Tag Archives: europe
Pending home sales fall across all regions of the United States
After steadily increasing for three months, pending home sales in the United States let up in May with the first year on year fall for almost two years with all four major regions seeing a decline. The Pending Home Sales Index, a forward looking indicator based on contract signings from the National Association of Realtors fell by 3.7% to 110.8 in May from a downwardly revised 115 in April and is now 0.2% lower than May 2015. But even with last month’s decline, the index reading is still the third highest in the past year, but declined year on year for the first time since August 2014. According to Lawrence Yun, NAR chief economist, pending sales slumped in May across most of the country. ‘With demand holding firm this spring and homes selling even faster than a year ago, the notable increase in closings in recent months took a dent out of what was available for sale in May and ultimately dragged down contract activity,’ he said. ‘Realtors are acknowledging with increasing frequency lately that buyers continue to be frustrated by the tense competition and lack of affordable homes for sale in their market,’ he added. Despite mortgage rates hovering around three year lows for most of the year, Yun explained that scant supply and swiftly rising home prices which surpassed their all-time high last month are creating an availability and affordability crunch that’s preventing what should be a more robust pace of sales. ‘Total housing inventory at the end of each month has remarkably decreased year on year now for an entire year. There are simply not enough homes coming onto the market to catch up with demand and to keep prices more in line with inflation and wage growth,’ Yun pointed out. Looking ahead to the second half of the year, Yun believes that the fallout from the UK’s decision to leave the European Union breeds both immediate opportunity as well as potential headwinds for the US housing market. ‘In the short term, volatility in the financial markets could very likely lead to even lower mortgage rates and increased demand from foreign buyers looking for a safer place to invest their cash,’ he said. ‘On the other hand, any prolonged market angst and further economic uncertainty overseas could negatively impact our economy and end up tempering the overall appetite for home buying,’ he added. In spite of last month’s step back in contract signings, existing home sales this year are still expected to be around 5.44 million, a 3.7% boost from 2015. After accelerating to 6.8% a year ago, national median existing home price growth is forecast to slightly moderate to between 4% and 5%. A regional breakdown of the figures shows that the PHSI in the Northeast dropped 5.3% to 93 in May, and is now unchanged from a year ago. In the Midwest the index slipped 4.2% to 108 in May, and is now 1.8% below May 2015. Pending home sales in… Continue reading
Warning over implications of changes in Renters’ Rights Bill in UK
The Association of Independent Inventory Clerks (AIIC) is urging the Government to re-evaluate its Renters' Rights Bill, which includes measures to stop letting agents charging tenants for an inventory check. The industry body says that these costs will simply be passed to landlords who will then incorporate them into tenants' rent. Earlier this month, the Renters' Rights Bill, which also includes measures to ban agents charging tenants registration fees, admin fees, reference check fees, renewal fees and exit fees, was given an unopposed second reading in the House of Lords. The Private Members' Bill was set up by Baroness Grender and has received strong support from Labour and the Liberal Democrats and it is thought the Bill has a strong chance of success as it now runs alongside a petition against agent fees charged to tenants, which has been gaining support since March and has now received well in excess of 250,000 signatures. ‘Here at the Association of Independent Inventory Clerks, we're strongly opposed to the banning of inventory fees charged to tenants by letting agents,’ said Patricia Barber, chair of the AIIC. ‘We envisage that if banned these charges would continue to be charged to tenants through the unspecified and unclear means of a higher rent,’ she explained, adding that not being able to charge tenants a fee may encourage some letting agents to bypass inventories altogether, something which could be extremely costly for all parties involved. ‘A detailed inventory helps landlords, agents and tenants to determine exactly how the property's condition has changed over the course of the tenancy, what can be deemed fair wear and tear and what needs to be replaced and therefore deducted from the tenant's deposit,’ Barber pointed out. ‘We totally understand that some fees charged to tenants are too high and complicated, but we believe that if fair and worthwhile fees like inventory checks are made clear to the tenant then there should be no problem in them being charged,’ she said. ‘The vast majority of letting agents are transparent in the fees they charge to tenants. Banning fees altogether and particularly inventory check fees is certainly not the answer and could contribute to more deposit disputes and property damage further down the line,’ she added. She also pointed out that the Renters' Rights Bill remains some way off becoming law as it still has to pass through the House of Commons before receiving Royal Assent. Its next stage is the Committee stage in the House of Lords, a date for which is yet to be announced. The AIIC is the UK's largest membership organisation for independent clerks and recently announced that it has joined the Property Redress Scheme. Continue reading
First time buyers paid more for a home in England and Wales in May
First time buyers in England and Wales paid an average of £173,282 to get on the housing ladder in May, a record high that fuelled by intense competition for properties. This was despite some uncertainty creeping into the housing market ahead of the referendum on the future of the UK in the European Union, according to the latest first time buyer tracker index from real estate agents Your Move and Reeds Rains. But transactions in the first time buyer sector were down by 0.8% compared to the previous month at 24,900 completed sales in May compared to 25,100 in April. However, the report points out that without a pre-referendum supply shortfall first time buyer numbers would have been even higher. The amount paid by first time buyers was up 2.7% from £168,656 in April and 15.8% more than the average of £149,645 seen in May 2015. First time buyer house prices have now increased by more than £23,000 in the last 12 months and current average prices paid are the highest on record. Across the market as a whole, house prices dipped in May in anticipation of the EU referendum on 23 June, with the latest Your Move House Price Index showing house prices in England and Wales fell 0.4% month on month in May. But the bottom of the market has defied this trend fuelled by unwavering first time buyer demand. The overarching trend remains strong, with first time buyer numbers some 13.2% higher than the 22,000 seen in February and 5.1% higher than a year ago. The tracker report also shows that the average mortgage rate for first time buyers slipped further in May to 3.08%, a new record low, following a fall of 0.37 percentage points over the past year. And while there is a climbing cost of purchasing a home, these cheaper rates mean mortgage repayments have not increased significantly as a proportion of first time buyer’s income. As of May, mortgage repayments accounted for 21.1% of income, just 1.7% more than a year ago. Meanwhile, the average first time buyer deposit currently sits at £27,669, up 12.8% or £3,146 from £24,523 a year ago. When compared to the average first time buyer income of £39,651, this represents an extra 29 days’ worth of salary. As a proportion of income, the average deposit has climbed 6.1% compared to May 2015. Continue reading
