Fencing supplier Echo Barrier has launched a new version of its H2 sound reduction barrier.

The Echo H3 has been developed by the company’s acoustic experts and is now fire resistant and weatherproof.

It has a sound dampening core as standard, achieving noise reduction of up to 30dB, the manufacturer says.

New products also in production include an acoustic tent and a transparent barrier.

Technical director Peter Wilson said: “Our team of acoustic engineers are constantly researching and developing new solutions to ensure we can meet the needs of our customers. The number of contractors now specifying noise reduction solutions as part of their site management credentials is increasing rapidly, as the impact of noise on local communities becomes more of an issue.”

The average price of a typical three bedroom house in Jersey increased to the highest it has been for three years in the second quarter of 2014, the latest official data shows.

The House Price Index report from the Statistics Unit shows that all property types saw an increase in the mean price of properties sold compared with the previous quarter.

But it was the three bedroom sector that has performed the best with an average price of £508,000 and overall the mix adjusted price of all property sold was up 5% quarter on quarter.

But it must be remembered that prices are coming from a low base. For example, the first quarter of 2014 recorded the lowest level of average property price in Jersey for more than five years.

The turnover of properties in the second quarter of the year was 13% greater than in the previous quarter and at a similar level to the average seen in the latter half of 2013 at around 300 properties sold per quarter.

Share transfer transactions accounted for more than half, 56%, of all eligible flat sales, a slightly greater proportion than in 2013.

The index measures the combined average price of one and two bedroom flats and two, three and four bedroom houses and includes share transfer properties and is seasonally adjusted.

It also gives an idea of trends in terms of prices and sales. In 2008 and 2009 the mean price of one bedroom flats had been essentially stable at around £230,000. During 2010 and 2011 a reduction in the mean price of this property type was recorded, largely attributable to an increase in the turnover of lower priced share transfer properties.

The mean price then increased slightly during 2012, to around £210,000, where it remained before falling below £200,000 in late 2013 and early 2014. In the latest quarter the mean price of one bedroom flats at £219,000 was 10% higher than in the previous quarter.

Following a period of stability throughout 2008 and 2009, when the mean price of two bedroom flats was around £320,000, the subsequent two years saw increases, taking the annual mean price of this property type to around £340,000 in 2012.

Since the first quarter of 2013 the average price of two bedroom flats has remained essentially stable at around this level, except for a downward fluctuation recorded in the fourth quarter of 2013.

In the latest quarter the mean price of two bedroom flats at £354,000 was 4% higher than in the previous quarter and almost 7% higher than the average for 2013.

The mean price of two bedroom houses sold between 2008 and 2010 was around £400,000 but has since fallen, with the annual average price recorded in each year from 2011 to 2013 being below £400,000.

In the latest quarter, the mean price of two bedroom houses at £382,000 was similar to the previous quarter, just 1% higher, and 2% higher than in 2013.

After a period of strong…

It’s all very well training civil servants in project management, but the ministers and permanent secretaries that make the decisions need training too.

That’s one of the conclusions of a highly critical Public Accounts Committee report, out today, into the work of the Major Projects Authority (MPA).

"There remain serious weaknesses in government’s project delivery capability,” said committee chair Margaret Hodge. “We welcome the creation of the Major Projects Leadership Academy, but the MPA needs to target top decision-makers as well as managers. This should include ministers, shadow ministers and permanent secretaries.”

Two ministers have attended half-day or full-day courses on project management run by the MPA and found it helpful, the report notes. “It would be beneficial to extend this support more widely, as it would help to develop greater awareness of project delivery issues at the highest decision-making levels in government.”

The report also says that there needs to be better planning at the outset of projects and greater transparency in decision making.

The MPA was established in March 2011 as a partnership between the Cabinet Office and the Treasury to improve project delivery across government.

In September 2013, the Government Major Projects Portfolio consisted of 199 major projects covering a wide range of activities, from transforming how departments do their work to building ships and motorways. These projects represent a considerable and rising cost to the taxpayer: the MPA reported in May 2014 that the whole-life cost of these projects was £488bn, an increase of some £134bn on the previous year.

Mrs Hodge said: "We support the work of the Major Projects Authority and welcome the progress it has made so far, but without stronger powers it is unlikely to achieve its aim of a systemic improvement in project delivery across government.”

The report says: The MPA is unlikely to achieve a systemic improvement in project management without stronger, more formal mechanisms for driving change. At present, the Treasury does take account of MPA recommendations when making spending decisions, but it is under no formal obligation to follow them. Equally, the MPA often has to rely on personal credibility and informal influence, rather than having formal mechanisms, to get its voice heard in its work with departments. For example, the MPA is helping with recruitment for leadership positions on several major projects, but only on an ad hoc basis and told us that its role is not yet ‘systematised’. This lack of formal powers reduces the influence of the MPA with the Treasury and with departments, limiting its ability to drive improvements in project management.”

It recommends that the chief executive of the MPA should have a formal mechanism available to set out his or her position if politicians over-rule. “Where ministers or officials reject MPA recommendations, there should be a formal and transparent process in place to document this.”

More controversially, the committee calls for more Treasury control over major projects. “The Treasury should take ownership and responsibility for overseeing the government portfolio,” the committee suggests. “It should ensure that decisions about whether, and how, individual projects should proceed are based on each project’s impact on the total portfolio’s value and risk, and the relevant department’s delivery capability and existing portfolio of projects.”

The full report, Public Accounts Committee – 10th Report: Major Projects Authority, can be downloaded at http://www.publications.parliament.uk/pa/cm201415/cmselect/cmpubacc/147/14702.htm

Only half of aspiring home owners in the UK are aware of the new Mortgage Market Review rules that were introduced in April, according to new research.

Of those that are aware of the MMR, many still don’t understand its impact although many are now preparing in advance for their mortgage application, the research from TSB shows.

Some 41% of those made aware of the MMR feel it will ensure they can only borrow what they are able to afford and after being offered a straightforward explanation of the changes, only 3% felt they still didn’t know how the MMR may affect them.

The bank says that this shows how such explanations can go a long way to help consumers and it is good news that many aspiring home owners are now considering preparing for their mortgage application better by taking a few sensible actions.

More than half, 53%, said that they will save up as much as possible, 49% said they will check their credit report before applying for a mortgage, 45% said they will take the time to work out what they can afford ahead of their application, 29% will look to pay off existing debts and 21% will make sure they’re on the electoral roll.

TSB advices that new mortgage applicants in particular should check with their bank or building society how much you can borrow before searching for properties. TSB offers a soft search approval in principle with no impact on credit rating.

They should also have realistic expectations about what they are able to repay and work out how much you earn, spend and what you spend it on and check their report which can be done online.

Other tips include saving as much as possible as the bigger the deposit, the lower the cost of your mortgage is likely to be and if you’ve never had any borrowing, take out some form of credit such as an agreed overdraft or a credit card, but ensure you pay it back regularly to build your credit rating.

TSB also offers assistance for people whose application has been rejected, helping them understand the reasons behind the decline and assisting them wherever possible.

‘Though the Mortgage Market Review is usually recognised as a positive change by people who understand it, many still have worries as it remains shrouded in mystery,’ said Ian Ramsden, TSB mortgages director.

‘We say don’t panic, but do prepare for your mortgage application with some straightforward, simple steps. Break down your finances, work out how much you can afford and aim to future proof your mortgage as far as possible by discussing plans with your mortgage adviser,’ he added.

Higher fees and the recently introduced mortgage cap are having an effect on the prime property market in Dubai with price growth weakening.

After entering positive territory in the middle of 2011, annual residential price growth in Dubai’s mainstream segment has been very strong indeed. However, after peaking at 35% at the end of 2013, the growth rate has now been slowing.

According to Khawar Khan of international real estate firm Knight Frank the deceleration in price growth can be attributed to a combination of higher transfer fees and the mortgage caps.

But he pointed out that the new rules have impacted Dubai’s luxury homes market to a much greater degree. Indeed prices increased by just 6.3% year on year in the second quarter of 2014 compared with 24% in the mainstream property market.

