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Home sales jump as looming Brexit deadline unleashes pent-up demand

By | Residential Property

‘There’s only so long that buyers and sellers can delay the familial, financial and emotional forces driving the need to move,’ says analyst at Rightmove.

The fast-approaching Brexit deadline and lower house prices have spurred buyers into action, with home sales rising 6.1 per cent on last year, according to August data from Rightmove.

Asking prices fell but less than is usual in August when many people are on holiday, dropping 1 per cent on the month and climbing 1.2 per cent on the year – the highest increase since September last year.

“There’s only so long that buyers and sellers can delay the familial, financial and emotional forces driving the need to move,” said Miles Shipside, housing market analyst at Rightmove.

“With the average time between agreeing a sale and moving in being more than three months, we’re now entering the last-chance saloon for those who want to have finished their move before the end of the year.”

Buyers may see the current Brexit deadline as more definite than the last one in March as the new government has repeatedly stated its “do or die” commitment to leaving the EU on 31 October, Mr Shipside noted.

While some buyers may have hesitated earlier in the year, waiting for more clarity on Brexit, many buyers as well as sellers now want “the certainty of getting the deal signed and sealed” before Britain exits the EU, he added.

The average asking price in the UK stood at £305,500 in August – the lowest since April, Rightmove figures showed. Although it was higher than a year ago, the 1.2 per cent annual rise still lagged behind inflation, which is running at 2.1 per cent, according to the latest official data.

“There is little doubt that the market continues to face its inevitable challenges,” said Glynis Frew, chief executive of Hunters, an estate agency with over 200 branches across Britain.

Official data showed last week that the average price at which homes are sold grew only 0.9 per cent in the year to June, while in London it tumbled by 2.7 per cent. The average British home cost £230,292 in June, down from a peak of £232,000 in August 2018.

Buyers have been biding their time as it remains unclear whether the UK will leave the EU with or without a deal. In the latter case, house prices could plunge by almost 6 per cent in 2020 and another 3 per cent in 2021, according to forecasts by the government’s spending watchdog, the Office for Budget Responsibility.

However, the more confident buyers are now abandoning the ‘wait and see’ approach and taking advantage of improved housing affordability as the Brexit deadline nears, Ms Frew said, commenting on Rightmove’s findings.

For its latest report, Rightmove measured 130,435 asking prices, covering around 90 per cent of the UK market. The properties were put on sale by estate agents between 7 July to 10 August and advertised on rightmove.co.uk.

Source: The Independent

Investment in UK Residential Property Up 150% Despite Brexit

By | Publications & Reports, Residential Property

The uncertainties of Britain’s departure from the European Union hasn’t stopped investors from backing the UK’s residential sector.

Total investment volumes in the UK’s multifamily sector rose by more than 150% to 6.8 billion euros ($7.6 billion) in 2018, according to a report by broker JLL. London helped lead the charge, with investment volume nearly doubling to 2 billion euros compared to 2017.

‘Action plan’ for Social Housing Green Paper to be published in September

By | Social Housing

The next stage of the Government’s Social Housing Green Paper will be published in September, Prime Minister Theresa May announced on Wednesday.

It will include an “action plan and timetable” for the implementation of reforms to social housing.

Speaking at the Housing 2019 conference in Manchester on 26th June, Ms May said that the publication will include the creation of a stronger consumer regulation regime for social housing, enhancing tenants’ rights and “making it easier to enforce them”.

She said: “I have always been clear that this green paper must not be simply an intellectual exercise highlighting the nature of the problem – it must be the practical next step in actually fixing it.”

The government published its green paper, entitled A new deal for social housing, on 14 August 2018, and a subsequent consultation of sector views closed on 6 November.

Ms May said that the reforms to be implemented by the action plan would be “wide-ranging”.

“It will include the creation of a stronger consumer regulation regime for social housing, enhancing tenants’ rights and making it easier to enforce them; changes to the way complaints are resolved, so that tenants know exactly how to raise concerns and can be confident their voices will be heard and [their concerns will be] acted upon; empowering residents still further by requiring landlords to demonstrate how they have engaged with their tenants; and a commitment to further boost the supply of high-quality social housing, through the Affordable Homes Programme and other funding.”

However Ms May, who is due to step down on 24 July, did not use her speech to set out further funding, or to respond to calls this week from organisations in the sector to substantially increase government grant levels.

Yesterday, a coalition of organisations in the sector – including the Chartered Institute of Housing (CIH), the National Housing Federation and Shelter – called for government investment to increase to £12.8bn annually to deliver the affordable housing required.

