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There are further signs that the central London prime property market is slowing with the latest report from agents showing viewings and registrations falling.

Sandfords called the top of the London market several weeks ago as signs of a slowdown in buyer activity appeared, and now they report further evidence, declaring that viewing levels and applicant registrations have descended.

‘Following a sustained period of rapid growth, signs of a slowdown in the prime central London market are becoming progressively evident and price levels have topped for the time being,’ said director Andrew Ellinas.

‘In May, the average number of viewings declined, demonstrating an ease in demand levels and, although prices have not yet fallen, they have stalled,’ he added.

A yearly picture shows that things have, in actual fact, changed quite considerably with a 45% decline in viewing figures. Applicant registrations have also fallen and, compared to this time last year, a 40% decrease has been reported by Sandfords.

Ellinas believes that the cause responsible for the slowdown is simple; buyers are refusing to pay the current asking prices for properties in central London, after they rocketed out of control.

‘Prices surged to unbelievable levels and it is only now that buyers are putting a stop to such premiums. We estimate that 45% of the properties we are instructed to sell are now over priced by 10% and an additional 25% of properties by as much as 20%,’ he pointed out.

‘A small percentage of our current stock has recently been reduced in price as some vendors recognise this recent change in the market, but all vendors need to be willing to follow suit if they want to sell their property in what has become an uncertain market,’ he explained.

‘When the market presents its challenges, as it is doing now, my advice for vendors is to instruct the local specialist who can make things happen when they are more difficult. Not all agents can perform when things get tough,’ he concluded.

The UK government is lending £60 million to local councils so that they can build affordable homes over the next two years.

Housing Minister Kris Hopkins said that 15 councils will be able to borrow funds to build over 1,000 homes in their area and he also launched a second round of bidding to ensure councils make full use of this opportunity.

‘Councils asked for extra borrowing powers and we have delivered. Now 15 authorities from across the country will get a share of £60 million of borrowing to deliver over 1,000 affordable homes,’ said Hopkins.

He pointed out that another £240 million borrowing power is still available. ‘There’s £300 million extra borrowing up for grabs for the next two years. Council house building starts are now at a 23 year high and more council housing has been built since 2010 than in the previous 13 years,’ he explained.

‘But we can go further and with these new borrowing powers available I want authorities to act, and build the affordable homes their communities want,’ he added.

He also pointed out that house building is a key part of the government’s long term economic plan.
The new money is available for councils who can put in bids that meet a simple criteria; ensuring taxpayers get the value for money they rightly expect.

The councils that have successfully applied for borrowing include: Birmingham Council seeking £10.6 million to build 186 new affordable homes, Wiltshire Council for £2.7 million to build 90 affordable homes and Cheshire West and Chester Council for £7.5 million to build 23 affordable homes.

Hackney Council has applied for £2.7 million to build 74 affordable homes and Dudley Council for £6.2 million to build 123 affordable homes.

Over half of landlords in the UK say that damage to property is the top cause of disputes with tenants followed by decoration and then rent arrears.

New research from the Online Letting Agents found that 58% cited damage, 50% redecoration and 42% rent arrears and cleaning.

It also found that two thirds of landlords went to court to settle disputes and for 20% of landlords, the disputed amount was over £1,000.

The majority of landlords who experienced a dispute over rent arrears say that the average time of late payment was six weeks, while 20% had to wait over four months for payment of outstanding rent.

The research also shows that despite the importance of inventories in helping to solve disputes, a fifth of landlords admit to failing to carry out check-in and check-outs.

‘Our research shows that damage to property is a major problem for landlords during, or at the end of a tenancy and rent arrears remain a big problem,’ said Eleanor Carroll, director of the Online Letting Agents.

She found out that rising numbers of landlords are using the courts to resolve their disputes with recent figures from the Ministry of Justice showing that between January and March 2014, landlords in England and Wales went to court to make 47,220 claims to repossess property, the equivalent of 525 a day.

‘To help avoid disputes, it is vital that landlords carry out a professional inventory with a check-in and check-out at the start and end of a tenancy, to protect their property and deposit. What’s more, landlords should make regular visits to check for damage during the tenancy,’ added Carroll.

