Young families suffer property shortage


In a recent survey, carried out by SmartNewHomes.com, 94% of participants said they felt there were not enough new homes available for families to buy.

The survey was run as part of a SmartNewHomes.com campaign, which is asking the Government to review its planning rules to provide suitable housing for young families. Visitors to the web site were invited to express their views on the current housing mix.

An overwhelming 86% of participants indicated they were looking to purchase a typical family home, and 72% were looking to move within the next year. However, the majority of these potential buyers were struggling to find a suitable property to meet their family’s needs.

A revealing 39% indicated that they were looking to spend under £200,000 for their next home, yet the average price for a new home last month was recorded as £254,374.

David Bexon, Managing Director, SmartNewHomes.com said: “This survey reinforces our campaign – not only are there not enough new family homes on the market, but those that are available are beyond the budget of over a third of buyers. Surely if a massive 94% of consumers feel there is a shortage of suitable family homes the Government should take action and adjust their current planning policies accordingly.

“A recent announcement by DCLG clearly highlights that there is a vast proportion of Brownfield land available for development, with enough land in the South East to accommodate over 400,000 new homes. However, it is essential that Government gives careful consideration to the types of properties built in such areas – affordable three and four bedroom houses are clearly in demand and apartments must not be constructed at the expense of young families.”

While 58% of properties on the SmartNewHomes.com site are currently apartments, only 34% of people who visit the site actually search for this type of property. In stark contrast, detached and semi detached properties make up just 32% of the mix on the site, yet 56% of visitors are searching for these properties.

Bexon continued: “There is clearly a severe problem with the current housing mix, with too many apartments and a not enough detached and semi-detached properties being built. The current over supply of apartments was recorded in our recent index which noted apartments taking the biggest fall in price."

The Middups, who have two young children aged 4 and 11 months, were fortunate enough to find a new three bedroom family home in Woking, where there is a serious oversupply of new apartments, particularly near the town centre. More room and a safe and spacious garden were essentials, so the Middups were forced to disregard most of the new developments in the area as unsuitable.

“We wanted to upsize to a larger house, where the children would have more space to run around and play safely. We were aware of the huge number of new apartments in the area, so we consider ourselves very lucky to have found our new family home, which is perfect for our needs,” said Geraldine Middup.

Bexon added: “If the Government fails to address this issue and refuses to work more closely with the developers who understand the demand across different regions this problem seems set to worsen, with rising house prices preventing young families from getting onto the housing ladder or forcing them to stay in their current property as they cannot afford to move.”

One million homes could be built on brownfield land

The Department for Communities and Local Government estimate that 63,500 hectares of previously developed land was available for development in 2005. Forty four per cent (27,600 hectares) of this land was judged to be suitable for housing, with the remaining land available for other uses such as commerce or recreation.

In the three south-east regions, where demand for housing is highest, it is estimated that there is enough land to accommodate over 400,000 new homes.

The statistics show that there are still many new "brownfield" sites being made available every year, despite a record-breaking seventy four percent of all new developments already being built on previously used land. This improved use of brownfield land is reflected in an eleven percent reduction in the amount of land left lying derelict or vacant compared to five years ago.

Lords Planning Minister, Baroness Kay Andrews said:

“There is a real need to build more homes if we are to meet the housing needs of future generations and these statistics show that many of these could go on re-used sites.

Baroness Kay Andrews added: “In some areas it may be necessary to bring forward other sites if we are to meet local demand, but there are other areas where local authorities could be doing more with the land that is already available. By making the most of suitable brownfield land, local authorities can continue to protect the countryside whilst ensuring there are more homes available for first time buyers."

Seventy four per cent of all new developments are currently built on "brownfield" land, up from fifty six per cent in 1997. Draft planning policy on housing (PPS 3) encourage local authorities to continue to consider how to best use previously developed sites and proposes new requirements for them to develop "brownfield" strategies, including pro-active work to bring suitable" brownfield" land into development.

Victorian villa voted most popular

The architectural preferences of the home buying public have progressed little in the last decade, with Victorian and Georgian architecture remaining the most popular, reveals new research carried out by home warranty provider Premier Guarantee.

The survey, which asked members of the public to select from a list of homes from different eras, found that the Victorian villa was voted by 25% of respondents as the most popular house type, closely followed by the Georgian townhouse with 23%.

The spacious rooms and detached status of the Victorian villa remains much sought-after, while the townhouse’s versatile living space spread over three or four storeys still appeals to today’s homebuyers, who are attracted to the light interiors and comfortable proportions.

However, more contemporary choices such as the cutting edge Huf Haus and the modern detached house came in third and fourth with 13% and 11% of the votes respectively, suggesting that buyers are receptive to current designs that are more spacious than character homes, such as the thatched or terraced cottage.

Robin Plaster, sales and marketing director of Premier Guarantee commented: “Housebuilders are often criticised for building pastiche homes with Victorian or Georgian architecture, but it would appear they are responding to market demand.”

“However, the popularity of chic new home styles such as the timber and glass Huf Haus suggests buyers are becoming more receptive to interesting modern architecture which tells a story about the era it was built, rather than one of the past. Perhaps housebuilders should be more daring in their designs, adopting the best aspects of nineteenth century architecture and combining it with contemporary design principles.”