‘Established, mainstream locations such as Dubai Marina remain very popular among western expats and continue to see healthy demand and thus price growth. That in turn has led some investors to look elsewhere for value, including newer developments in areas such as Jumeriah Village, Dubai Sports City and Dubai Silicon Oasis where prices are rising off a relatively low base,’ said Khan.

‘Therefore with demand for residential property remaining strong in both newer, as well as more established, mainstream locations in Dubai, prices in this segment continue to post strong gains,’ he explained.

He also pointed out that the new mortgage rules implemented by the UAE Central Bank are stricter for those buying residential property worth over AED5 million. For example, if an expat buyer was to purchase a property above that value, they would need to raise a 35% deposit. By comparison, the same buyer looking for a property worth less than that amount would require a 25% deposit.

‘Thus, while the new mortgage caps have hit the residential market as a whole, they have had a lesser impact on the mainstream segment,’ added Khan.

He explained further that after halving between 2008 and 2010, both mainstream and luxury home prices have since largely recovered. However, rents in the latter segment haven’t been able to keep up, which in turn has led yields to harden. By comparison, as a result of a stronger recovery in rents, mainstreams yields continue to look relatively attractive to investors.

Finally, Dubai’s strong economic conditions and buoyant labour market continue to attract foreigners in their droves. ‘Since this rising population needs decent, and not always luxurious, accommodation, we expect demand to outstrip supply in the short term. All else equal then, we believe that mainstream residential prices will continue to rise faster than luxury home prices over the next 12 to 18 months,’ added Khan.

Travis Perkins Group is staffing up for a major expansion drive.

The builders' merchant group already operates from 1,900 sites around the UK across the 17 businesses that make up the company.  It employs nearly 24,000 people and is the UK’s largest supplier to the building and construction market. 

However, it wants more.

“Our ambition post-recession is to substantially increase trading space over the next five years,” said group property director Martin Meech. “This includes a considerable number of brownfield or implant branches and stores, and more than 30 trade parks.”

First step is putting in place a new team to drive the property acquisition and management programme, with five senior appointments.

Peter Webb has been appointed property director for the general merchanting division. Phil Joyce is divisional property director for P&H. Nick Pinney joins from Strutt & Parker to be property director for the contract merchanting division. Jim Adams has joined as property director for the consumer division (Wickes). Finally, Darren Screen has joined as property finance director.

This restructure has also created a further 20 new positions within the group property team at head office in Northampton, including the promotion of Graham Lund to director of construction.

The price of property coming onto the market in the UK has fallen for the first time this year, down by 0.8% or £2,116, according to the latest figures from Rightmove.

This takes the price of an average home to £270,159 and means that the annual rate of growth has fallen from 7.7% to 6.5%.

However, Rightmove has upgraded its 2014 forecast and says that new seller asking prices will see an 8% annual increase by the end of the year, hitting the top end of its original forecast of 6% to 8%.

The firm also says that there is evidence that the frenetic activity seen in some areas during the first half of the year is cooling, in part due to stricter mortgage eligibility criteria and previously pent-up demand having now been partially satisfied.

However, the significance of the first fall of the year in new seller asking prices should not be overstated in spite of the dampening effect of the more cautious tone from the Bank of
England. July has seen price falls in six of the last 10 years, with this drop largely reflecting a normal seasonal slowdown.

‘A price fall in July is not unexpected as prospective buyers turn their attention to the summer holidays. Buyer confidence may also have taken a knock with suggestions that mortgages are becoming harder to get and repayments may get more costly sooner than originally anticipated should the rumours of an interest rate rise before the next election come true,’ said Miles Shipside, Rightmove director and housing market analyst.

He pointed out that the Bank of England is trying to cool some of the existing and potential excesses of the housing market, with affordability, personal debt and default risk all high on the agenda. The Mortgage Market Review (MMR) and additional high loan to income and stress -testing guidance, along with suggestions of earlier than expected interest rate rises have had a dampening effect.

‘However, while lower than in the latter months of 2013, Bank of England mortgage approvals are still running at an average of over 60,000 a month, 23% higher in the year to date than during the same period in 2013, and 40% above the 48,162 monthly average between 2008 and 2012. It is also likely that current mortgage approval numbers are still being curtailed by the hangover from the implementation challenges of MMR,’ he explained.

‘Market conditions still compare favourably with this time last year, with growth in both the economy and employment, plus a comparative thaw in mortgage availability,’ he said, adding that he does expect that market activity will slow down in the run-up to the election in May next year.

‘Faster turnover of property breeds confidence among potential sellers, bringing more to market. This is important to help satisfy pent-up buyer demand and it also helps to keep a lid on prices if there is more property choice for buyers and more competition among sellers,’ he pointed out.

Rightmove…

Plastic pipe producer Polypipe has shown a steady start to life on the London stock exchange, reporting first-half numbers that reflect market growth.

Polypipe was floated in the stock exchange in April this year. Today it reported its results for the six months to 30 June 2014. Revenue was up 11% on last year to £168.2m and basic operating profit was up 29% to £22.7m.

However, initial public offerings (IPOs) are a costly business and exceptional charges of £12.4m were incurred in relation to the flotation costs. A further £8.6m of exceptional finance costs were incurred from a debt refinancing.

As a result the business made a pre-tax loss of £4.6m for the first half, compared to a £9.7m profit for the same period last year.

There was strong demand for residential piping systems from UK housebuilders, increasingly from smaller developers and projects outside of London and the southeast. There was also good demand from road and rail projects, new high-rise apartment blocks in London and from flood alleviation schemes.

Chief executive David Hall said: "I am delighted with the progress that we have made following the group's successful IPO earlier this year and these results show that we are delivering on the strategy we set out at the time. The group's healthy growth in sales and underlying profits demonstrates the confidence returning to our sector and a deserved reward for operational improvements and investment we made when market conditions were much tougher. We are well placed to capitalise on the future growth opportunities and I remain confident that we will deliver results for the full year in line with our expectations at the time of the IPO."

The average advertised rent in Great Britain increased by 6.56% in July 2014 compared to the same time last year, reaching £1,029 per month, the latest index shows.

National rents surpassed the £1,000 per month mark in June 2014, and since then have continued to climb steadily, rising an average of £11 per month over the past four weeks, the data from Move with Us shows.

Contributing to the sustained national growth is the average rent in Greater London which stood at £2,376 per month in July and showed no signs of abating having increased consistently for the last 12 months.

On average, renting a property in the capital is now £43 more expensive that it was at the beginning of July and £223 or 10.11% per month more expensive than July 2013 when rents reached a low of £2,148 per month.

The data also shows that these improving markets conditions are not limited to the capital. A monthly increase of £9 in the South East means properties in the region are also becoming more expensive to rent, with average prices £90 (8.07%) per month higher than the same time last year.

Average advertised rents in East Anglia, traditionally an expensive marketplace given its commuter connections to London, averaged at £948 per month in July. As rents continue to increase, this month by £13, it would not be unexpected to see average advertising rents overtake the £1,000 per month mark within the next 12 months.

As house prices in Scotland stalled in July, the rental market flourished. Average rents stood at £737 per month in July, approximately £60 per month more than when compared to the same time last year. Other northern regions also experienced growth in July. The North West saw a slight decline over the last 12 months of 1.43%, with average advertised rents at £625 per month in July 2014.

‘Typically if the sales market improves, the rental market falters and vice versa. However, any fears that the rental market would decline as the sales market sprang back to life have now been allayed. The rental market has continued to grow alongside the sales market. It’s as strong as it’s ever been,’ said Robin King, director of Move with Us.

‘For once it’s not just the South that’s driving climbing advertising rents as improvements have spread up to the northern regions too. While the North West was the only region where the average advertising rent declined in a yearly comparison, we expect to see rents in this region increasing in the coming months,’ he added.

House-builder Bovis homes has reported a 75% leap in first half revenues and has more than doubled its profits.

In the six months to 30 June 2014 Bovis Homes made revenues of £322.1m (2013 H1: £184.4m). Profit before tax was up 166% to £49.4m (2013 H1: £18.6m).

With operating profit up 150% to £51.2m (2013 H1: £20.5m), the operating margin was 15.9%, up from 11.1% last year. This is expected to be more than 17% for the full year.