But going to court is not as simple as it might seem. Separate research shows that 62% of legal notices served by landlords on tenants were incorrect.

According to the study by Landlord Action trying to save costs by doing it yourself can be counterproductive as it means the action is at risk of being thrown out by the courts if it is not correct.

Paul Shamplina, managing director of Landlord Action, said that mistakes in eviction notices are among the most common reasons for delays and increased costs when a landlord tries to recover possession from a tenant who has an Assured Shorthold Tenancy (AST).

‘I understand the need for landlords to consider every cost but I can’t stress enough that the notice is the most important part of a possession court case and the slightest mistake can end up costing a landlord significantly more than the cost savings in extra legal fees, delays and lost rent,’ he pointed out.

The study found the top five reasons for notices being invalidated are incorrect expiry dates, failure to comply with deposit legislation, inaccurate accompanying rent arrears schedules, the method used to serve the notice and typing errors.

‘Over the last year, we have encountered an increasing number of problems with notices served by landlords and agents. As a result, our legal department has carried out a…

The Canadian Real Estate Association (CREA) has updated its forecast for home sales activity and prices for 2014 and 2015.

Little is expected to change on the sales front but nationally average home prices are expected to increase by 5.7% in 2014 but by such 0.7% in 2015.

The CREA report says that an extraordinarily bleak winter resulted in slow start to 2014 national sales activity. As the first quarter ended, sales momentum heading into spring was constrained by a continuing shortage of listings in a number of local markets. However, the rise in newly listed properties in April and May supported an increase in sales activity.

Overall, the deferral of sales and listings reflects a delayed start to the spring home buying season, with combined sales for the period from March to May coming in largely as anticipated and at average levels. These deferrals are now likely to have been largely depleted, which suggests that the strength of sales momentum heading into the summer may be transient.

CREA’s forecast for sales activity in 2014 is largely unchanged from its previous forecast published in March. At that time, interest rates had been expected to start to edge higher in the second half of the year. However, it now appears that interest rates may not begin to rise until closer to the end of the year, which remains supportive for home ownership affordability over the balance of 2014.

Sales are forecast to reach 463,400 units in 2014, representing an increase of 1.2% compared to 2013. This is little changed from CREA’s forecast of 463,700 sales, a rise of 1.3%, published in March.

Activity is still expected to remain in line with its 10 year average and to hold within fairly short reach of 450,000 units for the seventh consecutive year.

British Columbia is forecast to post the largest year on year increase in activity at 8.3% and make the biggest contribution to the increase in national sales activity. B.C.’s projected increase in sales this year largely reflects a slow start to 2013.

Alberta’s annual sales are projected to rise by 3.8% in 2014, while activity in Saskatchewan, Manitoba, and Ontario is expected to be roughly in line with 2013 levels. Sales are forecast to fall by 1.7% in Quebec, by 4.2% in New Brunswick, by 5.1% in Nova Scotia, and by 2.6% in Newfoundland and Labrador.

In 2015, the outlook for the economy, jobs and incomes is one of further improvement, accompanied by a slow and gradual increase in fixed and variable mortgage interest rates.

On balance, these two opposing factors should most benefit housing markets where sales are currently softer but prices remain more affordable. Sales in relatively less affordable housing markets are likely to be more sensitive to higher fixed mortgage rates, whether from the standpoint of higher monthly mortgage payments or qualification for mortgage financing based on the posted five year mortgage interest rate.

As such, provinces east of Ontario are expected to post the largest gains in activity in…

A three-part documentary on the construction of London’s Crossrail tunnels starts next week.

Part one of BBC 2’s Fifteen Billion Pound Railway airs on Wednesday 16th July at 9pm and follows the construction of the new train tunnels and stations under London.

The first episode, Urban Heart Surgery, follows the team of workers as they drive tunnel boring machine Ada through Tottenham Court Road station within 800mm of the operating Northern line.

