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Property value growth in Australian capital cities flat in September
Residential property values across Australia’s capital cities were virtually flat over the month of September, according to the latest RP Data CoreLogic Home Value Index. There was a 0.1% rise in values over the month which translates into a 2.9% capital gain over the third quarter of 2014. However, the flat result for September masks the fact that five of Australia’s capital cities recorded a fall in values over the month whilst only Sydney with growth of 0.8%), Brisbane with a rise of 0.7% and Adelaide up 0.9% recorded an increase in dwelling values over the month. The September quarterly was once again driven by exceptionally strong conditions across the Sydney and Melbourne markets where the quarterly capital gain rate was 4.1% and 3.7% respectively. Additionally, Adelaide recorded a solid increase in values over the September quarter, posting a 3.1% capital gain. Brisbane was up 0.6%, Darwin up 1.4% and Canberra also up 1.4%. But Perth saw a fall of 0.6% and Hobart was down 1%, the only two capital city markets to record a decline in values over the September quarter. Values are now 9.3% higher over the 12 months to the end of September 2014, with every capital city recording an increase in dwelling values over this period. Sydney values are driving the growth trend, increasing by 14.3% over the past year. The data shows that a substantial gap exists between Sydney and the next best performer, Melbourne, where values increased by 8.1%. Darwin was the third strongest performer over the past year with a 7.1% capital gain, followed by Brisbane at 6.4% and Adelaide at 5.8%. Hobart values were 4.6% higher over the past 12 months while in Perth values were 3.2% higher. Canberra recorded the lowest rate of annual capital gain at 1.7%. Despite the ease in capital gains over September, other indicators remained strong over the first month of spring. Auction clearance rates continued to beat the 70% mark week to week while volumes across RP Data real estate agent and valuation platforms remained strong which indicates heightened levels of industry and mortgage market activity. According to RP Data’s research head Tim Lawless, more listings are entering the market place as the weather warms up. He said that the big test for the housing market will be whether additional stock is absorbed by an increase in buyer numbers. ‘The annual rate of appreciation in dwelling values has actually been moderating since reaching a peak in April this year. The fact that the annual trend of capital growth has been trending lower is an important factor to note as it highlights that the rate of capital gain is no longer accelerating,’ he explained. ‘Even though housing market conditions remain very buoyant, we have been seeing the 12 month trend drifting lower since peaking at 11.5% in April. A moderating annual trend, as well as the relatively flat September result, is likely to be welcome news to policy makers and potential buyers after the… Continue reading
The rate at which UK house sales fall through is rising
The rate at which house sales in the UK are falling through has increased steadily since March 2013, new research shows. Tougher mortgage rules have prevented purchasers borrowing as much as they anticipated they would be able to is one reason, according to the research from Quick Move Now. Also, buyers are increasingly nervous of a potential market crash, said Quick Move Now’s market analyst Donna Houguez. ‘We are seeing two clear reasons for the upwardly moving fall through rate. Stricter rules imposed on borrowing by lenders as a result of the mortgage market review have resulted in buyers making offers, confident that they would be able to secure a mortgage and then realising that they were unable to, forcing them to pull out of sales,’ she explained. ‘In August and September, the reason for sales falling through clearly changed, and it was the buyers themselves who became nervous. We saw a sharp increase in the number of buyers who had made a generous offer in order to secure a property against the competition change their mind and pull out amid fears of an imminent property market collapse,’ she added. Meanwhile, the Little House Company has compiled statistics from its database of private vendors to evaluate the trends of private sellers from June to August 2014. This data is particularly interesting as the summer months are generally regarded as a bad time to sell homes, yet the findings show a significant number of vendors bucked the trend and listed their homes this summer. The research shows that the average age of private vendors was 40.3 years of age, which suggests that the majority of private vendors are second time buyers. The research also shows that greater London is the most popular area to sell homes without an estate agent, compared to other UK regions. Central London remains a stronghold for estate agents with direct sales stronger in the suburbs. Private vendors are not limited to Greater London, and the data shows private vendors listing properties up and down the UK. The second and third most popular areas for private property sales this summer were Cheshire and South Yorkshire, respectively. Continue reading
London housing bank being created
The Mayor of London has announced what is described as an innovative new £200 million investment scheme for developers and housing associations that will help accelerate the building of thousands more low cost homes in the city. He said that the London Housing Bank will offer tailored financial support to speed up the construction of homes compared to existing development timetables. This could include building later parts of large multi-phased housing schemes earlier than scheduled. The Bank offers low cost loans starting at 1% interest to incentivise development partners to build up to 4,000 homes on a range of sites, with the condition that these homes will be rented to Londoners at low cost rent with a minimum discount to market of 20 % for at least 7seven years. Boris Johnson said that this will result in homes being delivered several years earlier than traditional house building plans allow. The loan will be available for up to 16 years and after it is repaid, developers will have the option of selling the homes to the current occupiers to support home ownership, selling into the market, or retaining as affordable homes to use as long-term rent. The London Housing Bank prospectus is being launched at the same time as the Government launches a national investment scheme for developers to boost house building, with the initial funding for the Housing Bank being made available to the Greater London Authority by the Government. The Mayor's commitment to fast tracking development with the Housing Bank is part of a package of wider measures he is promoting to stimulate house building. He is on track to see 100,000 low cost homes built over his two terms, with more affordable homes being built this year than since 1980, as well as helping 50,000 Londoners into low cost home ownership and introducing a range of innovative new measures including new Housing Zones and accelerating purpose built rental sites. ‘Through the pioneering London Housing Bank, I'm challenging the capital's developers to get building, and deliver the homes Londoners need, as fast as humanly possible. Loans are available from a £200 million pot to significantly accelerate the pace of development, especially on bigger schemes, and unlock additional supply,’ Johnson explained. ‘Through this exciting new fund we hope to provide thousands of brand new homes many years sooner than would otherwise be possible for hard working Londoners,’ he added. All homes will be advertised on the FIRST STEPS online portal, the Mayor's programme to help low and modest income Londoners to buy or rent in the capital at a price they can afford. A wide range of new and existing housing providers are encouraged to bid for loans as well as private sector organisations including private registered providers and developers. Bidding will be through the Greater London Authority's Investment Management System (IMS). The majority of funding is expected to be low cost interest bearing loans, with equity… Continue reading
