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Latest UK property news: river pollution delays homebuilding, costs rising for homes near Ofsted’s “Outstanding” and the housing market 2023

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The current UK property news headlines continue to reflect the dramatic changes and challenges of the underlying economy.

While energy prices and their effect on the cost of living and the spending power of households dominate the news, concern is also voiced about environmental factors that can delay housebuilding projects, the premium you need to pay to live near a school rated as “Outstanding”, and prospects for the housing market in 2023.

The energy price hikes revealed for different EPC properties

Pit energy prices against EPC ratings and it will be the latter that wins hands down. That is the message from research conducted by building society Nationwide and published by Landlord Today on the 2nd of November.

Despite the Energy Price Guarantee underwritten and recently confirmed by the government, the average household’s energy bills will be an estimated 80% higher than last winter – with a typical annual bill of around £2,500.

But the Nationwide’s survey reveals that different Energy Performance Certificate (EPC) ratings across the housing stock will mean that poorly performing households are likely to pay more for their energy:

  • homes with EPCs rated between A and C, for instance, are likely to pay an annual £1,800 a year (compared with £1,000 the previous year);
  • homes rated D can expect to pay £2,600 a year (compared with £1,440 a year ago); and
  • homes rated F to G will be paying an average of £4,500 a year (compared with £2,220 a year ago).

River pollution delaying 100,000 new homes in England and Wales

In an article on the 28th of October, Property Press Online considered the impact that polluted rivers have had on the building of new homes.

The story notes the current shortage of housing – with first-time buyers and those looking to rent having the most pressing need. Against the background of such a housing shortage, new homes need to be built as quickly as possible.

Yet the widespread and increasing incidence of river pollution has recently led to the postponement or even cancellation of projects for building a total of some 100,000 new homes.

The cost to the economy of these delays and cancellations of housebuilding projects could amount to as much as £16 billion, says the article.

Spending falls in September as households cut back on costs in anticipation of energy price rise

Nationwide building society’s Spending Report for September registered a further tightening of belts by consumers in the run-up to what will be especially expensive energy bills this winter.

Indeed, spending on essential domestic energy use has already seen a substantial increase in September – spending on energy, other utilities, and non-essential items has gone up by an estimated 23% compared with the same month last year.

In addition to the additional cost of energy, households faced increases of an average of 8% and 12% on rents and mortgages respectively and 14% more than this time last year on servicing debts such as loans and credit cards.

An extra £195,919 to buy a home near an outstanding state school

Most parents about to send their child to a state school will be looking for one that has been rated as “Outstanding” by Ofsted. If you are among that band of hopeful buyers looking to buy a home near such a school, expect to pay an average extra premium of £195,919 on the price of your house.

That is the conclusion reached by research by online listings website Zoopla and referenced in a story in the Daily Mail on the 29th of October.

In the scramble for highly-rated state secondary schools, many parents are prepared to move out of London into the surrounding home counties – where they will still be paying nearly an extra £200,000 for a house near their ideal school.

Before making any such move, of course, the homebuying parents will need to have done their research to confirm the date of the last Ofsted inspection (making sure that the school is, indeed, still rated as Outstanding) and check that the home they intend buying falls within the appropriate catchment area for the school.

Zoopla: What's going to happen to the housing market in 2023?

Who really knows what is going to happen to the housing market in the new year to come? Online listings website Zoopla made a stab at just such a prediction in a posting on the 31st of October.

The biggest impact on the market is expected to be a return to mortgage interest rates of between 4% and 5% soon into the New Year. As these become a new norm, the days of cheap borrowing will become a thing of the past, forecasts Zoopla.

Demand will be undermined by the lingering fallout from the recent pandemic and the current cost of living crisis fuelled by inflation – factors likely to result in a fall in average house prices by the end of 2023 of some 5%.