Tag Archives: finance
Auckland and surrounding area sees most new home building
Auckland and its surrounding regions have driven most of the recent growth in building consents for new dwellings in New Zealand, according to the latest official figures to be published. In September 2015, some 2,242 new dwellings were given in permission in the country as whole, up 13% from the same month last year, the data from Statistics New Zealand shows. The regions with the largest increases were Waikato, Auckland, Bay of Plenty and Northland while the regions with the largest decreases were Wellington and Canterbury. However, Canterbury still accounts for almost one quarter of the national total. However, in seasonally adjusted terms, the number of new dwellings consented fell 5.7% in September after a 5.3% fall in August but this is following on from a 20% surge in July, and the trend is increasing. ‘In the regions surrounding Auckland, growth is being driven by new houses, while in Auckland itself, apartments are also a big part of the picture,’ said Statistics New Zealand business indicators manager Clara Eatherley. ‘While we see a bit of volatility from month to month, the overall picture recently has been growth in building consents, both on the residential side and the non-residential,’ she added. Continue reading
Prime properties in commuter areas set to outperform London prices
Prime commuter housing markets are set to outperform prime London in the five years to 2020, according to new research from international real estate advisor Savills. Overall the relative value offered compared to the capital is likely to underpin medium-term house price growth, the five year UK prime housing market report says. However, short term growth prospects are likely to be hampered by the combined impact of stamp duty, mortgage market review and a slow prime London market. The price gap between property in London and its commuter belt indicates the potential for significant growth once the ripple effect is restored, it explains. Prime London property prices are 36.8% above their 2007 levels, compared to a 6.6% rise in commuter areas over the same period. Consequently, the prime housing markets in London suburbs, inner commuter, up to 30 minutes train journey to London, and outer commuter up to 60 minutes, locations have the strongest growth prospects over the five years to 2020, at 24.5%, 24% and 23.4% respectively. However, the report explains that these prime housing markets in the commuter zone markets are dependent on movement in the prime London housing markets, which is only expected to occur after they acclimatise to a new tax and regulatory environment, allowing the fundamentals of wealth generation, both domestic and global, to translate into restored demand. This is expected to start to take effect in 2017, with trend rates of price growth returning from 2018 onwards to deliver five year price growth of 21.5% in prime central London and 18.2% growth in other prime London markets. Across the rest of the country prime housing markets are expected to be driven by a preference for city and town locations and strengthening local economies. Scotland is seeing a similar predilection for metropolitan areas, but all markets over £750,000 are being constrained by Land and Buildings Transaction Tax to some degree. ‘We expect the trend for urban living to continue as London buyers seek out vibrant locations where they don’t have to sacrifice the convenience of living close to shops, restaurants and leisure facilities,’ said Sophie Chick, Savills research associate director. ‘Positive sentiment for cities in the north of England is also being bolstered by talk of a northern powerhouse, despite the proposals being some way off,’ she explained. ‘While the prime property market is continuing to adjust to a new fiscal and regulatory environment, wages are increasing, interest rates are still low and there is political certainty for the next five years. Under these circumstances, we expect prime property to return to long term trend rates of real price growth in 2018,’ she added. Continue reading
Majority of home owners in Australia concerned about property values
More than two thirds of Australians are concerned that Australia’s housing is vulnerable to a significant correction in values, according to the latest housing sentiment survey. Some 68% of respondents to the September CoreLogic RP Data TEG survey said they believe the housing market is vulnerable to a significant correction in values. However, the findings are a reduction from the previous quarter results where 75% of respondents indicated they were concerned about a significant downturn, but despite the apparent improvement in consumer perceptions, 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 worth an estimated $6.2 trillion. ‘While we don’t envisage dwelling values will fall substantially, the probability of declines in Sydney, and to a lesser extent in Melbourne, after such a strong run of capital gains isn’t unlikely,’ said CoreLogic RP Data head of research Tim Lawless. ‘Home values are already trending lower in Darwin and Perth. It was less than three and a half years ago that capital city dwelling values fell by 7.4% between October 2010 and May 2012,’ he pointed out. Additionally, 95% of survey respondents believe that foreign demand is pushing property values higher, with 19% indicating that foreign buyers were responsible for placing ‘extreme’ upwards pressure on home values. Only 5% of survey respondents thought foreign buying activity wasn’t pushing home values higher. According to Lawless, the results are a stark reminder that the true extent of foreign buying of residential properties across Australia continues to lack transparency, despite the House Economics Committee Report on Foreign Investment in Residential Real Estate being handed down almost a year ago. He added that the latest statistics haven’t been updated since the 2013/14 financial year. Some 55% of survey respondents thought that the current housing market conditions represented a good time to buy a property, down from 60% in June. Respondents based in Sydney, where housing market conditions have been running the hottest, were the most pessimistic about buying conditions, however 29.7% of respondents still thought that now was a good time to be getting into the market. Alternatively, more than 70% of survey respondents thought buying conditions were ripe in the Australian Capital Territory, Adelaide, regional Queensland and Perth. The proportion of survey respondents who thought property values will rise over the coming six months has been trending lower, with respondents who thought home values will rise over the next six months dropping from 49% in March and 48% in June to just 40% of all respondents in September. Continue reading
