The government is firmly committed to the green deal scheme, and is considering the options to encourage areas of green renovation with street by street or community projects. These schemes are reminiscent of the envelope grant schemes of the late eighties and early nineties. There have been discussions on offering higher cash back when more residents in prescribed area sign up for the scheme. The government and providers will benefit from savings in transport and bulk buying if areas can be targeted. There is no doubt in the government’s commitment to ensure funding for the green deal scheme but there is still a lot to be resolved to make the green deal scheme a success. With a need to train suitable green deal assessors to carry out the necessary surveys and documentation. The government has pledged £200 million to fund incentives for the green deal as part of their statements in the autumn in 2011. With green building a hot topic it is important that the professionals that will administer the scheme have a full understanding of the various considerations when carrying out green building renovations.
Commercial property yields continue to rise, lead by prime London markets
May 1, 2012
The London prime commercial property market is performing well with rental growth in the office and industrial property sectors leading the way with a 0.4 level of growth in the first quarter. This is very encouraging news as the rest of the economy has suffered several hits. Many commentators follow the prime London commercial property market as a good indicator of the future performance of the rest of the UK commercial property markets. Some of the prime retail rents in the capital have risen by as much as 2.4 percent. With the release of these figures some fund managers are starting to look at other investment property to maximise the returns for their funds with tangible inflation proof assets. With interest in new development and funding speculative development on the increase does this mark the being of a revival in the UK property sector? With many quoting the seven year property cycle the drop started in 2008 so if history repeats the market should be buoyant by 2015. The clever money will be made before the rest of the sector catches up and sees clear proof that the sector is returning to favour with investors. As with all markets they always over correct, the question is have they over corrected on the way down?
Conservation and listed building renovation specialists
April 29, 2012
Renovating and converting period buildings require a unique set of skills and experience, your conservation building specialist will not only need the practical skills to complete the renovations but also experience on how to finish the details. It is one thing being able to complete lime plastering and rendering but as with all renovations to period property the devil is in the detail. Swept and corner details on items like window reveals may have been lost through previous unsympathetic building work so the original detail on your building may not be able to be copied. Experienced conservation contractors will look at the period of the property and the architectural style and will be able to advise on these details. Joiners, roofers and other members of the restoration specialist contractor’s team will finish lead works and external joinery detail to make sure it is appropriate to the original style and keep the building true to its heritage. Good heritage and conservation building specialist contractors will share your passion for period buildings and like all purists will each have a particular period or building style that ignites their love of old buildings. Conservation building specialists will be able to offer advice on how to layout your conservation building project to stop modern items like gas and electric meters from spoiling the look and feel of your conservation building renovation. There is always some conflict between modern essentials that would not have been used when the building was constructed and keeping the building true to its origins. Although conservation officers will not allow you to make certain alterations to the building exterior these guidelines are often updated and fine tuned. Conservation building repair and renovation specialist will keep up to date on these guidelines and regulations. Any major building renovation will trigger a building notice or full plans submission to the local building control department or a private building inspector. This is important because it keeps your building up to safety and thermal efficiency regulations. However there is always a certain degree of compromise to be made between the wishes of the conservation officer and the building inspector. Your building contractor can make these compromises much easier drawing on their experience and knowledge of the building regulations and period building expertise. This knowledge and experience could potentially save you thousands of pounds of unnecessary work, so choosing the lowest building tender is not always the best way to control your budget. It is often said that the bitter taste of poor quality lingers long after the sweetness of a cheap price is forgotten, and with specialist renovations and restorations this is most certainly the case.
Property continues to become cheaper to buy as UK mortgage rates drop
April 27, 2012
The past year has seen mortgage rates drop in the UK making it increasingly easier for potential property buyers. Recent studies have shown that the average five year fixed rate has reduced in the last year from 5.59 down to a new rate now at 4.89. The five year fixed rate remains a favourite deal amongst first time buyers and people choosing to remortgage for home improvements or a home extension. The mortgage interest rate is only one half of most home buyers or home owner’s wish list. The loan to value rate or the amount of deposit required is often the biggest driver for those wishing to secure a new home loan. With many home owners choosing to stay put and opt for home improvements or a home extension remortgaging is a good option. With home extensions starting from as little as fifteen thousand pounds adding extra space or an extra bedroom can prove far more economically viable than moving house.
Period property extension specialists building contractors
April 26, 2012
When selecting a contractor for a home extension it can be a challenge to feel absolute confidence in the contractor you have selected for your home extension. With a period property extension this can be even more of a challenge, when planning a home extension there is a great deal to think about. With a period property the attention to detail is even greater. You do not have to just think about brick match you have to consider the brick pattern it could be English bond, English garden wall? The mortar colour, joint widths and pointing finishing also need to match the main residence. There are other considerations like the roof design matching tiles and lead finishing details is only part of the picture. You also have to consider joinery detail, fake purlins or weather boarding under the eaves and roof pitches. Your extension plans may suit a lower pitched roof but does this match the traditional roof pitches and design of the architectural period style? This is before you have even give a thought to the window section profiles, design of rain water goods or other external finishing’s. Then there is the interior to consider? Do you need to match period details like plaster cornice, ceiling roses or window and door frame architraves? What about plinth blocks and matching internal doors. In early Victorian or late Gregorian period properties simple and cheap materials like soft woods were carefully crafted and machined in elaborate details to create a sense of grandeur and style. So when choosing a building contractor for a period property or conservation area extension make sure you see pervious examples of their work. Do they have the knowledge and expertise to create a home extension that will add and not detract from your period property?
