There is still immense pressure for the government to support developers, to achieve and deliver the target of One million New Homes before 2020. A lack of skills continues to be a major, contributing, factor to this. LSL Land & New Homes looks at the current prices of new build properties, and questions if the government plans are realistic. Shaun Peart, managing director of LSL Land & New Homes, explains:
“The year on year price change to end September 2015 has remained relatively static again this month at 6.5%. Whilst most commentators seem to agree on a relatively flat market, the most interesting trends are perhaps those noted by e.g. the RICS and Land Registry which point to excess demand, relative to a static or falling supply of property for sale. There seems to be universal agreement that too few houses are being built and that there is clear political backing for an increase in the overall volume of new build. However a recent survey pointed to skill shortages being a very important constraining factor in the supply of housing and there doesn’t seem to be a short term solution to this issue.
But when the data is examined more closely, an interesting emerging trend can be seen. The New Build Price Index tracks year on year changes and so compares the average price in each region in the year to September 2015 with the Year to September 2014. The year on year price growth in Greater London, as measured by this index, peaked in November 2014 and has been gently falling since that time. In the year to September 2014 it stood at 14% and in the year to September 2015 it stands at 10%, a fall in the year on year growth rate of 4%. Over the same period the figures for East Anglia and the South East have risen by roughly 4% to now stand at a little over 8% (a doubling over the year)....
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