The 1930s semi-detached home, with fewer rooms and a more cramped design, proved the least popular property, followed by the 1960s bungalow, which is often viewed by younger generations of buyers as a retirement home.

Pets more precious than people

Despite often having the most to lose if unable to work, self-employed people are more likely to have pet insurance than accident or income protection, according to new research by specialist accident and health insurer Combined Insurance.

At a time when the number of self-employed people working in the UK has risen from just over 3 million in 2003 to almost 4 million in 2006, the latest findings show that almost a quarter (23%) of self employed workers have pet insurance, yet just one in five (20%) have accident insurance.

Worse, perhaps, fewer than one in ten (8%) have income replacement protection to guard against an unforeseen loss of income.

Combined Insurance asked a GB representative sample of 2,000 people which insurance policies, if any, they currently have in place.

Key findings include:

Self-employed workers have the highest monthly commitments, standing at £1166 per month – compared with the national average £954 pcm. In addition, 30% of self-employed workers have nothing saved to guard against a loss of income.
It’s not just the self-employed leaving themselves exposed. The latest findings reveal less than one in five (18%) of the UK’s total workforce have accident cover and just 7% have income replacement in place.
The findings also show it is women, more so than men, who are the most vulnerable to an unexpected loss of income. As many as 84% have no accident cover and a further 94% have no form of income protection in place.
Just 12% of Scots currently have any accident protection in place, and only 5% have any sort of income replacement insurance to finance their monthly commitments should they lose their income.
Nigel Brittle at Combined Insurance says: "In a country where approximately one in five workers are self employed, it is a concern that so many are more likely to financially protect their pets than they are themselves or their families. We know the average Briton could survive for just 17 days without an income, so it makes sense to take steps to guard against an unforeseen loss of earnings."

"For little more than the price of an average weekly take-away meal, people could have the peace of mind knowing that if the worst should happen, they and their family are able to make ends meet."

Storm flood risk populations named by experts


Experts speaking out after government cuts to funding for national flood defences have named several major UK population areas where a catastrophic storm event, maybe even as serious as hurricane Katrina, could devastate the area and cause heavy loss of life.

Although such a storm would unlikely be a hurricane, the populations involved would be large and just as devastated.

Speaking at a press conference in London, on the anniversary of Katrina, the researchers said that low-lying areas such as Hull, where one-quarter of the population lives on the flood plain, would suffer badly in the event of a severe weather combination.

Storm surges in conjunction with high tides have always been a risk to some parts of Britain and the Thames Barrier project - which has operated to protect London on numerous occasions - was built (eventually) after disastrous flooding along the east coasts of Britain in 1953. Although rare, such combinations of weather do happen and as low-lying areas become more populated the risk to people becomes greater, pointed out the experts.

One of the experts, Professor Penning-Rowsell, head of the Flood Hazard Research Centre at the University of Middlesex, said, "I wouldn't buy a house in Thamesmead. Not because the risk [of a severe flood] is very high, but because the consequences of a flood in Thamesmead would be catastrophic."

High-population, low-lying areas named as at high risk were Hull, Portsmouth, areas around Cardiff and the Thames Gateway. Other areas could be affected, said the experts. For example, although the Capital itself was well protected little or no protection existed for the 40,000 people living further along the Thames between Eton and Teddington.

Although the speakers accused ministers of ignoring the lessons of Hurricane Katrina and criticised government cuts to national funding for flood defences, there was recognition that some events would not be prevented by defences, only mitigated by awareness and preparation.

"We have to accept that no matter how much money we spend, there will always be a bigger event than what we've designed for, and the consequences, tragically, are often death," said Jean Venables, former chairman of the Regional Flood Defence Committee of the Environment Agency Thames region.

Storm flood risk populations named by experts

Experts speaking out after government cuts to funding for national flood defences have named several major UK population areas where a catastrophic storm event, maybe even as serious as hurricane Katrina, could devastate the area and cause heavy loss of life.

Although such a storm would unlikely be a hurricane, the populations involved would be large and just as devastated.

Speaking at a press conference in London, on the anniversary of Katrina, the researchers said that low-lying areas such as Hull, where one-quarter of the population lives on the flood plain, would suffer badly in the event of a severe weather combination.

Storm surges in conjunction with high tides have always been a risk to some parts of Britain and the Thames Barrier project - which has operated to protect London on numerous occasions - was built (eventually) after disastrous flooding along the east coasts of Britain in 1953. Although rare, such combinations of weather do happen and as low-lying areas become more populated the risk to people becomes greater, pointed out the experts.

One of the experts, Professor Penning-Rowsell, head of the Flood Hazard Research Centre at the University of Middlesex, said, "I wouldn't buy a house in Thamesmead. Not because the risk [of a severe flood] is very high, but because the consequences of a flood in Thamesmead would be catastrophic."

High-population, low-lying areas named as at high risk were Hull, Portsmouth, areas around Cardiff and the Thames Gateway. Other areas could be affected, said the experts. For example, although the Capital itself was well protected little or no protection existed for the 40,000 people living further along the Thames between Eton and Teddington.

Although the speakers accused ministers of ignoring the lessons of Hurricane Katrina and criticised government cuts to national funding for flood defences, there was recognition that some events would not be prevented by defences, only mitigated by awareness and preparation.

