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UK sees boom in number of properties smaller than 37sqm: Would you buy a ‘micro-home’?; Just goes to show how undervalued our properties are
Topic Started: 22 Aug 2017, 08:51 PM (986 Views)
Bardon
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UK sees boom in number of properties smaller than 37sqm: Would you buy a ‘micro-home’?

The number of "micro-homes" in the UK is soaring, as the chronic lack of supply in the property market means developers are slicing up buildings to create multiple dwellings.

These properties, categorised as micro because they are smaller than 37 square meters – about the size of a tube carriage – are permissible because of the so-called "Permitted Development Rights” (PDR), an act introduced by the Government in 2013.

This legislation allows builders and developers to change the use of buildings without the need for planning permission, including changing offices into residential homes.

Since the act came into force, the number of micro-homes in the UK has rocketed. Almost 8,000 were built in 2016, the highest number on record, according to Which? analysis of Land Registry data. Most are being built in urban areas such as London, Liverpool, and Bristol.

Now buyers are being warned that purchasing a micro property could leave them with a depreciating asset.

Which? found that these properties don’t necessarily grow in value like their larger counterparts, while some mortgage lenders won’t lend on them at all.

While micro-properties offer a cheaper alternative to regular houses – in 2016 they sold for an average £279,000, less than half the average price of a London home sold in the same period (£580,000) – they might not be as valuable over the long-term.

Which?'s investigation combined information on property sizes from the Government, with house price data from HM Land Registry, and found that properties with floorspace of between 50 and 120 sq m had the best price growth, while homes smaller than the national minimum space standards (37 sqm) did not perform as well.

Price growth for properties smaller than 37 sqm was 6.9pc, compared with 8.7pc for homes larger. This is despite almost two-thirds of these smaller properties being located in London and the South East, which have experienced huge house price growth over the past few years.

David Blake of Which? Mortgage Advisers said: "With the average London micro-property selling for £279,000, smaller homes can represent a more realistic opportunity for many but can also be harder to mortgage.

“Smaller properties can put lenders off due to concerns around the future value of the investment. However, there are mortgage lenders who are receptive to properties of this nature, if demand is high enough and sustainable.”

British families live in some of the most cramped conditions in Europe, with the UK having the smallest homes by floor space area of any European country. The average new build property in Britain covers just 76sqm compared with almost double that amount of 137sqm in Denmark.

Overcrowding in homes can lead to depression, the breakdown of relationships and physical symptoms such as asthma, past research has found.

http://www.telegraph.co.uk/property/uk/uk-sees-boom-number-properties-smaller-37sqm-would-buy-micro/
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Ex BP Golly
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I lived very comfortably in a well designed 65/sm property.

It had a bath and shortage shower.

37/sm would be possible with extraordinary design for storage and multiple space purpose usage.

I was thinking of buying a bedsit at 7 Elizabeth St Sydney at one stage do looked into interesting furniture. You have to spend big, but unlike most people, you'd st last have some quality things surrounding you rather than a MacMansion full of Ikea

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I love danpalon !
2.5kg per s/m culturally polycarbonate.

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Edited by Ex BP Golly, 22 Aug 2017, 11:11 PM.
WHAT WOULD EDDIE DO? MAAAATE!
Share a cot with Milton?
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newjez
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Life would be better if they hadn't privatised the railways.

It should be easy and cheap to commute to London. It is now neither.

I am looking at going back to rail, and my cross country ticket is a fraction of the ticket I would pay to get to London. About a third for the same distance.
Whenever you have an argument with someone, there comes a moment where you must ask yourself, whatever your political persuasion, 'am I the Nazi?'
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Bardon
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I see the UK is also experiencing an upswing in the number of first home buyers completing on contracts as well.

First-time buyers make up half of all July purchases

The stamp duty surcharge, combined with the reduction in buy-to-let mortgage tax relief is potentially dissuading new small-scale, amateur landlords from entering the market.
Half of all property purchase valuations in July were made on behalf of first-time buyers, according to research from Connells Survey & Valuation.

The proportion of the property purchase market represented by first-time buyers is six percentage points higher than the five year average for July (43%).