In an interview with Social Housing, housing minister Kit Malthouse said yesterday that while he could not answer whether the government was prepared to raise grant to these levels, it would be “foolish” not to keep grant under review to maintain housebuilding where the market is “starting to soften”. He said that these would be considerations for the government’s Spending Review later this year.

In her speech, the prime minister reflected on past policy announcements, including a commitment in the 2015 Conservative Party manifesto to deliver one million new homes by 2020. “Commentators and critics said it could not happen, but it is happening,” she said.

She added: “There remains much to do, but over the past three years we have shown what can be achieved.”

Ms May also acknowledged that “too many” governments – including the one in which she served as home secretary under David Cameron – had “concentrated solely on homeownership, as if supporting those struggling to find a home to rent were somewhere contrary to such an aim”.

Responding to the prime minister’s speech, Terrie Alafat, chief executive of the CIH, said: “We look forward to the Social Housing Green Paper action plan the prime minister announced today. The green paper covers issues that have a critical effect on the lives of millions of people, and it’s vital we maintain momentum.”

She added: “The prime minister is right when she says there is more – a lot more – that still needs to be done to turn that commitment into reality. Yesterday a coalition of housing organisations including the CIH set out in detail what needs to be done to solve our housing crisis. We called for a 10-year programme to build around 1.5 million social homes to rent, as well as shared ownership properties to buy. This would cost £12.8bn a year and add around £120bn to the economy every year.”

Source: Social Housing

Unique Manager Showcase Event, London

By | Residential Property

The Unique Manager showcase is returning to London on the 26th June 2019, bringing together the best boutique Fund Managers in the investment space across several asset classes covering:

  • Equities
  • Structured Products
  • Fixed Income
  • Alternatives
  • Tax Efficient Investments

Along with plenty of interesting Managers there will be CPD accredited seminars and panel discussions with industry experts.

Announced Managers:
Unicorn Asset Management
EG Capital Advisors
Atlantic House Fund Management
Sanford DeLand Asset Management
and many more.

Further Details:

Date: Wednesday 26th June 2019

Time: 9am – 4pm

Event Type: Manager Events

Location: London

Venue: Leonardo Royal Hotel, 10 Godliman St, London EC4V 5AJ

To register for the event please to go:
https://uniquemanagershowcase.com/events/unique-manager-showcase-london

Boost for housing market as Japan’s biggest housebuilder, Sekisui House, moves into UK

By | Residential Property, Social Housing

Japan’s biggest housebuilder will move into the UK housing market with immediate effect after striking a multi-million pound deal that will see it work with Homes England and Urban Splash to deliver thousands of new homes across England.

  • £90m investment boost to the UK housing market
  • Sekisui take a 35% equity stake in Urban Splash’s modular House business
  • Investment will deliver new housing stock using modern methods of construction

Sekisui House, one of the world’s leading housebuilders, are pioneers of modern methods of construction, where homes are built in factories and then shipped out to sites.

The £90m deal, which has been facilitated by lead real estate and financial advisor JLL, comprises a total new investment of £55m into regeneration company Urban Splash’s ‘House’ development business. It provides a significant boost to the UK’s modular housing industry and will help to speed up production of much-needed new homes.

Sekisui House have invested £22m of new equity, with £30m of equity and debt funding coming from the Government’s Home Building Fund, administered through Homes England.

Experienced entrepreneur Noel McKee, founder of We Buy Any Car, has also made a sizeable investment in the new partnership and will take an incremental c 5% stake.

Yoshihiro Nakai, President and Representative Director of Sekisui House Ltd said:

“We are extremely pleased to be able to work together with Homes England and Urban Splash to establish our operations and help to create outstanding communities in the UK.

“Using modern methods of construction to build high quality homes with short build times is one of our company’s great strengths. Our technology and know-how can help resolve pressing social issues in the UK, and I want to see us play our part effective immediately. These operations can also help bring vitality to UK regions, and we will work to make the strongest connections with the local communities.”

‘House’ is expected to deliver thousands of homes across England using modern methods of construction.

Minister of State for Housing, Kit Malthouse MP, said:

“Sekisui House bring with them a proven track record in harnessing the modern methods of construction that are transforming home building.

“Backed by Government investment, today’s announcement will support our urgent mission to deliver more, better and faster home construction to ensure a new generation can realise the dream of home ownership.”

Homes England, the government’s housing accelerator, has been instrumental in providing significant financial support and expertise to the new partnership as well as providing assurance to the investors.

