Weekly Summary: 5th April 2024

DATA: Nationwide reported house prices rose 1.6% in the year to Mar 2024

They report the annual rate increased from 1.2% last month despite the -0.2% monthly fall.

DATA: Halifax reported house prices rose 0.3% in the year to Mar 2024

They report the annual rate decreased from 1.6% last month thanks to a 1.0% monthly fall.

DATA(PDF): Zoopla reported house prices fell 0.3% in the year to Feb 2024

They report that “Market activity improves across all key measures led by sales, which are 9% higher than a year ago” and “More sellers coming to market and stock of homes for sale up 20%”. They also report “The percentage of the asking price achieved has narrowed from 95.5% in November 2023 to 96.1% in March 2024”.

DATA: BoE reported a rise in mortgage approvals for purchase in Feb 2024

They report the number of mortgage approvals for house purchase increased to 60,400 in February, a 7.7% seasonally adjusted increase on the previous month and just 9% below the pre-pandemic average.

DATA: HMRC reported 82,900 residential transactions in Feb 2024

This seasonally adjusted data was 1.2% higher than the previous month but still 16% lower than the pre-pandemic average.

DATA: BoE reported a fall in effective mortgage rates in Feb 2024

They report the average rate on new lending (purchase and remortgage) fell again in February and is now down to 4.91% from its peak of 5.37% in November last year. Meanwhile the average rate on outstanding balances increased to 3.49%, slightly higher than the 3.42% reported for the previous month.

DATA: DLUHC reported building control based housebuilding data

The data for Q4 2023 reports a 10% fall in starts compared to the previous quarter with a 51% fall compared to Q4 2022, though this may still reflect the rush to start construction in Q2 due to changes in regulation. Meanwhile, the number of completions increased 0.2% compared to the previous quarter and was 15% lower than the previous year. However, leading indicators for supply are starting to pick up a fall in activity – see Chart of the Week.

DATA: Scottish Government published housebuilding data for Q4 2023

They report “There were 20,992 all-sector new build home completions and 16,017 starts in Scotland during 2023 (calendar year). There were fewer homes completed (2,701 fewer; 11% decrease) and started (5,009 fewer, 24% decrease) in 2023 than in 2022”.

DATA: HMRC published Annual Tax on Enveloped Dwellings (ATED)

The release shows “total ATED receipts in the 2022 to 2023 financial year were £124 million, increasing by 4% (£5 million) compared to the previous year” but “the number of liable ATED declarations in the 2022 to 2023 financial year was 4,800, marginally decreasing (less than 1%) compared to the previous year”.

DATA: VOA published local reference rents and LHA list of rents

The releases include the list of rents used to calculate Local Housing Allowance and reference rents by BRMA and property size.

DATA: ONS published UK population estimates for 2022

They report “The UK population at mid-year 2022 was estimated to be 67.6 million, an increase of 6.8% since 2011”.

DATA: ONS published Housing affordability in England & Wales, 2023

The release compares average full-time earnings to house prices. It found the average price to earnings ratio was 8.3 in England and 6.1 in Wales. This was similar to 2022 levels as the prices used are not mix adjusted.

DATA: FCA published updated Mortgage Charter uptake data

They report “around 760,000 accounts benefited from one or more of the options set out in the Charter” and “Around 90,543 mortgage accounts have temporarily reduced monthly payments via the new FCA rules”.

DATA: UK Finance published new quarterly insight into Buy-to-Let lending

The release is welcome given the lack of publicly available data on BTL though we are still limited to the latest quarter’s data in PDF format. They report “The value of new buy-to-let lending for the UK in Q4 2023 was £6.3 billion, down 55.4 per cent compared with the same quarter in the previous year” and “The average gross buy-to-let rental yield for the UK in Q4 2023 was 6.74 per cent, compared with 5.85 per cent in the same quarter in 2022”.

