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Scotland sees strongest house price growth for seven months
Property prices in Scotland increased 0.8% in December month on month and 2.5% year on year, according to the latest index figures. It is the strongest year on year increase since May 2015, taking the average house price to £170,641, with the typical property up by £4,000, according to the index from Your Move. But Aberdeen recorded a steep fall in house prices, down 6.8% year on year as demand fell due to the falling oil price. Overall sales were strong with transactions up 21% in December 2015 compared to the same month in 2014 and the top end of the market is recovering, with 11 million pound home typically sold each month by the end of 2015. But Christine Campbell, Your Move managing director in Scotland, pointed out that the increase over the year to December is still below the 4.4% rise in 2014, as growth was skewed by the introduction of the Land and Buildings Transaction Tax (LBTT). She also pointed out that the average house price has now broken through the £170,000 barrier again for the first time since May and 2015 was a turbulent one for some parts of Scotland. Aberdeen experienced the biggest dip in house prices with property values in the area falling 6.8% or £15,551. ‘This decline has been driven by the drop in demand for homes in the area, as the tumbling oil price reduces employment and investment into the city,’ said Campbell. ‘Aberdeen has also felt the negative affect of the introduction of the LBTT, as it’s home to a large number of higher value properties which the tax hit hardest. The city has now slipped to sixth in the house price rankings, down from third at the end of 2014,’ she explained. Total sales for the year were 6% higher than in 2014, in stark contrast to England and Wales where sales are down 2.6% year on year. In Scotland, the type of homes selling swiftest were flats, up 18.4% in the last quarter of 2015 compared to the same period in 2014. The smallest increase was in pricier detached properties, but sales still rose 8.8% over the same time period. ‘As typically the cheapest type of property on the market, flats have benefited most from the switch to LBTT which removed tax paid on purchases under £145,000. With an extra 3% surcharge on second homes coming into force in April, we can expect another jump in sales during the first quarter of 2016, as sellers hurry to beat the tax hike,’ Campbell said. The million pound property market has seen the most extreme changes this year. Overall, there has been a 30% annual increase in the sale of high value homes in 2015. Half of these sales came in March, as owners rushed to beat the introduction of the LBTT. This was followed by a short term drought which saw the average number of million pound… Continue reading
UK property asking prices up almost 3% month on month
The price of property coming to the market in the UK increases by a substantial 2.9% or £8,324 in January, hitting a new record of £299,287 and surpassing the record set in October 2015 by over £2,700. Housing demand is higher than ever as the latest Rightmove report records that traffic to the property portal hits record levels, with visits up nearly 20% year on year in January. It says that there has been an encouraging 5% uplift in new properties coming to the market compared to same time last year resulting in the highest total number of newly listed properties at this time of year since the 2008 credit crunch. The firm is also predicting that 2016 will be the year of the first time buyer as Government initiatives and a low interest rate outlook are now aligning when there is more property choice for first time buyers, with a 10% year on year jump in the number of two beds or fewer coming to the market. ‘The new year’s market has hit the ground running in many locations, continuing last year’s momentum and resulting in the price of property coming to the market hitting a new high. Many agents reported high numbers of sales in November and December and properties selling more quickly, so it’s encouraging to see signs of replenishment of property, especially in the first time buyer sector,’ said Miles Shipside, Rightmove director and housing market analyst. ‘However, in spite of the apparent veneer of market buoyancy, those thinking of putting their property up for sale need to avoid being too optimistic with their initial asking price, as most buyers are still understandably being very selective about their future home,’ he added. The previous record price high was set in October 2015 but this has now been exceeded by £2,738, pushing the average new seller asking price to £299,287. Shipside pointed out that a continuing feature of the recovering market over the past few years has been the supply of property coming to market failing to keep pace with demand. There are now signs of fresh supply increasing with the volume of new properties coming to the market is at the highest level since the credit crunch of 2008. However, he added that it should be noted that this is patchy by region with only four regions above the 5% year on year average uplift, namely London, South East, South West and Yorkshire and the Humber. In the West Midlands new stock is actually down by 0.3% and Wales and the North West have seen an uplift of 1% or less, restricting fresh choice for buyers in these regions. ‘While more properties are coming to market there is little anecdotal evidence of tax shy landlords selling up. It is more likely made up of additional first-time sellers who are either hoping to bag a buy to let investor before the April stamp duty hike, or joining others who… Continue reading
Stamp duty change led to super prime sales in London falling by a third in 2015
The number of super prime £10 million plus property sales in London fell by a third in 2015 as the impact of a stamp duty increase at the end of 2014 made buyers more price sensitive. However, the latest research report from international real estate firm Knight Frank says there are indications vendors have started to factor in higher transaction costs and the annual decline was accentuated by a series of deals before the new rates came into effect in December 2014. The number of Knight Frank super prime transactions fell 16% over the same period as the stamp duty increase meant the transaction tax on a £10 million property rose to £1.1 million from £700,000, or an additional 4% of the sale price. The report points out that the 2014 reform is likely to be followed in April 2016 by a further three percentage point increase for buy to let properties and second homes. However, according to the report the resulting slowdown in activity, there are signs the market has begun to absorb the 2014 changes and asking prices that increasingly reflect the more subdued state of demand have ended the stand-off between buyers and sellers. The report suggests that to some extent buyers and sellers have become tired of the inaction and as asking prices become more realistic, buyers have seen the market is flat rather than falling off a cliff and are therefore encouraged to act. But the overriding mood is one of caution and annual price growth in the super prime market remains subdued, standing at 0.5% in December after a marked slowdown in recent years. However, it is suggested that the safe haven appeal of prime central London property continued to support demand in a year marked by economic volatility centred on events in China and geopolitical concerns around the world. There were mixed fortunes for London’s different prime central London markets in 2015. Kensington and Mayfair continued their upwards trajectory in 2015 and both areas grew their super prime market share and Kensington was the largest super prime market in 2015. The report also points out that the high quality of London’s super prime pipeline is evident in the growing share of new build deals done above £10 million, which has gone from a fifth in 2012 to over a third in 2015. Continue reading
