Tag Archives: finance
Supply shortage pushing up property prices in the US
Shortage of supply is keeping house prices in the United States on the up across most of the nation but growth is slowing to a more healthy paces, according to the latest quarterly report. Overall prices increased during the third quarter of the year with the median existing home single family home price up in 87% of markets. Some 154 out of 178 metropolitan statistical areas (MSAs) showing gains based on closings in the third quarter compared with the third quarter of 2014, the data from the National Association of Realtors (NAR) shows. And 24 or 13% of areas recorded lower median prices from a year earlier. There were slightly fewer rising markets in the third quarter compared to the second quarter, when price gains were recorded in 93% of metro areas while 21 or 12% of metro areas in the third quarter saw double digit increases, a fall from the 34 metro areas in the second quarter. Some 16 or 9% of metro areas saw double digit increases in the third quarter of 2014. According to Lawrence Yun, NAR chief economist, there is no question the housing market had its best quarter in nearly a decade. ‘The demand for buying picked up speed in many metro areas during the summer as more households entered the market, encouraged by favourable mortgage rates and improving local economies,’ he said. ‘While price growth still teetered near or above unhealthy levels in some markets, the good news is that there was some moderation despite the stronger pace of sales,’ he added. The national median existing single family home price in the third quarter was $229,000, up 5.5% from the third quarter of 2014 when it was $217,100. The median price during the second quarter of this year increased 8.2% from a year earlier. Total existing home sales, including single family and condo, increased 3.4% to a seasonally adjusted annual rate of 5.48 million in the third quarter from 5.30 million in the second quarter, and are 8.3% higher than the 5.06 million pace during the third quarter of 2014. Yun explained that sales had the potential to be even higher last quarter given the decline in mortgage rates and favourable economic conditions. ‘Unfortunately, the lack of any meaningful gains in housing supply pushed prices in some areas above what some potential buyers, especially first time buyers, are able to afford,’ he added. The five most expensive housing markets in the third quarter were the San Jose, California metro area, where the median existing single family price was $965,000, San Francisco at $809,400, Anaheim–Santa Ana, California at $715,300, Honolulu at $714,000 and San Diego at $554,400. The five lowest cost metro areas in the third quarter were Cumberland, Maryland, where the median single family home price was $82,400, Youngstown–Warren–Boardman, Ohio, at $90,700, Decatur, Illinois at $101,400, Rockford, Illinois at $102,800 and Elmira, New York at $108,800. ‘Many of the metro areas with the fastest price appreciation over the past year… Continue reading
Research reveals that almost half of UK tenants sublet their property
Almost half of tenants who sublet their property in the UK do so without their landlord’s consent, according to new findings from the National Landlords Association (NLA). The findings come as the government recently announced proposals to introduce minimum room sizes in order to crack down on problems with private rented accommodation such as unauthorised subletting, which often results in overcrowded and cramped properties. Of the 11% of tenants who say they have sublet all or part of their property before, just 5% did so with their landlord’s permission. Some 26% of tenants say they have approached their landlord about subletting but have had the request declined and 63% say they have never asked their landlord about subletting their property. Overall, the findings show that 32% of tenants have approached their landlord about subletting their property with 22% of requests being permitted by the landlord. ‘These findings indicate that subletting is not common in private rented homes, but worryingly that where it does happen, much of it takes place behind landlords’ backs, without their knowledge or permission,’ said Carolyn Uphill, chairman of the NLA. ‘This isn’t something apparently harmless, like putting your flat on AirBnB while you are on holiday. We are talking about individuals looking to deceive their landlord and maximise their personal gains at the expense of proper property management standards and the risk of others. It not only increases the cost of renting for the unwitting sub-tenants, it affects their rights and can reduce security of tenure,’ she explained. She also pointed out that subletting can also breach a landlord’s mortgage terms, the conditions attached to licenses granted for letting out shared homes and invalidate existing insurance products so they must be aware of the problems it presents. ‘The NLA advises all landlords to insert a clause into new tenancy agreements that makes clear sub-letting is only allowed with the landlord’s permission, which should not be unreasonably withheld. This would reduce their exposure to a whole host of unnecessary risks, including hefty fines and even a prison sentence,’ said Uphill. ‘Landlords who are worried that subletting may be occurring in their properties without their permission should seek advice from a professional organisation such as the NLA which can provide help and support,’ she added. Continue reading
More British buyers in the prime London property market, research suggests
Domestic buyers have risen to a new level of prominence in the London property market as overseas purchasers are being put off by current property tax levels, it is claimed. In the third quarter of this year some 79% of property purchases were made by domestic UK buyers, up from 75% a year ago, according to the latest London Property Monitor from March & Parson. The firm says that sales activity from domestic buyers has surged forwards to fill the gap left by overseas buyers and investors, who have been left more cautious by the strong sterling, stricter Government measures on non-domicile status, and heftier Stamp Duty for higher value purchases. As a result of this new hesitation, domestic mortgage buyers and first time buyers have become more prominent in the London market, with the proportion of mortgage buyers in Prime London soaring from 53% in the second quarter to 65% in the third quarter. At the same time, overseas and foreign nationality buyers accounted for 21% of all prime London property purchases during the third quarter which has fallen quarter on quarter, and is also down from 25% of all sales during the third quarter of 2014. This pattern is also being mirrored in the prime central London market traditionally favoured by overseas investors, with the proportion of foreign buyers standing at 32%, down from 34% in the second quarter and 37% a year ago. The investor share of the market has also dipped in the prime central London market over the past three months. Investors accounted for 35% of all prime central London sales during the third quarter, a considerable drop from 42% in the second quarter. Yet with domestic buyers stemming this shortfall, overall demand for Prime London homes has grown in the three months to September 2015, and the number of registered buyers has climbed 4%. Combined with a 5% drop in the supply of properties available on the market, and buyer competition is building as these trends diverge. There are currently 14 buyers for every available property for sale in London, increasing from 12 in Q2, and 10 at the end of 2014. According to Peter Rollings, chief executive officer of Marsh & Parsons the strength of sterling and government encroachments on nom-dom status make investing in the London property market seem daunting for foreign buyers. ‘This has cast some shadows over the capital, but the millions of Londoners who live and work in the city have acclimatised much more quickly to the property taxation changes, and have risen up to fill the void left by overseas purchasers and investors,’ he pointed out. ‘We’re noticing longer purchase chains than ever as domestic buyers really start to dominate the market, and demand is really putting a strain on supply. This should ensure that London houses prices and sales activity continue their ascent into 2016,’ he… Continue reading