Bovis completed 1,487 homes in the half-year, a 54% increase on 963 for the same period last year and a new high for the company.

With 3,530 homes completed in the first 32 weeks of the year, the update strategic plan is to grow the business to achieve annual volumes of between 5,000 and 6,000 new homes, with a return on capital employed of at least 20% by 2016.

The land required to operate at this level will increasingly be sourced through strategic land conversion.  After a period of greater consented land market purchases, Bovis is reverting to more of a balance between consented land purchase and strategic land conversion.

Chief executive David Ritchie said: "In the first half of 2014 the group has delivered a record number of legal completions leading to a 150% increase in operating profit. This significant increase is the result of the compound positive effect of increased volumes, improved average sales price and stronger profit margins.

"The group has also had its most successful half year of land investment acquiring around 4,600 high quality consented plots on 23 sites.  This will support further sales outlet growth into 2015 and beyond, which is expected to lead to further strong improvements in return on capital employed.

"The strong trading position will enable the delivery of a significant increase in profits in 2014 in line with our expectations, subject to stable market conditions. With a further increase in capital turn, this level of profit is expected to generate a return on capital in 2014 of approximately 16%.”

Shareholders are set to benefit, with an enhanced dividend for 2014 of 35 pence per share, followed by a further 35 pence per share in 2015.

The latest Construction Trade Survey, published today, show that activity rose in the second quarter of 2014 across all areas of construction, including building contractors, specialist contractors, civil engineers and product manufacturers.

Future growth, however, may be put at risk by rising costs, as many contractors are still working on projects won at low prices. Cost inflation since winning these jobs has eroded expected profit margins in many cases.

Commenting on the survey, Construction Products Association economics director Noble Francis said:  “Firms across construction reported rises in output during Q2 and the majority of the industry is expecting activity to rise over the next 12-18 months.

“Unsurprisingly, private new housing was the key driver of construction activity.  On balance, 41% of contractors reported that private housing output rose in Q2 compared with a year ago.  The largest construction sector, private commercial, also enjoyed an increase in activity with 37% of contractors reporting that commercial output rose in Q2 compared with a year ago.  In addition, 46% of building contractors reported that work in publicly-funded education and health construction saw a return to growth, reflecting the recovery in capital investment in 2014/15 with less than a year to go to the next election. 

“Tender prices rose in Q2.  Many major contractors are still working on projects won in 2013 at relatively low prices but have been suffering from the key concerns of rising costs and skills availability, especially in specific sectors such as private new housing.  Overall, 80% of building contractors reported, on balance, that costs rose over the past year; 95% reported that materials costs rose over the past year and 75% reported that labour costs rose over the past year.  In terms of skills, 47% of building contractors reported that bricklayers and carpenters were difficult to recruit.”

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Key survey findings for Q2 include:

• 41% of building contractors reported that private housing output was higher than a year ago;

• 46% of building contractor firms reported public non-housing (education and health) output was higher than a year ago;

• 37% of building contractors reported that private commercial output was higher than a year ago;

• 58% of firms reported tender prices were higher than a year ago;

• 80% of building contractors reported that total costs were higher than a year ago;

• 95% of building contractors reported materials costs were higher than a year ago;

• 75% of firms reported that labour costs were higher than a year ago;

• Profit margins rose for the first time since the financial crisis six years ago (according to 5% of building contractors);

• 14% of specialist contractors reported being paid within 30 days, the highest recorded

• 47% of building contractors reported difficulty recruiting bricklayers and carpenters.

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The Construction Trade Survey takes data every quarter from six industry trade associations: Construction Products Association; Civil Engineering Contractors Association; National Federation of Builders; Federation of Master Builders; National Specialist Contractors Council; and UK Contractors Group.

UKCG director Stephen Ratcliffe said:  “There are some mixed signals in these results showing that there is some way to go before full recovery in the sector.  As we move towards the general election next year, UKCG will continue to stress to politicians on all sides of the political divide the need for a visible public sector pipeline of infrastructure investment and a steady flow of new projects."

National Federation of Builders chief executive Richard Beresford said:  “The good news is construction output is rising.  However, higher tender prices, materials and labour costs and difficulty in securing skilled labour at reasonable cost all highlight the fragility of this recovery.  Longer term institutional investment and more easily accessible finance options for the industry would go some way to securing stable, sustainable growth.”

The private rental market in Scotland saw a sharp rise with average rent prices rising 10% last month compared to 4.4% in the UK as a whole.

The data also shows that, for the first time this year, private rental prices in all regions of the UK have risen, with an average increase of 4.4% since June.

The HomeLet Rental Index, the largest monthly survey of private tenants in the UK, shows that annually the UK private rental market continues to rise. The average UK private home rent rose by 8.3% over the year to July 2014. The average rent in the UK now stands at £900 a month, compared to £825 a year ago.

While in previous months the Greater London market has shown itself as a clear front runner in rent rises, July’s data points to fast rising markets in other parts of the UK.

Scotland has seen the biggest increase in rents across the whole of the UK with rents rising 10% from an average of £578 in June to £636 in July. Rent prices in Scotland over previous months have indicated a falling market, with annual figures showing prices falling 0.5% in May and 3.8% in June, so the 10% rise in July represents a sudden change in the state of the market. July's rise was enough to tip Scotland back into positive territory on an annualised basis, with rents now 1.4% higher than a year ago.

Other regions in the UK showing strong growth this month include Wales, East Anglia and the South West. Year on year, East Anglia and the South West have consistently shown the highest rent price rises in the UK, at 9.4% and 8.1% respectively, alongside Greater London at 9.4%.

‘With all eyes on Scotland ahead of the September independence vote, it is interesting to note that in July Scotland has shown the biggest leap in rental prices across the whole of the UK, with a rise in tenant’s incomes too. These are early figures, so it is too early to tell if this represents a sustainable uplift in the Scottish market, but indicates Scotland may be one to watch,’ said Martin Totty, chief executive officer of Barbon Insurance Group.

‘The private rental sector has seen rental values increasing across the whole of the UK this month, without exception. East Anglia and the South West continue to be very strong markets, with annual figures in these regions showing prices rising year on year as fast as the London market, and standing well ahead of the rest of the UK,’ he added.

According to Kate Faulkner, property analyst at propertychecklists, the data suggests that for tenants who can stay for long periods in their rental properties, they are more likely to be able to keep their rental costs down, while moving often could mean paying higher rents, potentially each time they move.

‘Just as with property…

Four out of 10 civil engineering contractors have employed apprentices in the past 12 months, according to the latest annual training and development survey by the Civil Engineering Contractors Association.

The picture appears to be getting better, however. Two years ago, only 19% of companies across the construction industry as a whole offered apprenticeships, according to a 2012 report by the UK Commission for Employment & Skills.

A third of civils contractors are also now recruiting graduate trainees – 32% CECA members took on graduates last year, the survey showed.

CECA’s membership comprises more than 300 contractors of all sizes, covering approximately 80% of the civil engineering market in England, Wales and Scotland.

CECA chief executive Alasdair Reisner said: “It is great news that contractors are recruiting the next generation of employees as the sector gears up to deliver major programmes of work in the future. CECA has long argued that an effective skills system is vital in developing an efficient workforce and is a key driver of economic growth.

“Industry must work together with government and skills providers to ensure the system is demand-led and can respond to the evolving needs of businesses of all sizes. Unless we can continue to recruit and train new entrants, the UK will face a substantial construction skills shortage over the next decade.”

Happy as he may be, the CECA survey still shows that most contractors are doing no training at all – whether at apprentice or graduate level.

Mr Reisner said that he wanted government help to push the message in schools and careers guidance centres that the infrastructure sector was a good place to work. “We need to ensure all children of primary and secondary age, and their teachers, parents and carers, are well informed about the wide variety of challenging, dynamic and exciting job opportunities available in our sector,” he said.

Thirty-six stalled house-building projects have been shortlisted for government loans to help get them started.

The Department of Communities & Local Government has a pot of £850m to lend to schemes for infrastructure that is needed to make the schemes viable. The money will go towards building road improvements, schools and parks to support the extra homes being planned.