Sir Edward Lister, Chair of Homes England, said:

“When Homes England launched last year we said we’d disrupt the housing market to increase the pace of construction. By helping bring one of the world’s largest and most innovative housebuilders to UK shores, we’re putting our money where our mouth is.

“By creating a more diverse landscape – where smaller builders such as Urban Splash get a stronger foothold – we’re rebuilding the building industry; driving up quality and improving consumer choice.”

Tom Bloxham MBE, Chairman of Urban Splash, said:

“We believe that there is a real opportunity in the UK housebuilding industry. We hope to leverage our 25 years of place-making experience and our recent investments into modular housing by bringing in new partners; having looked far and wide we chose Sekisui House from Japan because of the company’s unrivalled global experience in modular construction and shared values and philosophy that we are making homes not units, and a joint belief in the need for a green future.

“We are also proud to partner with Homes England – part of the UK Government – because of their commitment to modular and desire to grow capacity in the UK housing business.

“We are incredibly excited about the accelerated production of much-needed homes and evolving traditional practices as we embrace the benefits of innovative offsite construction. I hope it will establish us as the housing partner of choice for landowners – both public and private.”

Source: Homes England

Brexit effect on UK house prices is changing

By | Publications & Reports, Residential Property

The latest data from mortgage lender Nationwide has added to growing signs that any impact of Brexit uncertainty on UK house price growth is starting to ease.

Growth in British house prices picked up slightly in April, with a year-on-year rise of 0.9%, up from an annual rise of 0.7% in March. The average price for a property in the UK now stands at £214,920 ($280,656). Month-to-month figures show prices were up 0.4% between March and April, marking the biggest increase since November.

“While the ongoing economic uncertainties have clearly been weighing on consumer sentiment, this hasn’t prevented further steady gains in the number of first-time buyers entering the housing market in recent quarters,” said Robert Gardner, chief economist at Nationwide.

“Indeed, the number of mortgages being taken out by first-time buyers has continued to approach pre-financial crisis levels in recent months,” Gardener added.

“First-time buyer numbers have been supported by the strength of labour market conditions, with employment rising at a healthy rate, and earnings growth slowly gathering momentum.”

Although house prices growing by just under 1% doesn’t seem too much to laud over, the consistent rise over the last few months has shown that some pockets of buyers are shaking off Brexit uncertainty.

“Given the previous years of outstanding house price growth, we could be forgiven for thinking that anything below the 1% mark where the annual rate is concerned, is entering life support territory,” said Marc von Grundherr, director of estate agent Benham and Reeves.

“This simply isn’t the case and while the rate of price growth has paused for breath, it remains within easy reach of wider targets for the year as we enter just the second quarter, von Grundher added.

“Without the sufficient market fuel of buyer demand and replenished stock levels the market may struggle to make it out of second gear, however, it’s likely that we will see conditions accelerate through the spring and summer seasons with some more positive growth levels registered despite the continued uncertainty of Brexit.”

Source: Yahoo News

Chancellor offers £3bn fix for Britain’s ‘broken housing market’

By | Residential Property, Social Housing

Philip Hammond’s spring statement includes funding to build 30,000 affordable homes.

A new £3bn scheme will fund the building of 30,000 affordable homes, the chancellor has said, as he proclaimed that the government was on track to reach its target of 300,000 new homes a year in Britain.

Philip Hammond’s spring statement also contained a patchwork of separate schemes to boost housebuilding, including £717m to “unlock up to 37,000 homes” in the Oxford-Cambridge arc, Cheshire and west London.

“The government is determined to fix the broken housing market,” said Hammond. “Building more homes in the right places is critical to unlocking productivity growth and makes housing more affordable.”

Under the affordable homes guarantee scheme – an existing programme that will receive renewed government support – the government does not directly fund new homes but gives a Treasury guarantee to housing associations to allow them to build.

The housing charity Shelter said while it welcomed the boost for affordable homes, borrowing by housing associations would not solve the housing crisis, and the government needed to fund much higher levels of social housing.

Polly Neate, chief executive of Shelter, said: “The government’s decision to renew the affordable housing guarantee scheme is a welcome announcement. This initiative will support the building of more desperately needed social and affordable homes.

“While this is good news, it has to be noted that we can’t deliver social housing on the scale we need on borrowing alone – 3.1m social homes are needed in the next 20 years to tackle the housing crisis at its root and lift thousands of families out of homelessness. We need much more grant funding for social housing in this year’s spending review to get a grip on our ever-growing housing emergency.”

Official government figures show that affordable homes – for sale or to rent – make up a relatively small, but growing, part of the housing supply in England.

