The commercial market has seen a ‘significant turnaround’ in the past six months, but more stock is needed following the introduction of permitted development rights, experts claim.
They suggest confidence is finally beginning to return to the sector as the wider economy improves.
Simon Price, of commercial consultants Alder King, said: “The overriding position in the office and industrial markets has improved significantly in the last year, but particularly in the last six months.
But the introduction of permitted development rights – which allows some office buildings to be converted into residential use – means the supply of commercial space is in decline.
This is particularly evident in Bristol, where Alder King is based, Mr Price explained.
He added it has resulted in a ‘clearing out’ of the poorer space available in the market – particularly at the bottom end.
In addition, office tenants still operating from buildings due to be converted are being pushed back into the market at a higher level.
Another change in the market is the “strong interest” in new speculative buildings under construction that are not due to be completed until next year.
Mr Price said: “There has been a very quick turnaround in the market as confidence has grown, with supply falling and take-up increasing.”
Graham Ricketts, associate partner at Brasier Freeth, suggests speculative development has not been financially viable and rents still need to rise to make development stack up.
But he said: “It won’t take much more as confidence is certainly returning to the market and availability of second hand stock is very limited.
“In London’s prime West End locations, rents continue to rise and stock diminishes, so there might be a ripple effect to outer London and Surburban locations.
He added: “I would have preferred many of those properties that have been converted into residential spaces to remain as commercial. But without a shadow of a doubt, the commercial office market is much more positive than six months ago.”
If you are looking for a new build home, try this Radford Gardens development named after a Hereford United player
Where exactly is it? In an area called Belmont, in the south western suburbs of this cathedral city, about 1.5 miles from the city centre.
Monster housing estate or tiny boutique development? Somewhere in the middle. The 129 house development by Keepmoat has been named after Hereford United player Ronnie Radford who scored in the team’s historic (by which we mean it happened in 1972 and has never been repeated) defeat of Newcastle United in the FA Cup. The first residents will move in this autumn. Radford Gardens is a key part of a £30m regeneration of Belmont, which will eventually include a new playground, open space, café and community centre, and homes built for rent.
How much will it cost me? Two bedroom houses start at £113,995 (or from £91,196 with the Government’s Help to Buy scheme). The largest, four bedroome properties, start at from £156,995 – or £125,596 with Help to Buy.
What is so great about it? As well as affordability the location, within walking distance of the heart of the city, is great. Hereford is a very pretty, small city with a good range of high street and independent shops and cafes. In May, a new £90m scheme opened at Hereford Cattle Market bringing a Waitrose and an Odeon cinema.
Surely its not completely perfect? Early buyers will have to endure three years of building work around them, although the developer stresses work will be phased to make sure it causes as little disruption as possible. Expressions of interest in the scheme are strong, which means buyers may have little choice but to purchase off plan and wait. The small parade of local shops in Belmont is rather uninspiring.
Who will my neighbours be? As well as Hereford United fans of a certain age, the main buyers are anticipated to be young families from the Hereford area in need of a larger home.
What is Hereford itself like? A picturesque, old fashioned and tourist friendly city on the River Wye, 16 miles from the Welsh border. Hereford boasts a city centre peppered with beautiful seventeenth century buildings, and since it is where brewer Bulmers is based the (many) local pubs tend to have extensive cider menus. As well as its football club Hereford has a popular rowing club, and two leisure centres. There are several golf courses in the countryside nearby, and Brecon Beacons National Park, the Forest of Dean and the Malvern Hills are all within easy striking distance for outings.
Is it any good for kids? All Radford Gardens properties have gardens and a play area will be built on the site. Hereford Leisure Pool and gym is less than a mile away, as are St George’s playing fields, on the banks of the River Wye. Nearby primaries include Riverside Primary School and Our Lady’s RC Primary School, both rated “good” by Ofsted. However The Hereford Academy (seniors) is considered unsatisfactory by the Governments’ schools’ watchdog, which will be a worry to parents of older children who will need to investigate other secondary options in the city.
How are the public transport links? Buses run into town if you don’t fancy the walk and Hereford Station is just over two miles from Radford Gardens. For drivers the M50 is around 20 minutes away, connecting to the M5 between Birmingham, Bristol and Exeter.
Is it up and coming? Hereford is holding its own. Average properties cost £224,619, up 5.39 per cent in the last year.
I like the sound of Hereford, what else is on sale there?
1. If you would like a rambling seven bedroom house on the outskirts of the city with an acre or two then this lovely looking house could be perfect, on the market at £850,000.
2. Or hear the bells of Hereford Cathedral from this four bedroom Georgian town house in the city centre, yours for £695,000.
3. Hereford has some tremendous period property, including this Grade II listed four bedroom house, priced at £385,000.
4. Awaken to views of the River Wye with The Boathouse, a five bedroom detached house overlooking the water. It is on the market at £335,000.
5. You get plenty of bang for your buck in Hereford, like this three bedroom Grade II listed detached house, yours for beneath the £250,000 Stamp Duty threshold.
6. If your budget is slim how about a two bedroom cottage, postcard pretty, on the market for £145,000.
High crime rates can have a significant impact on house prices with a third of Britons saying they would demand a reduction on a home in an area blighted with problems.