Episode two, Tunnels Under the Thames, features the Bermingham father and son team working on new train tunnels under the River Thames in southeast London. It also follows project manager Linda Miller rebuilding the Victorian Connaught Tunnel under the Royal Docks.

The final episode, Platforms and Plague Pits, tracks the team building the vast new station at Canary Wharf. The cameras also join engineers as they carve out the underground caverns that will become the new stations at Liverpool Street and Whitechapel. And, it follows archaeologists as they uncover a 14th Century emergency burial ground, established ahead of the plague.

Crossrail chief executive Andrew Wolstenholme said: “The documentary series provides a unique insight into the complexity and challenges of delivering Europe’s biggest construction project through the very heart of London. Every day people walk past our construction sites unaware of the maze of tunnels that are being constructed below London’s busy streets.”

House-builder Bovis Homes Group has increased its output in the first half of 2014 by more than 50%.

Legal completions in H1 2014 reached 1,487, which is 54% more than the 963 it built in the first half of 2013, the company said in a trading update.

The first-half operating margin is expected to be at least 15%, up from 11.1% last year.

Average sales price on legal completions was £210,000, which is 11% higher than the H1 2013 average of £188,500, driven by mix and modest improvements in house prices

A record investment of 4,597 consented plots on 23 sites has been added to the consented land bank during the first half of 2014 to maintain growth momentum.

Chief executive David Ritchie said: “Bovis Homes has delivered its highest ever number of first half-year legal completions, driven by the high quality investments made during the last few years.  This is expected to lead to excellent first half results with a material improvement on last year.

"Trading continues to be robust, further increasing our confidence in delivering both strong volume growth for 2014 and an enhanced forward sales position for 2015.  The group achieved a record number of land investments during the first half year in what continues to be an active, but orderly land market.

"The group's results are now benefiting from our assertive, disciplined strategy of growth through land investment and we are well positioned to deliver our 2014 targets.  Looking further ahead we are confident that further improvements in key financial metrics can be delivered and that ongoing land investment will continue to strengthen the business and further enhance shareholder returns."

Bovis Homes Group will report its half-year results in full on 18 August 2014.

Researchers at Nottingham Trent University have developed a new building material which is as strong as MDF but is made from shredded paper.

They say that the material could be viable for use as a new type of wall board.

The study, led by civil engineering lecturer Dr Anton Ianakiev and Dr Anthony Crabbe from the School of Art & Design, established a new, rigid composite material which is paper-based but also fire and water resistant.

As yet unnamed (shreddie board?) is made from a mixture of long strands of shredded office paper and a sodium silicate gluing agent, which protects against flame and moisture.

To make it, the two materials are mixed at a ratio of 80% paper and 20% sodium silicate and then compressed at high pressures at 90°C.

The result is a composite material that removes the need to recycle the paper and is affordable, quick to manufacture, competitive against chipboard and medium density-fibreboard (MDF) and can be moulded into various shapes, including structural panels.

Dr Ianakiev said: “It’s very important that the materials of tomorrow are designed to be as sustainable as possible. Shredded paper, which is widely available, could become a viable construction material at a potentially low cost.

“The fact that it can be used to make a rigid material that is fire and water resistant will surely make it very appealing to the construction industry.”

To further exploit the material’s high stiffness, the researchers moulded it into a ribbed pattern that greatly increased its load bearing capacity.

Dr Crabbe added: “We’re very pleased with the results of moulding this composite material which performs better than chipboard in respect of its strength, versatility and its variety of potential applications.”

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Postgraduate researcher Hooi Cheah, who worked on the project, added: “Recycled waste paper really could become an important future material for the construction industry as it is a more sustainable way of reprocessing waste paper than recycling it.”

Consumers and firms in the UK are to be asked for their views on how fairness should be assessed when lenders make changes to the terms of mortgage contracts and whether the Financial Conduct Authority (FCA) needs to make changes to its rules or guidance.

In a discussion paper published today, the FCA sets out some of the factors that are considered relevant when assessing changes to mortgages contracts and asks for views on its current approach to fairness.

‘Consumers have a right to be treated fairly if their lender changes a term of their mortgage contract,’ said Clive Adamson, director of supervision at the FCA.

