPORT(PDF): Fabian Society published “Homes for Britain” report

The planning focussed report sets out 10 proposals for Labour to build more homes.

CORPORATE: PRS REIT published interim results

They report occupancy at 97% and like-for-like rental growth of 5.7% in 2022 thanks to renewals around 5% and new lets at 10%.

COPORTATE: Henry Boot published final results

They report “a partial recovery in home buyer interest this year from the lows experienced in the final quarter of 2022”.

CORPORATE: Vistry published final results

They report “we have seen an improving trend on private sales in the first 11 weeks of the year, with the Group’s average private sales rate per site per week for the year to date at 0.54, increasing to 0.62 in the last four weeks”.

CORPORATE: Crest Nicholson published AGM statement

They report their sales per outlet per week (SPOW) was “at 0.52 for the last eleven weeks from the start of the calendar year. This improvement versus the eleven-week SPOW rate from 1 November 2022 at 0.35, as reported at our Preliminary Results in January 2023”.

Chart of the Week

The latest DWP Family Resources Survey provides a wealth of data on income, housing tenure, housing costs and other metrics. Today’s Chart of the Week republishes their data on savings by weekly household income. It highlights the lack of savings with 13% of all households having no savings and a further 26% having savings of less than £1,500. As the chart highlights, this is more extreme for those with lower incomes. Around 20% of households in the lowest two income groups have no savings and around a third have savings of less than £1,500. The situation is reversed the other end of the income distribution with 42% of those earning £2,000 or more per week having savings of £30,000 or more. However, the survey suggests 6% of this group have no savings.