Docklands News

Property prices have risen to nearly nine times the average household disposable income, according to Office for National Statistics (ONS) data. In the year to the end of March, the average property in England sold for £275,000, with this 8.7 times the average annual disposable household income of £31,800. In Wales, the median house price was £176,000 – six times the average income of £29,400, while the ratio in Scotland was 5.5 as house prices averaged £166,000 compared to a £30,300 salary. London is the least affordable region, with those in the lowest 10% of earners having to work 40 years to buy an average house. At the other end of the scale, an average-priced home in the North East cost the equivalent of almost 12 years of income. The ONS data shows that UK house prices rose by 12.8% in May, up from 11.9% the month before, hitting an average of £283,000. This is £32,000 higher than the typical price a year earlier. 

The Daily Telegraph   City A.M.   Evening Standard  

First-time buyer house prices and rents have risen three times faster in the past two years, according to Rightmove. Monthly rental payments are soaring at unprecedented rates data from the property site has revealed - increasing by 17% since 2020, compared to 5% in the two years before that. Wages rose by 14% in the same period, meaning income has failed to keep up. The average 10% deposit now stands at £22,493, 13% higher than two years ago, Rightmove found. Average monthly mortgage payments have climbed 22%. A new first-time buyer now typically pays £973 a month based on the average mortgage rate, up £173. In the previous two years the increase was just £41. Tim Bannister, of Rightmove, said that chasing soaring house prices had put first-time buyers at a disadvantage if they were unable to live with parents or family members while saving. The average monthly rental payment is up £128 over the last two years, with a tax crackdown on landlords driving many out of the market and reducing supply. A survey conducted by Rightmove found those planning to buy their first home said the biggest challenges they face are rising house prices and soaring energy bills. Fewer than half (43%) said they hoped to be able to afford a home within the next three years. Two-thirds of respondents had already started saving towards a deposit, the survey found. However, Rightmove said demand for first-time buyer properties is up by 35% compared to 2019, suggesting many are still determined to get on the ladder despite stretched affordability. 

The Daily Telegraph  

Interest rate rises will push up monthly mortgage costs so much that even a 10% house price fall will not make homes cheaper to buy than at the start of the pandemic, new analysis shows. In January 2020, before the pandemic hit, a typical couple spent 17% of their pre-tax salaries on their monthly mortgage payments, according to Pantheon Macroeconomics. This was below the average of 18.5% for the preceding 20 years, as low interest rates meant mortgage payments were comparatively cheap. Since the Bank started raising rates in December 2021, the share of salary needed to cover the mortgage payments on an average home has risen to 20.6%. This is the highest since September 2008, during the global financial crisis. Pantheon expects the share to peak at 23.5% in September. 

The Daily Telegraph (18/07/2022)  

Property and rent prices have been rising at an accelerated rate, according to the latest figures, as a cost of living crisis hammers household budgets. Rents in the UK rose by 3% in the year to June, up from 2.8% in the 12 months to May. House prices increased 12.8% in the year to May to £283,000, up from 11.9% in April, the Office for National Statistics revealed. The average cost of a home has jumped by £32,000, more than the average annual wage of £31,252.  

City AM (20/07/2022)  

Homeowners and landlords are flocking to "green mortgages" in a bid to escape soaring interest rates. The number of borrowers searching for such a loan has quadrupled since mortgages became more expensive last year, according to analysis by mortgage data firm Twenty7Tec. The deals work by offering lower interest rates and cash-back to incentivise property owners to improve the energy efficiency of homes. Twenty7Tec predicted "mass adoption" of green mortgages within the next three years, as borrowers try to keep costs down. 

The Daily Telegraph (16/07/2022)  

The developer in charge of a massive redevelopment of the Royal Docks has been removed from the project. London Mayor Sadiq Khan has torn up a £1bn agreement with Chinese developer Advanced Business Parks (ABP), having become dissatisfied with progress on the flagship scheme. The project covers 35 acres (14 hectares) of derelict public land north of Royal Albert Dock, with plans for nearly 5m sq ft (46,000 sq m) of development. About a tenth of the land has been built on so far. City Hall will leave what has been built so far in the hands of ABP, but the remaining five phases are to be entrusted to another developer. A spokesperson for the Greater London Authority said: "The Greater London Authority has terminated the development agreement for the regeneration of Royal Albert Dock, which was signed in 2013 under the previous mayor, after neither ABP London Investment Ltd nor its guarantor, Dauphin Holdings Group, were able to meet the obligations in the agreement".

BBC News (13/07/2022)