Tag Archives: house
Average house prices in the UK fell by 1.1% last month, the latest data shows
Average house prices in the UK fell 1.1% in September but are still up 6.9% on an annual basis, according to the latest index figures to be published. During the month average house price stabilised at £203,135, but in London property prices fell 3.3% but are still up 19.8% year in year taking the average price in the capital to £507,967. The National Housing Market Monitor report from haart estate agents says that the market remains strong with almost 10 buyers chasing each new property instruction across the UK, up from eight two years ago. In London there are 16 potential buyers chasing each property instruction. The difference between the London market and the UK as a whole is also marked with it comes to new properties being put up for sale. They have increased annually across the UK by 2.8% but in London by 23.1%. The report from the independent agent which has a network of 200 branches across the country, also shows that the average property price for first time buyers has reached two year high at £160,218, up 4.1% on a monthly basis and 8.2% annually. ‘Although our data shows a small slowdown in house price growth on a monthly basis, this must be taken in the wider market context. Good mortgage deals are still very much on the table and interest rates aren’t going up for the foreseeable future,’ said Paul Smith, chief executive officer of haart. ‘We have 10 buyers chasing every new property instruction UK wide so sellers shouldn’t be concerned. They should be reassured that the UK property market is still performing well,’ he added. New properties for sale across the UK in September increased 2.8% annually but fell on the month. This is the fourth consecutive month in which property supply has increased on an annual basis. In contrast the number of new buyers is down 6.6% annually, again the fourth consecutive month in which the level of demand has fallen on an annual basis. Similar to new buyer registrations, the number of first time buyer registrations decreased 6.4% annually and 2.8% on the month. However first time buyers now make up a higher percentage of all mortgages written, 44.7% in September 2014, up from 41.1% last year. The average mortgage achieved by first time buyers is also up and now stands at £125,668, an increase of 11.1% annually and 3.9% on the month. Continue reading
All regions of the UK see a year on year rise in residential rents
Rents in the UK have continued to increase steadily throughout the year with the average rent in the third quarter of 2014 reaching £903 per calendar month, according to the latest index. This is an increase of £21 per calendar month, up from £882 per calendar month in the second quarter of 2014, the data from Countrywide Residential Lettings shows. In September, the average UK rent increased to its highest level for 32 months to £916 per calendar month, a growth of 5.2% year on year. All regions saw a year on year increase in rents apart from the Midlands, which saw no increase in the third quarter of 2014 while Greater London saw the greatest increase, up 9.8% on the third quarter of 2013, followed by the East of England which saw an increase of 7.3%. The data also shows that arrears have remained relatively stable with many regions seeing a decrease and some seeing less than a 1% increase. In terms of the size of properties, all properties saw an increase in rent quarter on quarter and year on year. Four bedroom plus properties saw the greatest increase in rent year on year, up 5.8% to £1,524 per calendar month, followed by three bedroom properties up 4.8% to £956 per calendar month. Two bedroom properties saw the smallest growth in rent, up 4.1% to £822 per calendar month. Meanwhile, Countrywide says that the Bank of England’s request for extra powers, in order to direct lenders as to how much buy to let investors are able to borrow, could mean that landlords in the South East and London will have to find a 40% deposit in order to secure mortgage finance. According to an analysis by the firm the powers, if granted, will allow the Financial Policy Committee to ask lenders to stress test how much new landlords can borrow and ensure that the income landlords receive is greater than the interest payments on their mortgages. Lending on investment property is typically secured against the rental income a landlord can generate. For most lenders, landlords are assessed on whether the rent generated from the investment property will cover 125% of the interest component of the mortgage. This gives both the lender a degree of security against interest rate rises and takes into account the money a landlord will reinvest back into the property for general maintenance and improvements. At present, the interest rate against which the borrower’s ability to meet repayments is at the discretion of the lender. Over the past two years, this rate has typically been around 5%, translating into 1.2% above the 3.8% rate at which the average landlord secures their loan. For the average landlord who has purchased during 2014, the rental income from the property covered 205% of the mortgage interest, well inside the 125% limit. Tested against an interest rate of 5%, generally the rate which lenders currently use to test affordability means the rent will cover 165% of the mortgage… Continue reading
New five year forecast predicts 30% rise in average house prices in England and Wales
Average house prices in England and Wales are set to increase by 30% in the next five years, with the national forecast reinforcing the north/south divide, new research suggests. While prices in London are set to rise by almost 33%, the real beneficiary of the recent London boom will be the South East, forecast to increase by 37% by 2019, says the latest report from Rightmove. The North West will be the slowest riser but will still go up by 24%, adds the new forecast comes from a collaboration between the property website Rightmove and economic forecaster Oxford Economics. It is described as the most comprehensive house price forecast of its kind ever created, based on property and economic data rather than opinion and short term market factors. It takes into account both asking and sold prices, surveyor valuations and analytics from the Oxford Economics’ Global, Industry and Regional forecasting models. The majority of fastest performing areas are all within easy commuting distance of London and include towns such as Southampton which is forecast to see price increases of 43%, Luton at 41% and Brighton also at 41%. The analysis also says that the Home Counties and outer boroughs are set to benefit from the ripple effect of a year of strongly rising prices in London, alongside the brighter economic picture. Prices in the capital itself are forecast to rise at a slower rate than the South East and East Anglia with prime central London having a period of much slower growth after the frenetic increases of 2014. West London is predicted to be caught in the prime London slowdown with a modest rise of 14%, bringing its potential for future growth in line with the slower northern cities of Carlisle with growth of 17% and Manchester with a price growth forecast of 19%. The forecast compares and contrasts the fortunes of neighbouring areas, and takes into account the effect of strong house price growth in one location spilling over into adjoining areas. Economic factors that are more significant in some markets than others are also considered, for example the exchange rate has a big effect on house prices in prime central London, but is of rather less direct importance in the wider suburban markets of the South East and further afield, where employment and population growth are key. ‘Alongside the publication of the Rightmove monthly House Price Index which is based on new seller asking prices, we have unique access to other sources of property data from surveyors and property transaction prices at a very local level. This has enabled us to work with Oxford Economics to create a unique forecast that can be used as a guide by a number of businesses,’ said Miles Shipside, Rightmove director and housing market analyst. ‘Understanding the path of future house price growth is a key element of UK economic strategy and decision making, and our data driven forecasts contain insight not previously available from other commentators or the Government’s own… Continue reading