The 36 schemes will collectively result in more than 200,000 new homes being built across the country, according to plans. The projects will go through a final due diligence process before receiving the funding.

Sites requiring support even include three schemes in the London area. The continued development of the Greenwich Peninsula is on the list, as is Ebbsfleet Eastern Quarry.

The funding will be available between 2015 and 2020 and will be in the form of a long term loan with interest.

The full list is:

• continued development of the Greenwich Peninsula in southeast London, to help provide nearly 10,000 homes
• Acton Gardens in Ealing, to help provide over 2,500 homes
• Wood Wharf development in London, to help provide over 3,000 homes
• Beaulieu development in Chelmsford, to help provide 3,600 homes
• Bishop Stortford North development in East Hertfordshire, to help to provide 2,200 homes
• redevelopment of the former Rugby Radio Station site, to help provide 6,200 homes
• Monkton Heathfield development outside Taunton, to help provide 4,500 homes
• DN7 initiative in Doncaster, to help provide over 3,000 new homes
• New Lubbesthorpe development in Leicester, to provide over 4,000 homes
• development of North Wellingborough, to help provide 3,000 new homes
• redevelopment of Arborfield Garrison in Wokingham, to help provide 2,000 homes
• Langarth development in Truro, to help provide 1,500 homes
• Cheeseman’s Green development in Ashford, to help provide 1,500 homes
• Dallington Grange development in Northampton, to help provide 3,400 homes
• development at Lawley Village in Telford, to help provide 2,500 homes
• Newcourt Urban Extension in Exeter, to help provide over 2,000 homes
• East Kettering development, to help provide 5,500 homes
• development at Hunts Grove in Gloucester, to help provide 1,750 homes
• Barwell development at Hinckley and Bosworth, to help provide 2,500 homes
• Branston Locks development in East Staffordshire, to help provide 2,500 homes
• development at the Festival Gardens site in Liverpool, to help provide over 1,500 homes
• Bath Riverside development, to help provide nearly 1,900 homes
• Colchester North Growth Area Urban Extension, to help provide 1,600 homes
• Weston Airfield development in North Somerset, to help provide over 2,500 homes
• Ebbsfleet Valley, to help provide over 3,500 homes – this site forms 1 part of the larger area that the proposed Ebbsfleet Development Corporation would cover as part of the 15,000 home Ebbsfleet Garden City initiative
• Overstone Leys development in Daventry, to help provide 2,000 homes
• North West Bicester development, to help provide over 5,500 homes
• Welborne development at Fareham, which will help provide 5,400 homes
• Middle Deepdale development at Scarborough, which will help provide 2,300 homes
• Thetford North development in Breckland, to help provide 5,000 homes
• Lincolnshire Lakes development in Scunthorpe, to help provide 3,500 homes
• Whitfield development in Dover, to help provide over 5,700 homes
• Bela Priors Hall development in Corby, to help provide nearly 3,000 homes
• Alphington development near Exeter, to help provide 1,500 homes
• West Witney development in Oxfordshire, to help provide 1,500 homes.

The first wave of projects to benefit from a UK government £1 billion scheme to provide new homes has been announced with 36 large projects set to get a share.

Communities Secretary Eric Pickles said the move will unlock or accelerate the provision of over 200,000 new homes across the country.

Some £850 million will be released as part of a five year £1 billion programme and five projects will be chosen from a shortlist of 36. The funding will be used to build the infrastructure needed to provide schemes of at least 1,500 homes.

The money will go towards the building of road improvement, schools and parks to support the extra homes being planned and the shortlisted projects will now go through a final rigorous due diligence process before receiving the funding.

Sites include the continued development of the Greenwich Peninsula in South East London, which will help provide nearly 10,000 new homes, while funding is also expected to go to Ebbsfleet Eastern Quarry, to help provide 3,500 homes.

‘Residential construction is now at its highest level since 2007 and continuing to rise, and 216,000 new homes were given planning permission last year. We are supporting locally led development, and this £1 billion programme will help unlock or accelerate over 200,000 new homes across the country,’ said Pickles.

‘This is part of our wider package of housing programmes to support home ownership, increase investment in the private rented sector and further increase house building,’ he added.

Pickles explained that the funding will be available between 2015 and 2020 and will be in the form of a long term loan, with interest, ensuring a fair rate of return for taxpayers.

As well as the £1 billion loan funding, the large sites infrastructure programme also includes £12.5 million capacity funding and expert planning and technical support for councils dealing with large scale sites, as well as brokerage support from central government to unblock obstacles to development.

The shortlisted projects are in Greenwich, east London, Rugby, Monkton Heathfield just outside Taunton, Doncaster, Bishop Stortford, New Lubbesthorpe in Leicester, North Wellingborough, Wokingham, Truro, Ashford, Northampton, Telford, Exeter, East Kettering, Gloucester, Hinckley, Branston Locks in East Staffordshire, the Festival Gardens site in Liverpool, Bath, Colchester, Weston Airfield in North Somerset, Ebbsfleet Valley, Daventry, North West Bicester, Fareham, Scarborough, Thetford North, Ealing, Scunthorpe, Dover, Chelmsford, Corby, Alphington near Exeter, Wood Wharf in London and West Witney.

The £1 billion large sites infrastructure fund is one part of a wider package of support to get large scale housing developments back on track. Other support includes a £12.5 million local capacity fund to enable councils to put in place the skills and resources to move major schemes forward through the planning process.

The government has already helped unlock a range of large scale sites across the country. These include Sherford near Plymouth, where £32 million government investment is being put towards the road improvements needed to support over 5,000 new homes, schools, shops and communities facilities.

In Cranbrook near…

Residential property price growth in Australia has moderated with values in capital cities up just 1.7% in the second the second quarter of the year.

The latest figures from the Australian Bureau of Statistics show that while prices are still on an upward trajectory they are not growing as fast as they were a year ago.

This means that prices are easing back to a more sustainable pace, according to the Housing Industry Association (HIA), the voice of Australia’s residential building industry.

‘Capital city residential property prices grew by 1.7% during the June 2014 quarter. While this pace was slightly faster than in the March quarter, this growth is more modest compared with what occurred during mid to late 2013,’ said HIA economist, Diwa Hopkins.

‘During that period, residential property prices were increasing between 2% and 4% per quarter. While it’s too early to call a trend, the signs are mounting that price growth is easing back to a more sustainable pace,’ she explained.

She pointed out that annual growth reached what looks to be a cyclical peak rate of 10.9% in the March 2014 quarter. This rate eased back to 10.1% per annum in the June quarter.

Residential property prices in Sydney continue to grow the most rapidly, in both quarterly and annual terms but growth rates remain highly divergent across the different capital cities.

‘Steady and sustainable price growth reinforces confidence in the market and is a key ingredient to achieving healthy levels of new home building activity. We expect starts to break through 180,000 in 2014, following nearly 170,000 last year,’ said Hopkins.

‘Continuing improvements in the supply of new homes will be important in taking some of the momentum out of house price pressures, and we may already be seeing early signs of this,’ she added.

A breakdown of the figures show that over the June 2014 quarter, residential property prices increased fastest in Sydney with growth of 3.1%. In Brisbane they increased by 1.8, in Melbourne by 1.3% and in Adelaide by 1%.

Canberra saw prices increase by 0.8%, Darwin by 0.7% and Hobart by 0.3% while prices fell in Perth by 0.3% during the June 2014 quarter.

Hopkins also pointed out that the ABS Residential Property Price Indexes may be discontinued as part of reductions to the ABS work programme and said this was a blow to the real estate industry.

‘There have already been significant cuts to data provision for the housing industry in recent years. At a time when governments and businesses need more not less official information about economic conditions, the reduction in ABS data represents a cost to the economy, not a saving,’ she said.

Residential property price growth in Australia has moderated with values in capital cities up just 1.7% in the second the second quarter of the year.

The latest figures from the Australian Bureau of Statistics show that while prices are still on an upward trajectory they are not growing as fast as they were a year ago.

This means that prices are easing back to a more sustainable pace, according to the Housing Industry Association (HIA), the voice of Australia’s residential building industry.

