Tag Archives: europe
Majority of Australians feel the housing market is heading for a downturn
Two thirds of Australians now think the housing market is vulnerable to a sustainable downturn with the sentiment affecting all regions of the country, a new poll shows. While the survey results suggests that respondents are concerned about a crash in home values, this remains unchanged from a year ago, and lower than the 68% of respondents who indicated ‘yes’ to this question six months ago. The higher proportion of respondents who were concerned about a large correction in the housing market was broad with all regions indicating at least 61% of respondents were concerned about a housing market crash, according to the CoreLogic-TEG housing market sentiment survey. The result indicates that a significant proportion of the community are wary of substantial value falls across the nation’s largest and most important asset class, which according to CoreLogic RP Data is currently worth an estimated $6.5 trillion. Recent housing market forecasts from CoreLogic RP Data and Moody’s Analytics indicate dwelling values are likely to experience falls, however the peak to trough declines are likely to be short lived and relatively slight, followed by a longer period of relatively sedate housing market conditions. Home values are already trending lower in Perth and Darwin with both cities recording a peak to current fall of 4.6%. Additionally, the pace of capital gains in Sydney and Melbourne, where dwelling values have surged higher over the past two growth cycles, is moderating in what has been a controlled trajectory to date. The survey also revealed a slowdown in the proportion of survey respondents who think now is a good time to buy; 61% indicated they would consider buying a home, however a year ago the reading was much higher at 71%. Perceptions around buying conditions worsened across most regions over the past 12 months, with Tasmanian and Sydney buyers the most pessimistic about buying conditions. Only 40% and 50% of respective respondents in these cities indicated they felt it was a good time to buy. However, buying sentiment improved over the past year in some of the weakest markets where listing numbers are higher and housing prices have reduced. The proportion of survey respondents who indicated that current market conditions represent a good time to buy increased by 1% over the year in Perth while buyer sentiment in the Northern Territory increased by a substantial 20% compared with a year ago. When survey respondents were asked whether they thought home values would rise, fall or remain stable over the coming six and 12 months, most respondents expect values to remain stable, however 17% of respondents are expecting values to fall over both the next six and 12 months. A year ago, 49% of survey respondents were expecting dwelling values to rise over the coming six months compared with only 31% over the most recent quarter. Respondents based in Sydney have seen the most substantial deterioration in the proportion expecting values to rise over the next half year. A year ago,… Continue reading
North West of England worse hit by negative equity values in UK
Hundreds of thousands of home owners in the UK who bought property in 2007 are still likely to be stuck in negative equity despite the current strong growth in the residential market. Almost 1.5 million property transactions were completed in 2007 when property prices reached peak levels, just before the financial markets imploded in 2008 and according to research from online estate agent HouseSimple, average property prices 53% of towns and cities are still below average prices in 2007. While average London prices have risen by 56% since 2007, that is not the case across large parts of the country, particularly in the North of England where 17 of the 20 towns and cities worst hit by negative equity are located. The research, which looked at 75 major towns and cities in England and Wales, also shows that it is the North West that has been worst hit by post-recession negative equity with 40% of the top 20 negative equity towns and cities in the region. The worst affected towns are Blackpool and Middlesbrough, where house prices are still almost 30% lower than pre-crash highs. Along with Blackpool, Blackburn and Liverpool are both in the top five worst affected towns and cities, with average house prices still 25% and 23% lower respectively than before the crash. Yorkshire and the Humber has also been hit hard, with a quarter of towns in the top 20 list in that region. Average prices in Middlesbrough are still 28% below pre-2008 levels, while in Bradford and Hull, house prices are 20% and 19% lower than 2007 averages. House price recovery in the South has been much stronger than the north. As you might expect, London’s house prices have more than recovered, and average prices today are almost £200,000 higher than 2007 levels. Property prices in Winchester also seem to be recession proof, up 44% to £447,046, compared to average 2007 prices. Meanwhile, average prices in the commuter town of Stevenage are 39% higher than pre-recession values. Sale and Stockport in the North West, where house prices now average £252,203 and £206,368 respectively at 25% and 22% more than 2007, buck the trend in the region. They are the only towns outside the South of England in the top 20 towns and cities where house prices have more than recovered to pre-recession levels. ‘London home owners have watched as their properties have risen in value substantially since 2008 but, thousands of people around the country have had to put their lives on hold, unable to move because they are trapped in negative equity,’ said HouseSimple chief executive officer Alex Gosling. ‘Unfortunately, the North of England has been slower to recover losses suffered during and after 2008. And anyone wanting to relocate for work or family reasons faces a less than appealing choice, either making a loss on the sale of their property or staying put and waiting until the price of their house at least recovers to… Continue reading
US existing home sales bounce back after unexpected decline
Sales of existing homes in the United States bounced back in March with big gains in the Northeast and Midwest, according to the latest index data to be published. Total existing sales, which are completed transactions that include single family homes, town homes, condominiums and co-ops, increased by 5.1% to a seasonally adjusted annual rate of 5.33 million in March from a downwardly revised 5.07 million in February. The data from the National Association of Realtors also shows that overall sales rose in all four major regions last month and were up 1.5% compared with March 2015. Lawrence Yun, NAR chief economist said the rebound was welcome after an uncharacteristically large decline in February. ‘Closings came back in force last month as a greater number of buyers, mostly in the Northeast and Midwest, overcame depressed inventory levels and steady price growth to close on a home,’ he explained. ‘Buyer demand remains sturdy in most areas this spring and the mid-priced market is doing quite well. However, sales are softer both at the very low and very high ends of the market because of supply limitations and affordability pressures,’ he added. The index also shows that the median existing home price for all housing types in March was $222,700, up 5.7% from March 2015 when it was $210,700. March's price increase marks the 49th consecutive month of year on year gains. Total housing inventory at the end of March increased 5.9% to 1.98 million existing homes available for sale, but is still 1.5% lower than a year ago when it was 2.01 million. Unsold inventory is at a 4.5 month supply at the current sales pace, up from 4.4 months in February. ‘The choppiness in sales activity so far this year is directly related to the unevenness in the rate of new listings coming onto the market to replace what is, for the most part, being sold rather quickly,’ said Yun. ‘Additionally, a segment of would be buyers at the upper end of the market appear to have been spooked by January's stock market correction,’ he explained. Matching the lowest share since August 2015, properties typically stayed on the market for 47 days in March, a decrease from 59 days in February and below the 52 days in March 2015. Short sales were on the market the longest at a median of 120 days in March, while foreclosures sold in 50 days and non-distressed homes took 46 days. Some 42% of homes sold in March were on the market for less than a month, the highest since July 2015 when it was 43%. The data also shows that the share of first time buyers was 30% in March, unchanged both from February and a year ago. First time buyers in all of 2015 also represented an average of 30%. ‘With rents steadily rising and average fixed rates well below 4%, qualified first time buyers should be more active participants than what they are right now. Unfortunately,… Continue reading
