TAX BREAKS FOR PREFAB HOMES – LET’S GET BRITAIN BUILDING

I was very interested to read an article in The Times on Saturday 7 January 2017 regarding proposals from the UK Government to give tax breaks for a new generation of prefabricated home manufacturers.  This is part of a package to reinvigorate Britain’s failing housing market and to ensure that the government hits its target of building a million new houses in the next five years.  I do think that this is a welcomed proposal as there have been some significant improvements and innovations in the house building process recently and house builders of all sizes should be encouraged through tax breaks to investigate and take advantage of these new techniques.

This article in The Times coincided with a very interesting article I was reading by Graham Norwood in which he led the call for more direct housing i.e. council house/housing association properties, making the point over the last few years successive governments of varying political hues have failed to inspire the house builders to increase the amount of properties that are being built.  I am a great believer and in fact think that it is of fundamental importance to society that people have the opportunity to live in quality housing.  The scourge of homelessness and dilapidated properties is one that desperately needs to be tackled.

I feel that it is important that for both political and economic reasons that our society is underpinned by home ownership.  I have detailed in previous blogs the assistance that I think requires to be given to first time buyers and I would wholeheartedly support any incentives to help builders increase the amount of properties that are being built but I do also think that there should be a controlled increase in the amount of social housing being built.  I very much liked Graham Norwood’s suggestion of “community housing” although it is interesting that as part of his article he does state that he would much prefer to live in a privately owned property than one that is either council or community owned.  For this reason I would advocate a return to some form of controlled right to buy with strict rules and guidelines in relation to properties being built and, for every property sold under right to buy, a certain number would be required to be built to replace them.  I think that some form of right to buy or shared equity scheme could be used to assist people to actually get on the housing ladder and might be a means of controlling house prices.  I will explore this theme further over the weeks to come.

Lindsay Darroch
Partner – Head of Property 
@LindsayDarroch
www.blackadders.co.uk

 

V & A Dundee receives £4.8 million pledge

Image: Design Dundee Ltd/PA

I was delighted to read in the Dundee Courier about the £4.8 million pledge received from the Scottish Government.  This would appear to be a key piece of the jigsaw and a catalyst for taking the V & A in Dundee to the next stage.

As readers of previous posts will know (14 October 2010), I think the importance of the V & A to the Scottish economy in general and Dundee economy in particular will be huge, and that the venue will go a long way to enhancing Dundee’s reputation as a leading UK city.  The knock-on effect for the property market will be more visitors, more purchasers, more people realising the huge untapped potential of Dundee.

I would urge everyone to support the V & A project and work together to ensure that it happens.

Lindsay Darroch
Head of Property Services

Dundee: A property investment capital?

Dundee: A property investment capital?In 2003 a newspaper carried the headline that Dundee was the property investment capital of Western Europe.  Low entry prices, strong demand from tenants, good gross rental yields compared to price all contributed.  This trend continued but as prices carried on their rise and rent stayed the same, yields dropped and with the credit crunch in 2008 the picture became somewhat different. 

Well what about now?

There is still a lack of mortgage funds available for the buy to let investor with 60% to 70% loan to value becoming the max and stringent rent to interest coverage usually between 120% and 140%.  However, in the last couple of weeks I have noticed an increase in property investors coming back to the market.  Lower prices tied in with a very strong tenant demand have caused rents and rental yields to purchase price to increase – lack of mortgage funds available to the first time buyer can be attributed to this situation as they struggle to climb on the property ladder. This along with the attraction of potential Capital Gains in the short to medium term has got the sophisticated investor back looking at property.

In times of low interest returns on savings, a secure investment that can be liquidated is a good way to grow your savings with minimal risk – provided you take the right advice.

Whilst I think it is too early to expect returns of the headlines that we saw in 2003, I certainly think that as the economy recovers there will be a growth of property investors coming into the market.