"We have to accept that no matter how much money we spend, there will always be a bigger event than what we've designed for, and the consequences, tragically, are often death," said Jean Venables, former chairman of the Regional Flood Defence Committee of the Environment Agency Thames region.

Quick-fix DIY improvements won’t do anymore

The days of quick-fixes adding thousands of pounds to home asking price are numbered, according to a report from energy supplier npower.

Britons are currently relying on style over substance when it comes to selling houses, with nine out of ten doing everything from baking fresh bread to undertaking a complete DIY makeover, to help sale chances.

But soon they may have to use their loaf differently, says npower. Buyers and sellers are going to have to swot up on a property’s less superficial aspects as well or risk losing out when Home Information Packs come into force next year.

The research published by npower reveals that despite the government’s attempts to educate the public on Hips, over a third of homeowners (36%) confessed they still have no idea what they are.

Improving energy efficiency is bottom of people’s priority list when moving, with only nine% giving it any thought at all but as Energy Performance Certificates are a compulsory part of Hips, sellers are going to have to get wise.

Two out of three people also admitted they are completely clueless about how energy efficient their home actually is and don’t see it as important information to give potential buyers.

When it comes to understanding a home’s energy consumption, a generation gap has developed. Homeowners over 50 put their younger counterparts to shame with 43% knowing how energy efficient their home is, compared to just one in five of those aged 18 to 29.

Finishing touches left to the boys

British men are getting in touch with their feminine side when selling their homes and are almost twice as likely as women to brew a pot of coffee, bake bread or arrange flowers, to make their property more attractive to potential buyers.

Do it for others

While spending on DIY has doubled in the last 20 years, many of these projects aren’t undertaken until just before the homeowner moves out. Over half (55%) of all sellers are dabbling in some sort of redecoration to improve their property’s saleability. Scots take home improvement most seriously with 65% doing DIY projects to aid their sale. Those in the North East are the least likely to pick up a paint brush for other people (46%).

The ‘De-clutter Bug’

Over 540,000 homeowners are choosing to put items into storage and live without home comforts to project a minimalist look, in the hope that it will help their property sell.

Andrew Winter, presenter of Channel Four’s Selling Homes comments: "While redecorating and putting items into storage are sure fire ways of making a property more eye catching, people also need to wise up to how getting a good or poor rating on an Energy Performance Certificate can influence a sale. Having an energy efficient home will make it more attractive to potential purchasers as well as adding pounds to the value and questions around a home’s energy efficiency will become the norm, just like asking about miles per gallon when you are buying a car."

"There is a lot of confusing information out there about Hips and the Energy Performance Certificates but it is important that people don’t stick their head in the sand and make sure they understand what it means to them. Even if you aren’t thinking of selling in the near future, it is better to get things in order now, as living in an energy efficient home is kinder to the environment and will save money too."

npower has produced an ‘Energy Efficiency Sells’ guide which provides both homeowners and potential buyers with no nonsense, practical advice on how to achieve a good energy rating for your home and what to look out for before you make an offer. The ‘Energy Efficiency Sells’ guide is available at http://www.npower.com/HIP/

Men homebuyers secure better deals than women

Women are three times as likely to offer the asking price for a home than men are, new research indicates.

Research from propertyfinder.com finds males are much more aggressive home bargain hunters than the nation’s ladies are.

In the current market, 17% of women are paying what the vendor is asking, compared to just 5.5% of men. Men are pushing much harder to secure a deal that suits them. 22% are making offers of 10% or more below the asking price, compared to just 10% of women.

However, British men are picky purchasers, looking at 30% more homes than women before buying - an average of 6.8 homes - compared to a lesser 4.5 homes viewed by women.

Women more thorough

The reason for this is that women are much more thorough with their research before they even begin viewing potential houses, which is revealed by the latest findings. As a result, women have a clearer idea of exactly what they want and tend to fall in love with their dream home faster than men.

Warren Bright, chief executive of Propertyfinder.com said, "Women know what they want when searching for a property and they do their homework thoroughly before viewing, which is in stark contrast to their male counterparts."

"British males have more of a tendency to decide what they are looking for along the way, consequently viewing more properties than the average female house hunter before finding the one that they want."

The average male Briton is prepared to spend more of their hard earned cash than women on their ideal home, spending on average £243,000 to buy the house they want and applying for a £206,000 mortgage. The average UK woman will spend less (£238,000) and apply for a smaller loan of £193,000.

Despite the interest rate rise earlier this month, both sexes are still expecting house prices to rise. British women show more confidence in the market expecting a rise of 5.6% compared to just 2.1% from men.

37% of women believe house prices will rise as more people buy property as an investment, while 46% of men think prices will rise because their area is up and coming. 41% of males and 32% of females attribute the future rise to more people settling in their area.

Confidence in the market remains steady, with expected price rises in the next 12 months slipping slightly month-on-month from 5% in July to 3.7% this month.

Housing market ‘runs out of steam’

The housing market has ‘run out of steam’ with prices falling by 1.6% in August, according to property website Rightmove’s August index out today.

In the report Rightmove said the average asking price for a home in August dropped by £3,540, with London suffering its first fall since December.

