■  The limit on mortgage interest relief for Buy to Let investors will limit the expansion of Buy to Let investors’ portfolios (see Savills Policy Response – Buy to Let Tax Relief document). There is some evidence that this is having an effect in the new build markets although the scale of the impact is not yet clear. The number of investors for Buy to Let making reservations on new build sites has fallen in August more than for first time buyers and home movers, especially in London, according to the HBF survey.

■  The reduction in affordable housing rents of 1% per annum from 2016 (instead of an increase of CPI +1% per annum) has meant that housing associations are offering to pay less for Section 106 housing on development sites and are likely to build fewer homes for sub-market rent than previously planned.

■  Starter Homes replacing affordable rented homes is the latest strategy by the current government to 'turn generation rent into generation buy’. This will, on the face of it, generate a higher land value on the sub-market housing, but the risk is that new homes are concentrated in too narrow a section of the market and that Starter Homes displace market sales including Help to Buy.

■  In the last year the requirement to provide affordable housing (Section 106) on sites of 10 homes or less has changed twice. The requirement was dropped in December 2014 but was then reinstated in a High Court ruling in July 2015. These changes, along with potential for appeals and the alternative affordable tenure of Starter Homes, has brought confusion and uncertainty to the market, potentially delaying development on smaller sites.

NB. The extension and changes to permitted development rights for residential conversion or replacement are not captured in our index results this quarter.