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Property Renovations at Record High as Homeowners Can’t Move
This article is an external press release originally published on the Landlord News website, which has now been migrated to the Just Landlords blog.
The amount of homes for sale in Britain is at its lowest level since records began in 1978, reveals the Royal Institution of Chartered Surveyors (RICS).
RICS members are reporting an average of just 47 properties on their books.
Property Renovations at Record High as Homeowners Can’t Move
In London, the high cost of moving house is discouraging homeowners from moving up the property ladder.
Removal costs, Stamp Duty and stricter mortgage lending rules under the Mortgage Market Review (MMR) are forcing families to make more space in their current homes, rather than move. As a result, a record number of households are staying put and renovating their homes instead.
In the year to March – the most recent figures available – over 100,000 Londoners applied for planning permission to upgrade their properties with new basements, attic bedrooms, side returns and kitchen extensions.
This compares with 87,000 applications in the previous year and less than 67,000 in 2009, according to Barbour ABI, which tracks trends in the UK construction industry.
It equates to an increase of more than 40% between 2009-15.
The true figure may be higher, as many rear, side returns and loft extensions do not require planning permission.
With new relaxed planning laws, it will be even easier for homeowners to improve their properties, as they can add two storeys to their houses with their neighbours’ consent.
Associate Director of Aylesford International estate agents, Charlie Parkin, says that the cost of moving makes it difficult: “Stamp Duty is a big factor – it has taken the stuffing out of the market.”1
Saul Empson, of Haringtons buying agents, explains that even highly priced basement extensions are becoming viable: “If the alternative is having to pay £1,500 to £2,000 per square foot for existing space in a new house, why not dig for extra space in your old house at a cost of £500 per square foot?”1
The small number of movers could have an effect on the amount of properties for sale.
Chief Executive of Spicerhaart estate agents, Paul Smith, reports: “Our data shows that there are currently 20 buyers chasing every property for sale in London, so funding that dream house is near impossible.”1