In the six months to 30 September 2018, there were 9,909 new affordable homes started, up from 6,989 in the same period of 2017.

The definition of what “affordable” means is controversial. The government defines it as “social rented, affordable rented and intermediate housing, provided to eligible households whose needs are not met by the market”. It includes shared ownership homes for sale “provided at a cost above social rent, but below market levels”.

Source: The Guardian

Government confirms annual CPI+1 Rent Increase

By | Publications & Reports, Social Housing

The Government has indicated that it will permit annual rent increases of up to one per cent above the consumer price index (CPI), in it’s response to a consultation with the sector.

The MHCLG announced plans in October 2017 to permit Registered Providers to increase rents on social rent and affordable rent properties by up to CPI plus 1% each year from 2020, for a period of at least five years.

In September 2018 it launched a consultation on its proposed direction to the Regulator of Social Housing concerning social rents from 1 April 2020 onwards, which closed on 8 November. Yesterday it published the results of that consultation and it’s response.

Seventy-one per cent of respondents to the consultation agreed that the regulator’s Rent Standard should apply to local authorities.

Meanwhile 57 per cent agreed with the proposal to permit Registered Providers to increase rents by up to CPI plus one per cent each year. However 34 per cent of those responding to this question disagreed with the proposal, including 87 per cent of responses from individuals and organisations representing tenants.

The MHCLG stated in its response: “The government acknowledges the concerns raised about the potential impact on tenants of permitting rent increases of up to CPI+1% each year from 2020. However, it is important to recognise that most existing tenants will have benefited over the previous four years from a reduction of 1% each year as implemented through the Welfare Reform and Work Act 2016. MHCLG adds that the CPI plus one per cent is the maximum increase but “landlords have discretion to apply a smaller (or indeed no) increase based on local circumstances”.

The response concludes; “Overall, we believe that the proposed CPI+1% limit strikes a fair balance between the interests of landlords, tenants and taxpayers.”

It adds: “The Government therefore intends to proceed with the proposal to permit annual rent increases of up to CPI+1%.”

In October 2017, Theresa May announced that the CPI plus one per cent rises would resume for five years from 2020, and the government launched its formal consultation in November last year.

The consultation received 157 responses, of which 37 per cent were from local authorities or their representative bodies. Eighteen per cent were from private Registered Providers or their representative bodies and 35 per cent were from individuals or tenant organisations.

 

Source: Social Housing

CBRE launches £250m Affordable Housing Fund

By | Residential Property, Social Housing

This month has seen CBRE Global Investors, one of the world’s giant real asset investment managers with $104.5bn in assets under management, launch a £250m Affordable Housing Fund. The investments are from 13 institutional investors, including social investment institution, The Big Society Capital. Twelve out of 13 of the  investors are new to the affordable housing sector. Coming from the UK and Europe, the institutional investors include “pension funds and insurance companies”. Hannah Marshall, Head of UK funds commented, “If you look at Europe, you can see that for many of the Dutch pension funds, it’s already quite central to their agenda; you can see some of the bigger investors actually implementing targets – wanting to have a certain percentage of their portfolio in impact investment within the next five years, for example.”

The Fund will invest in social and affordable rented housing, shared-ownership properties, homeless hostels and housing for ‘key workers’, such as nurses. It is designed to make a social impact, while targeting a 6% total return. Ms. Marshall stated, ‘Our strategy contributes towards our investors ESG targets, and generates a positive social impact as we invest in the funding of homes for those households unable to afford to rent or buy in the open market’.

The Fund will act as a Social Landlord, leasing the properties to Registered Providers, as opposed to setting up their own RP for now. Investments will be sourced from house builders, individual RPs and Local Authorities and will include “both development and buying existing portfolios”.

Impact investing continues to gain traction among institutions into 2019, and the trend remains for investors and real estate fund managers to explore the opportunity within the social and affordable housing sector in the UK. In December, Legal & General Affordable Homes was granted registered provider status, helping push Legal & General’s affording housing initiatives.