Chairman invests heavily in house builders
April 24, 2012
The chairman and founder of Redrow the well know house building firm has invested heavily in the firm in fact to a level that requires shareholders approval. The additional funds will be utilised to expand its London division and for the purchase of strategic land opportunities throughout the country. Redrow like many other house builders can see many opportunities to acquire good value sites to add to their forward land bank. House builders and property developers are increasingly looking for traditional, bridge and mezzanine funding. This will allow them to take advantage of the opportunities that are available, as banks and receivers are increasingly agitated at having cash tied up in sites. These land and site owners by default are increasingly motivated to off load sites in exchange for cash. Their urge for liquidity has converted into some good value sites and opportunities. The other option for site owners is to undertake a joint venture property development. This is when the land owner carries out a joint venture property development with a main building contractor. The land is put into the deal at cost and the construction is usually carried out at cost with the profits usually split fifty fifty on the sales.
New build development schemes allow buyers to buy with only 5% deposit
April 23, 2012
The government backed newbuy scheme allows home buyers to take advantage of this unique scheme that offers 95% mortgages. There is of course set criteria but if you want a new build property with a capital value of less than £500,000 and you want a capital and repayment mortgage the scheme could suite you. The newbuy scheme also only accepts home buyers that will use their new build properties as their main residence. It excludes second home buyers, landlords and buy to let property investors. The buyers must also be UK citizens and qualify for a mortgage in the usual manner. The sales that the scheme generates will be good news for house builders and developers as well as the construction industry. The number of new build properties has been languishing at record low levels since the beginning of the economic down turn. This year it appears that the world of property development and house building has started the first steps of a revival. Although many of these developments are still under the radar many professionals in the construction industry are reporting increased activity. Just as the property sector gradually shut down production, with many architects, quantity surveyors and structural engineers being the first to suffer reduced workloads. The reverse is becoming true with activity in the design and consultancy sectors of the property industry showing increased orders.
Tips for property development
April 22, 2012
The basic concept of property development is simple you buy a site or property for one price. Then spend your construction budget on the construction phase of the project. Then achieve the sales price or GDV as it is referred to in the industry, that’s Gross Development Value. The difference between the cost of the purchase price with the construction costs added and the uplift to the gross development value leaves the gross development profit minus finance costs and professional fees. What’s left is the net development profit, so there are three main figures which much be absolutely correct to achieve the gross development profit. These are the site purchase price, the construction costs and the gross development value, if the first two are too large or the last too small, the development will fail commercially. Before you commit to undertake any property development you should carry out a property development appraisal. This will vary in size and complexity in line with the size and complexity of the development. Working backward check the gross development values by looking at suitable comparables, other properties of similar size, location and specification, and what sales prices they have achieved. For the build costs on simple developments ask good local contractors to give you some provisional build costs. For larger or more complex property development it is worth considering employing the services of a Quantity Surveyor or QS as they are often called or an experienced development manager. They will be able to advise not just on build costs but also on the soft costs, professional fees, structural engineers, architects, connection charges for statutory supplies, gas, electric, water, etc and 106’s or other planning related costs. The last variable cost is the land, site or property purchase price. This is often where property developers make the most profit by buying a site cheaply and then obtaining a change of use by sub division or other planning gains. The value of the site usually increases sometime dramatically when planning permission is gained. This uplift in capital value is called a planning gain, this cash locked into the site or property give any development a good financial start. It is possible to reduce costs through the project by tight controls on the build costs and property development finance charges but these savings are no substitute for buying wisely and obtaining a profitable planning gain.
Do I need a planning consultant?
April 20, 2012
If you have property or land that you want to change the use on you may well go to an architect but often the best person for this job is a planning consultant. If it is a larger residential scheme or a commercial scheme it is probably best left to the expert, a planning consultant. They work more like a lawyer than an architect looking at case law and precedence rather than drawing plans and asking for approval. The first stage for a larger scheme is to start with a feasibility study these can be as little as a thousand pounds which considered against the capital value of the planning gain is relevantly small. The planning gain is the value of the site once planning permission is granted minus the value of the site preplanning. Some planning consultants will “work at risk”, this when they carry out various studies transport, need for the new proposed development and finding a suitable case to put forward for the development. They do not charge for the work they carry out instead they take a percentage of the planning gain. This is speculative on their part because if the development does not go ahead they do not get paid. It also acts as motivation to make sure they make the maximum effort to obtain the planning application.
Planning minister dismayed at the UK’s attitude towards planning
April 19, 2012
There has been much debate about planning and the built environment recently after the release of the National Planning Framework document in late March. Many in the industry are dismayed at the negative attitude of many to any changes to the built environment. New development creates opportunities and often much needed jobs. There have also been discussions over the high costs of planning and infrastructure charges that can often cause border line developments to remain at design stage. With banks, lenders and private investors taking renewed interest in speculative property development funding the review of planning charges and infrastructure levy’s has proved very timely. One developer had reportedly paid planning fees of 2million pounds on an 8million pound scheme in London. With these figures it really illustrates the need for a sensible review of planning charges. These can be a barrier to many schemes and hold back desperately needed houses and other residential and commercial property development schemes.
