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UK construction industry gets boost from improved home lending
The UK government’s Help to Buy scheme and a renewed willingness by banks to lend to home owners has boosted the construction industry, it is claimed. The latest official figures from the Office of National Statistics shows that output in the construction industry in the third quarter of 2014 increased by 0.8% compared to the previous quarter. The ONS data also shows growth of 2.9% between the third quarters of 2013 and 2014, the sixth consecutive period of annual quarter on quarter growth. Most recently, in September 2014, output in the construction industry was estimated to have increased by 1.8% compared with August 2014, following a fall of 3% in August and an increase of 2% in July. On the year, the picture is of continued growth, with output in the construction industry increasing by 3.5% in September 2014 compared with September 2013. Housing, as a sub-element of all construction output, was worth £6.77 billion in the third, up 5% on the second quarter and 22% higher than in the third quarter of 2013. Within housing, output by the private sector has grown 19% since the third quarter of last year, while construction by public organisations grew by 35% on an annual basis According to David Newnes, director of Your Move and Reeds Rains estate agents, The Help to Buy scheme and a renewed willingness on the part of banks to lend to borrowers with smaller deposits played a significant part in boosting demand all across the country, giving first time buyers a better shot at the goal of home ownership. ‘This injected new energy into the construction sector, but although house building is making headway across the pitch, we’re still a long way from seeing the form that was in evidence before the crash,’ he said. He pointed out that households received a welcome boost in the cost of living game with the news that wage growth is beating inflation, but dogged demand for housing must be matched with a new charge of supply if the cost of housing is to be kept within the grasp of new buyers. ‘House price inflation may have been reined back from the intensity witnessed earlier this year, but in the long term building new homes remains key to ensuring that competition over available property and price rises stay at healthy levels, and don’t eat away at consumer confidence,’ he explained. ‘Higher LTV lending dipped last month, as new loan to income caps came into force. We need to ensure that the bottom of the market stays firm, anchored on a solid bedrock of plentiful supply of starter homes,’ he added. Andrew Bridges, managing director of specialist London estate agents Stirling Ackroyd, believes that gradual progress won’t be enough for the construction industry. ‘This growth is still slower than the rest of the economy and not yet fast enough to capture the true scale of opportunity,’ he said. ‘Homes are most sharply sought after, and that’s reflected in the best figures for the housing portion of output… Continue reading
Median and average sale prices continue upwards in Miami, latest data shows
The performance of the Miami real estate market remains consistent with record activity in 2013 due to strong demand despite increased existing and new construction supply, it is suggested. Median and average sales prices continue to rise, according to the latest statistics from the Miami Association of Realtors. In the third quarter, the median sales price for homes in Miami-Dade County was $250,000, an increase of 8.7% compared to last year while the median sale price for condominiums rose 3.5% to $189,900. These third quarter price increases mark 11 consecutive quarters of growth for both single family homes and condominiums. ‘The Miami real estate market continues to attract the attention of both domestic and foreign buyers, fuelling solid growth and creating opportunities for both buyers and sellers, said Liza Mendez, chairman of the association’s board. ‘While there is more supply available than a year ago, there is still strong demand, and the growth of supply, new listings, sales and prices is more moderate, resulting in a more balanced market,’ she added. In Florida the state wide median sales price for single family existing homes in the third quarter was $182,000, up 4% from the same quarter a year ago, according to the latest housing data released by Florida Realtor. The median sales price for condominiums in Florida was up 6.9% compared to the same quarter last year at $139,000. Compared to last year, the average sales prices for single family homes and condominiums in Miami-Dade County increased 14.9% to $438,431 and 3.8% to $341,927, respectively. There were 7,632 homes and condos sold in Miami-Dade County during the third quarter of 2014, a decrease of 5% compared to the third quarter of 2013, when there was record sales activity. Sales of single family homes increased 0.2% to 3,552, while condominium sales decreased 9% to 4,080 compared with the same period in 2013. ‘In Miami, market performance continues to vary greatly depending on location, property type, price range and other factors,’ said Franciso Angulo, residential president of the Miami Association of Realtors. ‘While in most cases, increased supply is offering buyers more choices and less pressure, others are still experiencing significant competition and bidding wars,’ he explained. He pointed out that the Miami Association’s initiatives to increase inventory and focus on assisting members to get more listings has proven successful along with some additional distressed properties coming on the market. In addition, the fact that sales remain at historically strong levels while inventory is growing points to seller confidence. Sellers are listing properties for sale because they have confidence in the market, according to Angulo. Home and condominium listings also increased in the second quarter but by narrower margins. There were 6,237 new single family home listings during the third quarter, a growth of 5.1% relative to the same period last year. New condominium listings increased by only 1% from 8,282 in the third quarter of 2013 to 8,366 this year. At the current sales pace, current inventory represents 5.7 months of inventory for single family… Continue reading
UK house price growth slows as demand slips for fourth month in row says RICS
House price momentum in the UK continued to slow and new buyer demand tailed off in October, according to the latest Residential Market Survey from the Royal Institution of Chartered Surveyors. Nationally, new buyer demand slipped for the fourth consecutive month with London bearing the brunt of the decline, as 62% more surveyors reported a fall in new buyer demand across the capital. Meanwhile across the rest of the UK dipped to a net balance of -18%. As a result of the weaker trend in buyer interest, sales expectations are now at their lowest point since the beginning of the year and the picture regarding near term price expectations is not dissimilar. But Scotland and Northern Ireland have the most optimistic view on house prices in the run up to Christmas with net balances of 36% and 37% respectively. Meanwhile, stock coming onto the market remained virtually unchanged in October with a net balance of -2%, continuing the trend which has been in place for much of the past year. As a result, even with the dip in demand, much anecdotal evidence from surveyors points to an ongoing challenge in securing adequate new instructions. At a national level, the slowdown in buyer activity in the sales market stands in marked contrast to the lettings market, where tenant demand continues to grow strongly. Over the last quarter, this has particularly been the case in East Anglia, the north of England and Scotland and rent expectation remain generally firm with respondents' anticipating an increase of around 2.5% over the next twelve months across the whole of the country. ‘The flatter trend in the market is partly a reflection of potential buyers becoming a little more cautious about making a purchase as more stringent lending criteria has made it harder to access mortgage finance,’ said Simon Rubinsohn, RICS chief economist. ‘An increasing awareness of the approaching general election also appears to be contributing to the softer market if the responses to the latest survey are anything to go by. However, with new instructions still flat at a headline level as has been the case for most of the last year it seems implausible that the dip in demand will result in very much of a decline in house prices,’ he explained. ‘Meanwhile, demand to rent property is growing as the sales market slows and this, coupled with a drop in supply of new stock to let, is helping to underpin the rental outlook for landlords pretty much across the whole of the country,’ he added. Continue reading