The asking price for the average house fell to £214,040 in August, giving an annual growth rate of 9%, Rightmove said. In July it stood at 10.6%, after a 2.9% rise over the month in the asking price of the average home.

The survey, which measured asking prices of properties put on sale by estate agents in the five weeks to August 12, is the first to provide a snapshot of market movement since the Bank of England raised interest rates at the start of the month. Rightmove said the annual rise in prices slowed from 10.6% in July to 9%.

The turnaround in house price growth has already been reported by others including Nationwide and Halifax, but their surveys are based upon prices actually paid rather than asking prices and so are too old to reflect the rate rise.

Rightmove, by contrast, concentrates on asking prices. The lag between the two sets of figures is believed to result from sellers maintaining asking prices, despite deteriorating market conditions through July. Rightmove's commercial director, Miles Shipside, said: "Prices have passed their peak for 2006. The record price levels seen so far this year were driven by the south of the country."


"With that market cooling, and the signals from the Bank of England that interest rates may move up again, sellers may have to reduce their price expectations."

Miles Shipside said the decline in price growth was welcome news for homebuyers, many of whom were priced out of the market by the recent boom. He added, "Activity in the property market virtually stopped dead after two successive rate rises in 2004 and took a year to recover. Prices are now cooling off and require no further intervention from the Bank."

Landlords should choose agents carefully

Although thousands of students are about to hit the streets in search of accommodation, many landlords will see their dreams of a steady rental income shattered due to the actions of some third-rate letting agents, according to risk experts.

Those landlords who don’t use agents need to take special care in choosing their tenants or they, too, can lose a lot of money, said risk consultants Leaseguard, who also provide insurance and tenant referencing services.

Mairi Scott, Leaseguard managing director warned, "Too many landlords get caught out by thinking they can just appoint a letting agent, hand over the keys, then sit back and wait for the money to roll in. Others put a postcard in a newsagent’s window, and then accept the first tenant who agrees to pay the rent they are quoting."

Every year many small landlords get their fingers badly burned by letting agents who are inefficient or unprofessional – or by plausible-seeming tenants who fail to pay their rent.

Choose the wrong agent and your problems can pile up faster than junk mail in a vacant apartment’s letterbox. If your agent fails to find reliable tenants you could face months with no rental income, leaving you struggling to pay the mortgage on the empty premises.

Even when a tenant is found, disputes over tenants’ deposits can lead to legal costs as landlords take action against the agent and/or the tenant to recoup loss of rent or the cost of repairing damage to the premises. Landlords could face court appearances, fines or other actions if they do not comply with housing regulation.

However, there are many good agents out there – to find one, Mairi Scott recommends that you check the quality of their service by asking the following questions:


Are they a member of a recognised industry body? These include:

Association of Residential Letting Agents (ARLA)
Association of Residential Managing Agents (ARMA)
National Approved Letting Scheme (NALS)
National Association of Estate Agents (NAEA)
Ombudsman for Estate Agents (OEA)
Royal Institution of Chartered Surveyors (RICS)
UK Association of Letting Agents (UKALA)
Are their staff trained to industry standards?

How long have they been in business?
Do they carry out tenant reference checks themselves or do they use a referencing company? Can you see some samples?
Are they up to date on legislation affecting landlords?
Do they have professional indemnity insurance?
Do they have a detailed knowledge of the local market, especially the area where your apartment is located?

What are their fees? Can they show you a list of all charges? Can they tell you, in writing, the total amount you’ll be paying?
What is their policy on holding rent and deposits on your behalf and are they a member of the voluntary tenants deposit scheme?
Can they offer insurance to protect your property or a rent guarantee with legal expenses policy?
Mairi Scott also warns landlords to beware of agents whose valuation of your rental income seems too high, compared with their competitors.

If you decide not to use a letting agent, then you should choose your tenants very carefully. Before signing up a tenant, Leaseguard advises that landlords should always use a legally drawn-up Tenancy Agreement. Other things they should check with tenants include:

Are they employed on a permanent contract? Check with employer
What about affordability?
What about credit worthiness?
Self-employed? Ask to see their accounts for last three years. If not available, ask for an accountant’s reference or, if you are still not satisfied, insist on six months rent in advance.
Can you see their passport or photo driving license? Ask them to sign something, then check signature against passport or driving license.
Can you see utility bills from the last three years? (To check their last addresses)
Request a reference from any previous landlords.
If they are from overseas, can you see their work permits?
"If they are working temporarily in UK, it’s worth popping into the property now and again to check that it is not being overcrowded. I’ve heard of cases where two or three people sign up for a flat, then sub-let the couch and floors to half a dozen other people," concluded Mairi Scott.

Holiday home rental stats reveal growth trends

It’s no real surprise that the holiday property renting hot spot so far this year is Germany.

The 'World Cup Effect' meant Germany has been the top performer for rentals in the first half of 2006 but statistics from holiday home rental firm, Holiday-Rentals.co.uk reveal both where property owners are looking to let and also where holiday makers are looking to rent.

