News
US home sales up to highest rate for 18 months, latest data shows
Existing home sales in the United States jumped in March to their highest annual rate in 18 months, while unsold inventory showed needed improvement, according to the latest index. Data from the National Association of Realtors shows that this growth was led by the Midwest, but all major regions experienced strong sales gains in March and are above their year on year sales pace. Total existing home sales, which are completed transactions that include single family homes, town homes, condominiums and co-ops, increased 6.1% to a seasonally adjusted annual rate of 5.19 million in March from 4.89 million in February, the highest annual rate since September 2013. Sales have increased year on year for six consecutive months and are now 10.4% above a year ago, the highest annual increase since August 2013. March's sales increase was the largest monthly increase since December 2010. According to Lawrence Yun, NAR chief economist, the housing market appears to be off to an encouraging start this spring. ‘After a quiet start to the year, sales activity picked up greatly throughout the country in March,’ he said. ‘The combination of low interest rates and the ongoing stability in the job market is improving buyer confidence and finally releasing some of the sizable pent-up demand that accumulated in recent years,’ he explained. Prices are also climbing steadily. The median existing home price for all housing types in March was $212,100, which is 7.8% above March 2014. This marks the 37th consecutive month of year on year price gains and the largest since February 2014 when it was 8.8%. ‘For sales to build upon their current pace, home owners will increasingly need to be confident in their ability to sell their home while having enough time and choices to upgrade or downsize. More listings and new home construction are still needed to tame price growth and provide more opportunity for first-time buyers to enter the market,’ said Yun. The percent share of first time buyers was 30% in March, marking the third time since last March that the first time buyer share was at or above 30%. First time buyers represented 29% of all buyers last month compared to 30% in March 2014. All cash sales were 24% of transactions in March, down from 26% in February and down considerably from a year ago when they were 33%. Individual investors, who account for many cash sales, purchased 14% of homes in March, unchanged from last month and down from 17% in March 2014. Some 70% of investors paid cash in March. Distressed sales, that is foreclosures and short sales, amounted to 10% of sales in March, down from 11% in February and 14% a year ago. Some 7% of March sales were foreclosures and 3% were short sales. Foreclosures sold for an average discount of 16% below market value in March, similar to the 17% recorded in in February while short sales were also discounted 16%, up from 15% in February. Properties… Continue reading
UK landlords without cast iron inventory losing out in tenant disputes
Since the start of the tenant deposit schemes in 2007 in the UK more tenants than landlords are continuing to be awarded 100% of the disputed amount at adjudications, new research shows. Data from the Tenant Deposit Scheme Annual Review 2014, shows that over the last eight years, tenants have been awarded 20.25% the whole dispute amount, compared with 18.21% of landlords. Furthermore, the dispute amounts have risen leapt from £736 in 2010 to 2011 to £860 in 2013 to 2014. Cleaning remains the most common cause of dispute, appearing in 53% of all cases, followed by damage in 46% of cases, redecoration in 29%, arrears in 16% and gardening in 14%. Disputes over gardening have seen a steady increase since 2011, up by 3% ‘Despite the best efforts of the deposit schemes, landlords and agents are not being awarded 100% of the deposit as often as tenants. It is worth asking ourselves why landlords have failed to improve their success rate at disputes over the last few years. One obvious reason is the quality and lack of evidence which is presented at adjudications,’ said Jax Kneppers, chief executive officer of Imfuna Let. He believes that many landlords and agents are not conducting an adequate inventory or check-in and check-out and don’t keep copies of correspondence with the tenant, which could be evidence in a dispute. ‘It is so important that landlords and agents have a properly compiled inventory. This will always be much more detailed than a landlord’s own document and will provide vital evidence in any end of tenancy dispute. The tenants should check and sign their agreement detailing the inventory when they check-in,’ Kneppers explained. ‘At the end of the tenancy, the tenant should always be present during the check-out inspection. Tenants should also be made aware of any problems and chargeable issues to their deposit, as this will avoid disputes. Using a deposit scheme dispute service should always be a last resort. The landlord should make every effort to communicate and negotiate with their tenant,’ he added. According to the firm the best way for landlords and agents to protect their property and avoid a dispute, is by ensuring that its condition is fully recorded at the start of the tenancy, with a comprehensive inventory, along with a thorough check-in and check-out report. The firm’s software aims to give landlords and agents a bullet proof inventory that records the property check-in condition status. The software provides a side by side comparison report which clearly demonstrates any change in condition of the property, illustrated with date and time stamped photographs. Users can also print out a deposit dispute report, again saving time, meeting deadlines and ensuring that the tenancy deposit protection adjudicator has the information at their fingertips. Continue reading
UK gross mortgage lending showing signs of picking up
Mortgage lending in the UK is still down on a quarterly basis on what it was a year ago but there are signs of a pickup, according to the latest figures to be published. Estimates from the Council of Mortgage Lenders shows that gross mortgage lending reached £16.5 billion in March, some 21% higher than February but lending for the first quarter is 12% down on the final quarter of 2014 and 3% down on the first quarter of 2014. However it is up month on month for the month of March, some 7% higher than March of 2014 and CML chief economist Bob Pannell said that the underlying lending picture is stabilising. ‘Sentiment and activity are showing early signs of improvement, and should be further supported by the effects of stamp duty reform. We expect to see lending strengthen over the next few months, albeit from a relatively sluggish start in 2015,’ he said. But buy to let lending is stronger. Data from the Bank of England shows that gross lending for buy to let purposes was £27.4 billion in 2014 and over the past five years the share of total buy to let lending in overall mortgage lending picked up to 15% in the fourth quarter of 2014 Q4, higher than in the pre-crisis period. The Bank’s network of Agents noted that the rental market had continued to grow strongly in recent months, supporting continued steady growth in buy to let activity and gross buy to let lending has grown faster than overall gross mortgage lending in recent years. Gross buy to let advances for remortgaging have also increased in recent years. As a share of the total it grew from 32% in 2002 to 52% in 2014, with the share of gross advances for house purchase at 45%. According to David Whittaker, managing director of Mortgages for Business, buy to let is not subject to the nerves and jitters of this spring’s home owner mortgage market. ‘Election uncertainty might be putting some people off buying a home, but in the meantime millions of tenants still need somewhere to live and landlords are investing in new properties, as buy to let mortgage rates reach new lows,’ he said. ‘Underpinning this, rents are picking up on the back of a strengthening jobs market, supporting yields while steady price growth is still providing an additional bonus of capital growth to many landlords,’ he explained. However he pointed out that there are uncertainties on the horizon. ‘The latest noises from the Bank of England indicate how the powers that be seem as unsure about the future path of interest rates as the man on the street. However, when rates do rise, or if the economic recovery does slow, landlords will be in a better position to stand up to headwinds than a year ago as their tenants’ financial health improves,’ he added. In general the mortgage lending market is improving, according to… Continue reading