‘Capital city residential property prices grew by 1.7% during the June 2014 quarter. While this pace was slightly faster than in the March quarter, this growth is more modest compared with what occurred during mid to late 2013,’ said HIA economist, Diwa Hopkins.

‘During that period, residential property prices were increasing between 2% and 4% per quarter. While it’s too early to call a trend, the signs are mounting that price growth is easing back to a more sustainable pace,’ she explained.

She pointed out that annual growth reached what looks to be a cyclical peak rate of 10.9% in the March 2014 quarter. This rate eased back to 10.1% per annum in the June quarter.

Residential property prices in Sydney continue to grow the most rapidly, in both quarterly and annual terms but growth rates remain highly divergent across the different capital cities.

‘Steady and sustainable price growth reinforces confidence in the market and is a key ingredient to achieving healthy levels of new home building activity. We expect starts to break through 180,000 in 2014, following nearly 170,000 last year,’ said Hopkins.

‘Continuing improvements in the supply of new homes will be important in taking some of the momentum out of house price pressures, and we may already be seeing early signs of this,’ she added.

A breakdown of the figures show that over the June 2014 quarter, residential property prices increased fastest in Sydney with growth of 3.1%. In Brisbane they increased by 1.8, in Melbourne by 1.3% and in Adelaide by 1%.

Canberra saw prices increase by 0.8%, Darwin by 0.7% and Hobart by 0.3% while prices fell in Perth by 0.3% during the June 2014 quarter.

Hopkins also pointed out that the ABS Residential Property Price Indexes may be discontinued as part of reductions to the ABS work programme and said this was a blow to the real estate industry.

‘There have already been significant cuts to data provision for the housing industry in recent years. At a time when governments and businesses need more not less official information about economic conditions, the reduction in ABS data represents a cost to the economy, not a saving,’ she said.

With the football season starting in the UK an annual analysis of the price of homes close to Premier League football grounds shows that they have increased by 129% over the last 10 years.

The average house price in the surrounding postal districts of the 20 clubs contesting the Premier League for 2014/2015 is now £329,520, some £79,918 higher than the average for the whole of England and Wales which is £249,601.

This is more than double the 55% increase in house prices across England and Wales as a whole over the same period, the research from the Halifax shows.

This represents an average increase of £185,478 during the past decade; from £144,042 in 2004 to £329,520 in 2014, and is equivalent to a weekly rise of £386.

The biggest increases in value have been seen in homes close to Manchester City’s Etihad Stadium, where the average home value in this postal district has risen by 150% over the decade.

The area around Hull City's KC Stadium has seen the second biggest increase with a rise in average property prices of 123% and house prices around Chelsea’s Stamford Bridge ground have recorded the third biggest rise of 121%.

Newcastle United finished bottom of the Premier League house price table with the average value of properties close to its home ground falling by 22% between 2004 and 2014, the only stadium to record a decline in prices over the past decade.

Despite not seeing the largest percentage increase in prices, the postal district covering Stamford Bridge in SW6 is the most expensive area to live in currently, with an average house price of £959,522. This is more than 15 times the average price in the least expensive Premier League postal district of L4 which is home to both Liverpool and Everton Football Clubs.

At £329,520, the average house price outside a Premier League ground in 2013 may not stretch a Premier League footballer as average wages reportedly topped more than £30,000 a week in 2013 but it’s a different story for everyone else, as this is10 times higher than national average gross annual earnings.

Nevertheless there are some variations, and while four of the five least affordable Premier League postal districts are in London, it’s not the same story at other grounds around the country. Chelsea has the least affordable Premier League postal district with the average property price of £959,522 being 18.4 times gross average earnings in the area. Arsenal at 11.7 times is in the second least affordable postal district, followed by Queen Park Rangers at 10.6 times and Tottenham Hotspur 8.7 times.

However, at the other end of the league, the postal district L4 for Liverpool and Everton Football Clubs is the most affordable Premier League postal district with the price of the typical home just 2.2 times gross annual average earnings.

‘With the Premier League hailed by many as the best in the world, for many clubs some of this success also seems to have rubbed off on the…

Closing down businesses and laying people off is not the same as creating synergies, Balfour Beatty has pointedly said this morning.

In a rallying call to shareholders to keep the faith, Balfour Beatty’s board has put out another wordy statement that seeks to maul Carillion’s analysis of merger benefits.

Yesterday Carillion set out details of how it expected to make synergy savings of £175m through a merger. (See previous report here.)

Balfour Beatty retorted that Carillion’s plan meant cutting its £2.8bn a year UK construction business to just £900m. Balfour Beatty said that it planned to grow, not scale back, and said Carillion’s assumptions were flawed.

Today Balfour Beatty’s board has issued a more detailed analysis of Carillion’s business plan, once again affirming its rejection of the merger proposal.

It said: “The board believes the proposed plan involves reducing Balfour Beatty's UK construction revenues by up to two thirds. Such rescaling would require a significant reduction in overheads, just to maintain current margins (equivalent to over 6% of the lost revenue).  This cost reduction will reduce the amount of available synergies that flow through to profitability. Cost savings driven by shrinking the business should not be confused with synergies. These reductions in cost will reduce the amount of the £175m that could enhance profitability.

“A smaller UK construction business would have a lower addressable cost base, further reducing the potential synergies available from any transaction. Incremental value for shareholders can only be generated by increasing absolute profit and cash returns.”

It also said that keeping Parsons Brinkerhoff rather than proceeding with the sale “exacerbates the scale of the challenge at a time when the management team would be undertaking a fundamental downsizing of the UK construction businesses”.

Balfour Beatty said that Carillion’s axe would come down heaviest on its UK Regional construction business, which accounted for £1.8bn of last year’s £2.8bn UK construction revenues. Yet the Regional business is the “best placed to benefit from any recovery in UK construction, and is already showing signs of such a recovery”, Balfour said.

It also said that Carillion’s sums failed to take into account the overlap between the businesses of the two competitors. “This could result in revenue and profit leakage,” Balfour said.  

Carillion’s plan to stop the Parsons Brinckerhoff sales process remains a massive stumbling block for Balfour Beatty. This is what caused the merger talks to collapse in the first place and move into hostile takeover phase. (See our 31 July report here.)

“Terminating this process risks damaging a significant part of the value of Balfour Beatty,” it said today.

Balfour Beatty is seeking to persuade its shareholders that its own plans for the business are better than Carillion’s axe.

It plans to close some regional offices and make some reductions to overheads, sell Parsons Brinckerhoff and refocus as an Anglo-American construction and specialist services group. Joint ventures in Asia and the Middle East will be retained subject to them being value accretive.

More selective tendering to focus on repeat customers, frameworks and larger contracts over £5m will “result in a large reduction in the number of contracts but only a modest reduction in revenue”.

Balfour Beatty said that its own strategy was already showing signs of success. “Balfour Beatty has already demonstrated that cost savings can be achieved independently of a merger; £70m of annualised cost savings have been delivered over the last three years,” it said.

“We will continue to demonstrate this plan is working by sharing leading indicators on a periodic basis, including on the size, composition and margin of our order book and in respect of overhead efficiencies. Our plan of progressive but substantial improvement avoids operational and value destruction risks, and leaves it much better equipped to exploit the market recovery that is under way.”

Annual rent rises in England and Wales have increased to 2%, the first real time growth since September last year, to average £753 per month, the latest index shows.

It means that rents have returned to levels last seen in November 2013 but the rise is just 0.1% when inflation is taken into account, according to the index from LSL Property Services.

The report also shows that tenant finances have improved with 7.3% of rent in arrears, down from 7.8% in June and 8.1% last July. But landlords have seen total returns moderate, down to 10.3% per annum as property price rises cool.

‘The rental market is approaching its busiest period yet rent rises remain modest. However, tenants looking to rent a new property this month still need to budget the same as they would have in November. At a time when the UK is facing a serious shortage of homes, and with purchase prices rising steadily, that is an immense achievement for the private rented sector,’ said David Brown, commercial director of LSL Property Services.

‘Rents have tracked inflation for many years and as of July remain down 0.2% in real terms since the start of 2010. This is testament to serious improvements in the supply of new homes to let, thanks to investment by landlords. If that investment keeps flowing, and the right incentives for new landlords remain, this positive trend should continue,’ he pointed out.