 

Source: Investment and Pensions Europe

Investment Week: Sustainable & ESG Investment Awards 2018

By | Residential Property, Social Housing

Best ESG Fund Management Group (Generalist)
Hermes Investment Management – WINNER
Kempen Capital Management
Martin Currie Investment Management
Montanaro Asset Management
Newton Investment Management
Pictet Asset Management
Robeco – highly commended

Best ESG Fund Management Group (Specialist)
Castlefield Investment Partners
DWS Responsible Investments
EdenTree Investment Management – WINNER
HSBC Global Asset Management
Impax Asset Management – highly commended
Kames Capital
Legal and General Investment Management
Liontrust Asset Management

 

Best Environmental Fund
CB Save Earth Fund
Impax Environmental Markets Plc – WINNER
Pictet Global Environmental Opportunities Fund

Best Ethical Investment Fund
Amity UK Fund
CB European Quality Fund
Kames Ethical Cautious Managed Fund
Kames Ethical Equity Fund
Newton SRI Fund for Charities
Premier Ethical Fund
Rathbone Ethical Bond Fund – WINNER
Standard Life Investments UK Ethical Fund


Best ESG Investment Fund

Arabesque Systematic
Davy ESG Equity Fund
F&C Responsible Global Equity Fund
Hermes Global Equity ESG Fund – WINNER
Kempen (Lux) Sustainable European Small-cap Fund
LGIM Future World Gender in Leadership UK Index Fund
Muzinich Bondyield ESG Fund

Best Sustainable Investment Fund
Brown Advisory – U.S. Sustainable Growth Fund
Castel Residential Property Fund
FP WHEB Sustainability Fund – WINNER
Hermes Impact Opportunities Equity Fund
Insight Sustainable Euro Corporate bond fund
Janus Henderson Global Sustainable Equity Fund
Kames Global Sustainable Equity Fund
Liontrust Sustainable Future Managed Fund
Royal London Sustainable World Trust
Wellington Global Impact Fund

Best New Entrant – Fund
Baillie Gifford Positive Change Fund
Castlefield B.E.S.T Sustainable European Fund
Foresight Smart Bonds Fund
FP Foresight UK Infrastructure Income Fund (FP FIIF)
M&G Impact Financing Fund – WINNER
Montanaro Better World Fund
UBAM – EM Sustainable High Grade Corporate Bond
VT Gravis Clean Energy Income Fund

Best New Entrant – Services
Heartwood Sustainable Multi Asset Strategies
Smart Pension
Tribe Sustainable Impact Model Portfolio Service – WINNER

Award for Innovation (Funds)
Amundi Planet Emerging Green One
Castlefield B.E.S.T Sustainable Portfolio Fund
Davy ESG ex Fossil Fuels
HSBC Global Lower Carbon Bond Fund
Mirova Natural Capital Althelia Funds
Pictet Global Environmental Opportunities Fund
RobecoSAM Global SDG Credits Fund – WINNER
Standard Life Investments Global Equity Impact Fund
Threadneedle (Lux) European Social Bond Fund
Trium Morphic ESG L/S UCITS

Award for Innovation (Portfolios)
Canaccord ESG Service
Barclays Sustainable Total Return Strategy
Financial Express Investments – Responsibly Managed Portfolios
Thomas and Thomas Pro-Ethical Portfolio Service – WINNER

Award for Innovation (Non-fund)
Arabesque S-Ray
CPR Asset Management – Risk Management through ESG material signals
ixo Protocol – WINNER
Schroders Climate Progress Dashboard
Thomson Reuters ESG Data

Award for Innovation (Research & Methodology)
BMO Global Asset Management – SDG Mapping and Engagement
Bridges Fund Management – Impact Management Project – WINNER
Davy Asset Management – ESG Valuation Model
Morningstar® Portfolio Carbon Risk ScoreTM
RobecoSAM SDG framework
S&P Global Ratings Green Evaluation
Thomson Reuters Diversity & Inclusion Index
Tribe Impact Methodology
WHEB Asset Management – Impact Report 2017 and Interactive Impact Microsite

Best ESG Research Team
AVPN
BMO Global Asset Management – WINNER
DWS
Hermes Investment Management
Montanaro Asset Management
S&P Global Ratings
Storebrand Asset Management

Best Thought Leadership Paper on Sustainable Investing
AVPN – The Continuum of Capital in Asia – WINNER
Castlefield Investment Partners – Corporate Governance – “Remuneration: Pension Provisions”
DWS – Measuring Physical Climate Risk in Equity Portfolios
EdenTree Investment Management – The Future of Work
Fidelity – Pulling away: Inequality as an ESG risk
Hermes – Modern Slavery: The true cost of cobalt mining
Lazard Asset Management – The Growing Importance of the “E” in ESG / Giving Credit Where It’s Due
Morningstar – Passive Fund Providers Take an Active Approach to Investment Stewardship
P1 Investment Management – Investing in extreme weather conditions
Schroders – Carbon Value at Risk

 

Source: Investment Week 2018

 

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