Dubai was hot on Germany's heels, with an average number of enquiries per property double the site average, says the report from Holiday-Rentals.co.uk. Perennial favourite, Tenerife remained popular, with a healthy 20% rise in the average number of enquiries per property per month compared to 2005. Renter interest in Italy was up 13.2%, backing up recent reports that the country is growing in popularity, particularly its cities, with enquiries in both the Rome and Venice areas up around 25% on last year. Other regions that performed particularly well were Sicily (up 30.9%), Lombardy (up 28.5%), Campania (23.6%), Tuscany and Marche (up 10.4%).

Growth in holiday home ownership

Property owners become advertisers for a number of reasons: they may be investors, locals cashing in on tourists, or private owners looking for ways to make their second home pay its bills. In any case, trends, public opinion and economic factors all have a part to play.

With so much news over the past couple of years devoted to cheap property prices and relaxed property laws in some of the new EU Member States Holiday-Rentals’ top 10 is not surprising. Interestingly, although Bulgaria didn't make it onto the list this time, it showed huge growth in the latter half of 2005 and the firm expects it to surge again as ski properties prepare for winter.

Trendy exotics - like Morocco & Dubai demonstrate how intrepid holiday homeowners can be whilst they search out the next hot spots.

Surprisingly, France, a giant in the industry showed very respectable growth - beating out other old favourites: Spain, Italy, and Portugal. Could this be a sign of its enduring popularity or possibly a reflection of the fact that more owners are getting savvy to the fact that they can turn their unused second home into a cash cow!

Another recent survey from the company revealed that October was the favourite month for city breaks with 40% of planned breaks that month. City breaks are one of the latest frontiers for holiday rentals - but with travellers rating décor and furnishing (97%), and food preparation facilities (69%) as important, Holiday-Rentals see this as a niche where property owners can compete with hotels. Favourite destinations in their survey were Barcelona and Rome, with Paris, Krakow, Lisbon, Prague and Amsterdam hot on the heels.

House prices rise at fastest pace for two years

House prices rose in July at the fastest pace since 2004 as the housing market upturn broadens out said the Royal Institution of Chartered Surveyors today.

The view of surveyors is that the recent interest rate rise will not dampen the market.

Their UK housing market survey showed 31% more Chartered Surveyors reported a rise than fall in July, up from 28% in June. RICS estate agents reported that all regions are now experiencing price rises for the first time in over 2 years. Nevertheless, wide variations in price rises remain evident.

With demand strengthening and new instructions moving into decline, surveyors remain optimistic over the outlook for house prices in the next three months with the August 0.25% interest rise not expected to knock market confidence.

Instructions to sell property have fallen for the second consecutive month with surveyors indicating that the government U-turn on Hips has removed the urgency of would be sellers to market their properties. The stocks of unsold property have reached the lowest levels since September 2004, down 10% on year ago levels.

An improving job market has instilled greater confidence across most regions during 2006 with surveys of households pointing to a good financial situation, allowing new buyer enquiries to rise in July at a faster pace than June. Completed property sales for the past year were up 16.9% against a rise of only 11% in January.

London and the South East remain the strongest housing markets boosted by a strong financial services sector. Healthy gains in house prices were also recorded in the North West, Scotland and the South West, but the rest of the country is only showing muted gains.

RICS spokesman, Jeremy Leaf, said: "The increase in interest rates will do little to dampen the market as a strong economic outlook and improving employment prospects will hold up the confidence of households."

"Further interest rate rises are to be expected later this year and will slow activity in early 2007 from current buoyant trading levels. Rising house prices are still preventing first time buyers from entering the market creating a property glass ceiling for many in London and the South East."

Councils in recycled land shame

Some councils are successfully building large numbers of new homes on previously developed land, benefiting the British countryside, said the Campaign to Protect Rural England.

"We warmly congratulate these councils," said Henry Oliver, CPRE's head of planning and local government. "We're delighted that there has been such strong progress across the country by council planners and developers in raising the level of land recycling and getting away from wastefully low densities for new housing."

Out of a total of more than 300 councils in England outside London, 43 have succeeded in having at least 90% of their new homes built on previously developed, brownfield land. Fifteen of these councils have achieved a land recycling level of at least 95%, which means less than one new home in every 20 was built on a greenfield site.

The land recycling heroes are: Adur (96%), Bournemouth (98%), Brentwood (98%), Dudley (99%), Elmbridge (98%), Epsom and Ewell (99%), Hertsmere (96%), Sandwell (97%), Spelthorne (98%), Surrey Heath (96%), Three Rivers (96%), Watford (an unbeatable 100%), Woking (98%) and Wolverhampton (95%).

Name and shame

However, the campaigners also name and shame brownfield under-achievers. The CPRE said 13 councils have allowed less than a third of new housing on previously used land.

Corby was England's worst recycler, with just 9% of homes built on brownfield and Milton Keynes and North Lincolnshire both built less than 20% - a far cry from the Government's national target for at least 60% of new homes to be built on brownfield land or by converting existing buildings.

Other poor performer were: Ashford (33%), Boston (28%), East Riding (23%), Eastbourne (30%), Great Yarmouth (31%), Harlow (23%), Kingston upon Hull (33%), Rugby (30%), Swindon (32%) and Waveney (25%).

Corby council angrily dismissed the CPRE's allegation saying an anomaly in the government's classification system meant that most of its new homes, which were built on a former quarry site, were not identified as brownfield development.