POLICY: Scottish Government published Housing Bill

It will “introduce an ‘ask and act’ duty on social landlords and bodies, such as health boards and the police, to ask about a person’s housing situation and act to avoid them becoming homeless wherever possible” and includes proposals for “long term rent controls for private tenancies, new rights to keep pets, decorate rented homes and stronger protection against eviction”. The Scottish Government also introduced legislation to “simplify the planning process for zero and low carbon technologies”.

REPORT(PDF): BoE published Financial Policy Summary & Record

They report “While household finances remained under pressure from increased living costs and higher interest rates, the outlook for UK households had continued to improve somewhat since Q4”. They also note “For 40% of new mortgages in 2023 Q4, borrowers would be past the current state pension age at the end of their mortgage term”.

REPORT: LUHC Committee reported on shared ownership

They report “Shared ownership schemes are drastically failing to deliver an affordable route to homeownership for too many people and subject buyers to rising rents, uncapped service charges, and a disproportionate exposure to repair and maintenance costs”.

REPORT: Resolution Foundations published Housing Outlook Q1 2024

They report “Overall, UK homes are more cramped, and less conveniently located for jobs, than in many comparable countries. Adding insult to injury, the UK’s housing stock is also the oldest in Europe (four-in-ten homes were built before 1946), and one of the most poorly insulated as a result”.

REPORT: County Councils Network reported on rural renters

Their analysis shows “the number of households in private and social rent has increased by over half a million in county and rural areas over the last decade, outpacing the increase in renting in London and the country’s other major cities”.

REPORT: SMF reported on rental regulations, subsidies and tenants’ rights

They report “Regulations like rent controls can help renters, but are tricky to calibrate to avoid unintended consequences” and “Stronger renter protections do not seem to have a negative effect on supply”.

REPORT: HBF reported on the twentieth anniversary of the Barker Review

They report “England would have 2 million more homes today if the Barker Review’s most ambitious scenario for increasing housing supply had been achieved” and “looking at Barker’s central housing supply scenario (requiring 240,000 homes to be built a year), England has still fallen 900,000 homes short”.

REPORT: Savills reported on the benefits of residential development

They report “A strong residential pipeline is important not just for delivering new homes for sale, but also for providing social infrastructure, and providing homes for those in need of sub-market housing.” and “a continued slowdown in residential development will have significant further consequences for the provision of public services”.

REPORT: YMCA reported on unlocking affordable homes

They highlight challenges in providing affordable homes and “the inadequacies of funding models, particularly in regard to the accessibility and flexibility of grants provided by Homes England. These inadequacies tend to affect smaller organisations, such as local YMCAs, more significantly”.

REPORT: Propertymark published Housing Insight Report for Feb 2024

They report an increase in new properties coming to the market along with rising stock levels, and a fall in the number of registered potential buyers compared to last year.

BLOG: VOA blogged on how they value new homes for Council Tax

They explain how they value properties built after 1991 in England and 2003 in Wales.

CORPORATE: Bellway published interim results

They report “The private reservation rate in the first half of financial year 2024 increased by 15.4% to 105 per week (2023 – 91), representing a private reservation rate per outlet per week of 0.43 (2023 – 0.38)” and “the underlying operating margin was 11.0% (2023 – 17.6%), with the reduction reflecting the effect of lower volume output, cost inflation and the use of sales incentives, together with extended site durations”. They also report “In the six weeks since 1 February, the private reservation rate increased by 20.7% to 163 per week (1 February to 12 March 2023 – 135), representing a private reservation rate per outlet per week of 0.67 (1 February to 12 March 2023 – 0.56)”.

Chart of the Week

We have been tracking reports of lower housebuilder sales rates for a while now and there’s been a clear drop in planning applications/permissions and housebuilder starts. But there’s been limited signs of any impact on completions or other measures of actual delivery – until recently. As the chart below shows, the number of weekly new build EPCs (a leading indicator for net additions) had continued to track previous years in the first two months of 2024. However, since the beginning of March, the number of new build EPCs has fallen away and is currently around 22% lower than normal. The timing of Easter may be a factor but it appears the continued resilience of delivery in the Midlands and North of England hasn’t been enough to offset the falls in delivery in London and the South East.

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