A breakdown of the figures show that rents in nine out of 10 regions are higher than a year ago. The fastest annual increase is in the South East, where the average monthly rent is now 3.8% higher than in July 2013.

This is followed by a 3% annual increase in the North West, and annual rent rises of 2.3% in London. The North East is the only region where rents have dropped over the last 12 months, falling 3.8%.

On a monthly basis, eight out of 10 regions have seen rents rise in July. The fastest month on month increases are in the South East and North West, with rents respectively 1.7% and 1.6% higher than in June. Coming a close third is the East of England, where rents are up 1.5% over the past month.

Only two regions have seen rents fall on a monthly basis. The South West experienced a 1% monthly drop in average rents in July, while in the West Midlands rents were 0.5% lower than in June.

As of July the gross yield on a typical rental property in England and Wales stands at 5.1%. This represents a fall of 0.2% since July 2013 when the gross yield on a rental property averaged 5.3%. However, yields are steady on a monthly basis, at 5.1% over the past six months. .

Taking into account price growth alongside void periods between tenants, total annual returns on an average rental property stand…

A rebuilding of Ealing Broadway railway and tube station in west London has been approved by local council planners.

Platforms will be extended to accommodate the high-capacity Crossrail trains that will pass through the station every six minutes at peak. To cope with the extra traffic, a new ticket hall will be built and the entrance will be doubled in size. New lifts will also be installed.

Construction will now start next year, with Vinci as main contractor, and is expected to take 18 months to complete.

The new station, designed by Bennetts Associates, will have a long, curved canopy running the length of the forecourt. The façade will be replaced with a new glass structure.

Client for the project is Network Rail, whose programme director for Crossrail, Matthew Steele, said: “Crossrail is one of the most important projects that Network Rail is working on and promises to deliver huge improvements to rail transport in Ealing, west London and out to Reading. The project team are committed to delivering these important works efficiently and in partnership with the local authority.”

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Property bridging loans have provided investors with the greatest annual returns and the lowest volatility across a range of alternative asset classes, according to the latest research.

In the 12 months to the end of June, private investors in short term secured loans have seen a total annual return of 10.5%, almost twice the 5.3% return from collectable art, and compares with negative returns for gold and wine investments.

Physical gold investments are worth 1.6% less than a year ago, while investors in fine wine have suffered an even greater loss of 16.5% over the 12 month period.

Those who invested £500,000 in bridging loans on 1st July 2013 would now see their investment worth £552,000, while the same investment in fine art would have gained approximately half as much value, to reach £526,500, according to the research from West One Loans.

If invested in gold, the same £500,000 would be worth just £492,000. However this drop represents only a fraction of the losses seen for fine wine. A £500,000 investment in fine wine would have lost more than £80,000 in the course of the last year, to be worth £417,500 as of July.

‘Economic recovery is strengthening across the developed world, led by the UK. So alternative investments are no longer a question of finding havens. Growth is on the agenda – and investors are on the hunt for ways to get involved,’ said Duncan Kreeger, director at West One Loans.

‘Property now has an enormous capacity for growth, to overcome a particularly sharp downturn and make up for the ground lost over the last five years. But while developers are in no way short of projects, finance is the tightening bottleneck to further progress,’ he explained.

‘For those private investors who can offer assistance, this is presenting enormous opportunities. Bridging loans can give individuals and smaller institutions access to the property lending market previously dominated by increasingly cautious large banks,’ he added.

When compared by volatility, the same major asset classes also favour bridging for stability of returns, with a three month standard deviation of 0.03% for property bridging loans.

Second lowest for volatility, though reflecting consistently low returns, is fine wine, with a volatility of 1.6% over the last three months. Meanwhile, fine art has seen a three month volatility of 1.7%, a considerable improvement since art investments saw a peak in volatility earlier in 2014. However, these assets all compare favourably with gold, which saw volatility spike over 10% in the three months to July.

‘Sophisticated investors are looking to alternative assets as a new way to navigate risk and return, spreading their capital between a greater variety of asset classes. But alternatives are also about new ways of linking the investor to the asset. For example, physical gold or art works are an excellent way to hedge against more mainstream markets but the ownership and investment structures are…

Housing maintenance contractor Mears and trade union representatives have agreed to talks with the arbitration agency ACAS.

Mears has withdrawn its proposal to de-recognise the unions GMB, Unite, Ucatt and Unison at its Brighton & Hove City Council contract and the unions have called off a planned protest demonstration.

As previously reported, Mears was looking to change the contract conditions of workers it had taken over from the council when the service was outsourced.

All parties will meet with the Advisory, Conciliation & Arbitration Service (ACAS) on 12^th September.

GMB branch secretary Mark Turner said: “Although we are very pleased to see Mears reverse their decision on de-recognition, the joint trade unions are fully aware that there is still a lot of work to be done on both sides at the meeting planned for September. Having ACAS involved to both facilitate and lead those discussions is a further positive step. It should do much to ensure that all sides are happy with any end agreement and that going forward all parties then work within the spirit of that agreement."

GMB organiser Gary Palmer added: “Mears conciliation in removing the threat of de-recognition means the joint unions will immediately reciprocate and therefore we have agreed to halt all planned actions against them, including in the first instance the August 19th Brighton race day demonstration. I look forward to now sitting down with Mears and ACAS to settle our differences and move forward within the spirit of an approved agreement."

A £12.8m programme of works starts in September to improve harbours links in Cornwall and the Isles of Scilly.

The government has allocated £7.3m of funding towards the scheme to improve harbour infrastructure at both St Mary’s and Penzance plus a further £1.8m to repair and resurface public roads on the island.

The harbour scheme will see the pier extended and widened at St Mary’s, along with provision of new freight storage facilities and improved access for passengers. It also includes dredging and some highway improvements in Penzance.

The roads funding for the Council of the Isles of Scilly will fund resurfacing for the majority of the local road network on the island and is a one off payment. The work will be done at the same time as resurfacing of the island’s runway, while all the necessary plant and machinery is already on the island.

The harbour infrastructure works are expected to begin this September and be completed by June 2015, with the St Mary’s Quay extension to be complete by March 2015 ahead of the summer season.

The Miami residential real estate market continued to see rising prices in the second quarter of 2014 due to strong demand, according to the latest report from estate agents.

The data from the Miami Association of Realtors show that there is particularly strong demand for single family homes priced between $200,000 and $400,000.

Overall the median sales price for homes in Miami-Dade County was $245,000, an increase of 8.9% compared to last year, while the median sales price for condominiums rose 5.6% to $190,000.

The market has now seen prices increase for 10 consecutive quarters for both single family homes and condominiums with demand from both domestic and overseas buyers.

‘While supply is growing and creating more balance between buyers and sellers, inventory in certain price points and market segments remains tight, particularly for single family homes. Financing for condominiums is still difficult to obtain, a fact that is hurting sales for this property type,’ said Liza Mendez, chairman of board.

Compared to last year, the average sales prices for single family homes and condominiums increased 3.5% to $460,018 and 6.7% to $375,941, respectively.

While in the whole of Florida the median sales price for single family existing homes in the second quarter was $180,000, up 5.3% from the same quarter a year ago and for condominiums it was up 10.1% to $142,000.

There were 8,139 homes and condos sold in Miami-Dade County during the second quarter of 2014, a negligible decrease of 0.9% compared to the second quarter of 2013, when there was record sales activity. Sales of single family homes increased 4.9% and condominium sales decreased 5.2%.

However, sales of single family homes priced between $200,000 and $400,000 surged 68% in the second quarter while sales of condominiums priced between $100,000 and $400,000 increased 35%.

‘As the Miami real estate market continues to normalize and perform in a healthy manner, there are increased opportunities for all types of buyers. While inventory is still limited depending on the area and price range, buyers generally have more to choose from and prices remain at affordable 2003 levels,’ said Francisco Angulo, residential president of the Miami Association of Realtors.

The Association also said that its initiatives to increase inventory and focus on assisting members to get more listings has proven successful along with some additional distressed properties coming on the market. The fact that sales remain at historically strong levels while inventory is growing points to seller confidence, it said and sellers are listing properties for sale because they have confidence in the market.

