This month, insiders reveal a crisis crippling the construction industry and its implications for investors. House prices show a subtle decline, contrasting with a rise in asking prices. Discover key details about the planning and infrastructure bill that could reshape housing development. Plus, the mortgage landscape is shifting with rates dropping but deals disappearing fast. In a surprising twist, only 5% of rental homes are affordable for benefit claimants. Enjoy a light-hearted chat about quirky Scottish politics while brewing coffee with an Aeropress!
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Quick takeaways
House prices reflect a cautious buyer sentiment despite a recent increase in asking prices, highlighting a current buyer's market scenario.
The Building Safety Act has led to delays in high-rise developments, potentially resulting in a long-term undersupply of apartments in major cities.
Deep dives
Current State of House Prices
House prices have seen a slight decline of 0.1%, with annual growth remaining steady at 2.9%. Interestingly, asking prices have experienced a 1.1% increase in the last month, suggesting a disparity between the overall market sentiment and seller confidence. This trend indicates that while buyers might feel cautious, sellers are optimistic about potential price gains. With increased inventory on the market, buyers now have more options and bargaining power, pointing to a buyer's market overall.
Challenges in the Construction Industry
The Building Safety Act, or Gateway, imposes significant challenges for developers wishing to build taller structures, mandating stringent safety regulations. This regulatory framework has halted or scaled back many developments, as over 800 high-rise projects are currently awaiting approval, leading to a potential undersupply of apartments in urban centers. Consequently, the ongoing delays could exacerbate the existing supply-demand imbalance in the housing market, particularly in cities like London and Manchester. If unresolved, this may lead to higher property and rental prices in the long term.
Rental Affordability Crisis
A significant report reveals that only 5% of privately rented homes are now affordable for benefits claimants, due to the housing benefit freeze that has not kept pace with rising rental prices. This issue creates a dilemma for the government, as increasing benefits could be politically unfavorable while the need for private landlords remains critical. The lack of affordable housing options forces many individuals to seek financial assistance from other sources to secure accommodation. This situation underscores the intricate challenges the government faces in addressing the housing affordability crisis.
This month’s market update brings you a major insider scoop, as Rob B reveals the story that’s crippling the construction industry right now and what it could mean for the market and you as an investor.
(0:55) Kicking off this month’s market update with house prices...
(4:05) Key details from the planning and infrastructure bill.
(5:05) Rob B’s huge insider insights revealed…
(9:55) What’s the latest on commonhold?
(11:02) Let’s get an update on mortgages…
(12:29) Interesting research on rental affordability.