This week was all about strategic growth centred around housebuilding in the UK. Zoopla assured buyers it was now cheaper to buy than rent, deposit allowing and reported house price rises, supported by first time buyer desperation, looked set to dampen in April, post stamp duty holiday, before regaining momentum as the year progresses. Rates permitting…Welcome to another UK Property News Recap – 14.03.2025.
New Construction work is hard to come by
According to Arcadis, construction built on its numbers in the final two quarters of 2024 due to increased demand in the public-non-residential and industrial sectors. However new work is proving hard to come by while the UK economy remains in flux – total output in 2024 was down 5.3% as a result. Short term, this looks set to continue as any significant “developments” are kicked further down the 2025 line.
Americans have a “steak” in London
American buyers weighed up high inflation at home and abroad in 2024 with some opting to take advantage of the weak pound and falling prices in PCL. As a result US buyers overtook the Chinese in the final quarter of 2024, increasing their presence in the UK by 11.6%. Chinese nationals seemingly taking a step back from the UK market, well for now at least.
The Biggest Building Boom
Much of the week’s news was dominated by the planning and infrastructure bill which was introduced to Parliament on Tuesday. The Bill is designed to speed up planning decisions to boost housebuilding and remove unnecessary blockers and challenges to the delivery of developments like roads, railway lines and windfarms, boosting economic growth.
The Top 8 Reforms Planned:
1 – Planning Committees – to streamline planning decisions through the introduction of a national scheme of delegation. This will introduce mandatory training for planning committee members, and allow councils to set their own planning fees.
2 -A Nature Restoration Fund – Natural England will be able to invest funds levied on developers on mitigation and compensation schemes to boost the environment. To achieve this they will be able to seize farmland, allotments and other green spaces for nature restoration projects.
3- Compulsory Purchase Reform – local authorities will no longer require government permission for CPO’s, shattering landowners’ hope value.
4 – Development Corporations – Will be given enhanced powers to green light developments, removing local authorities from the process.
5 – Strategic Planning – Spatial development strategies to be produced by mayors, or by local authorities in some cases
6 -National Significant Infrastructure Projects – consultation requirements for projects – such as wind farms, roads or railway lines –to be streamlined. Opposition will only be given one legal challenge attempt.
7- Clean Energy- Wind and solar power will be prioritised for grid connections.
8 – Bill Discounts- In an attempt to get people to warm to pylons, anyone living within 500m of new pylons across Great Britain will get up to £2,500 off their electricity bills over 10 years.
Buying becomes cheaper than renting in the UK
The property portal Zoopla claimed the scales had tipped back in favour of buying after rental growth caused the average UK rent, £1,248 per month, to exceed the average mortgage, £1,038, for those first time buyers able to cobble together a 20% deposit.
Mortgage rates continue to fall
Average mortgage rates finally began to shed some pounds in March – overall two- and five-year fixed rates fell by 0.13% and 0.10% to 5.39% and 5.22% respectively according to Moneyfacts. Struggling to keep up with the changes, home loans have become time sensitive – the average shelf-life of a mortgage product fell to 16 days, from 36 days a month ago. This comes, as more product options have become available.
Persimmon’s end of year results report card show promise
Persimmon’s end of year results showed completions and prices ticked up along with the groups underlying operating profit and margin, both increasing by 14%. Moving forward, the group remains optimistic for continued growth, buoyed by a 21% improvement on approved planning applications, a strong forward order book and £1.55bn of land investment to “build” on.
Old Trafford football stadium to be rebuilt
Old Trafford is to be benched in favour of a £2bn new stadium, supported by an extensive regeneration project which will include new housing and commercial developments, boosting economic growth outside of the Capital. They just have to first find the money….
Our survey says…
A survey of 300 UK landlords found that a third of landlords plan to expand their portfolios this year, while 43 per cent expect yields to improve. Location dependent….
Average house prices crawl back up
According to Acadata HPI the average sale price of a home in England and Wales increased by 0.7% to £357,300 in February 2025 – the second positive month in a row. Despite this, prices remain far removed from the giddy highs of 2022 but Wales and Northern regions are up for a hike.
Trophy commercial property commands a premium
Blackstone Inc bet on rising commercial rents and bid against itself, upping its bid for London’s Can of Ham skyscraper from £300m last year to £330 million. The offer is yet to be agreed by the seller Nuveen, till then Blackstone will have to wait.
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\More stock but less demand
RICS Residential Market Survey found that more stock hit the portals in February, just as first time buyers retreated, causing the number of agreed sales to follow suit. As we head into April, expect houses to “spring” up online, joining the remaining landlord stock that didn’t shift in time to make the stamp duty deadline, further boosting listings numbers. Despite prices overall edging higher with the exception of the South/West, Yorkshire and Humber and East Anglia, post stamp duty, prices are expected to stagnate till the economic picture clears.
In the lettings market, despite tenant demand falling for a fourth month in a row, supply appears to be reducing at a faster rate, which will maintain and elevate rental prices further.
Savills’ end of year results show improvement
End of year trading results for Estate Agency, Savills showed promise despite initial reservation from investors and buyers at the start of 2024 to transact. The group’s revenue increased by 7% to £2.4bn up from £2.2bn in 2023. Profit before tax increased by 59% to £88.3m representing a reported pre-tax profit margin of 3.7% up from 2.5% in 2023. In the London office market, the most notable change in 2024 was in City of London prime rents, which rose by 7.5%. Buyers deterred by increased taxes and economic uncertainty turning to the rental market in the short term to consider their next move.
Deutsche Bank considers downsizing
Deutsche Bank is considering downsizing in Canary Wharf when their lease expires in 2028, after identifying that out of its existing 375,000 sq ft space in London, spread across 21 Moorfield and 10 Upper Bank Street , 125,000 sq ft of it is surplus to requirement.
And that concludes another UK Property News Recap – 14.03.2025. If you have any comments or suggestions, please get in touch.