Home and condominium listings also increased in the second quarter but by narrower margins. There were 8,635 new single family home listings during the second quarter, a growth of 4% compared to a year ago. New condominium listings increased 3.8% from 6,025 in the second quarter of 2013 to 6,255 this year.

At the current sales pace, current inventory represents 5.5 months of inventory for single family homes and 7.8 for condominiums. Compared to the second quarter of 2013, supply…

There has been a huge surge in student housing investment activity in the UK over the last two years, according to a new analysis paper from Savills.

There was £5 billion worth of standing stock and development sites sold in 2012 and 2013, and the early signs for 2014 suggest there will be similar high levels of investment activity this year.

Indeed, the latest data shows that in the first four months of the year, there have been transactions worth £950 million and this equates to over 17,000 beds, above the level seen in the same period of 2013 and well above previous years including 2012.

The report points out that with a further £1.4 billion worth of investments on the market Savills expects to see activity in the region of £2.5 billion by the year end.

According to Yolande Barnes, Savills director of world research, the lower volume of investment activity in 2013 relative to 2012, some 33% less compared to only 18% fewer beds traded reflects an important trend. She also pointed out that 2013 saw a substantial increase in the number of deals in prime regional markets which were up 76%.

‘This trend is likely to continue given the attractiveness of the student housing sector to investors, although investors will have to bear in mind some of the risks,’ she said.

‘We saw some compression of blended average yields in the sector over the last year, with average initial yields falling slightly to 6.2% compared with 6.3% previously. This reflects the increased competition for investments in prime London and super prime regional markets,’ explained Barnes.

‘Although activity in prime and secondary regional markets increased by 80% last year, yields remained relatively static reflecting the riskier profile of student demand in these markets,’ she said.

‘For 2014, we are forecasting total returns of 13.7%. This is comprised of average blended yields compressing to 6.0% and rental growth of 3.5%,’ she added.

The report points out that the introduction of university fees for UK domiciled undergraduates has led to falling student numbers in the 2012/2013 academic year. However, UCAS application data suggests that numbers are recovering, but a close look at the figures shows evidence of a flight to quality emerging.

It also points out that there is a lack of certainty over the position of tuition fees in the event of Scotland gaining independence. Under European Union law it is possible to discriminate against students from other parts of the member state but not those from other parts of the EU. It appears likely that the government would charge all students the same fee but offer Scottish domiciled students a grant equal in value to the fees. This leaves the future position of other EU students studying for free in Scotland uncertain.

Savills has expanded its analysis of how the purpose built student accommodation sector can play its part in solving the housing crisis and identified 77,000 student properties across the UK that, with the provision of more…

Much has been written about the property market in prime central London cooling but there are now signs that this is spreading to other parts of the country as asking prices begin falling.

Price rises are slowing down in response to rising supply and the average asking price for a flat has actually dipped slightly since July to £161,956, ending a 14 month rally, according to the latest asking price data from Home.co.uk.

Less affected by supply issues are detached, semi and terraced properties and asking prices are continuing to rise for the time being overall but home prices have dropped back during the last month in some regions.

The relatively strong regional markets of the South East, South West, East Anglia and Yorkshire have seen asking prices fall by 0.1%, the first time this has happened this year and is regarded as further evidence of a cooling market.

Greater London posted a more muted month on month asking price rise of 0.3%. Price rises in other English regions, Scotland and Wales since July were all similarly modest at 0.2% or less with the exception of the East Midlands where asking prices increased by 0.5%.

It means that the average annual appreciation for England and Wales fell by 0.3% to 9.3% as the dynamics in the residential property market show signs of changing. The increase in supply was particularly high in Greater London, up 39% compared with a year ago.

‘Record prices in Greater London have tempted many more potential vendors to sell. Supply is up 39% but we must remember that it is rising from an ultra-low level. Some 14,720 properties entered the market last month which is 31% less than the 20,615 properties that were placed on the market in August 2008. Such is the demand in London that supply would need to much more before price stability was seriously threatened,’ said Doug Shephard, Home.co.uk director.

‘If we look at the wider supply dynamics across the rest of the country it is clear that buyer demand is certainly lower than it was before the financial crisis of 2007, but supply remains very low indeed. On the demand side, mortgage lending is working and interest rates remain very favourable for the time being,’ he pointed out.

But he added that on the other hand supply has increased by just 6% over the last 12 months across the UK. Outside of London, the largest rises in supply were found in the West Midlands and in Wales with 9% and 8% growth respectively year on year.

‘Such modest increases, from what is a record low level, are hardly likely to cause a crash any time soon, but they will help tame price rises and that will both help stabilise the market and be welcome news for aspirant buyers,’ said Shephard.

The report also reveals an end to the improving trend observed in the slower markets in terms of marketing times. In August 2013, only four regional markets, London, the South East, East…

Balfour Beatty has dismissed Carillion’s proposed business plan for a merger of the two businesses, insisting that it wants to grow its construction business, not whittle it down to a third of its current size, as Carillion is proposing.

This morning Carillion said that it plans to have only a third of the combined profits of the two companies coming from construction, with the bulk of the money coming from support services, such as serving school dinners and cleaning office, and from investments.

In its statement, Carillion said it was the better managed business and if it got its hands on Balfour Beatty it could make that better too.  While Carillion is implicitly critical of Balfour Beatty management – perhaps suggesting that not many of them would keep their jobs for long after a merger that increasingly clearly would be a Carillion takeover – Balfour Beatty’s board is no less critical of Carillion’s thinking.

Balfour Beatty says that Carillion wants to retain Parson Brinkerhoff – the US engineering subsidiary that Balfour Beatty is in the process of selling – without providing any strategic rationale for it, other than that the turnover it generates would be nice to have.

It said of Carillion’s plans: “Several key business plan assumptions suggest an analysis based on the integration of businesses smaller than Carillion’s, rather than one that is substantially larger. In particular, the substantial rescaling – possibly by up to two thirds – in the revenue of Balfour Beatty’s UK construction business would eliminate future earnings recovery potential. It would also incur cash outflows of many hundreds of millions of pounds of restructuring costs and working capital.

“As a result, the board of Balfour Beatty has serious reservations as to the achievability of the stated synergy number and believes that it creates unacceptable operational and financial risks. In contrast, Balfour Beatty has clear plans for developing rather than partially eliminating the UK Construction Services business, including achieving future cost savings where 100% of the benefits achieved would accrue to Balfour Beatty shareholders.”

Balfour Beatty adds: “Carillion continue to require Parsons Brinckerhoff to remain part of the potential combined business, without providing any strategic or value related logic for its retention, other than for financial presentation purposes. Balfour Beatty has been clear that Parsons Brinckerhoff has not provided synergistic benefits for the group over five years of ownership, and this has not been disputed by Carillion. Their proposed approach would result in the likely termination of the Parsons Brinckerhoff sales process. This risks damage to that business, as well as eroding its competitive position, and potentially resulting in a loss of value to our shareholders.”

Mortgage arrears and possessions in the UK continued to fall in the second quarter of 2014, according to the latest data published by the Council of Mortgage Lenders.

The number of mortgages in arrears of 2.5% or more of the balance stood at 131,400, or 1.18% of all mortgages, at the end of June, down from 138,200 or 1.24% three months earlier and 154,900 or 1.38% a year ago.

The figures shows that there was a fall in numbers across all arrears bands, and the overall total is now at its lowest since the first quarter of 2008.

A total of 5,400 properties, representing 0.05% of all loans, were taken into possession in the second quarter, down from 6,400 in the preceding quarter and 7,600 a year ago. At 11,800, the number of cases of possession in the first half of this year was at its lowest since the second half of 2006.

The totals reported include arrears and possessions in the buy to let sector, which also continued to decline. The number of buy to let mortgages in arrears of three months or more, including cases in which a receiver of rent had been appointed, stood at 13,400 at the end of June, down from 14,700 three months earlier and 17,900 a year ago. In the second quarter, 1,300 buy to let properties were taken into possession, compared to 1,400 in the previous quarter and a year ago.

