Docklands News

England needs 616,000 extra homes each year to accommodate record numbers of migrants, according to the Centre for Policy Studies. The think tank said current house building targets were based on outdated assumptions of some 170,500 migrants arriving in England each year. Even if net migration reaches 700,000 a year, as some analysts have predicted, 500,000 homes would still need to be built annually. The Home Office has privately predicted that another 1.1m foreign workers and students would come to the UK in 2024 unless ministers intervene. Kristian Niemietz, head of political economy at the Institute for Economic Affairs think tank, said concerns about the pressure of increased migration on the housing market could be resolved by a more flexible planning system. 

The Daily Telegraph (23/05/2023)  

Around 116,000 households will soon see the cost of their mortgage jump, with Financial Conduct Authority data showing that their fixed-rate deals will come to an end this month. If they do not secure a new deal and move on to their lender’s standard variable rate, they could face an interest rate of 7.49% or more. Moneyfacts data shows that the average two-year fixed rate mortgage in June 2021 was 2.59%, but now stands at 5.26%. For five-year fixes, the average was 2.92% in 2018 but is now 4.97%. UK Finance figures show that more than 76,600 borrowers missed payments worth at least 2.5% of their outstanding balance by March, while 750 properties were repossessed in Q1 – 50% more than in the previous quarter. More than 1.4m people are coming to the end of fixed-rate mortgages this year. 

The Times (20/05/2023)  

London Mayor Sadiq Khan says he has met his own housebuilding target for affordable new homes in the capital. He said 63,817 affordable homes were completed between 2015-16 and 2022-23 and that 116,000 affordable homes were started during that time. Mayor Khan has met his target by including figures from the last year of previous mayor Boris Johnson's term in office in 2015-16 when construction of 7,189 affordable homes got under way. Work started on a record 25,658 affordable homes last year, up from 18,840 in 2021/22. Greenwich and Ealing were the best performing boroughs in 2022-23. Each recorded more than 2,000 affordable homes started either by the council or housing associations

BBC News (15/05/2023)   Evening Standard (15/05/2023)   The Guardian (15/05/2023)   The Mirror (15/05/2023)  

Plans to abolish the “feudal” system of leaseholds across England and Wales have been dropped. Michael Gove Gove, the housing secretary, will next month announce a range of measures to protect the 10m Britons who own their homes in a leasehold. The measures are expected to include a cap on ground rents, more powers for tenants to choose their own property management companies and a ban on building owners forcing leaseholders to pay any legal costs incurred as part of a dispute. However, Mr Gove will stop short of abolishing leaseholds altogether, despite a pledge made in January to end it this year. Mr Gove wanted to replace leaseholds for flats with a “commonhold” system, but government sources say that Downing Street pushed back on Gove's plan, with the prime minister's officials arguing there would not be enough time before next year's election to enact such major reforms.

The Guardian (13/05/2023)   The Times (13/05/2023)  

The mortgage market has doubled since the mini-budget, with 5,264 options available in May 2023, up from 2,258 in October 2022. The number of options within the 15% and 25% deposit ranges are the highest on record, suggesting greater stability in the level of choice. The average “shelf life” of a mortgage product is now 25 days, compared with 15 days in October 2022. Fixed mortgage rates rest lower on a month-on-month basis, but it is anticipated that fixed interest rates will start to rise due to volatile swap rates. The average standard variable rate mortgage has continued to climb, standing at 7.37% typically, the highest level since December 2007. Rachel Springall, a finance expert at Moneyfacts, said that borrowers who are coming off a fixed-rate deal may be understandably concerned about the rate difference between their existing rate and those on offer in the present market. 

Evening Standard (17/05/2023)  

Inflated house prices have resulted in more people paying inheritance tax (IHT), which earned the UK Government a record £7.1bn in the last financial year. Frozen tax thresholds are also dragging a growing number of families into paying the tax. IHT is typically levied at a rate of 40% on the value of an estate above the "nil-rate" allowance of £325,000 (£500,000 if you leave your main home to a direct descendant). The £325,000 threshold has not been raised since 2009, despite years of house price rises and asset inflation. Claire Roberts from Moore Kingston Smith says that wills can become complex and if they are not structured right then you can be double taxed. Chris Etherington of RSM UK provides advice on the pitfalls that can reduce the residence nil-rate band. 

The Sunday Times (14/05/2023)