‘It isn't always clear though to consumers how lenders and the FCA assess fairness in this area. This paper gives an opportunity for firms and consumers to give their views on what fairness means when changes are made in the terms of this very important financial product,’ he added.

As well as inviting discussion about the operation of the current regulatory framework. There are several options for potential further action. These include providing clarity and transparency about the FCA approach to fairness and further guidance on current rules but with no changes to the current regulatory framework.

Other options include introducing new rules, for example, around the information that firms must provide to a consumer or restricting the changes that a lender could apply to mortgage contracts.

This debate will also form part of the wider work the FCA is undertaking to understand consumer expectations and how the industry can better meet the information needs of consumers.

The FCA is keen to engage with both the mortgage industry and consumers during the discussion period. Interested parties can send their views directly to the FCA. The FCA intends to have face to face meetings with consumer groups, firms and trade bodies.

First it was bricklayers, now it is plasterers who are proving in short supply as industry recovery feeds through to the later stages of the construction cycle.

The latest survey of SME building firms by the Federation of master Builders (FMB) found that skills shortages are getting worse as activity picks up.

40% of FMB members surveyed said that the workload had increased during the second quarter of 2014. Only 14% had seen a decrease. This positive balance of +26 percentage points is up from a balance of +17 points in the first quarter survey. This was the fifth consecutive quarter with a positive net balance.  

Further increases are expected. In the first quarter the balance of firms expecting an increase in business minus those expecting a decrease was +29 points. This has now gone up to +34.

One of the side effects is that skilled workers are in increasingly short supply. Plasterers, site supervisors and site managers are proving hard to find, along with bricklayers, who remain top of the ‘most wanted’ list. One in five builders also struggles to recruit plant operators and general construction operatives. Scaffolders remain the least difficult trade to hire.

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FMB chief executive Brian Berry said: “More than a third of construction SMEs tell us that they are struggling to recruit the bricklayers they need to stay on top of their workloads. Plasterers are almost as difficult to come by with 27% of firms saying they are having difficulty finding these skilled tradesmen. The results act as a stark warning that the government must not take the recovery in the construction sector for granted. Although this snapshot of small construction firms marks the fifth consecutive quarter of positive results, if we don’t have enough of the right people to complete the work, private and public projects could be stalled across the board.”

He added: “Looking ahead, construction SMEs are still hugely concerned about the impact of the government’s apprenticeship funding reforms. If they are implemented as proposed, most micro-businesses, which currently train two-thirds of all construction apprentices, are likely to stop hiring apprentices altogether. CITB forecast that 182,000 new UK jobs are expected to be created in the construction industry by 2018 so this is not the time to jeopardise the ability of small firms to continue their proud history of training apprentices. Not only would this be disastrous for the construction sector itself and the hundreds of thousands of young people who are currently seeking employment, it would also be disastrous for the wider economy which is largely relying on construction and housing to drive the recovery.”

Steelwork contractors are hoping for a pick-up in business by being able to offer developers reasonable lead times and competitive pricing.

While other construction materials are facing shortages and consequent steep price increases, structural steelwork prices are increasing more moderately and steadily, according to the British Constructional Steelwork Association. This is making steelwork relatively more competitive as a framing material, according to BCSA director general Sarah McCann-Bartlett.

Ms McCann-Bartlett said that structural steelwork contractors in the UK have sufficient capacity to meet increased demand from the construction industry.

“Our members are now seeing stronger demand for constructional steelwork, and with improved prospects for construction in 2014 and beyond, BCSA members have reviewed their capacity and capability and are confident they can meet this demand,” she said.

“Unlike other construction products, where we’re seeing shortages, long lead times and price spikes, demand and supply in the structural steel market is more balanced. While we do expect to see a firming of prices, this will be relatively slow and steady,” she said.

Recent cost modelling by Gardner & Theobald found that the cost of steel framed buildings was competitive with concrete. The study, carried out in the first quarter of 2014, showed that on a like for like basis, the frame and upper floor costs for steel framed options can be up to 9% lower than for concrete.

