Tag Archives: housing
House sales flatten in UK due to forthcoming general election, says RICS
Buyer enquiries and house sales have flattened in the UK in the run up to the general election, according to the latest monthly market survey from the Royal Institution of Chartered Surveyors. In most parts of the country, the supply versus demand imbalance led to 21% more surveyors reporting a rise in house prices in March, up from 15% in February, and 15% more surveyors expecting prices to increase over the next three months compared with 10% in February but the results for both are significantly lower than in March 2014. Nationally, Northern Ireland continues to outperform the rest of the UK with the strongest house price growth in March and the highest price expectations over the next three months. However, across much of the rest of the UK, particularly in Wales and Scotland, price gains over the next three months are expected to be much more moderate. In London, a lack of prospective buyers saw enquiries and the number of agreed sales both fall for the eleventh consecutive month and 24% more surveyors reported a decline in the number of new properties coming onto the market for sale. However, compared to the start of the year when 42% more surveyors reported a decrease in prices, just 13% more surveyors saw prices fall in March and across the whole of the UK, the average surveyor sold 19.5 properties, reflecting activity since Autumn, although it remains some way down on where it was in the early part of 2014. The boost that was given to the housing market by the Help to Buy scheme has begun to dissipate and activity levels have slipped back as a result, according to Simon Rubinsohn, RICS chief economist. ‘Even more worrying are the tentative signs that price momentum could be set to pick up once again as the supply of stock to the market continues to fall. Anecdotal evidence does suggest that election uncertainty may be having some impact on the market, but underlying the trends visible in the latest survey is a very real housing crisis which will urgently need to be addressed by the next government,’ he explained. ‘It is significant that price expectations nationally are accelerating both at the three and twelve month time horizons and at the latter they are at their highest level since the spring of last year,’ he added. Continue reading
UK residential property market activity strong as valuations rise
Last month saw the strongest activity on record for property valuations in any month since 2007, up 36% on a monthly basis and annual growth of 42%, new data shows. After a 36% increase in activity on a monthly basis, the total number of valuations carried out in March 2015 has grown by 42% compared to March 2014. First time buyer activity increased by 33% in March compared with the previous month and was up 40% from the same month last year, according to the latest research from Connells Survey and Valuation. Activity on behalf of those further up the property ladder also saw rapid growth, but at a slower pace than for first time buyers. Valuations on behalf of established home movers picked up by 32% on a monthly basis and by 23% over the last 12 months. ‘New announcements like the Help to Buy ISA have combined with existing government schemes to boost interest from first time buyers. In the short term this is mainly about sentiment, but extra support has been consistently focused at this end of the market for years now, with a longer term impact too,’ said John Bagshaw, corporate services director of Connells Survey & Valuation. The data also shows that remortgaging in March has outperformed the overall housing market, posting 54% growth on an annual basis, following a 33% month on month rise and Bagshaw pointed out that record low interest rates are likely to stay for several more months. ‘Many households with a mortgage that seemed extremely competitive just a few years ago could find it in their interests to refinance, even to the security of a fixed rate. Such a recalibration of the mortgage market is working alongside a resurgent property purchase market to stoke demand for valuations,’ he explained. ‘Of course a little further ahead, there is still the prospect of interest rate rises. In fact deflation caused by a volatile oil price could make a turning point for interest rates more dramatic as and when this occurs. So there is no space for complacency although that isn’t stopping people looking for the best deals,’ he added. With by far the strongest monthly increase, buy to let activity in March was 54% stronger than in February. This takes the number of valuations carried out on behalf of buy to let landlords to levels 64% ahead of March 2014. The firm believes that landlords are responding to a pick-up in demand from tenants and a noticeable improvement in rental yields in some hotspots. It’s also possible this is another artefact of a booming jobs market, as people move to take up jobs. ‘Landlords are generally low LTV borrowers who tend to have reliable finances away from their property investments, so for lenders they offer a sound investment in a similar way to many… Continue reading
London emerging prime property proves robust ahead of election
Prices in emerging prime property areas in South West London have remained robust in the first quarter of 2015 despite the uncertainties presented by the election, according to a new index. The top performers in terms of capital growth in the first three months of 2015 was Clapham, up 5.5% after a weaker fourth quarter in 2014, followed by Southfields and Earlsfield, up 2.9% compared to last quarter. The emerging prime index from Douglas & Gordon also shows that investors have been attracted by the strong rental growth and some areas have become hotspots for young professionals and overseas investors and tenants who are drawn to upmarket developments. Investors are continuing to flock to smaller units, particularly flats, and this is due to attractive prices and high yields of 3.7% to 5% compared to 2.2% and 3.7% in prime areas. The index report points out that the Chancellor of the Exchequer’s clear signal in the Autumn Statement that properties under £900,000 would be free of political interference has meant that demand for properties under this threshold has remained strong. When it comes to properties over £2 million there has been little pick up from the second half of 2014 and the report says this is due to the fallout from the overhaul in stamp duty structure announced last year and uncertainties ahead of the election, particularly the potential introduction of a mansion tax if certain political parties come to power. Properties in Putney and Battersea, which saw spectacular growth in 2013 and 2014 thanks to well-heeled families seeking family houses, saw a standstill in prices in the first quarter of 2015. The report says this is because property prices in these areas, which generally have more large properties than flats, are now approaching the politically sensitive £2 million barrier, which is the threshold for the mansion tax if introduced. ‘This quarter’s index confirms that emerging prime has become the sweet spot of the professional private rental sector. One bed flats in the £300,000 price range are one of the best investments, given their protection from political interference and the demand from young professionals who increasingly feel more at home in places like Clapham than Central London,’ said the firm’s executive director Ed Mead. ‘It is very telling that for many buyers, both domestic and overseas, emerging prime areas are achieving a social cachet they’ve have never had. While the pre-election period is causing capital growth of larger properties to pause, we still think there is still some way to go on value,’ he pointed out. ‘For instance in Clapham we see demand continuing in the long term given the amount of undeveloped stock in the area. We anticipate the upward trend in prices to be reinstated if no mansion tax is introduced,’ he added. Continue reading
