New home building figures show an increase in house building across the UK, with plans for the highest number of homes to be built since the financial crash.
The demand for housing in the UK has been far higher than supply for many years now. UK house building ground to a halt after the financial crisis. Because of this, the government has recently stepped in to try boost construction. Figures show that new home construction is finally on the rise, with levels at a record high since the crash.
The government is consistently challenged about what they are doing address the housing crisis. Prime minister Theresa May has announced she wants another 300,000 new homes a year to be constructed. The government introduced it’s initiatives to build more homes across England on 7th February 2017. The plans outline new ways to calculate housing demand so the right houses are built in the right places. There are also guidelines about using land more efficiently. These plans encourage developers and councils to build higher and near public transport links. As well as this, they will reduce the time that developers need to wait to start building after planning permission. To do this they are allowing councils to issue completion notices easier, from 3 years to 2.
Highest levels since the Crash
In 2017, the National House Building Council announced the highest number of plans for new homes registered, 160,606 since 2007. A rise in general confidence in the economy and an obvious need for affordable housing has boosted house building across the country. Even London, where house building ground to a halt for many years, is witnessing the first increase in new home building since 2014. The industry is feeling optimistic, with more plans registered and a 4% rise in completions. The increase in completions is the highest it’s been since 2008.
Increase in Demand for Rental Accommodation
After the financial crash, 100% mortgages and high loan-to-value mortgages became impossible to obtain. Since then it’s remained difficult to get a mortgage so renting is the only option for many, especially young people. High quality rental accommodation in city centre locations is in high demand. Because of this, rents have been increasing and buy to let property investors have since a steady rise in the value of their properties. The amount of people living in rented accommodation has doubled since 2000. With a large increase in rental demand, developers have been building new homes, perfect for buy to let owners.
The need for affordable housing and the increase in UK construction offers many opportunities for investors in the buy to let market. An ever-increasing number of tenants are looking for long term rental accommodation, providing steady rental income for owners. There’s also been increases in the number of flats and apartment buildings under construction. RW Invest properties show the opportunities for serious gains and high yields for property investors. New properties in growing city centres are increasing in value. Buying off plan allows investors to get a low price, with an even higher return on investment. Despite the increase in construction, buy to let investment properties are still highly sought after.