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As we see more positive headlines about the property market, following the Budget announcement, LSL Land & New Homes brings further news about the movement in new build prices across the UK but also an insight into the relative affordability of new homes in each region as Shaun Peart, Managing Director of LSL Land & New Homes, explains.
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As we see more positive headlines about the property market,
following the Budget announcement, LSL Land & New Homes
brings further news about the movement in new build prices
across the UK but also an insight into the relative affordability of
new homes in each region as Shaun Peart, Managing Director of
LSL Land & New Homes, explains:
In the year to the end of February 2015 the year on year growth in
new build prices is 7.0% which is a slight fall on last month’s figure
of 7.2% and, as reported last month, the regional growth compared
to the slowing growth in Greater London is continuing.
Excluding Greater London, the average regional growth rate now
stands at 4.7% against a figure of 0.9% for this time last year when
some regions were showing negative growth and the overall
picture was largely flat. Now all regions are showing growth over
2% with the highest performers being generally closest to Greater
London.
It is likely, however, that the apparent slow down in the Greater
London market will be, in part, due to the relative affordability of
new homes which we are now able to monitor in our LSL Land &
New Homes Affordability Index.
An index below 100 implies that property is more affordable
with a below average proportion of income needed to service a
mortgage. A figure above 100 implies that a greater than average
proportion of income is needed to service a mortgage. It is clear
that in regions such as the East Midlands, North East and Yorkshire
and Humberside that affordability is more favourable but, as
expected, it is those buyers in Greater London, East Anglia and the
South East who may feel ‘the pinch’.
The LSL Land & New Homes Affordability Index is based on:
• Theaveragepriceofa70sqmnewbuildproperty,usinga
weighted index of flats and terraced housing, representing
the available mix in each region is taken (previously terraced
property only was used).
• AveragefulltimeearningsaretakenusingONSdata.
• TheHousePriceEarningsratio-createdforeachregionby
dividingtheaverageearningsintotheaverageprice.The
higher the ratio, the less affordable property is / the greater the
amount of earnings that needs to go into paying a mortgage.
• TheseHPEratiosarethenindexedtocreateanaffordability
index for each region where the average of all is 100.
Datasources:LSLNewBuildHousePriceIndex
ONS,EARN05–Averageweeklygrossearningsoffulltimeemployees,byregion.
LSL New Build Index
Poweredby
March 2015
Regions2bed70sqm starter home
Average annual FullTimeearnings
HPE
Affordability Index
East Anglia £178,478 £30,193 5.91 113
East Midlands £104,144 £27,252 3.82 73
Greater London £378,152 £37,864 9.99 191
North East £98,627 £25,242 3.91 75
North West £116,977 £27,232 4.30 82
Scotland £133,667 £26,932 4.96 95
South East £191,959 £32,972 5.82 111
South West £149,904 £28,177 5.32 101
Wales £119,045 £24,737 4.81 92
West Midlands £125,990 £26,290 4.79 91
Yorks & the Humb £105,488 £26,197 4.03 77
Average 5.24 100
Notes
ThisIndexhasbeenpreparedbye.survusinganonymiseddatabasedonaproportionofallnewbuildvaluationsprovidedforlendingpurposes.Figuresrepresent12monthrollingaveragesforeachperiod.ThecopyrightandallotherintellectualpropertyrightsintheIndexbelongtoe.surv.Reproductioninwholeorpartisnotpermittedunlessanacknowledgementtoe.surv as the source is included. No modification is permitted without e.surv’s prior written consent.
Whilst care is taken in the compilation of the Index no representation or assurances are made as to its accuracy or completeness. e.surv reserves the right to vary the methodology and to edit or discontinue the Index in whole or in part at anytime.
e.surv(www.esurv.co.uk)istheValuationbusinessofLSLPropertyServicesplc(www.lslps.co.uk)andistheUK’slargestresidential valuation practice, acting for lenders, developers, Social Housing organisations and other stakeholders in the residentialpropertymarket.Thebusinessemployscirca450charteredsurveyorsandcoverstheentireUK.
LSLLand&NewHomesisatradingstyleformembersoftheLSLPropertyServicesGroupEstateAgencyDivision,oneoftheleadingresidentialpropertyservicesgroupsintheUK.It’sstrategyistocreatepartnershipswithdevelopersandbuilderstosupport their objectives and add value to their businesses. It can provide integrated solutions for their benefit drawing on the expertise of companies who are also under the LSL Group umbrella including valuation services (e.surv), rental portfolio services,assetmanagementservicesandestateagencyservicesfrontedbywell-knownhighstreetestateagencybrandslikeYourMoveandReedsRains.Servicescanbetailoredtosuiteindividualneedsfrombespokesitesalesandmarketing,agencyreferraltothedisposalofpartexchange,assistedschemesandnewbuildstock,landsalesandacquisitions.
