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Existing home sales in the United States are 11% higher than a year ago
Existing home sales in the United States crept up in January to the highest annual rate in six months, and sales are now 11% higher than a year ago. The data from the National Association of Realtors shows that the West was the only region to see a decline in sales in January after a nationwide rise of 0.4% compared to December. The median existing home price for all housing types in January was $213,800, up 8.2% from January 2015, the largest rise since April 2015 and the 47th consecutive month of year on year gains. Lawrence Yun, NAR chief economist, said it was the largest year on year gain since July 2013. ‘The housing market has shown promising resilience in recent months, but home prices are still rising too fast because of ongoing supply constraints,’ he pointed out. ‘Despite the global economic slowdown, the housing sector continues to recover and will likely help the US economy avoid a recession,’ he added. Total housing inventory at the end of January increased 3.4% to 1.82 million existing homes available for sale, but is still 2.2% lower than a year ago. Unsold inventory is at a four month supply at the current sales pace, up slightly from 3.9 months in December 2015. ‘The spring buying season is right around the corner and current supply levels aren't even close to what's needed to accommodate the subsequent growth in housing demand. Home prices ascending near or above double digit appreciation aren't healthy, especially considering the fact that household income and wages are barely rising,’ Yun explained. The share of first time buyers remained at 32% in January for the second consecutive month and is up from 28% a year ago. First time buyers in all of 2015 represented an average of 30%, up from 29% in both 2014 and 2013. All cash sales were 26% of transactions in January, up from 24% in December 2015 but down from 27% a year ago. Individual investors, who account for many cash sales, purchased 17% of homes in January compared to 15% in December 2015, matching the highest share since last January. Some 67% of investors paid cash in January. Properties typically stayed on the market for 64 days in January, an increase from 58 days in December but below the 69 days in January 2015. Short sales were on the market the longest at a median of 77 days in January, while foreclosures sold in 57 days and non-distressed homes took 61 days and 32% of homes sold in January were on the market for less than a month. Distressed sales, that is foreclosures and short sales, rose slightly to 9% in January, up from 8% in December but down from 11 a year ago. Some 7% of January sales were foreclosures and 2% were short sales. Foreclosures sold for an average discount of 13% below market value in January compared to 16% in December, while short… Continue reading
Home lending in Scotland up in 2015, but tailed off at end of year
More first time buyers took out a loan for a home in Scotland in 2015 than in any year since 2008, the latest data shows. Home owner house purchase lending in the fourth quarter of 2015 totalled 17,200 loans, down 4% on the third quarter but up 14% in the fourth quarter 2014, according to the figures from the Council of Mortgage Lenders. A breakdown of the figures shows that first time buyers took out 8,000 loans, 2% down on the previous quarter but up 14% on the last quarter of 2014. They borrowed £870 million, down 2% on the previous quarter but up 14% on the fourth quarter 2014. Home mover lending totalled £1.4 billion, down 4% on the previous quarter but up 18% on the fourth quarter 2014. The number of loans in the period was 9,200, down 5% quarter on quarter but up 14% on year on year while remortgage lending went up by volume quarter on quarter and year on year. Annual home owner house purchase lending in Scotland totalled 64,800 loans, up 9% on 2014. This came to £8.5 billion, up 14% on 2014. First time buyers took out 30,000 loans worth £3.3 billion, up 8% by volume and 12% by value, on the previous year. Meanwhile, home movers took out 34,800 loans worth £5.2 billion, up 9% by volume and 15% by value, compared to 2014 while remortgage lending came to £3.1 billion, up 18% on 2014. This totalled 26,200 loans, up 12% on the previous year. ‘The sustained year on year growth in house purchase lending seen since 2012 continued in Scotland this quarter,’ said Linda Docherty, CML chair for Scotland. ‘This meant more first time buyers and home movers in 2015 took out a loan to purchase a home than in any year since 2008. With an economic climate of low interest rates and competitive mortgage deals, we would expect this growth in the Scottish market to continue into 2016,’ she added. Continue reading
Supply of homes to rent falls in UK as demand rises
The supply of rental accommodation in the UK is the lowest since records began a year ago, while demand for accommodation rose slightly in January 2015, the latest data shows. After a period of gentle decline, the number of properties registered per letting agent branch dropped by 5% to 172 in January, some 10 fewer than in December, according to the report from the Association of Residential Letting Agents (ARLA). A breakdown of the figures shows that supply in Scotland stands above the national average, with 280 properties available per member branch, while the supply of rental properties in London is 59% with only 116 properties per branch. However, London has seen a slight increase in the number of properties available over the last month, rising from 108 in December 2015. Demand for rental accommodation picked up in January following a seasonal lull in December, with an average of 31 prospective tenants now registered per branch. However, it has not returned to the high levels reported in January and February last year, when there were 38 and 40 tenants registered per branch respectively. In line with growing demand, the number of agents reporting rent increases for tenants increased in January, with 30% reporting an increase in rent, the highest since September 2015. ‘Supply of housing continues to be a problem and tenants bear the brunt of this with more people competing for properties at higher prices. The majority of tenants find that it is impossible to save very much at the end of the month to put towards buying their own home,’ said David Cox, ARLA managing director. He pointed out that ARLA’s recent Cost of Renting report found that a fifth of those renting in the UK do not expect to ever be able to afford to buy a home, and unless we act soon to build more properties, this number will only get higher. The report also reveals that 63% of ARLA members think the Chancellor’s stamp duty reforms for buy to let properties will push landlords out of the market, which will in turn cause supply to drop further and 58% believe the reforms will push up rent costs. However, 47% of ARLA agents reported that they have seen an uplift in interest from buyers looking to invest in buy to let properties before the 01 April, a rise from 24% from last month. ‘A few weeks into the new year and the April deadline for the stamp duty surcharge is looming and interest from buyers looking to invest in buy to let properties and beat the deadline is ramping up,’ said Cox. ‘The final details of the new tax will be revealed at the Budget in March but we are not expecting to see the Government back down on this policy. The findings from our members echo our concerns that efforts to penalise… Continue reading
