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Annual UK house price growth puts on a spurt, especially in Scotland
UK house price growth is increasing again with the latest figures from the Office of National Statistics showing an annual rise of 9.6% in the year to March 2015. This is up from annual growth of 7.4% in the year to February 2015 and some parts of the country have seen record increases. House price annual inflation was 9.4% in England, 5.7% in Wales, 14.6% in Scotland and 7.5% in Northern Ireland. This is the highest annual increase in Scotland since July 2007. Annual house price increases in England were driven by an annual increase in the East of 11.4%, London 11.2% and the South East 11.2%. Excluding London and the South East, UK house prices increased by 8.1% in the 12 months to March 2015. On a seasonally adjusted basis, average house prices increased by 1.1% between February and March 2015 and prices paid by first time buyers were 7.8% higher on average than in March 2014. For existing owners prices increased by 10.3% for the same period. But there are concerns that house price growth is so strong. ‘House prices are going up four times faster than people’s wages. No wonder mortgage approvals are falling and first time buyers are struggling to save a large enough deposit. And we all know that housing bubbles burst and cause economic chaos,’ said Frances O’Grady, general secretary of the Trades Union Council. ‘There is no sign the government yet understands the challenge of ending the housing crisis. Their headline policy is an incredibly unpopular plan to sell off social housing to the private market. This would reduce the supply of affordable homes when we should be adding to them as quickly as possible,’ added O’Grady. Peter Rollings, chief executive officer of Marsh & Parsons, pointed out that it is worth bearing in mind that these figures concentrate on March. ‘The country was still convinced that we had a close-run election on our hands and vendors and buyers in London were holding their breath about what impact mansion tax and other possible policies might have,’ he said. ‘Now the reality is far different, a frisson of excitement has returned to the high-end market,’ he added. Continue reading
UK property market sees lowest annual price growth since 2013
Annual UK property price growth was 3.7% in April, taking the average price of a home to £208,717, the lowest level of annual growth since July 2013, the latest index shows. Month on month prices were up 0.5%, according to the latest monitor report from haart estate agents. In London prices were up 1.9% month on month and 6.8% year on year to an average of £513,154. The data also shows that in April new buyer registrations fell by 1.6% compared with March, the first monthly fall this year, as buyers adopted a pre-election ‘wait and see’ attitude. Seller activity also slowed in April with new property instructions up just 1.5% month on month. The report also shows that house sales were up 3.3% in April compared to March but down 17.1% from April 2014. But there has been a post-election pick up in seller activity with the weekend after polling day seeing a 34% surge in new property instructions compared with the previous weekend. The average price of a first time buyer home increased 3.5% annually and 0.8% on the month. The report says that the new Help to Buy ISA, when the product is designed and implemented, will provide further assistance to first time buyers seeking to buy a home. First time buyers now make up 42.9% of all mortgages written, which is up slightly on March but still falls below 46.1% in April 2014. The average mortgage granted to first-time buyers is up 1.2% on the month in April and 2.5% annually. ‘The pre-election property market held its breath in April but the election uncertainty did not have an overall stifling effect on the market average property price growth for the UK slowed but did not come off the boil,’ said Paul Smith, chief executive officer haart, which has a network of over 200 branches across the country. ‘However, there was a drop in activity from sellers and prospective buyers in the run up as a wait and see attitude took hold of the market. We are already seeing the reversal of this with a flurry of activity from prospective sellers in the weekend immediately following the election,’ he explained. ‘Continuity of government, no mansion tax and supportive policies like the Help to Buy ISA should keep the property market on its upward trajectory for the rest of 2015,’ he added. Continue reading
Home owners in Scotland’s Shetland Isles see top value growth since 2009
Home owners in the Shetland Isles in the far north of Scotland have seen the value of their property increase by £39,311 or 31% since the trough of the last housing market cycle in 2009, new research shows. The situation has been helped by the islands having the highest employment rate in Scotland, according to the research by the Bank of Scotland. Aberdeen City has the second highest house price increase in Scotland since 2009, with property prices going up 21% or £38,275, followed by Aberdeenshire with a 16% increase of £33,022. The report notes that both are amongst the five areas in Scotland with the highest levels of employment over recent years and says that there is a clear link between levels of employment and house price performance in recent years. Those areas with the highest average levels of employment since 2009 have, on average, recorded bigger house price gains. For example, the five local authority districts (LADs) with the highest employment have experienced average house price rises of 14% or £23,462, since 2009, compared with an increase of 2% for Scotland as a whole. The average house price in the 10 LADs that recorded the highest employment rate between 2009 and 2015 rose by £9,554 or 6%. However, looking further afield to the top 20 LADs, they have seen an average increase of only 2% or £2,617, which is in line with the average for Scotland. In stark contrast, those areas with the highest levels of unemployment, as measured by the claimant count, have typically underperformed the Scottish average. The 20 areas with the highest levels of unemployment have recorded an average house price fall of 8% or £11,252. The five areas with the highest unemployment rate have seen a 7% drop in the value of their homes. ‘There has been a very clear relationship between conditions in the Scottish jobs market and house price performance during the period since the housing market downturn between 2007 and 2009. Those areas with high levels of employment have tended to record above average house price growth. Areas with high unemployment levels have, on the other hand, typically underperformed,’ said Nitesh Patel, economist at the Bank of Scotland. ‘The past few years have underlined the importance of local economic health in determining house price behaviour. Other factors, however, are also key drivers of house price trends including the strength, or otherwise, of housing supply,’ added Patel. Continue reading
