Tag Archives: finance
Households across the UK positive about property price growth
UK house price sentiment remains positive with households in all regions believing that property prices increased in September, the latest index shows. Some 22.5% of households surveyed across the UK said that the value of their home had risen over the last month, while 3.8% said that prices had fallen, according to the index from Knight Frank and Markit Economics. The index, which is a bellwether for house price movements across the country, recorded a reading of 59.3 and has now had a reading above 50 for 30 months in a row. Any figure over 50 indicates that prices are rising, and the higher the figure, the stronger the increase. Any figure below 50 indicates that prices are falling. However there is a north-south divide with the average reading for the north of England in September at 54.9 and the south of England at 64.1. This is the second widest gap between the two readings this year. While households in all UK regions perceive that property prices rose in September, Londoners perceived the highest rate of house price growth over the course of the month, followed by those in the East of England. However, in Yorkshire and the Humber perceptions of house price growth eased notably in September after rising for the previous three months to reach 60.4 in August. While households in the region still perceive that prices are rising, they are reporting that the pace of increases has slowed, with a reading of 54 this month. The index also shows that households in all UK regions expect house prices to rise over the next 12 months, led by households in the East and South East of England while some 5.9% of households expect to buy a property over the next 12 months, while a further 6.4% said that they would purchase a house within one to two years. The future HPSI, which measures what households think will happen to the value of their property over the next year, rose in September to 70 from 69.5 the previous month. However, the future HPSI remains well below its peak of 75.1 achieved in May last year, the report points out. ‘UK price sentiment remains in positive territory, and has stayed broadly stable since the election in May. However the north-south divide is evident, with the average reading for the north of England in September at 54.9 and the south of England at 64.1,’ said Gráinne Gilmore, head of UK residential research at Knight Frank. ‘This is the second widest gap between the two readings this year. Overall, households expect prices to rise over the next 12 months, with eight times as many households anticipating a rise in the value of their home as anticipating a decline,’ she explained. ‘Sentiment is being underpinned by the improving economy, with positive employment data as well as wage growth boosting buyer confidence. At the same time a shortage of stock on the market is serving, in some cases,… Continue reading
Debt is not holding back graduates in the US buying a home, new research shows
Having a lot of student debt doesn't greatly reduce young people's chances of home ownership in the United States, as long as they graduate, a new analysis has found. The findings challenge a popular concern that giant student loan payments are holding back people from home ownership. As it turns out, graduates' debt loads don't materially hurt their chances of buying a home, especially if they get at least a four year degree. Overall student debt has only a small negative effect on the odds of home ownership for a person with a bachelor's degree or higher, according to the research from real estate firm Zillow. The chances of a married couple with no student debt owning a home are about 69.8% if at least one of them has a bachelor's degree. If the same couple has $30,000 in student debt, their homeownership chances drop slightly, to 67.7%. ‘The income advantage of getting a degree pays off in terms of being able to buy a home in the long run. Student debt isn't the evil-doer it's made out to be, at least not when it comes to homeownership,’ said Zillow chief economist Svenja Gudell. ‘As long as students stay in school and get a degree, student debt doesn't deter them from homeownership, although it is possible that student debt could delay home ownership. People in their 20s and 30s are renting longer because they're delaying marriage, paying a lot in rent, and struggling to qualify for a mortgage when they finally find an affordable home. Add to that list that they are paying off student debt,’ she explained. The research also found that the least likely to own homes are people who have student debt, but no degree. In fact, a couple who borrowed more than$30,000 for school but never graduated has a less than 40 percent chance of home ownership. Graduates with advanced degrees are the most likely to own a home, even if they racked up a lot of student debt. For example, if a couple owes $50,000 in student loans, but one of them has a master's degree, they have a 75% chance of home ownership. A similar household with just $10,000 in loans and only a bachelor's degree has just a 69% chance of home ownership. Student debt has the greatest impact on the home ownership rate of people with two year associate's degrees. A couple with AA degrees and no debt has a 70% chance of owning their home. That declines significantly as debt grows. If the same couple has $50,000 in student debt, they own their home only 57% of the time. Getting an associate's degree improves chances of home ownership until a person has borrowed $70,000. After that, their chances of home ownership would have been better without a degree and no student loan debt. Getting a bachelor's, master's or doctorate degree, regardless of debt, increases the chances that people will… Continue reading
UK landlords left fuming over new smoke alarms laws
Landlords in the UK have criticised what they claim are unnecessary delays in the introduction of legislation which will make it compulsory to install smoke and carbon monoxide alarms in private rented homes. Draft regulations were published earlier in the year to require private sector landlords to install at least one smoke alarm on every storey of their rental property from 01 October 2015, providing local authorities with the power to fine landlords who fail to comply £5,000. However, the UK’s upper house of parliament, the House of Lords, has rejected the draft legislation at is final stage on the basis that the proposed introduction is less than three weeks away, that the government has not done enough to inform landlords of the changes, and that the legislation is poorly worded. The British Property Federation (BPF), which represents residential landlords and has supported the draft legislation, has warned that by the time the legislation is approved, landlords will be left with mere days to comply with the legislation, risking the £5,000 fine. The BPF has issued further concerns that information about the impending change in legislation has been poorly disseminated, and that many landlords may even be unaware of the changes and the potential fines. ‘We have been fully supportive of the campaign to make smoke alarms compulsory in private rented properties, and are therefore extremely disappointed to see this unnecessary delay in proceedings,’ said Ian Fletcher, director of policy (real estate) at the BPF. ‘The original timeframe for the legislation was tight, but allowing time for a further debate in the Lords is going to make this even worse. Coupled with the fact that there has been no publicity on the changes, we are worried that many landlords are going to be caught out by the fine as a result of government’s disorganisation and lack of clarity,’ he explained. ‘It is particularly frustrating that one of the reasons that this revocation has happened is because the introduction is worded poorly, as there has been no consultation on this,’ he added. Richard Lambert, chief executive officer of the National Landlords Association (NLA), described the situation as ‘farcical’. ‘These regulations are poorly worded, badly timed and being tabled with just days to spare before they are due to come into force on 01 October,’ he said. ‘As we understand it, there will be no guidance from the Government explaining how to comply before then. How can a landlord about to let a property on a tenancy from the start of October be expected to comply with these new requirements if they’ve not been told what they are and what is expected,’ he pointed out. ‘Given that there is no Government budget for marketing these new laws, and so it is relying on industry organisations and professional advisers as the main route to compliance, it’s shoddy, to say the least,’ he added. Continue reading
