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Prices and sales up in Scotland as market recovers from impact of new land tax
Property in Scotland increased by 1% in October, the biggest monthly climb since April and sales were up 10% year on year, the highest figure for the month for eight years. The latest data from the Your Move index also shows that East Lothian saw biggest boost as new homes developments have pushed prices up 6.3% since September. West Lothian saw the biggest jump in home sales of any area in Scotland, with third quarter sales up 23% on the same period last year. The rise took the average price of home in Scotland to £168,843 and the market over a million pounds is starting to recover with 30 homes in this sector sold between August and October compared to just 14 in the previous three month period. Christine Campbell, Your Move managing director in Scotland, pointed out that average property prices in Scotland increased by £1,600 in October, twice the £761 rise reported in September, as sales of million pound home start again. ‘This growth means that we have seen the largest month on month rise in property values since the introduction of the Land and Buildings Transaction Tax (LBTT) in April this year and the fourth biggest monthly jump since the August 2007, at the height of the housing boom,’ she said. She also pointed out that the seaside town of North Berwick has experienced some of the strongest sales activity over the summer, as buyers hunt for somewhere which has an easy commute to Edinburgh. ‘Crucially, the town has seen three homes sold for over a million pounds and completions on premium new homes which has helped fuel this considerable increase in local prices,’ said Campbell. ‘The top of the market now appears to be recovering after being affected by the steeper LBTT. After the introduction of the new levy in April, home sales in this price bracket ground to a halt, but they are now picking up again,’ she explained. ‘The compromise is that higher end sellers are having to reduce the prices of their homes in order to compensate for the increased LBTT tax rate. In Edinburgh, sales of detached homes in the third quarter of 2015 are up 3% year on year, but average prices for these properties have dropped 2% over the same period,’ she added. The index data also shows that so far in 2015 property sales in Scotland for first time buyers and home movers are increasing three times faster than the rest of the UK. ‘The landmark LBTT switch has made it cheaper to buy homes with the first threshold at £145,000. Some 50% of home sales in Scotland are outside the system,’ said Campbell. ‘With the average cost of a flat in Scotland only £134,000, flat sales have jumped 8% in the third quarter of this year, compared to the same quarter in 2014. Low interest rates have also fuelled the rise as we have seen… Continue reading
UK house prices up 7% year on year, latest index shows
UK house prices increased by 7% in the year to October 2015, up from 6.1% in the year to September 2015, according to the latest official statistics. The data from the Office of National Statistics also shows growth of 7.4% in England, 1% in Wales, 0.9% in Scotland and 10.3% in Northern Ireland. Average mix-adjusted house prices in October 2015 reached £300,000 in England and stood at £174,000 in Wales, £196,000 in Scotland and £158,000 in Northern Ireland. Excluding London and the South East, UK house prices increased by 5.6% in the 12 months to October 2015 and month on month on a seasonally adjusted basis, average house prices increased by 0.8%. A breakdown of the figures show that the pace of annual house price growth was again varied across the nine English regions in October 2015. The largest annual increase was in the East at 10.4% followed by the South East at 9.5%. The North East had the lowest annual growth of the nine regions, with prices increasing 2.9% in the year to October 2015 but up from 1.8% in the year to September. London prices increased by 7.7% over the year to October 2015, up from 7.2% in the year to September 2015. Prices paid by first time buyers were 5.9% higher on average than in October 2014 while for existing owners prices increased by 7.4% for the same period. Rishi Passi, chief executive officer of Oblix Capital, believes that prices are set to continue growing in 2016. ‘As the economy stabilises, driven by improving job prospects, rising wages and recurring delays in interest rate rises, for the meantime at least, it’s likely this surge in house sales and price inflation will continue,’ he said. ‘Warnings that growth on this scale is unsustainable may ring true in the long term, especially in crowded London and the South East, as affordability issues become too significant a barrier to entry for first time buyers and low income families. Developers should take heed and look to other regions for their next opportunity,’ he added. Continue reading
New campaign launched to help residential landlords in the UK
The National Landlords Association (NLA) has launched its latest campaign in the UK, Reinventing Renting, which identifies opportunities for landlords to enhance their lettings businesses. The campaign is designed to help landlords transform their businesses into more successful profitable enterprises and it contains useful resources, guides and presentations, including how to choose the right investment, improve financial planning and expand portfolios and maximise gains. It also looks at how to reduce exposure to a range of risks associated with letting property, such as impending interest rate rises, rent arrears and rogue tenants. The campaign focuses on supporting landlords who are struggling to turn a profit by exploring different business approaches and tenant markets, while providing assistance for landlords looking to make their business more profitable. It comes as changes announced earlier this year in the Summer Budget and the Autumn Statement a few weeks ago are set to seriously affect profitability within the sector. ‘As the leading landlord association we’re here to provide landlords with all the tools and information needed to make a success of letting,’ said Carolyn Uphill, chairman of the NLA. ‘Over the next few months, Reinventing Renting will look at some of the key issues for landlords and provide support and tips to improve the way they run their business,’ she explained. ‘The campaign has something for both new and experienced landlords and will be particularly useful for those who are struggling to make things work or worried about how the changes to mortgage interest taxation will affect them in the future,’ she added. Continue reading
