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Valuation activity in UK property market increased in first month of 2016
The UK housing market has started 2016 on a positive note as overall valuation activity in January increased by more than half on an annual basis, according to the latest research. In total, the number of housing valuations carried out in January climbed 52% compared to January 2015, the fastest annual uptick in total valuation activity since July 2015 when volumes rose by 57% on July 2014. The data from Connells Survey & Valuation also shows that on a monthly basis, valuation activity across all housing sectors grew by 13% between December 2015 and January 2016. John Bagshaw, corporate services director of Connells Survey & Valuation, believes that the recent announcement from the Bank of England that interest rates will be kept at rock bottom levels for the foreseeable future will boost the market further. The firm’s report show that the buy to let and remortgaging sectors were the key drivers behind the strong growth of overall housing activity in January. The number of valuations for buy-to-let purposes grew by 51% between January 2015 and January 2016, while the remortgaging sector soared by 97% over the same twelve-month period. Both sectors experienced steadier performances on a monthly basis, with the number of valuations carried out for buy to let investors in January up 11% on the previous month. Meanwhile, January’s remortgaging activity represented a 12% dip on December 2015. ‘Buy to let investors and remortgagors have enjoyed a busy start to the New Year. It might come as a surprise that there are still so many home owners who are paying higher rates, and so are opting to remortgage, when rates have been so low for so long. But ultimately it’s a shrewd move and one that is likely to remain popular with home owners so long as the Bank of England keeps rates at or anywhere near 0.5%,’ said Bagshaw. He explained that while many buy to let investors are hurrying to expand their portfolios before the Stamp Duty changes in April, others are newcomers to the sector, who simply see buy to let as a good investment opportunity regardless of the tax hikes. ‘We can expect the buy to let sector to reach a height of activity over the coming months, as some concerned landlords look to counter the effects of any measure that could hit their profit margins,’ he added. Annual valuation activity among home owners looking to move grew by 27% in January, while between December 2015 and January 2016 there was a 15% uptick in the number of valuations for home movers. Meanwhile, first time buyers saw slightly more modest progress. Valuation volumes among those taking their first step onto the ladder in January grew 22% on an annual basis and 5% on a monthly basis. ‘First time buyers are also getting ever more confident. The volume of affordable homes being built is gradually increasing. This means the hunt for that ideal first home has become less daunting… Continue reading
UK prime property prices up by an average of 0.3% in final quarter of 2015
Prime property prices in the UK increased by an average of 0.3% in the final quarter of 2015 despite a strengthening economy and low interest rates, according to the latest report. Beyond London prices of prime residential property saw muted price growth of 2.4% on average across 2015, but this was much lower than the 4.5% seen across the wider UK mainstream housing market. The situation reflects a general absence of urgency among buyers in the prime property market, says the report from international property services firm Savills. It explains that the resulting lack of upward pressure on prices was fairly uniform across the regions though markets in the London commuter zone performed marginally better, boosted in particular by the performance of prime property in high value towns and cities where annual growth averaged 5.4%. By contrast prime country property in London’s hinterland only saw annual growth of 1.9%. Across the country the performance of larger country houses has been most constrained with values of larger rectories and manor houses seeing little if any growth over 2015, reflecting a thinner stream of demand for the most expensive prime properties. The report also explains that higher value homes have been most affected by successive increases in stamp duty that culminated in the changes introduced in December 2014, which have also held back the prime property market in London. This has had a knock-on effect on demand flowing out of the capital, interrupting the ripple effect which we would otherwise expect at this point in the housing market cycle. The impact of taxation has also been noticeable in the prime housing markets in Scotland where the introduction of LBTT has meant that average price growth of just 0.4% in the past 12 months, though prime property in Edinburgh and Glasgow has performed more strongly. Across all areas smaller prime properties have performed best with those below £1 million showing annual price growth of 3.7%, much more in line with the wider housing market. Generally these markets have been the most buoyant, with greater levels of transactional activity. Looking ahead, in the short term Savills says that the demand for good quality family homes is likely to continue to underpin modest price growth across the prime regional markets, with appetite for larger higher value homes remaining more price sensitive. The firm is expecting price growth of 2.0% to 3% in 2016, which means sellers will need to remain realistic in their asking price, but which presents an opportunity for committed buyers. However, thereafter Savills expects the ripple effect to be restored as the market adjusts to higher transactional costs and buyers more actively seek to exploit the price differentials both between London and the commuter zone and the commuter zone and beyond, which have widened significantly over the past 10 years. The report also points out that Chancellor announced further changes to stamp duty in the 2015 Autumn Statement introducing a 3% surcharge on additional homes, the sales of… Continue reading
UK self-builders set to benefit from new register for plots of land
Self-builders in the UK should find it much easier to kick start their dreams of building a home with the launch of new registers to support eager builders find plots. From 01 April councils will have to keep a register of aspiring self and custom house builders when planning for future housing and land use, it was announced by Housing and Planning Minister Brandon Lewis. He explained that as part of government plans to provide more homes, new measures and guidance have been put in place to clearly set out the procedure local authorities will have to take when people wish to register their interest for a plot of land. The aim is that as more and more people want to build their own home this move will help unlock the massive potential the custom build industry has to expand and help meet the country’s future housing needs. ‘Many other countries have a track record of delivering large numbers of local homes through self-build and we’re determined to ensure self and custom housebuilding grows significantly,’ said Lewis. ‘The new registers are a fantastic example of our commitment to double the number of custom and self-build homes by 2020 so anyone who wishes to design their dream house can do so,’ he pointed out. ‘This government is committed to increasing housing supply and helping more people achieve their aspiration of home ownership whether that’s buying on the open market through schemes like Help to Buy, or by building or commissioning their own home,’ he added. The registers are in addition to the measure in the Housing and Planning Bill which will require authorities to ensure they have sufficient shovel ready plots to match the local demand on their register. The Self-build and Custom Housebuilding Bill has placed a duty on local authorities to keep a register of those seeking an interest in bringing forward self and custom build projects. The Housing Development Fund has been set up to provide access to £1 billion of loan finance for up to five years supporting the provision of over 25,000 homes through to 2024 to 2025. It is for custom build, small and medium builders and innovative new building methods. Continue reading
