Tag Archives: crisis
UK estate agents report a better balance between buyers and homes for sale
A better balance between the number of homes for sale and the number of registered home buyers in the UK is emerging, according to the latest report from the National Association of Estate Agents. The October Housing Market survey found that member agents reported an average of 53 properties for sale per branch, some 15% higher than the monthly average for the rest of 2014. It is the highest number recorded on books since October 2013 and compares with an average of 51 properties was recorded per branch in September. While supply showed signs of an increase, the number of house hunters registered per NAEA member branch fell, from 406 in September to 380 in October, easing the balance between the number of available homes and demand. The survey data also shows that the average number of homes sold during the month remained static on September figures, at average of nine sales per NAEA member branch. The number of first time buyers recorded fell, down 6% in October compared to the previous month’s figures, to 24% of total sales from 30% of total sales in September. ‘There is a better balance emerging between the level of demand and supply, as the number of registered house hunters falls for October, while the average number of available properties registered per branch rises to accommodate those looking to buy,’ said NAEA managing director Mark Hayward. ‘However, both supply and demand is still seasonably low for October. The decrease in buyer demand and in particular the decline in first time buyers, along with a relatively static sales market, could be a direct result of the stricter lending criteria which came into play six months ago at the end of April this year, making it harder for house hunters to access mortgage finance. This has certainly been reported as one possibility by our NAEA member branches,’ he added. When asked if the new MMR rules had led to a direct decrease in the overall number of home buyers since it was introduced six months ago, some 79% of NAEA member branches agreed it had affected the current number of buyers. With the exception of September 2014, in which 406 home buyers were recorded on average per branch, the number of house hunters registered per member branch had shown a decrease on figures recorded in April 2014 when it was 392 home buyers in the month MMR was introduced. NAEA member branches also said they believed the MMR had particularly affected demand among first time buyers with 70% of member branches reporting the implementation of MMR had led to a decrease in the number of first time buyers since it came into force. ‘First time buyers will be especially more cautious about making a purchase due to the stricter lending criteria now in place, which makes it harder to secure finance,’ explained Hayward. ‘In addition, prospective… Continue reading
Councils in England urged to sell off high value properties to fund more affordable homes
Councils in England should sell vacant buildings and reinvest the money in more affordable homes, according to a government minister. Too many are sitting on multi million pound vacant houses yet the sale of just one high value council house could help fund more affordable house building, increase supply and reduce social housing waiting lists, said Communities Secretary Eric Pickles. He said such a move is part of the government’s long term economic plan to get Britain building and is the latest in a number of measures taken since 2010 to make the best possible use of social housing. Social housing waiting lists have halved since 2010 but Pickles believes that new rules could bring this down even further and from next April, councils will be required to publish the most recent valuation of their social housing stock, annually to ensure it is being put to best use. The information will be published by postcode, listing how much the properties are worth, how many are occupied and how many are standing empty. Pickles explained that this will give people the information they need to ask questions of how their council is managing stock and how selling more expensive properties could provide the funds for councils to build more homes and reduce waiting times. Councils could also sell their higher value empty properties, releasing more money for house building without affecting existing tenants’ rights. And with the numbers of empty homes down by 160,000 since the end of 2009 to a 10 year low, this could reduce the numbers of empty properties even further. For example, Southwark council were able to sell off one of their council homes for a staggering £3 million, helping to fund the building of 20 new properties across the borough. Pickles argued that other councils across the country could follow suit, potentially helping thousands of families by selling their higher value vacant homes. ‘Councils across the country are sitting on millions of pounds which could be put to far better use and get them building elsewhere in the area. This would allow more families to come off social housing waiting lists and get into homes,’ said Pickles. ‘Instead of holding that money as equity in expensive empty properties, the councils should sell up those vacant buildings and reinvest the money to get the country building,’ he added. He pointed out that through the government’s Affordable Homes Programme some £19.5 billion public and private funding has been invested in affordable house building, with a further £23.3 billion investment planned from 2015 to 2018. Over 200,000 new affordable homes have been delivered since 2010. House building is a key part of the government’s long term economic plan and since 2010 a range of measures have been taken to ensure the best possible use of social housing. Continue reading
Home buyers in London borrowing higher amounts, latest CML data shows
More mortgages were completed and a higher amount borrowed in Greater London in the third quarter of this year than in any quarter since 2007, according to the latest data from the Council of Mortgage lenders. House purchase lending to home buyers increased 12% quarter on quarter in London totalling £7.1 billion, a rise of 15% on the second quarter. Compared to the third quarter of 2013, the number of loans increased 3% and value of these loans increased by 13%. This is the highest quarterly volume in London since the fourth quarter 2007, and the highest amount borrowed since the third quarter of 2007. First time buyers took out more loans and borrowed more in total than in any quarter since 2007 totalling 13,300 loans and £3.3 billion. The affordability levels slightly improved with first time buyers typically borrowed 3.86 times their gross income, less than the 3.90 in the previous quarter but above the UK average of 3.41. The typical loan size for first time buyers was £221,997 in the third quarter, up from £212,500 in the previous quarter. The typical gross income of a first time buyer household was £58,000 compared to £55,255 in the second quarter. First time buyers in London have tended to put down larger deposits than in the UK, typically putting down a deposit worth 24% of the property value compared to the UK average of 17%. In the third quarter, first time buyers paid 21% of gross monthly income towards capital and interest payments, a minor change from the second quarter when it was 21.1%. Due to higher house prices within London compared to the UK overall, there was a continued shift in the mix of properties bought by first time buyers in London towards more expensive properties. In the third quarter, 66% of first time buyers bought properties priced at more than £250,000, up from 63% in the second quarter and 54% in the same period last year. This was significantly higher than the UK overall level of 20%. In the third quarter of 2014, lending to home movers saw larger growth quarter on quarter compared to first time buyer lending, but a slight decline in lending volumes when looking at year on year comparisons. Home movers did however borrow more this quarter than any other quarter since 2007 totalling £3.7 billion. Home mover affordability changed fractionally, with home movers typically borrowing 3.69 times their gross income compared to 3.66 in the second quarter and the 3.05 in the UK overall. The typical loan size for home movers was £290,000 in third quarter, up from £281,000 in the previous quarter. The typical gross household income of a home mover was £83,596 in third quarter compared to £82,614 in second quarter. Home movers in Greater London spent 20.8% of their gross income to cover monthly capital and interest payments, slightly changed from 20.6% in the second quarter and less than the 18.8% UK average. The number of loans advanced for… Continue reading
