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Continued low interest rates boosting UK property sales
Home sales in the UK have exceeded 100,000 per month for a fifth month in a row with buyers attracted by low interest rates and attractive mortgage products. The latest official transaction data from HMRC shows that the provisional seasonally adjusted UK property transaction count for October 2015 was 105,490 residential and 10,160 non-residential transactions. The seasonally adjusted estimate of the number of residential property transactions decreased by 0.2% between September 2015 and October 2015. This month’s seasonally adjusted figure is 6.3% higher compared with the same month last year. The data also shows that the number of non-adjusted residential transactions was 2.6% higher than in October 2014. Peter Rollings, chief executive officer of Marsh & Parsons, pointed out that October marks the fifth consecutive month that home sales have cleared 100,000, putting activity in a whole other league to the first half of 2015. ‘There has been a slight correction on a monthly basis, but we’re still head and shoulders above a year ago, as buyers ride high on the wave of low interest rates and attractive mortgage products,’ he said. He also pointed out that in London, supply and demand are moving in different directions. ‘We’ve seen the number of available properties for sale fall 5% during the third quarter of 2015 compared to a 4% boost in buyers over the same period,’ he explained. Continue reading
Property prices in Ireland now growing faster outside of Dublin, latest data shows
Residential property prices are increasing more than twice as fast outside Dublin than in the capital as people continue to be squeezed out of Ireland’s largest housing market, the latest index suggests. Indeed, prices in Dublin increased by 1% in October and are up 4.5% year on year but this is the lowest annual rate of inflation since the middle of 2013, according to the data from the Central Statistics Office. Outside of Dublin property prices were up 2.1% month on month and 10.7% year on year as the market catches up with that of the main city. It was the highest rise outside of Dublin since October 2014. A breakdown of the figures shows that Dublin house prices rose by 1% in October whilst Dublin apartment prices increased by 0.8%. However, it should be noted that the sub-indices for apartments are based on low volumes of observed transactions and consequently suffer from greater volatility than other series. It means that at a national level residential property prices were 33.5% lower than their peak level in 2007. Dublin house prices were 33% lower than their peak, Dublin apartment prices were 40.2% lower than their peak and Dublin residential property prices overall were 34.9% lower than their highest level. Outside of Dublin residential property prices were 36.3% lower than their highest level in 2007. Property consultants Savills said it is not surprised that house price growth in Dublin has slowed sharply. However John McCartney, director of Research at Savills, believes this is more due to a technical base effect than to any material slowdown in recent months. ‘In the month of October last year, Dublin prices rose by a staggering 3%. This feat would have to be repeated in October 2015 for the annual rate of price growth to hold at its current 6.5%. This is highly unlikely, and as a result, the annual growth rate will be dragged lower,’ he said. He warned against reading too much into the figures. ‘The slowdown will undoubtedly attract headlines. But it will really say more about what was happening in the market last year than what is going on today,’ he explained. ‘The frenzied activity we saw 12 months ago as buyers rushed to avail of tax breaks and more lenient lending practices has gone. But agents are reporting steady transactions and robust prices, particularly in the €400,000 to €650,000 price range where competition is hottest,’ he concluded, adding that Savills expects annual price growth by the end of the year in Dublin to be around 5%. Continue reading
New planning reforms in UK welcomed, but lack of resources not addressed
The British Property Federation has welcomed the majority of the changes announced in the autumn financial statement by the UK Chancellor but expressed disappointment that there was no mention of a review of planning fees. ‘While there are some really sensible suggestions in today’s announcement, the planning system still has one big problem, the lack of resources in local authority planning departments,’ said Melanie Leech, chief executive of the BPF. ‘Both the private and public sector have identified this as one of the biggest obstacles for development, and with the private sector willing to discuss how it might be able to plug the funding gap, it is frustrating that Government has not engaged on this matter,’ she added. Included in the statement was amendments to planning policy to ensure the release of unused and previously undeveloped commercial, retail and industrial land for Starter Homes, and support for the regeneration of previously developed, brownfield sites in the greenbelt, by allowing them to be developed in the same way as brownfield sites elsewhere, providing it delivers Starter Homes. It will be subject to local consultation, such as through neighbourhood plans and Leech described it as a ‘very sensible step’ and one that will put a stop to endless battles in the planning regime as well as bringing forward the Government’s intended 200,000 Starter Homes. ‘The sites that will be eligible for this will not be lush green fields, but rather disused scrap yards and car parks which happen to sit within the Green Belt, and which are calling out to be more productively used,’ she pointed out. There will also be the establishment of a new delivery test on local authorities, to ensure delivery against the number of homes set out in Local Plans. The BPF believes that Local Plans are the key to sustainable development. Leech said it will ensure that local authorities really do concentrate on growth for their area and that their local plans are focused on delivery and the practicalities of housing the population. ‘The lack of resources afflicting local authority planning departments is an issue, and if authorities can keep their local plans kept short and sharp, they will help themselves,’ she added. The changes will also see the release of public sector land with capacity for 160,000 homes representing a more than 50% increase on the government’s record in the last parliament ‘The homes that are brought forward on these sites must be serviced with sufficient infrastructure and will ideally have homes for sale and for rent, to ensure that they contribute to mixed, vibrant communities,’ said Leech. The government will bring forward proposals for a more standardised approach to viability assessments, and extend the ability to appeal against unviable section 106 agreements to 2018. It is well known that a lot of disagreement between local authorities and developers arise due to viability assessments so the move towards a standardised viability model should go a long way to… Continue reading