The figures are broadly in line with the CML’s revised forecast of 135,000 mortgages in arrears at the end of 2014, down from 150,000, and 25,000 cases of possession in the year, down from 28,000.

‘Another fall in arrears and possessions is clearly welcome and shows that borrowers, lenders and money advisers are generally continuing to work well to contain payment problems where they arise, helped by an improving economy and low interest rates. But rates will rise at some stage, of course, and borrowers should be planning for that now,’ said CML director general Paul Smee.

‘We welcome the message from the Bank of England that, when it raises rates, it plans to do so in a series of baby steps, matched to a careful assessment of the ability of households to deal with higher borrowing costs. Any borrower anticipating payment problems should talk to their lender as soon as possible. Today's figures continue to show that in many cases it is possible to work through a period of difficulty, with lenders committed to helping borrowers get their finances back on track,’ he added.

Figures released by the Finance & Leasing Association (FLA) confirm the picture. They show a 27.3% fall in second charge mortgage repossessions in the second quarter of 2014 compared with the same period last year. In the first half of 2014, repossessions were down by 36.2%.

‘The low number of repossessions is what we would expect to see in this market given lenders’ approach to forbearance. The forecast for 2014 suggests that the…

David Fison, who moved from leading a major contractor to leading a smaller family firm, has said that employees set to be made redundant in the wake of mergers and acquisitions have nothing to fear.

In what sounds like a call to come and join him at Osborne, David Fison says that the big company efficiency savings could benefit smaller firms.

He adds that working life at smaller companies can have a lot to offer.

Mr Fison joined family-owned Osborne as chief executive in 2009 after being sacked as chief executive of Skanska. Before that he was head of civil engineering at Balfour Beatty, where he worked for many years.

Without actually naming Balfour Beatty, his comments are clearly designed to be heard by his former colleagues who may become victims of merger synergies and tossed overboard.

He says: “I am watching the merger moves of the large contractors and consultants with great interest. It is what big companies do to gain market share and maximise earnings by cutting costs through combining teams, offices, etc. What that means of course is laying people off, often the most experienced and therefore most expensive – usually described in press releases as ‘creating synergies’. But this is happening at a time when the construction industry is becoming increasingly aware that it faces major issues over resources, by which I mean people as well as materials and plant.

“Various reports suggest that the industry lost 300,000 people during the recession. Another 300,000 are due to leave in very short order as the baby boomers of the 1940s hit retirement age. Replacing them will not be easy or quick. As investment in infrastructure and construction generally ramps us – with predictions of a 10% increase in workload over two years, having enough good quality, trained people is going to be the deciding factor in what work firms have the capacity to bid for and deliver. The anticipated synergies in those big mergers may not evolve as companies find they need to hang on to resources. But if they don’t, big company efficiency savings look like being to the benefit of smaller companies.

“Most small businesses have a longer horizon, less ambitious profit ambitions and can offer secure job opportunities for construction staff. The jobs may not be so big but we are closer to our customers, more agile, and value what individuals have to offer. For staff, and in fact for clients, it’s a bit like choosing a restaurant. You can go to a top class hotel with formal service or the local restaurant round the corner. Both give you good food to suit your budget but with a different style. It’s just about making the choice. Smaller businesses have a lot to offer, I believe. We are looking forward to welcoming new recruits going forward.”

Having been twice rebuffed by Balfour Beatty’s board, Carillion is now going over its head directly to shareholders.

Carillion has revealed that it has spent the week in meetings with several of Balfour Beatty’s major shareholders persuading them of the merits of a merger for the two companies.

Carillion says that if it gets its hands on Balfour Beatty it can achieve savings of £175m a year by combining the overheads of the two companies, primarily by imposing on Balfour Beatty what it regards as Carillion’s lower cost operating systems.

Carillion says that it has identified synergies across:

• back office, head office, and support function savings as well as from applying Carillion’s business operating model to Balfour Beatty’s UK business – £82m a year saved here.
• supply chain: using Carillion’s category management and demand planning solution, and through purchasing and procurement efficiencies – £36.5m a year to be saved here.
• information and communications technology (ICT): using Carillion’s outsourced back office solution, and through standardisation of systems and processes – £13m a year saved here.
• consolidation of the two groups’ property portfolios in overlapping areas, including head office, would save £17.5m a year.
• plus a further "£26m of annual recurring cost savings from agency labour, fleet, insurance and general overhead savings, including through the application of Carillion’s lean operating structure".

If the merger goes ahead before the end of this year, 40% of these synergies would be realised by the end of 2015 and the full 100% by the end of 2016, Carillion has been telling shareholders.

However, the restructuring would cost £225m to implement.

On Monday Balfour Beatty issued a statement setting out in detail why it had rejected Carillion's merger proposals. (See previous report here.) Carillion is clearly not yet ready to walk away.

Carillion has proposed that Balfour Beatty’s shareholders receive an additional cash dividend (or equivalent) of 8.5 pence per Balfour Beatty share (£59m in total) at the time Balfour Beatty’s final 2014 dividend would have otherwise been paid in 2015. This would be in addition to the final 2014 dividend they would be entitled to receive as shareholders in the enlarged group.

Carillion’s envisaged business plan for the group is to refocus significantly the UK construction services business, similar to the rescaling it undertook of its own construction business, avoiding low margin projects.

Growth would be focused on support services. Under Carillion's guidance, two-thirds of the combined group’s operating profit would derive from services and investments with just one-third coming from construction. This is despite Balfour Beatty being the UK's biggest construction company. Last year Balfour Beatty made £2.8bn revenue from UK construction alone. Carillion only turned over £3.3bn across its entire group.

In a statement this morning Carillion’s board said: “Carillion continues to believe in the powerful strategic logic and financial benefits of a merger with Balfour Beatty and is therefore continuing to consider its position. Carillion will make a further announcement in due course.”

In a separate statement today Carillion also reported its financial results for the first six months of the year, showing 5% rise in profit and a further 5% decline in turnover. (See report here.)

Demand for new homes in the UK fell slightly in July, the first monthly decline since January 2013, according to the latest residential market survey from the Royal Institution of Chartered Surveyors.

At the same time the supply of new properties coming onto the market increased for the second consecutive month and as a result of the rebalancing in demand and supply, house price growth across the UK appears to be moderating.

The RICS report suggests that the housing market has paused, with a net balance of 49% more respondents reporting an increase in prices in July, down from 52% in June and 56% in May.

In London, both sales and new buyer demand fell more sharply than elsewhere, with enquiries falling at their fastest rate since April 2008 and a net balance of 10% more respondents reporting an increase in prices, down from 30% in June.

The average number of sales per chartered surveyor, however, increased to 24.6, up from 21.1 at the start of the year, and sales expectations remain positive across the country, albeit a little less so than previously.

While there is a little more member caution reflected in the comments, prices are still projected to rise nationally over the next year and expected to increase by 2.6% on a 12 month view compared with around 4% at the start of the year. Surveyors in Scotland appear most optimistic, anticipating a price gain of 3.3%.

Loan to Value ratios on mortgages were little changed during the month but the results, nevertheless, show that lenders are now a little more circumspect in providing finance to the more expensive parts of the market. The average LTV mortgage for a first time buyer in the capital remained below 78% for the second successive month, which compares with an average close to 81% during the early part of the year.

‘A range of policy initiatives adopted by the Bank of England in recent months alongside heightened expectations surrounding a turn in the interest rate cycle has clearly had an impact on sentiment in the market,’ said Simon Rubinsohn, RICS chief economist.

‘The shift in the mood music amongst potential buyers in the London market has been particularly pronounced but that is in a sense consistent with the move to a more sustainable market in the capital,’ he explained.

‘Elsewhere around the country, the market in general is showing a greater degree of resilience, but that largely reflects the fact that in some areas the recovery has only recently taken hold and affordability is rather less stretched. Significantly, members now expect price gains over the next year to be faster outside of the capital, than in it,’ he added.

Peter Rollings, chief executive officer of Marsh & Parsons, said the data shows that the market has settled into a more sustainable rhythm. 'The housing market hit the ground running at an unbelievable pace at the start of this year, but it couldn’t maintain this speed long term and as we move into…