Tag Archives: crisis
Expectations for future house price growth in the UK eases to 13 month low
Home owners in the UK still perceive that the value of their home increased in September but at the slowest rate for eight months, the latest property market sentiment index shows. Some 26.7% of the 1,500 households surveyed across the UK for the Knight Frank and Markit Economics index said that the value of their home had risen over the last month, while 5.5% reported a fall giving the HPSI a reading of 60.6, the eighteenth consecutive month that the reading has been above 50. However, the reading was down on the 61.8 achieved in July and was the fourth consecutive month that households’ perceptions about house price growth have moderated. Households in all 11 regions covered by the index reported that prices rose in September, with those living in London perceiving that the value of their home had risen at the strongest rate at 67.7, followed by households in the South East at 67.5 and the East of England at 64.4. The future HPSI, which measures what households think will happen to the value of their property over the next year, fell in September to 69.2, its lowest level since August 2013 and well below its peak of 75.1 in May. Expectations for price growth weakened in ten of the 11 regions covered by the index, with households in Wales the only ones more confident of future price rises than the previous month. In London expectations fell to a seventeen month low. Some 5.7% of UK households said they planned to buy a property in the next 12 months. This is down from 5.9% in August. Looking at the figures on a regional basis reveals that 9.3% of households in Yorkshire and the Humber plan to purchase a property in the next year, compared to just 3.4% in Scotland. Men are more likely to be considering buying a home in the short term, with 6% of such respondents saying they planned to purchase a home within the next 12 months compared to 5.4% of female respondents. House prices are rising across the UK, but our index signals a continuing slow-down in the pace of growth. The index started to ease in June and the trend is continuing. Some 46% of respondents expect the price of their home to rise over the next year, the first time this proportion has been under 50% this year,’ said Gráinne Gilmore, head of UK residential research at Knight Frank. ‘The strengthening economy, job creation and low base rates are helping underpin property values, but there are signs that households across the board are becoming more circumspect about the scale of price growth they expect,’ she added. According to Jack Kennedy, senior economist at Markit, these figures continue to lead other indicators and point to ongoing evidence of a cooling in the UK housing market. ‘With the index tracking property price expectations easing to a 13 month low in September, expectations weakened across all regions with the exception of Wales,’ he said. ‘The prospect of… Continue reading
Flat prices have risen the most in the UK in last 10 years, new research shows
Flats prices in the UK have risen by more than twice the average for all properties in the last decade but most of the growth is down to increases in London, new research shows. The average price of a flat in the UK has risen by nearly £51,000 or £425 per month, from £157,172 in 2004 to £208,169 today, according to the research from the Halifax building society. The 32% increase in the average price of a flat is more than double the 15% rise for all residential properties over the same period. Detached homes at 12% and bungalows at 13% have recorded the smallest rises over the past 10 years. Whilst flats have increased most in price nationally since 2004, much of this rise is due to the performance of flat prices in London, where flats represent a relatively high proportion of the property market. Terraced homes have been the best performing property type in the greatest number of regions. These five are the North West, Yorkshire and the Humber, West Midlands, East Midlands and East Anglia. Semi-detached and terraced homes have remained the most popular types of property purchased over the past ten years. These two types represent 60% of all home sales in 2014; up from 56% in 2004. For first-time buyers, semi-detached homes have risen in popularity, accounting for 29% of purchases in 2014 compared with 25% in 2004. Detached sales have fallen from 21% of all property sales to 16% over the past decade. In the last five years prices have improved across all property types with flats recording the largest increase between 2009 and 2014 at 43%. Terraced properties at 31% growth experienced the next biggest rise. Bungalows have seen the smallest gain of 15%. The increase in flat prices nationally has been led by London with growth of 44% with a more subdued performance elsewhere in the country. All property types recorded substantial price falls during the housing market downturn between 2007 and 2009. Terraced houses fell 33% and flats were down 32% while bungalows fell by 21% and detached homes were down 26%. The report says that the tightening in credit criteria and the reduction in mortgage availability following the onset of the financial crisis made it more difficult for first time buyers in particular to enter the market. This helps to explain why terraced houses and flats, which are very popular with first time buyers, recorded the largest price falls during 2007 to 2009. ‘There has been a significant increase in the number of first time buyers since 2010 compared with a modest decline in the number of those moving home. This difference is reflected in a bigger rise in prices over the past five years for those property types that are most popular with first time buyers,’ said Martin Ellis, housing economist at the Halifax. ‘Since 2009, larger property types such as detached homes, semis and bungalows have underperformed flats and terraces. The demand for such properties has… Continue reading
UK govt announces new deals for private rented sector
Tenants renting privately in the UK will get a better, fairer deal under measures announced by Housing Minister Brandon Lewis. He said that people looking to rent a home will be better informed, have greater choice and more confidence they will be treated fairly thanks to a range of ambitious initiatives. But Lewis said this will not strangle the industry in red tape and regulation, which would destroy investment in new housing, push up prices, and make it far harder for people to find a flat or house to rent. Instead, the new measures will both provide the help tenants need, without jeopardising the millions of pounds in investment already lined up to build new homes specifically for private rent. ‘The private rented sector plays a vital role in our housing market, providing a flexible option for millions of people across the country. The last thing we want to do is strangle it in red tape but tenants and landlords should have confidence that they will be treated fairly,’ said Lewis. ‘This package of measures is designed to do just that, putting power in the hands of people to get the deal they serve, without punishing the vast majority of good landlords while still encouraging more investment in the sector,’ he explained. ‘I would urge all landlords to take account of the new code of practice and look to offer our model tenancy agreement while the Build to Rent deals demonstrate how committed we are to getting homes built specifically for this market,’ he added. In the package is a new model tenancy agreement which Lewis said will empower tenants to agree longer deals with their landlord and has the added benefit of avoiding the need for landlords to leave properties empty and pay fees to letting agents for finding new tenants. The new code of practice, produced by the Royal Institution of Chartered Surveyors, makes clear the legal requirements of landlords and letting agents alike, leaving both in no doubt about their responsibilities to their tenants. This is on top of a new requirement for letting agents to belong to one of three approved redress schemes, to ensure that any landlord or tenant who gets a raw deal has somewhere to go with their complaint and could even claim compensation. The minister also argued that the key to creating a bigger, better private rented sector is to secure more investment and encourage more professional landlords to enter the market and offer their homes to tenants. He announced three new deals to deliver homes specifically for private rent under the government’s Build to Rent scheme. He announced £17.7 million to Notting Hill Housing Trust to build 181 homes in Newham and Southwark, £4.8 million to Carpenter Investments to build 101 homes in Liverpool and £4.8 million to Derwentside Homes to build 114 homes for private rent in Durham. In total the Build to Rent scheme is well on track to deliver up to 10,000 new homes for private rent by 2015. The new… Continue reading
