Week commencing 20 June 2016

In today's bulletin

• Brexit vote likely to cause UK housing market short term instability
• Property transactions up after slow April

• IMechE calls for national freight strategy
• Solar energy could meet up to 13 per cent of global power needs by 2030

Property, Planning and Regeneration

Brexit vote likely to cause UK housing market short term instability

The decision by the UK electorate to leave the European Union will result in an unpredictable housing market over the coming months, according to a number of property and residential firms responding to the announcement on 24 June. The UK property market is facing short term volatility but many
experts predict that it will settle down in the long-term and still be attractive. In terms of overseas investment in property, experts highlight that before the leave vote there had already been signs of a ‘wait and see’ attitude, particularly where demand and prices were showing signs of slowing.

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London office market strong ahead of Brexit vote but uncertainty lies ahead

Commercial property rental values across the UK grew by 0.1 per cent in May. Published on 20 June, CBRE’s monthly index showed that the capital’s office market remained strong amid uncertainty. However, the report highlights that Brexit could affect potential occupiers’ decisions to remain in London
because of the loss of ‘passporting’, which has made London ‘an attractive location for businesses to establish European or global headquarters’. Katherine Bain, director at CBRE London, warned that “an exit would erode London’s position as a gateway to continental Europe.”

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Eight year high for residential mortgage sales

Sales of residential mortgages exceeded £13 billion in May, a record since the financial crash in 2008. The latest data from Equifax Touchstone, a provider of market intelligence (MI) to the life, pension, investment and mortgage industries revealed on 22 June that sales were up 4.4 per cent compared
to April with year-on-year figures also rising by a strong 18.4 per cent. In addition, buy-to-let mortgage sales also increased, while all UK regions experienced a month-on-month uplift.

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Property transactions up after slow April

The number of property sales in May increased by 1.5 per cent compared to April, according to a new report by HM Revenue and Customs (HMRC). However the report, released on 21 June, also noted that property transactions were down 11.9 per cent on May 2015, but that March-May 2016 was higher than the comparable period in 2015.
In addition, the report argued that an earlier drop in sales between March and April 2016 was down to the increase in stamp duty rates on additional properties, which took effect in April, as well as indications from the Bank of England that it intended to curb buy-to-let mortgages.

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Asking prices in the East rising faster than anywhere else in the UK

House prices in the East of England are rising faster than anywhere else in UK, according to the latest figures from property search engine, Home.co.uk. The figures show that asking prices in the East have risen twice as fast over the
last year as the rest of the country. Year-on-year prices in the East of England increased by 13.9 per cent compared to 7 per cent in Greater London.

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New energy regulation could see occupiers footing the bill for repairs

Landlords could be prevented from letting buildings that fail to meet the minimum required ‘E’ energy rating under new guidelines coming into force on 1 April 2018. Under the new Minimum Energy Efficiency Standards (MEES), experts are warning that landlords could pass on the costs of bringing
buildings up to standard to occupiers. Ben Strange, associate director at Lambert Smith Hampton said, “When these regulations come into force, 72 per cent of UK office buildings could be at risk of being unlettable.”

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Consultation launched on proposed single digital property register in UK

Changes to local land registry frameworks are currently under consultation, with plans to transfer responsibility for Local Land Charges from local authorities to the Land Registry. The proposals were outlined in the Infrastructure Act 2015 but secondary legislation is required to implement any
changes. The Land Registry argues that as a result of the changes, the proposed Local Land Charges Register Service will reduce overheads and eliminate regional variations in quality and cost for services. The consultation runs until 11 July.

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IMechE calls for national freight strategy

A national, multi-modal freight strategy would ease congestion on UK roads, reduce air pollution and bring economic benefits, according to a new report by the Institution of Mechanical Engineers (IMechE). Published on 22 June, the report, UK freight: in for the long haul, estimated that nearly one third of
commercial vehicles are driven empty, while claiming that around 150 million road miles could be saved through improved coordination of seaborne freight. The IMechE has called for the Government to establish “urban consolidation centres” which could be used to organise joint local deliveries.

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Energy and environment

MEPs consider a 30 per cent target for renewable energy in Europe

On 23 June, Members of the European Parliament (MEPs) voted in favour of a resolution to increase the European Union’s (EU) renewable energy target to ‘at least’ 30 per cent by 2030. The MEPs were responding to a European Commission progress report on renewables that found that many of
the EU member states had already achieved the current target of 20 per cent. The parliamentary vote had no direct legislative impact but the recommendations will feed into upcoming legislative proposals on the EU energy union which is expected before the end of the year.

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Solar energy could meet up to 13 per cent of global power needs by 2030

The share of global electricity generated by solar energy could increase to 13 per cent by 2030, according to a new report released on 22 June. The “Letting in the Light: How Solar Photovoltaics Will Revolutionize the Electricity System” was authored by the International Renewable Energy Agency (IRENA). It argued that solar photovoltaics (PV) capacity could increase from current
levels of 227 gigawatts (GW) to between 1,760 and 2,500 GW by 2030. IRENA recommends that for annual capacity to double over the next 14 years, the global solar PV industry will need to adopt the necessary infrastructure, update policies and support the creation of a global standards framework.

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