Tag Archives: british
Scottish country house prices moderate in first quarter of 2015
Prime country house prices in Scotland rose by 0.2% between January and March, a slightly more modest increase than the 1% growth seen in the final quarter of 2014, the latest data shows. Annual growth also slowed, to 1.2%. This compares to average growth of 2.1% in 2014, according to the latest index report from Knight Frank. Average prices remain 22% below the market peak in 2007 so a property valued at £1 million in 2007 would now be worth £780,000. However, there are regional variations in price growth across the prime market. Edinburgh leads from the front with a year on year price rise of 4.1%, followed by Central and Northern Scotland. However, while price growth at the top end of the market has slowed in the approach to the UK General Election, prime sales volumes in the first quarter of 2015 have increased. The firm says this can be attributed to the introduction of the new Land and Building Transaction Tax (LBTT) this month as both buyers and vendors in the prime market have looked to complete deals ahead of the introduction of the new levy. Under the new rules, 50% of buyers will not be liable to pay any tax on the purchase of a home. However, for homes valued above £333,000 the up-front cost of moving will increase. Knight Frank sales data shows the number of prime country homes changing hands between January and March, ahead of the implementation of the new levy, was 11% higher than during the first three months of 2014. The report suggests that the introduction of LBTT is likely to have a knock-on impact on sales at the top end of the market in the second quarter of the year. ‘However, we expect that in the medium term the market will adjust to the new system, underpinned by current favourable economic conditions,’ said Ran Morgan, head of Scottish residential sales. ‘In spite of higher levels of property tax, Scottish property continues to offer good value, especially when compared with London and southern England,’ he added. The data also shows that more than half of buyers in this property sector are from outside of Scotland. ‘Over the last year 57% of our buyers were from outside of Scotland, highlighting the global appeal of the country. This trend has continued in 2015, with individuals from Hong Kong, the United Arab Emirates and London all purchasing properties during the first three months of the year,’ explained Morgan. A breakdown of the figures shows that 31% were from other parts of the UK, on top of that 12% were from London, 5% were from the Middle East and 5% from Asia. Some 2% were from Europe and 2% from North America. Continue reading
UK buy to let lenders adopt new practice statement
Buy to let lenders in the UK who are members of the Council of Mortgage Lenders are adopting a new statement of practice, designed to provide clarity about how responsible lenders operate. The statement reflects existing good practice and aims to ensure that there is a clear explanation of the obligations of buy to let borrowers on their mortgages and is a sign that buy to let lending is growing. It signposts additional information from other organisations about the responsibilities of being a landlord, and is endorsed by the Residential Landlords Association, the Association of Residential Letting Agents (ARLA), the Association of Mortgage Intermediaries, the Intermediary Mortgage Lenders Association, and the British Bankers Association (BBA). Some 31 lenders representing an estimated 90% of the buy to let market have already adopted the statement of practice. All CML members who offer buy to let mortgages are expected to adopt it over the course of 2015. The statement sets out the overarching principles that individual lenders use in determining their own lending strategy and practice in relation to lending principles, information given to customers, customer responsibilities, lender responsibilities on affordability, handling financial difficulties, fraud prevention and complaint handling. Next year when the consumer buy to let lending framework is established under the Financial Conduct Authority, the UK’s financial watchdog, to comply with the Mortgage Credit Directive, buy to let lending will fall into one of three types. These are mortgages regulated by the FCA like residential mortgages when the property is either partly occupied by the borrower or let to an immediate family member; mortgages regulated by the FCA under the Mortgage Credit Directive Order 2015 defined as ‘consumer’; and mortgages not regulated by the FCA which are those predominantly for a business purpose. The statement of practice will cover any residential buy to let lending not otherwise covered by FCA regulation. ‘Lenders know how important it is to have a transparent mortgage market, in which borrowers can have confidence, and where lending policy is both responsible and clearly understood,’ said CML director general Paul Smee. ‘The new buy to let statement of practice reflects what responsible lenders already do and offers a clear explanation of how buy to let lenders operate. We hope it will make a valuable contribution to understanding the buy to let lending environment,’ he added. Continue reading
Steady property sales and price market forecast for Canada this year
Residential real estate prices in Canada are expected to remain stable this year while sales will vary considerably on a regional basis, according to the latest forecast report from the Canadian Real Estate Association (CREA). National sales are now projected to reach 475,700 units in 2015, representing an annual decline of 1.1% which would place annual activity slightly above but still broadly in line with its 10 year average. British Columbia is projected to post the largest annual increase in activity in 2015 at 4.9% followed closely by Nova Scotia at 3.7% Quebec at 2.5%, New Brunswick also at 2.5%, Ontario at 1% and Prince Edward Island at 1.4%. These numbers represent upward revisions to CREA’s previous forecast. Alberta is expected to post the largest annual decline in sales this year at 19.2% although the trend for activity is expected to begin recovering from a weak start to the year as consumer confidence recovers. Sales are also forecast to decline on an annual basis in Saskatchewan by 11.2% and in Manitoba by 1.3%. The national average home price is now forecast to rise by 2% to $416,200 in 2015. Only British Columbia at 3.4% and Ontario at 2.5% are forecast to see gains in excess of the national increase. Prices are projected to remain largely stable elsewhere, with increases or decreases of around 1% or less this year. The exception is Alberta, where average price is forecast to fall by 3.4%, reflecting a pullback in sales for luxury properties compared to homes in more affordable price segments. In 2016, national sales activity is forecast to reach 482,700 units, representing an annual increase of 1.7%. Much of the annual increase reflects an anticipated recovery for sales activity in Alberta and Saskatchewan in line with expected economic improvement in those provinces. Strengthening economic prospects are expected to result in improving sales activity in other provinces where sales have struggled, keeping prices more affordable amid ample supply. Meanwhile, anticipated mortgage rate increases are expected to keep activity in check in markets where homes are already less affordable and prices have continued rising. The national average price is forecast to rise by a further 1.9% to $424,100 in 2016. Given an ongoing shortage of supply for single family homes in and around the Greater Toronto Area, price growth in 2016 is forecast to be strongest in Ontario at 2.5% and Alberta at 2.4%. Gains of around 2% are forecast for British Columbia and Manitoba, and around 1% for Saskatchewan and Quebec. Average home price in the Atlantic region is forecast to hold steady in 2016. Continue reading