The BCSA says that “market research shows that steel remains the framing material of choice for specifiers”, with a market share of around 70% for multi-storey buildings and 95% for single-storey buildings.

Businesses are facing the risk of billions of pounds of additional costs from a recent legal ruling relating to holiday pay.

And it has at least one civil engineering contractor fearing for its very existence.

Holiday pay in the UK is currently calculated on the basis of a ‘week’s pay’ – based on basic salary and excluding payments such as working allowances, expenses, overtime, commission and bonus payments, all of which refer to specific work done by someone while performing their duties.

A recent European Court of Justice (ECJ) judgment redefined holiday pay to include an allowance for commission, despite the fact that commission is paid on sales made and the employee would not have delivered those sales while on holiday. 

If liabilities on holiday pay are backdated, individual firms may face massive unexpected bills.

Civil engineering contractor Owen Pugh Group, a medium-sized business based in Northumberland, fears it is under threat. Chairman John Dickson said: “Changes to the method of calculating holiday pay in the future have cost and administration implications which are difficult but bearable. But if these changes are applied retrospectively, whether over six or 16 years, they are little short of catastrophic.”

He added: “Like many medium-sized, privately-owned businesses, we will struggle to survive. If it happens, all I can see for the next few years is a collapse in investment, spiralling job losses and a huge rise in insolvencies.”

The issue has been picked up the lobby group Confederation of British Industries (CBI). Other medium-sized businesses have also told the CBI that backdated claims could push their otherwise profitable businesses into insolvency.

CBI deputy director-general Katja Hall said: “Backdated claims on holiday pay could lead to bills of millions of pounds for each business, and ultimately threaten their very existence.

“Businesses that have done the right thing and fully complied with UK law suddenly face the threat of substantial additional costs. And the companies most at risk are in vital sectors for our economy, such as manufacturing, construction and civil engineering.

“Moving the legal goalposts in this way is unacceptable. Although most businesses believe we are better off in a reformed EU, there is a real danger of expansive decisions being made by the European Court of Justice on the UK labour market. As part of an EU reform programme, this has to be addressed and it’s time to put a stop to back-door EU employment law being made.

“We need the UK government to take a strong stand and do all it can to remove this threat. Otherwise we face the very real prospect of successful firms in this country going out of business, with the jobs they provide going too.”

The ECJ’s ruling in the Lock v British Gas Trading Limited case means that, depending on the subsequent ruling from UK courts, employers may have to change the way they calculate holiday pay to take account of commission payments and could face retrospective claims relating to earlier periods of annual leave, with the potential of going back six years or possibly even as far back as 1998.

UK businesses are currently facing an anxious wait to see how the UK courts interpret the ECJ decision on commission, and on the outcome of related tribunals on how holiday pay should be calculated to account for overtime. Other related issues such as backdated tax and pension contributions could also be raised.

The CBI is calling on the government to defend the existing UK law as these rulings go beyond what could have been foreseen when the working time rules were introduced. The EU treaty is supposed to leave matters of pay with member states, it says.

Cases on commission and overtime are currently proceeding, meaning major uncertainty for businesses. The CBI is calling for the government to use its powers under British law to limit the retrospective liability firms’ face. 

Aedas, a leading firm of architects created by the 2002 merger of Abbey Holford Rowe in the UK and LPT Architects in Hong Kong, is demerging and returning to its constituent parts.

The eight UK offices and the offices in Russia, Poland and Kazakhstan will now operate under the name AHR.

The 13 offices in China, southeast Asia, the Middle East and the USA will continue to operate under the Aedas brand.

The board of Aedas said in a statement that “the demerger will allow both companies to focus on their respective strengths and will enable them to grow the businesses in different directions”.

The intention is that both groups will continue to work together on projects in the future.

Aedas chairman Keith Griffiths said: “This move reinforces Aedas primary aim to provide international design services to the major world cities through our network of 13 offices and 1,400 staff.”

Brian Johnson, chairman of the new UK practice, said: “We believe that this is a very natural evolution based on how the practice has been operating in recent years and to all intents and purposes there will be no change for our clients or our 450 staff.”

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