Oslo is world's most expensive city

A new study "Prices and Earnings" by investment bank UBS has compared purchasing power in 71 cities around the world based on the cost of a standardised basket of 122 goods and services. Oslo came out as the most expensive city, closely followed by London, Copenhagen, Zurich and Tokyo.

This result could be slightly misleading, however, as, along with the US, Scandinavia and Switzerland also pay the highest wages offsetting their high living costs. Moreover, the basket of goods and services does not include the cost of housing; when this is taken into account, it is London and New York that are the most expensive places to live.

The rise of Dublin

The highest wages are paid in Copenhagen, Oslo, Zurich, Geneva, New York and London. In a comparison of net wages, however, the Scandinavian and German cities lose ground due to their high tax rates and social security payments. UBS hail English-speaking Europe in their report as "the shooting star" in the international comparison of wages, with Dublin and London new in the top ten.

The UBS study found that the highest purchasing power - defined as how long you have to work to buy a Big Mac! - was in Zurich and Geneva, closely followed by Dublin, Los Angeles and Luxembourg. After buying the study's basic basket of goods and services, earners in these cities retain the highest portion of their net wages as disposable income to spend on things like vacations, luxury items or savings.

The average purchasing power in Central and South America is just a third of the level in the North American cities. But the biggest upward jumps compared to the previous issue of “Prices and Earnings” three years ago have also been in Latin America in São Paulo, Rio de Janeiro and Santiago de Chile. The basket of goods and services cost the least in Kuala Lumpur, Mumbai, Delhi and Buenos Aires.

Interestingly, a historical analysis of UBS' data shows that Europeans have reduced their working hours in the last 30 years in favor of more leisure time. Americans and Asians, on the other hand, seem to have a higher regard for earned income.

The UBS studies "Prices and Earnings" can be downloaded at www.ubs.com/research

Irish house price crash predicted

The International Monetary Fund has warned that Ireland's personal debt levels and the spiralling cost of houses threaten to undermine future prosperity.

In its latest report on the health of the economy, the IMF said the property market faces an "abrupt" downturn and not the soft landing predicted by other commentators.

The IMF said: "Bank credit to property-related sectors has grown rapidly and now accounts for more than half of total bank lending. Household debt as a share of household disposable income rose to about 130% in 2005, among the highest in Europe."

"Growth has become increasingly unbalanced in recent years, with heavy reliance on building investment, sharp increases in house prices, and rapid credit growth, especially to property-related sectors."

The IMF warned spending increases on public services should be minimal. "Modest fiscal tightening would be desirable in 2007, given the strength of domestic demand, potential risks of a hard landing, and the need to prepare for the ageing population," the report said.

Irish house price crash predicted

The International Monetary Fund has warned that Ireland's personal debt levels and the spiralling cost of houses threaten to undermine future prosperity.

In its latest report on the health of the economy, the IMF said the property market faces an "abrupt" downturn and not the soft landing predicted by other commentators.

The IMF said: "Bank credit to property-related sectors has grown rapidly and now accounts for more than half of total bank lending. Household debt as a share of household disposable income rose to about 130% in 2005, among the highest in Europe."

"Growth has become increasingly unbalanced in recent years, with heavy reliance on building investment, sharp increases in house prices, and rapid credit growth, especially to property-related sectors."

The IMF warned spending increases on public services should be minimal. "Modest fiscal tightening would be desirable in 2007, given the strength of domestic demand, potential risks of a hard landing, and the need to prepare for the ageing population," the report said.

Barbecues more attractive than house viewing

The latest data from haart estate agents reveals that the average London house price has fallen by a further 1% in July to £245,017 from £247,703 in June. However, prices are 8% higher than they were this time last year.

Despite the predicted bounce back in activity post World Cup, rising activity levels have been stifled during the hottest July since records began. The lower level of property viewings has resulted in the average percentage reduction in asking price rising to 3%.

However, first time buyers are continuing to show confidence in the market and are capitalising on the summer sale with first time buyer levels rising to their highest in 12 months.

Summer sale

The summer dip in activity is requiring sellers to accept as much as a 4.8% reduction in their asking prices in North London, where average prices are higher than South East London.

Paul Smith, chief executive of haart estate agents commented: "As the hot summer months cool down the activity in the property market, only the properties that are correctly priced are being snapped up."

"In this heatwave, people would rather be out at barbeques and enjoying the weather than shopping for houses. With fewer applicants viewing properties, sellers are often not in the driving seat and should keep their prices keen to ensure a sale."

First time buyers - bargain hunters

First time buyer levels are at their highest level in 12 months, having risen 2% in July to 28% of the market share as their confidence remains high.

Paul Smith continued: "The temporary dip in the market and the drop in prices have encouraged first time buyers to return. For those who are closely monitoring the market and waiting for prices to match their budget, now is the time to hunt for a good bargain."

"Despite interest rates rising last week, the selection of competitive mortgage deals currently available means that first time buyers are more able to afford mortgage repayments."

London-wide variations

The North of the capital saw July’s largest price decrease at 4.1%, setting its average at £229,628, and the month’s greatest average percentage asking price discount of 4.8%.

The South East region of London was the only region to see a price increase of 4.9%, bringing its average price closer to those of the other regions (£223,502).

"The South East has been boosted by the increased demand due to the good schools in the area and the shortage of suitable property," said Paul Smith.

