As we approach the seasonal break it is a good time to look back at a phenomenally busy year and an exciting year in the property market that has seen a lot of positive movement as well as some after effects from changes to stamp duty.
The past year has seen sustained price growth across the UK with the latest Halifax House Price Index showing an annual increase of 9.0% despite a slight slowdown in growth for the three months to November. This was also reflected in figures from the NHBC which reported new home registrations maintained a steady rate of growth with over 30,000 private sector homes registered in the last the three months alone, ahead of the same period last year.
According to the Office for National Statistics (ONS) London prices increased by 7.7% over the year to October. Although, whilst the changes to stamp duty have clearly helped the majority of homeowners, for the market above £1.5 million it has caused a material slowdown in activity.
2015 also saw the announcement that of a management buyout of Saxon Trust (perviously Calmez Ltd) by Directors James (“Jimmy”) Verdin and Chris Kemsley whom have now acquired the controlling shares from the company’s founder Michael Hess. Chris has succeeded Michael as Managing Director and will manage the existing loan agreements in close cooperation with established developer clients, with Jimmy now in the role of Chairman.
Michael Hess has continued to provide his expertise in a consultant role and works alongside the existing management team that includes; Clive Standish-White as Finance Director who is steering the company’s investment strategy, Sarah Crossley who is an experienced Quantity Surveyor and Projects Manager holding a Degree and Masters Degree in both disciplines, and New Business Manager Philip Barker who has a background of nearly 30 years in the property industry.
We have had the pleasure of supporting some great innovative projects in 2015 and we have seen some very interesting variety from skillful conversions to cutting edge new builds.
Amongst the highlights we have seen some exciting conversions and refurbishments from a mid-Victorian church near Bath to luxury flats in West London, an outstanding mews house development in central London to a beautiful barn conversion in Shropshire. With the latter project our client has been creating five spacious homes from a group of Victorian barns that are wrapped in the peace and quiet of beautiful countryside. As well as support through our mezzanine funding of £300,000, we have also been instrumental in placing the senior facility together with our QS providing project management. Early off-plan sales are a clear indication of the quality of this project which has a GDV of around £2.1 million.
Of the range of new build developments this year, key sites include two impressive executive homes in West Sussex where tremendous attention to detail has resulted in homes of the highest quality and contemporary style. The spacious accommodation of each house was complemented by the latest in modern fittings and the success of this development completed with both houses being sold off-plan. The GDV was around £3 million and our developer mezzanine funding was £275,000.
So we now look forward to 2016 and what is set to be an even busier year with our mezzanine funding providing essential backing to developers across the UK. The latest Rightmove House Price Index shows a forecast of new seller asking price inflation anticipated to be 6% in 2016 being driven by an ongoing imbalance between supply and demand. Despite increasingly stretched affordability and rising taxation in the buy-to-let sector, Rightmove analysis of email enquiries sent by potential buyers to estate agents since the start of October this year shows a jump of 37% compared to the same period in 2014. In contrast to this surge in demand, the number of properties coming to market has fallen by 5% over the same period.
Miles Shipside, Rightmove director and housing market analyst commented: “Whilst initiatives are in place to encourage developers to build more new homes to supplement the supply of existing ones coming to market, the lead-times are long and developers face capacity constraints. In the meantime strong demand is being further fuelled by the additional momentum and aspiration for home-ownership that schemes such as Help to Buy create. We therefore predict that the average asking price will be another £17,000 higher by the end of 2016.”
You can read the full Rightmove report here including their regional trend reports.
We look forward to another exciting Year in the Property Market and finally we take this opportunity to thank our clients for their business this year and wish everyone a great Christmas break and a Happy New Year!