ForfurtherinformationorenquiriesregardingtheunderlyingdataoftheLSLNewBuildIndex,pleasecontactRichardSextonviaemailrichard.sexton@esurv.co.ukorbyphoning07968932118.
ForfurtherinformationabouttheLSLPropertyServicesGroupincludingLSLLand&NewHomesand e.surv, visit www.lslps.co.uk
DatafortheLSLNewBuildDatabaseiscollectediscollectedoffthewebsitesofover300housebuildersonarollingquarterlybasissogivinga rough timeline of when sites start and finish and how many units have been built.
PLEASENOTE:Themajorityofnewbuildmarketactivitydataisquitehistoric,beingbasedonreturnsmadeviatheNHBCorLocalAuthoritycompletionsdata.TheLSLNewBuildDatabasetracksthenewbuildactivityofover300leadinghousebuilderswithdatacollectedfromtheirwebsitesonarollingquarterlybasissogivingaroughtimelinewhensitesstartandfinishandhowmanyunitshavebeenbuilt.
Disclaimer:ThedataisprovidedbyLSLLand&NewHomesandisbasedondataprovidedasdescribedabove.Whilereasonableskillandcarehasbeentakeninthepreparationofthedata–thecopyrightandallotherintellectualpropertyrightsofwhichbelongtoe.survlimited-neither e.surv Limited nor LSL Land & New Homes can accept liability for the accuracy or completeness of the data provided.
Reproductioninwholeorpartisnotpermittedunlessanacknowledgmenttoe.survLimitedisincluded.Nomodificationispermittedwithout e.surv Limited’s prior written consent.
No warranty of the figures is given and no responsibility or liability of any nature to you or any third party for the whole or any part of its content is accepted. It is assumed that you will carry out your own due diligence before proceeding with any proposals or making any financial commitments.
LSL New Build Index Poweredby
LSL New Build IndexPoweredby
Scotland* £ Average %+/-
Detached £258,130 6.3%
Flats £141,202 8.2%
Semis £165,232 -4.6%
Terrace £183,848 7.2%
North West* £ Average %+/-
Detached £277,867 2.3%
Flats £126,336 3.2%
Semis £169,987 3.0%
Terrace £160,118 2.1%
West Midlands* £ Average %+/-
Detached £305,977 4.3%
Flats £130,271 5.2%
Semis £193,927 5.2%
Terrace £186,551 6.3%
Wales* £ Average %+/-
Detached £238,525 -0.1%
Flats £135,870 7.7%
Semis £165,374 3.2%
Terrace £164,246 4.3%
South West* £ Average %+/-
Detached £334,293 4.7%
Flats £164,335 4.7%
Semis £218,298 5.2%
Terrace £212,395 5.5%
South East* £ Average %+/-
Detached £448,319 5.8%
Flats £197,133 8.0%
Semis £294,544 8.9%
Terrace £277,030 7.1%
Greater London* £ Average %+/-
Detached £635,239 16.4%
Flats £373,637 13.7%
Semis £454,750 15.1%
Terrace £492,534 20.5%
East Anglia* £ Average %+/-
Detached £349,395 6.5%
Flats £193,556 6.3%
Semis £241,683 4.4%
Terrace £245,950 9.8%
East Midlands* £ Average %+/-
Detached £270,031 8.0%Flats £107,289 5.8%Semis £167,641 1.1%Terrace £159,504 3.5%
Yorkshire & the Humber*
£ Average %+/-
Detached £262,033 2.9%Flats £118,763 7.4%Semis £155,703 0.2%Terrace £150,981 0.6%
North East* £ Average %+/-
Detached £254,632 5.6%Flats £109,210 3.6%Semis £160,156 6.6%Terrace £147,082 0.3%
*Size adjusted average price
*Size adjusted average price
*Size adjusted average price
*Size adjusted average price
*Size adjusted average price *Size adjusted average price *Size adjusted average price
*Size adjusted average price
*Size adjusted average price
*Size adjusted average price
*Size adjusted average price
Average new homes prices in the period March 2014 to February 2015 and % variation over same period 2013/14