Week commencing 21 May 2018

In today's bulletin

• London Housing Strategy takes aim at the capital’s housing crisis
• Home ownership rises for first time since 2004

• Network Rail announces new chief executive
• Improve water efficiency or face droughts

Property, Planning and Regeneration

London Housing Strategy takes aim at the capital’s housing crisis

The Mayor of London, Sadiq Khan, published his London Housing Strategy on 22 May, including a target to deliver 65,000 homes per year in the capital. Formalising much of the policy that the Greater London Authority has introduced over the past two years, the strategy crystallises the Mayor’s position on the like-for-like replacement of affordable homes and residents’ ballots on estate regeneration.
Reiterating the need for more housing sites, including smaller plots, the Mayor’s team has called for the diversification and improvement of skills and capacity across the building industry.

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Home ownership rises for first time since 2004

Home ownership in England is on the rise for the first time in fifteen years, according to official figures released on 24 May by the Ministry of Housing, Communities and Local Government.
The number of homes owned by their occupiers increased to 62.9 per cent in 2017, a modest rise on the 62.4 per cent recorded for 2015 and 2016. Overall, there were 23.9 million homes in the country at the end of March 2017, an increase of 217,000 properties or 0.92 per cent on the previous year.

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House prices down in London as capital lags behind

The average house price in London has fallen by 0.7 per cent in the last 12 months, despite prices in the UK rising by 4.2 per cent over the same period, figures from the UK House Price Index for March have shown.
The declining rate of house price inflation in the capital is in contrast to the situation in Scotland, where there was a 6.7 per cent annual increase – the highest annual growth of any region in the UK. The latest figures from HM Land Registry, released on 23 May, put the average house price in the UK at £224,000, while the figure in London has fallen to under £472,000.

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Overseas interest in West End commercial property remains strong

April saw £615 million exchanged over 10 deals in London’s West End commercial property market, taking total investment this year to £1.76 billion, figures released on 23 May by real estate advisors Savills have shown.
Overseas investors accounted for 40 per cent of turnover and remain the largest buyer group, continuing a trend that started in 2015. Despite sustained international interest, overall investment volumes in London’s West End are down approximately £1 billion on a year-for-year basis, the firm has stated.

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Rising labour costs putting pressure on small firms

Rising labour costs are driving up expenditure for small firms, the Federation of Small Businesses (FSB) has reported, as the number of its members citing increased operating costs hit a near-record high in Q2 2018.
More than 70 per cent recorded rising costs in the quarter, with 46 per cent of businesses naming increasing labour costs as the biggest cause for concern. A perceived lack of consumer demand also provoked anxiety, with almost a third of small firms citing it as one of the biggest barriers to business growth.

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Transport

Network Rail announces new chief executive

Andrew Haines OBE has been confirmed as the new chief executive of Network Rail.
Currently chief executive of the Civil Aviation Authority, Mr Haines will take up his new role in the early autumn after a handover period with his predecessor Mark Carne, according to an announcement made by Network Rail on 21 May.

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Plans submitted to get Northern Rail back on track

A recovery plan to tackle poor performance by Northern Rail is being considered by the Transport Secretary, the Rt Hon Chris Grayling MP and the Minister for Rail, Jo Johnson MP.
The timetable recovery plan submitted on 23 May follows a slew of cancellations and delays by the operator as a result of last week’s extensive scheduling changes, which were intended to boost operating capacity as part of plans to modernise the UK’s rail network. Proposed measures to tackle disruption include increased driver training, improved staff rostering and more peak-time services along the Bolton corridor.

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Energy and environment

Improve water efficiency or face droughts

Individuals and businesses must improve water efficiency to stave off significant water shortages by 2050, a report from the Environment Agency has warned.
‘The State of the Environment: Water Resources’, released on 23 May by the government body, claims that the current levels of water diverted for supply to homes and industries are already unsustainable in a quarter of groundwaters and one fifth of rivers, with the potential for reduced flows to damage local wildlife and ecology. Currently, around 55 per cent of water taken from freshwater sources is for public supply, while a further 36 per cent is used for electricity supply and other industries.

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Clean Air Strategy aims to curb cost of air pollution

Fresh plans to tackle air pollution and reduce its cost to society have been set out in the government’s new Clean Air Strategy, currently undergoing consultation until August. Launched on 22 May by the Secretary of State for Environment, Food and Rural Affairs, the Rt Hon Michael Gove MP, the strategy targets a 50 per cent reduction in the number of people living in areas with dangerous levels of air pollution by 2025.
The proposals include new primary legislation to empower local governments to improve air quality, measures to ensure only the cleanest domestic fuels are available for sale and plans to reduce ammonia emissions from farming by encouraging investment in greener infrastructure and equipment.

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Government support won’t boost fracking

A government support package to encourage UK fracking projects won’t have any tangible effect on the shale gas industry, according to analysis from international firm BMI Research released on 22 May.
Earlier this month the government announced the appointment of an industry regulator to help build capacity and capabilities for the energy source, reinforced by a £1.6 million shale support fund. However, BMI has said that the package fails to tackle the biggest hurdles to fracking projects, including the need for local government support and persistent public opposition to projects.

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North Sea revival borne out in offshore licencing frenzy

The Oil and Gas Authority (OGA) cited strong demand as it made available over 26,000 km2 of the UK Continental Shelf for offshore oil and gas exploration on 23 May. 123 separate licences have now been awarded to applicant companies as part of the 30th Offshore Licencing Round, representing a 50 per cent increase on existing acreage held for exploration.
The OGA expects a “healthy boost” in exploration and production, with the potential for undeveloped discoveries to unlock resource equivalent to 320 million barrels of oil.

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Other News

Government productivity review opens for business

Leading technologies such as cloud computing and e-commerce software could help businesses unlock a £100bn boost for the UK economy, a new government review into productivity has claimed. The Business Productivity Review, launched by the Chancellor of the Exchequer, the Rt Hon Philip Hammond MP on 22 May, aims to identify how companies can use new technology, management practices and business support services to boost productivity.
The review comes as research from the Confederation of British Industry revealed the UK economy could benefit from a five per cent reduction in income inequality if more businesses adopted innovative processes.

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