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TheNews RESEARCH House price trajectory
Professor David Miles
Our ageing population, combined with an increasing number of immigrants, are set to fuel a property price boom in the
ENERGY NEWS
It’s boom time for the EPC Industry Later this year, the
Phil Cardwell
As Energy Performance Certificates are a fundamental tool in helping the Government to calculate the UK’s carbon emissions, the EPC industry
looks set to enjoy an extremely attractive and prosperous future. For property owners and their agents, the time allowed to show reasonable efforts to instruct an EPC has been reduced from 28 days down to seven days from the time of marketing a property. “These new strict rules not only
affect the residential market but are also aimed at the commercial sector. In addition, focus has been placed on the letting industry where, by the year 2018, it will be unlawful for a landlord to rent a property below a minimum EPC rating, which is likely to be set at ‘E’,” says Phil Cardwell, National Operations Manager at Just EPC.
TENANCY DEPOSITS A milestone million for The DPS Kevin Firth
The Deposit Protection Service (The DPS) has paid back its millionth deposit, to a tenant living in the South
East of England. Since 2007, when The DPS started, deposits worth over £750 million have been returned to tenants, landlords
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and letting agents. The DPS is the only approved custodial tenancy deposit protection scheme in England and Wales, Kevin Firth, director of The DPS said, “As soon as we have agreement from both parties, we can repay deposits within 2 days so that tenants can quickly use their cash for future lettings, for instance. “We repay an average of 950
deposits a day to recipients across England and Wales and
work really hard to make things as simple as possible for everyone involved. We’re aiming to launch in Scotland too in the very near future, so landlords and tenants there will be able to take advantage of the same tried and tested system.” The DPS has hit the million
milestone just before its 5th birthday on April 7th. To mark the occasion, both the tenant and letting agent involved were given a bottle of champagne. “It’s
a lovely gesture particularly as it was such an easy process; The DPS did all the hard work!” said the tenant, Yvonne Stenning. Wendy Carman from Molica
Franklin was the letting agent. She added: “We protect all our deposits with The DPS and it was a big surprise to be called and offered a bottle of bubbly! I’m thrilled it was Yvonne’s deposit, she’s a wonderful tenant.”
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Government’s flagship initiative to increase the energy efficiency of British properties is due to be launched. “The Green Deal” is designed so that property owners can take measures to improve the energy performance of their property with no upfront costs. The costs incurred installing the measures will be recouped via the savings made in the monthly energy bills. Phil Cardwell says, “Capturing solar energy is becoming increasingly popular, especially when property owners can benefit from the feed-in tariff incentives. However, to benefit from the higher rate (FIT) the property will have to have an EPC rating of “D” or above, so before benefiting from solar energy and the feed-in tariff the homeowner must have an EPC.
www.justepc.co.uk
UK. This interesting, and perhaps unlikely scenario is painted by Professor David Miles, who sits on the Bank of England’s monetary policy committee. In a research paper he says
that the trend of rising real incomes and the likelihood of rising population density means the UK should anticipate a rising trajectory for real house prices over the longer term, also brought on by the fact that people will be older when they buy their first property. But he does not indicate exactly when this would happen. “This is particularly likely in a
country like the UK where population density looks set to rise relatively fast,” says Miles. At present, 62.2 million
people live in Britain, but the Office for National Statistics expects this number to increase to 67.2 million by 2020 and to 71.4 million by 2030. Over the past 25 years, house prices have reached levels which leave many people unable to afford to buy their own home. In 1986, the average home in a British city cost £35,209. Today the same property would cost around £170,000.
In his report on population
growth, house prices and mortgages, Miles says that the changes to the mortgage market over recent years will be permanent. “The first effect is likely to be prospective buyers postpone their purchase, while they save more to accumulate a larger deposit. As a result, the average age at which people would buy their first home will rise, and the share of owner occupied houses will fall,” he explains. The report also talked about the changes in the mortgage market being positive and the fact that banks and building societies insist on large deposits to get the best loan deals is not a sign of a damaged market, or one which is not functioning properly. He singled out the 100 per
cent mortgage deals, prevalent during the last housing boom that allowed people to buy without saving a penny for a deposit. “It probably never made sense for there to be 100 per cent mortgages. There may be no price at which it makes commercial sense for such a loan to be available,” he concludes.
“It probably never made sense for there to be 100 per cent mortgages.”
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