We’re planning to move home more often

British people are moving home more often than ever before and are planning for a lifetime of regular relocation, according to new research from propertyfinder.com.

While the average over 65 year old has moved 5.7 times in their life, spending an average of 9.2 years in each of their homes, the average 41-45 year old has already moved 7 times, spending just four years in each residence.

The 18-25s are the most footloose, having moved more than 3 times since they left the parental home, spending two years on average in each home.

When asked how many more times in their lives they expected to move, those under 30 expected an average of 6 more home moves, taking their expected lifetime total to 10, almost twice as many as their grandparents. Those aged 41-45 expected to move another 4.5 times, taking their total to 11.5, and suggesting that the young may even be underestimating their likely moves.


Social change is the key determinant of this trend. When asked what prompted them to fly the parental nest, 88% of the over 65s did so in order to get married. This compares to less than 3% of the under 30s in the survey. 53% of the under 30s left home to go to university. A further 8% did so to set up home with friends, something that none of the over 65s did.

Warren Bright, chief executive officer of propertyfinder.com said: "People now marry and settle down much later than their grandparents and are far more likely to move around as a result."

"This trend is due mostly to studies, changes in career patterns, the tendency of young people towards house-sharing and the likelihood of young people having serial relationships before settling down. Middle aged people have also become much more mobile due to rising divorce rates, the need to release equity to fund retirement and downsizing."

The Treasury, buy-to-let landlords, and estate agents are key beneficiaries of this trend. Stamp duty on the average home purchase is £2000 but in London it is a staggering £9000. Five home moves in London would therefore bring £45,000 into Gordon Brown’s coffers.

The high level of house prices and the social changes affecting the way young people live (and keep changing homes) will continue to boost demand for rental accommodation.

The private rented sector is bridging the gap between the parental home and the first rung on the property ladder and fuelling the rise of the buy-to-let landlord.

Estate agents will profit in both cases, as they provide services to home buyers, sellers and renters alike.

Warning over East European markets

New research shows that around three in ten (29%) Britons now see Eastern Europe as the market that will deliver the best capital returns for property investment over the next 10 years.

The Inside Track Group, which commissioned the survey, sees this optimism in Eastern Europe as misplaced, however. The company has performed research in the region, particularly in Croatia and Bulgaria, and chief operating officer Anthony McKay believes buyers are rushing into these markets not fully appreciative of the risks involved.

“Thousands of units are being built in both Croatia and Bulgaria – and many people see this area as the next ‘big thing’,” McKay says. “But, all there needs to be is a downturn in the market, or for political unrest to flare up, and many people are left thinking: ‘How on earth am I going to sell?’.

McKay continues: “It’s a good idea for buyers to consider higher risk, high return properties to go alongside low risk investments that make up the bulk of a successful housing portfolio. In Croatia and Bulgaria, though, inexperienced investors are putting their life savings on the line in the hope that they can make a fortune. I fear many people may end up bitterly disappointed because they are not aware of the complications within this market.”

Problematic purchasing processes

Inside Track has highlighted the following features of the purchasing systems in both Croatia and Bulgaria that could pose problems:

There is no legal organisation that regulates home ownership in Croatia, leading to a lot of confusion – the country’s land registry system can allow the person selling a property not to be the owner
Some properties in Croatia have been built without appropriate permission
In Bulgaria, investors must establish a limited company before they can purchase land
Tax regulations in Bulgaria can be extremely confusing
The average wage in both Croatia and Bulgaria is low, meaning most locals cannot afford to rent new build properties, and investors are limited to foreign tenants only
The group also issues the following general piece of advice: Ask yourself three questions before investing in any piece of property:

Will the re-sale value be more than the purchase value?
Will the property be desirable to rent?
Will the asset be safe?
“For the Croatian and Bulgarian markets, the answer is likely to be ‘no’ for at least one of these questions,” explains McKay.

Chris Davidson, Sales Manager at property investment specialists www.e-quity.com commented: "Bulgaria has attracted a lot of interest from popular TV shows such as A Place in the Sun, and there is no doubt that investors can pick up cheap property there. However, with stories of forged title deeds, mafia run operations and an abundance of supply in tourist hotspots, it is difficult for investors to pick out a real bargain."

Davidson continued: “Before recommending any property to investors, E-Quity always performs what we call ‘due diligence’ - thorough research and analysis examining factors which might pose risks to investments. Key areas include the political stability of the country, its legal system and banking infrastructure as well as the developer's track record, substantive evidence of its claims on investment performance and availability of investor security such as escrow accounts."

Davidson added: “I would recommend that anyone thinking about investing in any emerging market perform some ‘due diligence’ of their own and consider the option carefully.”

Spain set for 10% foreign resident population

The latest figures from the Spain’s National Institute of Statistics show that 3,880,000 of the country’s official population of 44,390,000 million are foreigners. This is 8.7% of Spain's population.

This is a staggering leap from only 2.2% at the beginning of the decade.

While no firm data exists to show how this immigrant population is divided according to countries of origin, it is clear that Britons make up a high proportion of the foreigners now residing in Spain and have been responsible for a significant portion of the growth in the total.

Within the automomous regions the Baleares is the place where the largest numbers of foreigners live making up 15.6% of this region's official population.

