News
Fewer loans for first time buyers and home movers in UK
First time buyers in the UK saw a drop in lending in January compared to the previous month and the same month in 2014, according to the Council of Mortgage Lenders. There were 19,000 loans advanced to first time buyers January, down 27% on December and 14% compared to January 2014. These loans by value were £2.8 billion, which was down 26% on December and 10% down on January last year. The data also shows that home movers were advanced 22,400 loans, a decline of 24% compared to December and 17% down year on year. These loans totalled in value £4.2 billion, 24% down on December and 14% down compared to January 2014. However, remortgage lending increased month on month with 25,600 loans advanced, up 15% on December but 12% down on January 2014. The value of these loans at £4.1 billion also increased month on month by 21% but was down 5% year on year compared to January 2014. There were 18,200 buy to let loans in January, up 6% on the previous month and up 12% on the same period in 2014. These loans came to £2.5 billion in value, unchanged compared to December but up 14% on January 2014. ‘The traditional beginning of year seasonal lull in lending is slightly more prominent in house purchase lending than in previous years, especially in comparison to the particularly strong levels at the start of 2014,’ said Paul Smee, director general of the CML. ‘Affordability constraints remain a factor for would-be borrowers, but we are still projecting lending to pick up over the next few months. Increases month on month in remortgaging, both for home owners and in the buy to let market, are welcome given the recent static nature of remortgage activity. Interest rates are looking unlikely to go up in the very near future and the greater availability of good mortgage rates has probably motivated people to look at a change,’ he explained. As previously reported, gross mortgage lending reached £14.8 billion in January. This represents an 11% decrease from December’s gross lending total and is 8% lower than lending in January 2014. The CML also pointed out that the data on which the results are based on the Financial Conduct Authority's statutory reporting, which is currently in a transition phase following the implementation of the Mortgage Market Review. As a result this month's data may be subject to greater revisions than usual reflecting the transition arrangements. According to Adrian Gill, director of Your Move and Reeds Rains estate agents, the data shows how the mortgage market has changed its’ spots in the last year. 'Lending has been tamed as new regulations and affordability checks have strengthened the borrowing process. Mortgage brokers are doing a more robust job and buyers are get sturdier solutions at the end of it. Although mortgage approvals are now running at more manageable levels than they were this time last year, the first time buyer market… Continue reading
Second phase of UK custom build fund announced
The second phase of a multi-million pound fund to help aspiring custom and self builders in the UK get their projects off the ground more quickly has been announced. The second phase of the £150 million fund is now open to bidders and will create up to 10,000 so-called ‘serviced plots’ which is land prepared for house building and connected to utilities such as gas and water, so builders can go straight in and build. According to Housing Minister Brandon Lewis the average self build takes two years but those using serviced plots can cut this by up to a year and he believes it will help further unlock the massive potential the custom build industry has to expand. The custom and self build industry currently accounts for around 10,000 new homes every year but the government is backing industry led efforts to double that by 2020. The £150 million fund is open to small builders and community groups as short term loans to help get the land ready for housebuilding. The land can then be sold as individual plots to people looking to build their own home. Lewis said he was determined to ensure as many people as possible could fulfil their custom build ambitions so he has given the green light for the first three bids to proceed to the next stage of assessment. Subject to successful completion three small builders in St Helens, South Norfolk and West Lindsey will receive a share of £850,000 to help provide 41 plots. ‘Custom build should not be something that’s confined to a small and select group of people. Anyone who aspires to build their own home should have the opportunity to do so. We want to see the industry grow significantly and this £150 million fund will help further unlock the massive potential it has to help even more people achieve their ambitions,’ said Lewis. ‘This fund will help create shovel ready serviced plots so small developers and custom builders can get on and build, finishing their projects more quickly,’ he added. Continue reading
Canadian property prices up an average of 6.3%, led by Toronto and Vancouver
Residential property sales in Canada edged upwards 1% month on month in February while sales are now up 6.3% year on year, according to the latest data from the Canadian Real Estate Association. The monthly sales increase was led by Greater Vancouver, the Okanagan region, and Greater Toronto. Gains there offset sales declines elsewhere, with more than half of all local markets having posted weaker sales in February compared to January. Year on year price growth decelerated in February for all housing types tracked by the index except two storey single family homes, which again posted the biggest year on year price gain at 6.63%. This was followed by terraced homes with growth of 4.4%, and single storey single family homes at 4.34%. Price growth remained more modest for apartment units at 2.77%. Price gains varied among housing markets tracked by the index. Greater Toronto saw growth of 7.84%, Greater Vancouver 6.38%, and Calgary with 5.96% posted the biggest year on year increases. Even so, the increase in Calgary was far smaller than gains posted last year and the smallest since December 2012. In other markets from West to East, prices were up compared to year ago levels by between 2% and 2.5% in the Fraser Valley, Victoria, and Vancouver Island, while holding steady in Saskatoon, Ottawa, and Greater Montreal, and falling in Regina and Greater Moncton. The CREA index report points out that the national average home price remains skewed by sales activity in Greater Vancouver and Greater Toronto, which are among Canada’s most active and expensive housing markets. Excluding these two markets from the calculation, the average price is a relatively more modest $326,910 and the year on year gain shrinks to just 1.5%. ‘A number of buyers across the Prairies stayed on the side lines in February. That’s likely to remain an important part of the national housing story until the outlook for oil prices starts improving. Meanwhile, home sales in British Columbia and much of Ontario are improving,’ said CREA president Beth Crosbie. Actual, not seasonally adjusted, activity in February stood 2.7% above levels reported in the same month last year, but remained 5% below the 10 year average for the month of February, the data also shows. ‘Sales came in below the 10 year average for the month of February in two-thirds of all local markets. That said, the opposite was true in a few large urban markets in British Columbia and Ontario despite a shortage of listings there, which is fuelling prices higher,’ explained Gregory Klump, CREA’s chief economist. The number of newly listed homes fell 2.5% in February compared to January, led by Greater Vancouver, the Okanagan region, and Calgary. New listings in Calgary have retreated in recent months after having climbed sharply toward the end of last year. The national sales to new listings ratio was 52.2% in February. With sales up and new listings down, this marked an increase from 50.4% in January. A… Continue reading
