PLANNING FOR NORTHERN IRELAND LOCATED “ASSETS” THE FUTURE FOR PROPERTY AND LAND BANK INVESTMENTS Brian Rowntree Chairman N.I. Housing Executive - 25th...
PLANNING FOR NORTHERN IRELAND LOCATED “ASSETS” THE FUTURE FOR PROPERTY AND LAND BANK INVESTMENTS Brian Rowntree Chairman N.I. Housing Executive - 25th January 2011
Northern Ireland Property Market Residential Land Typical Prices per acre 2001 £200,000 2007 £1,000,000+ 2010 £175,000 Commercial Property 2007 up to £16/ft2 2010 £11/ft2
Northern Ireland Residential Property Market Social Housing 2010 Social Housing Waiting List Number in Housing Stress
Sept 2010 39,344 persons 20,513 persons
HS % of total waiting list
52%
Northern Ireland Residential Property Market Total Zoned Land in N.I. Awaiting Development Hectacres DOE Land Availability Monitor 2009 Northern Ireland
6228 ha (potential) 145,312 units
Northern Ireland Housing Market Social Housing Waiting List 2010 Profile 46% singles 25% small families 17% elderly 12% rest
Northern Ireland Housing Market Social Housing (Waiting List) 2010 Map of Waiting List by N.I. Local Authority/District
Northern Ireland Property Market 2010
Tenanted Owner Occupied sold under Right to Buy Housing Association Stock
% of NI total stock
89,000 units 117,000 units
12% 16%
35,000 units
5%
Paid to Private Sector via Housing Benefit
50,000 units
7%
Total Sector Provision % of overall stock in N.I.
291,000 units
Including bedspaces and Co-ownership
40%
Northern Ireland Property Market
Northern Ireland Housing Executive Stock by District Council Area Map
Northern Ireland Property Market Northern Ireland Housing (Social) Areas of Priority Need Map
Northern Ireland Property Market Personal Observations – 2010 • Oversupply of available zoned land in Northern Ireland for present market capacity • Not all zoned and available land in areas of need • Evidence of trading in land in Northern Ireland at peak of property market 2005-2008 • Buy to let market fairly constant during present market vulnerability
Northern Ireland Property Market Personal Observations – 2010 cont’d • No churn in market (owner occupied market static with new build struggling) • First time buyers squeezed – mortgage finance as opposed to house price • Average age of first time buyer 36 (UK) • Average deposit requirement for house purchase 30% (UK)
Northern Ireland Property Market Personal Observations – 2010 cont’d • Shared equity products not attractive to mortgage companies (UK) • Shared equity products may be more expensive than standard rental (UK) • Rental market (residential) reasonably buoyant • Rental values in line with 2008 levels
Northern Ireland Property Market Personal Observations – 2010 cont’d • Value within housing market at present for first time buyers and buy to let investors (yields 8% to 10%) • Land values static and no obvious market in land disposals/acquisitions
Northern Ireland Property Market Personal Observations – 2010 cont’d • Public sector budgets for next four years to 2014 include capital receipts from sale of land and buildings • NAMA to begin asset disposals via nominated Irish banks in 2011 – strategic disposal policy • NAMA discounting of Irish bank loan portfolio will impact on securitised asset values ie. 40% to 60% loan discounts
Northern Ireland Property Market Personal Observations – 2010 cont’d • Availability of work in progress finance to take value out of land banks is essential. Limit on finance will further devalue land banks. Irish banks unable to respond in majority of cases • Construction costs (excluding land value) are static and have reduced in past twelve months ie. House building 84 sq m @ £60k and less. Now £60k for Code 4 modular build
Northern Ireland Property Market Personal Observations – 2010 cont’d • Evidence of increase in small works activity to residential property ie. Adaptations and extensions • Restrictions on private sector residential property grants due to CSR. Statutory grants only. DFGs • Thermal efficient properties will sell quicker in the market
Northern Ireland Property Market Personal Observations – 2010 cont’d • Retro-fitting of existing private & public sector stock a market for the future. 6.2m properties in UK by 2030 • Intermediate renting a growing market. Young professionals – no deposit to purchase – higher quality property – social/economic mobility • The 2007 Housing Market is dead