Valencia, Murcia, Cataluña and Madrid follow. The regions with the smallest numbers of foreigners are Extremadura, Galicia y Asturias with only 2.5% of their official population made up of foreigner residents.

According to a recent report by consultants Analistas Financieros Internacionales foreigners will buy around 170,000 new homes in Spain this year – by far the highest number of foreign purchases in any European country and a significant upward pressure on property values across the country.

West Midlands set to be the new South East

The government is putting pressure on the West Midlands for a greenfield housing bonanza. It could make the controversy over house building as intense and heated as it is in South East England, according to the countryside campaigners Campaign to Protect Rural England.

CPRE warns that a huge increase in house building in the countryside around Birmingham threatens to sabotage urban regeneration, encourage more people to move out of urban areas, consume Green Belt land and destroy open green landscapes.

The latest Government predictions of housing requirements could see 50% more land than currently planned being allocated for house building across the West Midlands over the next 25 years, with the figures more than doubling in some areas.

That would be incompatible with the region's present emphasis on brownfield development and urban regeneration and the West Midlands Regional Assembly has been consulting West Midlands councils about the implications.

Some councils – for example Shropshire and Herefordshire – have told the Regional Assembly that they could not meet the higher figures without great damage to the countryside and market towns.

And some urban authorities are warning that they have limited building land, and that developers would abandon house building on derelict or under-used sites that need remediation if they were given cheap green field alternatives.

But some other councils in the region want to go along with the government. Worcestershire County Council is contemplating expansions of Worcester and Redditch into the countryside and Coventry and Warwickshire seem willing to sacrifice large areas of Green Belt to let cities and towns expand outwards.

Towns such as Burton-on-Trent, Hereford, Rugby, Shrewsbury, Telford and Worcester – all already targeted for development – would also be in the firing line. Some might even double in size over twenty years. Others such as Lichfield and Warwick / Leamington which have been growing fast in recent years would have to keep on growing to fulfil the higher numbers, risking serious damage to their environmental quality.

CPRE says the government's new household projections are of limited relevance to the West Midlands because they assume a continuation of past trends and policies, whereas the current West Midlands planning strategy aims to take the region in a new and more sustainable direction.

The Government's fundamental premise, that building more houses will reduce prices, is misguided say CPRE who are not convinced that the house building industry would build at the much higher rate and believe developers could end up cherry picking the most profitable greenfield sites.

Bank of England raises interest rates to 4.75%

The Bank of England's Monetary Policy Committee today voted to raise the official Bank rate paid by 0.25 percentage points to 4.75%.

August seems to be the month for changes - The base rate was last changed a year ago when it was dropped a quarter point from 4.75%. It had been unchanged for a year before that.

It has now been within a quarter point of 4.5% since May 2004.

While economists had predicted a lively meeting this month few had expected the rate to rise just yet. . "The MPC faces its toughest decision for a while as it deliberates whether shorter term activity and inflation pressures justify tighter monetary policy," said economist Philip Shaw earlier this week.

But the Bank said at noon today that the pace of economic activity has quickened in the past few months. Household spending appears to have recovered from its post-Christmas dip. Business investment growth and investment intentions have also picked up.

In the United Kingdom 's main export markets growth has remained robust. As a result, over the past few quarters’ GDP growth has been at, or a little above, its long-run average and business surveys point to continued firm growth. The margin of spare capacity in the economy appears small.

CPI inflation picked up to 2.5% in June, and is expected to remain above the 2.0% target for some while. Higher energy prices have led to greater inflationary pressures, notwithstanding muted earnings growth and a squeeze on profit margins. Although the path of energy prices is extremely uncertain, energy price inflation is expected to moderate in the medium term. But some recovery in profit margins and pay growth is likely to mean that consumer price inflation will move only gradually back to the target.

Against the background of firm growth, limited spare capacity, rapid growth of broad money and credit, and with inflation likely to remain above the target for some while, the Committee judged that an increase of 0.25 percentage points in the official Bank rate to 4.75% was necessary to bring CPI inflation back to the target in the medium term.

Holiday camp development timeshare

Butlins the holiday camp company is preparing to woo holidaymakers into a ‘lifetime’ of holidays with a timeshare development.

The company is developing luxury sea-view timeshare apartments at its holiday centre at Minehead in Somerset, with building work set for completion in March next year.

For just £6,000 the new company called BlueSkies will offer a lifetime of family holiday breaks in May. August naturally turns out a little more expensive at £11,000. A ‘lifetime’ holiday turns out to be 30 years, plenty some would say when one week seems like a nightmare, but a dream opportunity for others perhaps.

Head of the BlueSkies development Mike Crowther said: "BlueSkies is holiday heaven for the growing number of people who enjoy the fun and convenience of a UK family break. Second homes and holiday apartments are an unattainable dream for many people as they can be expensive to buy, maintain and manage."

Timeshare owners will get an apartment set apart from the main Butlins holiday camp at Minehead in Somerset.

However, the scheme will be run on a points basis allowing shorter breaks at peak times to be swapped for longer holidays at other times of the year. This is typical of many timeshare schemes and BlueSkies has teamed up with specialist timeshare operator RCI to allow members to exchange the points with other timeshare owners around the world.