Tag Archives: guides
Moving home costs in UK at highest level since 2007, study shows
The average cost of moving home in the UK has risen by 5% to £8,689 in 2014 from £8,258 in 2013, its highest level since 2007, new research shows. The increase in the past year of £431 was mostly driven by fees paid to estate agents and surveyors, both of which accounted for £386 of the total rise in moving costs, according to the study from Lloyds Bank. As a result of this rise in costs and an increase in home sales in the last year, the total amount spent on moving has grown sharply by 15% in 2014, from £6.5 billion in 2013, to £7.5 billion in 2014. The rising cost of moving is driven by a 7% or £266 increase in estate agency fees and surveyors costs growing by 22% to £665 in the final quarter of 2014 compared to the same period a year earlier. Over the same period, conveyancing fees increased by 7% or £74 to £1,074. The average stamp duty paid fell marginally by 1% or £28 to £1,973. Many of these costs have increased as a result of higher house prices in 2014 compared to the year earlier, the report points out. The research also shows that stamp duty now accounts for 23% of all moving costs, whilst the proportion taken up by estate agency fees is 45%. In the 10 years since 2004, the total cost of moving has increased by 15% or £1,137, the same as the increase in house prices. In this period, average gross annual earnings have increased by 24%, meaning the total cost of moving as a percentage of earnings has decreased marginally, from 28% to 26%. During this period both house price and earnings growth lagged behind the increase in the consumer price index which rose by 30%. ‘With the cost of moving at its highest level since 2007, people struggling to cover the costs should look to make savings wherever they can. The recent changes in stamp duty should help buyers reduce their overall cost of moving, which can be a significant boost,’ said Andy Hulme, mortgages director at Lloyds Bank. Just four regions have seen the average cost of moving fall in the past year. They include Yorkshire and the Humber where home movers have seen moving cost fall by 8% to £5,875, North East and Wales both saw a fall of 7% and the North West it was down by 1%. On the other hand, for home movers in the London average moving costs has grown by 11% to £23,116, the most expensive moving bill in the UK. Whilst, in Northern Ireland there has been a 22% or £929 increase to £5,181 which is still the lowest in the UK. The cost of moving in London equates to 53% of the average gross full time earnings of £43,519 of London residents. In Northern Ireland this proportion is just under 19%, again, the lowest in the UK. Continue reading
Negative equity worse in some parts of US despite home values rising
Home prices are rising in the US but the rate of home owners who owe more on their mortgage than their homes are worth is stalled and even worsening in some places for the first time since the recession, according to a new report. Negative equity is going up in 21 of the largest 50 housing markets, indicating many underwater homes are not rising in value, says the latest review from real estate data firm Zillow. More than a quarter of mortgaged homes are underwater in some markets in Florida and the Midwest. The national negative equity rate is 16.9% yet home values rose 5.9% nationally last year. The report also shows that the at the lower end of the market homes are far more likely to be worth less than the balance of their mortgage and the analysis suggests that is because low end homes are losing value. At the peak of the real estate crisis, more than 15 million home owners owed more on their mortgages than their homes were worth, putting them in negative equity. Foreclosures, short sales and rapidly rising home values freed nearly half of those home owners, but now that trend has reversed in many metros. Indeed, three years into the recovery, home values overall continued to recover while owners of the lowest valued homes, those most likely to be stuck in negative equity, were left behind. ‘Higher negative equity rates have become the new normal. We've long been expecting the negative equity rate to fall more slowly as home value growth also slows, and unfortunately that's exactly what we're seeing,’ said Zillow chief economist Stan Humphries. ‘Compounding the problem is the fact that negative equity is decidedly not an equal opportunity predator, and looms larger over the bottom 10% of homes, where home owners are least prepared to withstand the assault,’ he added. In Atlanta some 49% of homes in the bottom third of home values are in negative equity, compared to 11% of mortgaged homes in the highest valued third. Among large metros, Virginia Beach at 28.3%, Jacksonville at 27%, Las Vegas at 24.4% and Atlanta at 26.1% had the highest rates of negative equity. Continue reading
Prime central London rental market see increased demand
Interest in the prime central London rental market has intensified in recent months as buyers become cautious prior to the election, and regulations surrounding mortgage lending take hold, a new report suggests. The proportion of those living in private rented accommodation has risen in recent years and this is partly a reflection on affordability, with rents increasing by just 1.4% when the effects of inflation are removed, according to the analysis from Kay & Co. It found that Bayswater and Marylebone offer family homes at significantly lower prices than other prime London locations and says that a family living in these areas could save over £44,000 a year on a 2,500 square foot home. Overall the prime central London lettings market experienced a relatively strong year in 2014. Annual growth in average rents returned to positive territory, recording the highest increase in rental values since 2010. However, the level of demand for rental properties was more subdued than in 2013 but there was certainly more interest in the latter half of the year. This could have been a result of households who were in the market to purchase a home awaiting the outcome of the general election and lenders becoming more cautious, the report explains. Weekly rents achieved averaged £882 per week across prime central London in 2014, an annual rise of 7% and, compared to the 2008 peak in the sales market, average weekly rents were 11.9% higher in 2014. The average weekly rent in the fourth quarter of 2014 had risen to £904 per week for prime central London. In comparison, the neighbourhoods of Bayswater and Marylebone offer more affordable rental stock within prime central London, with weekly rents in 2014 averaging £676 and £789 per week respectively. The performance of the lettings market in prime central London, including Bayswater and Marylebone, vastly outperformed Greater London as a whole in 2014. Average rental values across the capital registered 2.4% growth over the year based on the revised index of private housing rental prices by the Office of National Statistics. A breakdown of performance by property type in 2014 shows that flats performed better than houses across prime central London in 2014 in terms of rental growth. Average weekly rents for flats increased by 7.8%, compared to 5% for houses. The number of properties let in prime central London fell by 5.4% in 2014 compared to the previous year. A quarterly breakdown, however, reveals that it was the start of the year that saw considerable reductions in the volumes of properties let and this became less severe as the year progressed. By the fourth quarter of 2014, the annual change in the number of lets had increased by 6.7%. This coincided with increased uncertainty regarding the outlook for capital values in the prime central London sales market. There was also a simultaneous and continuous increase in average rents achieved each quarter in… Continue reading
