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Property prices in England and Wales down slightly month on month
Residential property prices in England and Wales increased by 6.1% in the year to February 2016 taking the average value to £190,275. The latest data from the Land Registry also shows that overall month on month prices fell by 0.2% but most regions have seen prices rise. London has seen the greatest increase in average property values over the last 12 months with a rise of 13.5% to £530,368 but at the opposite end the North East saw prices fall by 3.2% year on year. The North East also saw the most significant monthly price fall with a decrease of 1.2% the North West saw the greatest monthly price rise with a rise of 1.8%. According to David Brown, chief executive officer of Marsh & Parsons, the monthly dip in property prices disguises the fact that the majority of regions are experiencing striking growth. ‘There have been a lot of stimulants spurring on the housing market this spring To beat the 01 April implementation of additional stamp duty, second home buyers and buy to let investors have been frantically pushing through purchase completions as quickly as possible,’ he pointed out. ‘We’ve had documents collected and delivered by hand across London to solicitors to avoid postal delays, and our teams have been in at the crack of dawn to make sure all parties involved in the transaction are meeting their deadlines,’ he explained. ‘This short term whirlwind should go some way to balance out the slower sales activity seen at the end of last year, but only time will tell how buy to let demand tapers off as we enter into new territory. As buy to let investors face yet another blow from the banks, the incredibly strong buyer demand we’re seeing will take the reins, and keep the market on a stable course,’ he added. Rob Weaver, director of investments at property crowdfunding platform Property Partner, pointed out that price rises in London are more than double the rate compared to all other regions excluding the South East and the East. ‘High demand, a shortage in supply and out of reach properties in prime central London, has seen potential buyers flocking to outer London boroughs for more affordable housing and in turn that’s pushed prices ever skyward. Six of the outer boroughs have experienced annual price rises of more than 15% with Hillingdon top of the league at 17.1%,’ he said. ‘Again the upward trends continue west of the capital along the M4 corridor with Slough notching up a 19% annual increase. There’s a widening gulf with the rest of England and particularly Wales with the average house at a fifth of the price you pay in London. And sadly, we’re likely to see downward pressure on prices in south Wales over increasing uncertainty around Steel jobs in Port Talbot,’ he added. Continue reading
Housing affordability falls in Scotland for third year in a row
Rising house prices in Scottish cities has led to a further deterioration in affordability with average values up 3% from £176,009 in 2015 to £181,077 in 2016. This has resulted in average affordability in Scotland’s cities worsening in the last 12 months from 5.25 to 5.36 times gross average annual earnings, the third successive annual decline in affordability. The data from the Bank of Scotland Affordable Cities Review also shows that on average, affordability in Scottish cities is now at its lowest level since 2009 but is still 12% lower than the peak of 6.12 times earnings in 2008 at the height of the last housing market boom. The overall improvement in affordability across Scottish cities as a whole over the past eight years has been driven by a combination of an increase of 10% in the gross average annual earnings and an average house price decline 3%. Edinburgh is Scotland’s least affordable city where the average house price is 6.12 times the gross average earnings in the city. With an average price of £220,099, houses in Edinburgh are more expensive compared with average earnings than in any other Scottish city. Inverness at 6.03, Aberdeen at 5.72, Dundee at 5.38 and Perth at 5.24 make up the top five least affordable cities in Scotland while Stirling is the most affordable city and the second most affordable in the UK with an average property price of £165,658 which is 4.11 times the gross average annual earnings. Glasgow is the second most affordable city in Scotland and 10th in the UK, with an average house price of £159,580, which is 5.07 times the gross average annual earnings in the city. House price growth has been highest in Aberdeen over the past decade and since 2011 Aberdeen has recorded the biggest price rise of any Scottish city over the past decade and with a gain of 58%, is the only Scottish city to appear in the top 10 UK cities with highest house price growth in fifth place. The report explains that this is as a result of rising housing demand due to the strong performance of the oil and gas sector over most of the period. More recently, Aberdeen has seen a 22% rise since 2011 but prices are not declining due to a decline in the resources sector. ‘The rising house prices over the past three years have resulted in a deterioration in home affordability in Scotland’s cities. Although affordability is at the lowest level since 2009, it is still much lower than the height of the last housing market boom in 2008,’ said Nicola Noble, mortgages director at Bank of Scotland. ‘Aberdeen has recorded Scotland’s highest house price growth over the past decade and more recently during the economic recovery, due to strong performance in the oil and gas sector,’ she added. Continue reading
Property price growth eases in Australian capital cities
The rate of residential property price growth in capital cities in Australia eased during the final quarter of 2015, according to the latest data from the Australian Bureau of Statistics. The annual growth rate of home prices across Australia’s eight capital cities eased to 8.7% in the final quarter of 2015, driven in part by a deceleration of Sydney dwelling price growth. A breakdown of the data shows that year on year price growth remained strongest in Sydney with prices up 13.9%, followed by Melbourne with growth of 9.6% and Canberra with prices up 6%. In Brisbane prices increased by 4.2%, by 3.5% in Hobart and by 3.3% in Adelaide but prices fell by 3.2% in Darwin and were down by 2.9% in Perth. ‘From an affordability perspective, the slowdown in dwelling price growth to a more sustainable pace is a welcome development,’ said Shane Garrett, senior economist for the Housing Industry Association. He also pointed out that the quarter saw a narrowing of the gap between the capital cities in terms of price growth whereas in previous quarters, the divergence in the pace of price growth from city to city was very large. ‘During 2015, a record 220,000 new dwellings commenced construction across Australia. The additional supply is playing an important role in containing the severe price pressures in markets like Sydney and Melbourne,’ Garrett explained. ‘Ensuring an adequate supply of new housing in the future requires root and branch reform in areas like planning, land supply and the taxation burden on residential building,’ he added. Continue reading
