Tag Archives: europe
US housing market growth expected to be steady in 2016
Housing market growth in the United States is holding steady with a rise of 0.6% quarter on quarter, according to the latest real estate analysis report. The annual spring housing boom has been beneficial to most regions across the nation, with most markets outside of the Northeast seeing a small bump in quarter on quarter growth in the last month. The data from real estate firm Clear Capital also shows that in the West quarterly growth has increased by 0.2% to 1.3%, while quarterly growth in the South and Midwest have increased to a modest 0.8% and 0.3% respectively. However, growth figures in the Northeast are concerning with the firm’s models showing an average of zero price growth in the region over the last quarter. ‘This is especially alarming when considering that the spring season is a time when markets typically gain momentum leading into the busy summer season,’ said Alex Villacorta, vice president of research and analytics at Clear Capital. He pointed out that while prices in the region as a whole have appeared to stagnate, there are markets in the region that are performing positively, such as New York and Hartford, where prices have increased by 0.5% and 0.7% respectively over the last quarter. The regional year end forecasts may also be a cause for concern, with the West and North-eastern regions projected to fall potentially into negative territory over the next six months. The analysis predicts that by the end of 2016, the nation may see a new leader in terms of regional growth as the South and Midwest are predicted to have the highest price growth over the next six months, around the 0.5% mark. ‘While these six month growth rates are lower than what we have seen in recent years, slower growth does not necessarily spell disaster and instead could be indicative of markets that are finally beginning to moderate and even stabilize in these regions,’ Villacorta explained. On the MSA level, southern cities are dominating the top spots in our forecast, with six of the top 10 markets located within the region. Home prices in Dallas and Nashville are predicted to see growth throughout the remainder of 2016, increasing to the tune of 3% to 4% by the end of the year. Major Florida markets are also predicted to continue to rise, with Jacksonville and Orlando growth forecasts around 2.5% by the end of 2016, while homes in Tampa may increase by almost 4% over the next six months. ‘Overall, our forecasting models are predicting the second half of 2016 to be much slower than its start, with all regions forecasted to see very little price change by the end of the year,’ said Villacorta. ‘The Federal Reserve won’t be raising interest rates this summer, and while this will help keep the cost of mortgage lending to a minimum, at least in the short term, there are other key global factors that could spell… Continue reading
Home lending in the UK increased in May, latest CML data shows
Home owners in the UK borrowed £9.4 billion for house purchase, up 15% month on month and 8% year on year in May, according to the latest data. They took out 53,800 loans, up 13% on April and 5% on May 2015, according to the Council of Mortgage Lenders which said that some equilibrium is coming back into the home lending market. A breakdown of the figures show that first time buyers borrowed £4.3 billion, up 10% on April and 23% on May last year. This equated to 27,500 loans, up 9% month on month and 16% year on year. Home movers borrowed £5.1 billion, up 19% on April but down 2% compared to a year ago. This represented 26,300 loans, up 18% month on month but down 5% on May 2015. The data also shows that remortgage activity totalled £5.2 billion, down 15% on April but up 30% compared to a year ago. This came to 30,900 loans, down 12% month on month but up 25% compared to a year ago. Landlords borrowed £2.6 billion, up 4% month on month but down 4% year on year. This came to 16,600 loans in total, up 3% compared to April but down 8% compared to May 2015. ‘There was a sense of the market regaining some equilibrium in May, following the stamp duty driven spike in March and the subsequent dip in April,’ said Paul Smee, director general of the CML. ‘For the second month running, first time buyers borrowed more than home movers, the first time in 20 years that this has been the case. Buy to let continues at lower levels as expected, after the change to stamp duty,’ he pointed out. However, he also pointed out that Brexit, and its likely effect on the market, is a question to which the answer will not immediately be forthcoming. ‘Lenders will continue to be open for business as usual, but lending volumes may be affected by uncertain consumer sentiment,’ he added. The CML report also shows that affordability metrics for first time buyers have remained relatively stable. The typical loan size increased to £131,000 from £130,000 in April, while the household income of borrowers also increasing slightly from £39,700 in April to £40,000 in May, which meant the income multiple went up from 3.46 to 3.51. Home movers showed a similar trend with the average amount borrowed increasing to £166,000 from £163,000 in April, and the average household income of a home mover also increasing to £53,300 from £52,500. This meant the income multiple went down from 3.26 to 3.25 month on month. Remortgage lending saw a month on month decrease in May but a year on year increase by both volume and value, reaching levels similar to those in the first three months of the year. Gross buy to let lending continues to be lower than usual as expected after the surge in activity to beat the stamp duty changes on second properties ahead… Continue reading
Steady growth for UK commercial property returns and rental values in June
Commercial property returns and rental values saw steady growth in the UK in June but capital value growth slowed, according to the latest index report. Overall, rents across the UK grew by 0.2% in June, matching the trend for the year to date despite uncertainty in the build up to the EU referendum, according to the latest CBRE Monthly Index. But capital values grew by 0.1% over the month, a drop on 0.2% in May although the 0.6% total returns for the month matched returns seen almost every month of the year to date. In the first half of 2016 as a whole, rental value growth hit 1.1%, trailing the 1.7% seen in the same period of 2015. Capital values grew by 0.6% for the first six months of 2016, some way shy of the 4.1% in the first half of 2015. Total returns were also lower, from 6.7% in the first half of 2015, to 3% in the first half of 2016. The reports says that this lower return partly reflects an increase in stamp duty land tax in March. The retail sector experienced rental growth of 0.1% in June, above trend for the year so far, but capital values, which had been flat in April and May, fell by 0.2%. Total returns in the sector were 0.3%, compared with 0.5% the month before. The industrial sector experienced a strong monthly performance, with rents increasing by 0.4%, equal to its best monthly performance in 2016. The office sector saw rents grow by 0.3% in June, an improvement on the 0.2% of both April and May and in line with trend so far this year, while capital value growth slowed slightly from 0.4% to 0.3%. London offices mirrored this overall trend. Rental values rose by 0.3%, faster than the 0.2% seen in May, and capital value growth slowed from 0.6% in May to 0.5% in June, producing total returns in June of 0.8%. The London office market saw some outliers. Rental values in West End and Midtown offices were flat, down from 0.1% growth in May, while capital value growth also cooled to 0.2% from 0.5% in May. Offices in the City of London also experienced muted growth in the month, with rental growth of 0.2% and capital value growth of 0.1%, down from 0.6% and 0.3% respectively in May. ‘Overall, rents and capital values continued to grow in June, with the industrial sector in particular showing strong growth in a month of significant uncertainty. Clearly, capital value growth has slowed, but occupier demand has remained high across the country, pushing up All Property rental growth as fast as any other month this year,’ said Miles Gibson, head of research at CBRE UK. ‘These figures reflect CBRE valuations carried out in the days immediately following the referendum vote, but July’s monthly index will give a much clearer… Continue reading