The findings from Connells Survey & Valuation suggest that the significant upswing in first-time buyer borrowing seen by UK Finance in June has continued through the summer. First-time buyers took out 36,000 loans in June, up 22% month-on-month and 6% year-on-year, reaching its highest level since November 2006.

More : First-time buyer market soars 26% in June: UK Finance
As purchasing property falls back to 62% of activity in the mortgage valuations market, remortgaging has also seen a strong July, rising to 36%.


Remortgaging is 10 percentage points higher than the five year average for July (26%). This suggests that the lower mortgage rates coming to the market as a result of lender competition are helping those looking to refinance more than those purchasing property.

Conversely, buy-to-let activity has declined with fewer new landlords entering the market.

Government policies, including the stamp-duty surcharge and reduction in buy-to-let mortgage relief, have reduced the incentive to invest in the rental market.

John Bagshaw, corporate services director of Connells Survey & Valuation, said: “Demand from first-time buyers is supporting the housing market at the moment. People are eager to get on the property ladder, with record high employment and competitive mortgage rates. But this doesn’t mean it’s an easy task to get a foothold in the market. Economic conditions are still tough. The increasing cost of living and house price inflation are making it harder to save for a deposit. House prices are around eight times higher than earnings – and they’re rising twice as fast. With the value of a typical property rising £10,000 in a year, first-time buyers still need help. Perhaps they could be given an exemption from stamp duty?

“People are still investing in the buy-to-let sector, but they’re typically existing landlords looking to expand their portfolio and increase profits to offset increasing tax bills. But the stamp duty surcharge, combined with the reduction in buy-to-let mortgage tax relief is potentially dissuading new small-scale, amateur landlords from entering the market. This should be a concern for the Government, as fewer landlords will mean less competition in the lettings market. As housing policy is no longer entirely focused on increasing homeownership with the Government accepting the need for a healthy rental sector, they should think again about policies which hold it back. Of course, a serious step-up in house building would help everyone in the market.

http://www.financialreporter.co.uk/finance-news/first-time-buyers-make-up-half-of-all-july-purchases.html
Edited by Bardon, 23 Aug 2017, 08:01 PM.
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Tick Tock
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This is getting worse by the month.

Soon it will be like Japan where they have those tiny little boxes with just a bed and a T.V.

Thers actually someone in Sydney doing this i saw on the news months ago.

There so small the cleaners have to take the mattress out of the box to replace the sheets everyday or something stupid like that.

Don't know how much they cost but f*** that! :wak:
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Rat
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Filthy Rodent

Transmutation.
Consumer protection laws extended to small businesses. Banks not permitted to repossess due to non-monetary defaults (for example, a fall in the property value).
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Tick Tock
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Sydney sucks BIGTIME and Melbournes not f***in far behind it the way things are going!

No wonder half my family moved to QLD 20 years ago!!! :lol

I think Herbs is doin the best out of all of us i might add???
Edited by Tick Tock, 24 Aug 2017, 10:55 PM.
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Ex BP Golly
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Lukey
24 Aug 2017, 07:32 PM
This is getting worse by the month.

Soon it will be like Japan where they have those tiny little boxes with just a bed and a T.V.

Thers actually someone in Sydney doing this i saw on the news months ago.

There so small the cleaners have to take the mattress out of the box to replace the sheets everyday or something stupid like that.

Don't know how much they cost but f*** that! :wak:
Check out these happy FHBs in HK:
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The transmutation!

2nd home buyers get this:

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Edited by Ex BP Golly, 25 Aug 2017, 01:04 AM.
WHAT WOULD EDDIE DO? MAAAATE!
Share a cot with Milton?
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Tick Tock
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Umm...I don't think I have words to describe a situation like those pics show.....WTF. :?:
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Ex BP Golly
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Lukey
25 Aug 2017, 05:00 PM
Umm...I don't think I have words to describe a situation like those pics show.....WTF. :?:
Around 200,000 people live like that in Hong Kong.

Google "cage houses".

WHAT WOULD EDDIE DO? MAAAATE!
Share a cot with Milton?
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