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Hong Kong property sales fall amid call for help for young buyers
Residential property sales in Hong Kong decreased by 28.2% in March due to the introduction of a seventh round of market tightening measures, according to the latest analysis report. The move by the Hong Kong Monetary Authority is supressing the housing market amid calls for more housing to be built to measures put in place to help young first time buyers, says the report from international real estate firm Knight Frank. It also shows that mass residential sales below HK£10 million dropped almost 30% but prime residential sales above this price level saw a lower fall at 16.2%. The report points out that the tightening is being felt the most at HK$7 million and below. Despite the fall in sales, prices in the mass residential market increased by another 2.6% in March while luxury property prices remained stable. ‘To tackle the housing problem in Hong Kong, Knight Frank believes that the government should not focus on supressing housing demand, but effectively increase housing supply and provide assistance to first time home buyers,’ the report says. ‘The government should ease restrictions on mortgage lending for first time and young home buyers, perhaps by following the example of Singapore which has applied age conditions on housing mortgage loans,’ it explains. The report also shows that the office sales market was more active in March compared to February. Decentralised areas in particular saw some large transactions. It says that the latest initiatives launched by the Chinese government, including the establishment of the Asia Infrastructure Investment Bank and the proposed Shenzhen to Hong Kong through train will inevitably increase capital flow in the region. ‘Hong Kong being a global financial hub situated at the cross roads of Asia is set to benefit from this. We expect this to translate into increased commercial activity which will stimulate demand for office space from related industries taking the opportunity to expand their business in the city,’ the report points out. ‘As a result we remain optimistic about the office market in Hong Kong. Given the limited supply of office space and sustained demand from Chinese firms and certain industries, we expect Grade A office rents to rise by up to 5% during the year,’ it adds. Continue reading
Moving home costs in UK at highest level since 2007, study shows
The average cost of moving home in the UK has risen by 5% to £8,689 in 2014 from £8,258 in 2013, its highest level since 2007, new research shows. The increase in the past year of £431 was mostly driven by fees paid to estate agents and surveyors, both of which accounted for £386 of the total rise in moving costs, according to the study from Lloyds Bank. As a result of this rise in costs and an increase in home sales in the last year, the total amount spent on moving has grown sharply by 15% in 2014, from £6.5 billion in 2013, to £7.5 billion in 2014. The rising cost of moving is driven by a 7% or £266 increase in estate agency fees and surveyors costs growing by 22% to £665 in the final quarter of 2014 compared to the same period a year earlier. Over the same period, conveyancing fees increased by 7% or £74 to £1,074. The average stamp duty paid fell marginally by 1% or £28 to £1,973. Many of these costs have increased as a result of higher house prices in 2014 compared to the year earlier, the report points out. The research also shows that stamp duty now accounts for 23% of all moving costs, whilst the proportion taken up by estate agency fees is 45%. In the 10 years since 2004, the total cost of moving has increased by 15% or £1,137, the same as the increase in house prices. In this period, average gross annual earnings have increased by 24%, meaning the total cost of moving as a percentage of earnings has decreased marginally, from 28% to 26%. During this period both house price and earnings growth lagged behind the increase in the consumer price index which rose by 30%. ‘With the cost of moving at its highest level since 2007, people struggling to cover the costs should look to make savings wherever they can. The recent changes in stamp duty should help buyers reduce their overall cost of moving, which can be a significant boost,’ said Andy Hulme, mortgages director at Lloyds Bank. Just four regions have seen the average cost of moving fall in the past year. They include Yorkshire and the Humber where home movers have seen moving cost fall by 8% to £5,875, North East and Wales both saw a fall of 7% and the North West it was down by 1%. On the other hand, for home movers in the London average moving costs has grown by 11% to £23,116, the most expensive moving bill in the UK. Whilst, in Northern Ireland there has been a 22% or £929 increase to £5,181 which is still the lowest in the UK. The cost of moving in London equates to 53% of the average gross full time earnings of £43,519 of London residents. In Northern Ireland this proportion is just under 19%, again, the lowest in the UK. Continue reading
Property Ombudsman in England sees challenges rise
More people in the rented property sector in England are prepared to launch a challenge when they are not satisfied with their tenancy, according to the latest annual report from the Property Ombudsman. It comes at a time when legislation makes it a legal requirement for lettings agents and property managers in England to join a government approved redress scheme. Some 28% more signed up as members of the ombudsman at the end of 2014 compared with at the beginning of the year. Meanwhile the number of referrals were up 42% in 2014 compared to the previous year. The report says this is indicative of both the general trend in the consumer world to challenge when something does not give satisfaction. ‘Overall 2014 saw continued and significant growth in the private rented sector. With an estimated 1.6 million private landlords, many of whom have limited experience and understanding of their responsibilities, and large numbers of consumers seeking tenancies, the role of letting and managing agents in providing quality customer service based on a comprehensive knowledge of relevant legislation, is more important now than ever before,’ said the ombudsman Christopher Hamer. He repeated his call for a properly structured regulatory regime for the lettings sector. ‘Over the past year we have seen numerous pieces of legislation being passed which deal with aspects of the sector. Whilst any controls must be welcomed I feel an opportunity has been missed to bring all such legal obligations into a coherent and sensible single law to avoid the potential for inconsistency and misunderstanding of what is required,’ he pointed out. The report data shows there was a 19% increase in registered membership letting offices, a 40% rise in lettings cases received, a 33% increase in cases resolved via mediation, and a 10% increase in cases resolved via formal review. Some 11% of lettings issues reported to the ombudsman related to repair and maintenance, 54% of complainants were landlords versus 44% tenants and the average lettings award has risen 27% from £411.97 to £524.10. Some 23% of complainants were from the South East, followed by Greater London at 21% the South West at 9% and the North West also on 9%. The data also shows that there was a 14% increase in registered membership sales offices, a 43% rise in sales cases received, a 21% increase in cases resolved via mediation, and a 13% increase in cases resolved via formal review. Some 20% of sales issues reported to the ombudsman related to communication failure, 59% of complainants were sellers versus 39% buyers and 23% of complainants were from the South East, followed by Greater London at 13% and the South West and Eastern region both at 11%. Continue reading
