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UK house price growth pauses, latest index shows
Average UK property prices have increased by 6.8% year on year but the growth has paused with values obtained flat lining so far this year. The latest index from haart estate agents also shows that the average price of a starter home has fallen by 2.2%, good news for first time buyers. Overall the index reveals that in February average prices fell by 0.2% to £204,355 compared with the previous month but are still up by 6.8% compared with a year ago. But in London prices are down 1% month on month to an average of £466,990 and down 4.6% compared to February 2014. However, demand is still high with 21 buyers chasing each home for sale in London and 12 potential buyers for each new property nationwide. Paul Smith, chief executive officer of haart, pointed out that new housing stock across the UK materialised in February with supply up almost 11% in a single month which is matched by a similar uplift in buyer registrations, a sign of consumer confidence in the market. ‘So far this year average house prices are showing no significant fluctuations, which is good news for affordability. First time buyers are now benefiting from a dip in the average price of a starter home by 2% annually and from broader economic factors such as low interest rates and Help to Buy incentives,’ he said. ‘Despite this promising start to 2015, the number of new home starts promised post general election by the main political parties falls well short of what is needed and we still lack a strategic long term policy to address supply,’ he explained. He believes that London’s average property prices declining is no bad thing for affordability and sentiment. ‘This is no boom and bust but the beginning of a return to normality following the peak of the market in Spring 2014. The capital’s property market is still bustling with 21 potential buyers chasing each property for sale,’ he added. Continue reading
UK set to see more transparency on mortgage fees and charges
The Council of Mortgage Lenders and consumer organisation Which? have published a joint progress report on how to help people understand mortgage fees and charges. The aim is to improve the information given to consumers so that they can also compare the overall cost of borrowing. It says that organisations have made good progress, and most of the industry will have made the necessary changes by the end of the year. Meanwhile in July the CML and Which? will publish firm proposals and a timeline for implementation. The report calls for the introduction of a common approach by lenders to make their tariff of fees and charges available to customers to avoid confusion and make it easier to find information about mortgage costs. It also wants to see a wider use of consistent terms to describe the same types of fees and charges that currently have an array of different names and better explanations of whether fees are compulsory or avoidable and when they will be charged. It says there needs to be clearer ways of presenting information to help borrowers compare the cost of particular mortgage deals over specific periods, not just the upfront costs. ‘This collaboration with Which? has helped lenders focus on practical and simple ways to help customers by making information more transparent and consistent. We hope customers themselves will find it easier and less daunting to make informed choices about their mortgages as a result,’ said CML director general Paul Smee. Which? executive director Richard Lloyd said it is good news for thousands of consumers who supported the organisation’s call for an end to the confusion about the full cost of taking out a mortgage. ‘Which? has been working with the CML to simplify the wide range of complicated fees and charges in the market so people don't pay over the odds on their loan. We look forward to all mortgage providers making these changes so that people can get the best deals more easily,’ 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
