LSL New Build Index May 2015

LSL Land & New Homes is a trading style for members of the LSL Property Services Group Estate Agency Division, one of the leading residential property services groups in the UK.

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Land & New Homes

Registered office: Newcastle House, Albany Court, Newcastle Business Park,Newcastle upon Tyne NE4 7YB Registered number: 05114014 VAT number: GB 842 7959 83

LNH

1008

04/

2015

Part of the group

LSL Land & New Homes is a trading style for members of the LSL Property Services GroupEstate Agency Division, one of the leading residential property services groups in the UK.

www.lsl-landandnewhomes.co.uk

LSL New Build Index - May 2015

Following recent encouraging news that the number of homes built over the last 12 months was at its highest level since the end of 2009, LSL Land & New Homes report that, despite this increase in supply, house prices generally continue to rise as Shaun Peart, Managing Director for LSL Land and New Homes explains.

“In the year to the end April 2015 the year on year growth in new build prices is 7.3% which is slightly up on last month’s figure and nearly double last year’s figure as the graph illustrates.

For the third month in a row, however, growth in Greater London new build prices is slowing with the main growth area now being in the Southern regions (based on a line from the Wash to the Humber and excluding Greater London), which, at 6.6%, is more than three times the figure of April 2014. Growth in the Northern regions has, in contrast, tailed off over the past two months.

In terms of the future many believe that the combination ofchanges in the pension system, continuing low interest rates and greater political certainty following the election will have a positive impact on the housing market. Add this to talks of a Northern Powerhouse and the continuation of Government schemes to help buyers of new property it also appears to be good news for the new build market, in particular, although it will be interesting to see what impact the closure of the Help to Buy (Scotland) scheme will have on the Scottish market.

Affordability, of course, will be a contributing factor to futurehouse price growth and, as our table illustrates, there are vastdifferences across the country.

The table shows the weighted average price of a typical 70 sqm (2 bed) new build property in each region of the country (the weighting reflects the proportions of terraced to flats being built). This price is then divided by the average full time earnings in each region to get to a simple house price to earnings ratio. This is then indexed and the higher the index, the less affordable a ‘starter’ new build property is.

Yet again it appears that new build property in the East Midlands and the North East – as well as Yorkshire and the Humber – are more affordable to buyers with Greater London setting itself apart from the rest of the country. How this will change over the course of the next few months will be interesting to see but, for now, it is hoped that the new Government will support the industry in continuing to meet the clear demand there is for new builds and, as part of this, make new builds affordable for all - wherever in the country they may be.”

Data sources: LSL New Build House Price IndexONS, EARN05 – Average weekly gross earnings of full time employees, by region.


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Land & New Homes


LNH

1008

04/

2015

Part of the group



Notes

This Index has been prepared by e.surv using anonymised data based on a proportion of all new build valuations provided for lending purposes. Figures represent 12 month rolling averages for each period. The copyright and all other intellectual property rights in the Index belong to e.surv. Reproduction in whole or part is not permitted unless an acknowledgement to e.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) is the Valuation business of LSL Property Services plc (www.lslps.co.uk) and is the UK’s largest residential valuation practice, acting for lenders, developers, Social Housing organisations and other stakeholders in the residential propertymarket. The business employs circa 450 chartered surveyors and covers the entire UK.

LSL Land & New Homes is a trading style for members of the LSL Property Services Group Estate Agency Division, one of the leading residential property services groups in the UK. It’s strategy is to create partnerships with developers and builders to support 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, asset management services and estate agency services fronted by well-known high street estate agency brands like Your Move and Reeds Rains. Services can be tailored to suite individual needs from bespoke site sales and marketing, agency referral to the disposal of part exchange, assisted schemes and new build stock, land sales and acquisitions.

For further information or enquiries regarding the underlying data of the LSL New Build Index, please contact Richard Sexton via email [email protected] by phoning 07968 932118.

For further information about the LSL Property Services Group including LSL Land & New Homes and e.surv, visit www.lslps.co.uk


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Land & New Homes


LNH

1008

04/

2015

Part of the group



Average new homes prices in the period May 2014 to April 2015 and % variation over same period 2013/14

Documents

LSL New Build Index May 2015