Around 43 per cent of people said they would refuse to buy or rent a property in an area that suffered from high crime, according to a study by Direct Line Home Insurance.
A further 36 per cent of people said if they were considering buying a home in an area that suffered from crime they would insist on paying less than the asking price.
One in 10 people are so concerned about the impact crime rates can have on house prices or the saleability of a property, they would even consider not reporting a crime to the police because it would show up on an online crime map.
Unsurprisingly, half of those questions said they would also check the crime statistics for a neighbourhood they were interested in living in before they committed to renting or buying a home there.
Househunters who are concerned can check the crime statistics for somewhere they are interested in on Zoopla’s website.
They can do this by entering the address of a property they are considering and clicking on the local info section of the web page, followed by the tap for crime.
The page will show a breakdown of crime in the area and how it compares to the national average.
Katie Lomas, head of Direct Line home insurance, said: “Crime is at its lowest since 1981, but our research shows that it is still a major consideration for house hunters and homeowners.
“It is alarming that crime may go unreported because people are fearful of affecting the price of their property, as it will mean these crimes will not be investigated, potentially leaving criminals free to strike again.”
In fact, 4 per cent of people admitted they had been a victim of crime or witnessed a criminal offence in the past 12 months, but had not reported it to police for fear of it having an impact on the value or desirability of their property.
A further 8 per cent would also actively discourage a neighbour from reporting a crime in case it showed up on a police crime map.
Among those who had not reported a crime, 49 per cent had not reported a vehicle crime, while 41 per cent had ignored a robbery or theft from a person and 40 per cent had turned a blind eye to anti-social behaviour.
A third of people had not reported criminal damage and the same proportion had ignored the possession of a weapon by someone in their neighbourhood.
This Friday marks the end of the longest depression in British economic history, it has been revealed.
Official figures will confirm that the total amount produced by Britain – or Growth Domestic Product – exceeds the level last seen before the recession hit.
Government figures show GDP fell by 7.2 per cent between its height during the first three months of 2008 and its low in the second quarter of 2009.
Technically, a depression – defined as a long or deep recession – does not end until GDP exceeds this pre-recession peak.
Britain’s economic recovery has been slow. National output during the first quarter of this year was still 0.6 per cent below that peak, according to the Office for National Statistics.
But momentum has picked up significantly during the past year and Britain now has one of the fastest growing economies among wealthy countries in the world.
This confidence is already being felt in the property market. Latest research by Zoopla shows the average value of a home soared by £90 a day during the first half of this year, leaving the typical property costing £260,488.
But experts warn that while the economy is improving, there are other issues – such as the forthcoming General Election – that are influencing the performance of the house market.
Mark Harris, of mortgage brokers SPF Private Clients, said: “The official numbers are demonstrating what the housing market has known for some time – the worst is over for the economy. Confidence is returning, with many of the buyers who may have been worried about job security and delayed making a purchase, finally ready to take the plunge.
“However, while the recovery is welcome it is also tentative. There are signs that the housing market is now starting to cool a little with buyers better able to negotiate over prices than before. With the threat of an interest rate rise on the horizon and the uncertainty surrounding the General Election, along with the possibility of a mansion tax, there are plenty of hurdles for the housing market to overcome.”
The average cost of a home soared by £90 a day during the first half of 2014, research showed today.
House prices in Britain jumped by 6.5 per cent or £16,265 in the six months to the end of June, to leave the typical property costing £260,488, according to Zoopla.
Home values rose in all regions of Britain during the six months, with London leading the way with an increase of 8.2 per cent or £43,115.
The steep gain pushed the average house price in the capital up to £567,392.
But the East and South East were not far behind posting growth of 7.5 per cent or £19,440, and 7.4 per cent or £23,031 respectively.
The Zoopla research came as data showed the number of homes changing hands reached a six-and-a-half year high during June.
A total of 109,580 properties were sold for more than £40,000 during the month on a non-seasonally adjusted basis, according to HM Revenue & Customs.
The figure was the joint-highest number of homes to change hands since November 2007.
But on a seasonally adjusted basis, the property market showed some signs of moderating, with 102,680 residential properties sold during June, broadly unchanged from the previous two months.
The Zoopla data also provided further evidence that the housing market recovery is beginning to ripple out from London and the South East to other areas of the country.
Salford in Greater Manchester was the best performing town during the first half of 2014, with the average house price soaring by 12 per cent or £14,874 to stand at £138,619.
It was followed by Brough in Yorkshire, where prices jumped by 11.9 per cent or £25,184, to leave the average property costing £211,156.
Lawrence Hall, of Zoopla, said:“Homeowners up and down the country are starting to see the benefits of the recovery as home values make further headway in 2014.
“Property price growth has largely been a London and South East story until recently, so it is very encouraging to see the house price recovery broadening and the ripple effect starting to take hold further north.
“Over the past few years Salford especially has prospered from job creation in the area, which has helped boost the local property market.”
Overall, house prices rose by just over 6 per cent in the South West, North West and Yorkshire and the Humber during the first six months of the year, while they rose by more than 5 per cent in the East Midlands, North East and West Midlands.
Gains were lowest in Wales and Scotland at 3.5 per cent and 1.1 per cent respectively.
Recent strong house price growth has led to concerns that a bubble could be building up in the property market, particularly in London where values have soared by 20.1 per cent during the past year.