Tag Archives: housing
Increasing demand and lack of supply hitting UK first time buyer market
The UK housing market is seeing increasing demand and limited supply and first time buyers are finding it increasingly difficult to get on the property market, according to a new analysis. Since 1980, there has been considerable fluctuation in the UK housing market and while house prices have been increasing, home ownership among younger age groups generally has declined. The analysis from the Office of National Statistics also shows that if the number of households in England grows to 24.3 million in 2021 as projected, this would be equivalent to an additional 221,000 households per year. Housing is therefore likely to remain an important topic in the future. Overall, the UK housing market comprises 27.8 million residential properties, the report says. Linked to income, wealth and availability of lending, the housing market is sensitive to the overall economic climate. On average house prices have increased by 6.9% per year since 1980 and the greatest annual increase in house prices was 25.6% in 1988. In 2013, the average price (mix adjusted) of a property in the UK stood at £242,000. There were seven years between 1980 and 2013 where, on average, UK house prices fell, the majority of which occurred during the recession of the early 1990s. The biggest drop, however, was 7.6% in 2009. The economic downturn in 2008 had a considerable impact on the UK housing market. The decline in house prices was accompanied by reduced mortgage availability and stricter lending criteria, and this is a major reason in the UK for the continuing low level of housing transactions. The number of property sales in the UK almost halved from a peak of 1.67 million in 2006 to 0.86 million in 2009. Since 2009, however, the number of sales has partially recovered, increasing to 1.07 million in 2013. The report points out that rising house prices could partially explain the decline in the number of first time buyers taking out a mortgage. Between 1980 and 2002, the number of mortgages agreed for first time buyers was averaging around 486,000 per year. However, in 2003 there was a 31% decline in the number of mortgages for first time buyers from 2002. It also shows that in 2008 saw a further 47% decrease from 2007 as the effects of the economic downturn impacted on the housing market. While some recovery in the numbers of first time buyers has been apparent in 2013/2014, the level remains below the average seen prior to 2003. The report says that the reduction in the numbers of first time buyers has subsequently had an impact on the age of home owners. In 1991, 67% of the 25 to 34 age group were home owners. By 2011/2012, this had declined to 43%. There were also reductions in home ownership over the same period for the 16 to 24 age group from 36% to 10% and for the 35 to 44 age group from 78% to 64%. By contrast, home ownership has increased among… Continue reading
Miami saw record demand for property in 2014
The Miami real estate market continued to perform robustly in the fourth quarter of 2014 due to renewed consumer confidence and increasing demand from both domestic and international buyers, according to the latest monthly index report. The median sales price for single family homes increased to $246,140 in the fourth quarter, a 4.7% jump compared to the same period last year, the data from the Miami Association of Realtors shows. The median sale price for condominiums increased 8.6% to $190,000 in the fourth quarter compared to a year earlier. Miami-Dade County has now seen 12 consecutive quarters of growth for both single family homes and condominiums. ‘We expect Miami home prices to continue to increase in 2015 but at a more moderate rate. Limited supply and strong demand for single family homes is still reflective of a seller’s market,’ said Christopher Zoller, the association’s residential president. ‘There is also strong demand for both new construction and existing condominiums, so we will continue to see price growth for residential properties in Miami-Dade,’ he added. Compared to the fourth quarter of 2013, the average sales prices for condominiums in Miami-Dade County increased 18.5% to $375,269. The average sales price for single family homes decreased 2% to $394,095. Sales of single family homes, which set an all-time record for all of 2014, increased 7.7% to 3,426, while condominiums decreased 3.3% to 3,981 compared with the same period in 2013. ‘Much of the increase in single-family home sales activity is due to consumer confidence. Many buyers who were staying on the side lines are now buying. Huge gains in job growth and more solid economic indicators are resulting in more consumers returning to the housing market,’ explained Carlos Gutierrez, the 2015 president-elect of the association. Home and condominium listings also increased in the fourth quarter of 2014, up 3% in the fourth quarter of 2014 compared to the same period last year. New condominium listings increased by 4.2%. At the current sales pace, the number of active listings represents 5.6 months of inventory for single family homes and 8.4 for condominiums. Compared to the fourth quarter of 2013, the month’s supply of inventory for condominiums increased 19.7%. The inventory for single family homes decreased 0.2%. A balanced market between buyers and sellers offers between six and nine months of supply inventory. The median days on the market of single family home listings during the fourth quarter was 45 days compared to 40 days during the same period last year, an increase of 12.5%. Similarly, the median days on the market for condominium listings were 58 days compared to 47 last year, an increase of 23.4%. In the fourth quarter of 2014, some 55% of closed sales were all cash compared to 60% a year ago. All cash sales were 41.4% of single family home closings and 66.9% of all condominium sales. Since nearly 90% of foreign buyers pay cash, this reflects Miami’s top position as a prime… Continue reading
US housing market set to see strong demand from first time buyers in 2015
The growing gap between housing's low and top tiers in the United States is expected to restore healthy demand for first time buyers and those moving up the housing ladder. 2015 has the promise of a transitional year where full buyer momentum in the low and mid tiers reinforce a strong housing recovery, according to the latest analysis report from Clear Capital. It says that sustained national price growth in the low tier segment, once driven by investor activity, is good news for first time buyers and also encouraging is the number of potential buyers locked into underwater mortgages has been steadily decreasing. The recent rise in home prices continue to bring more home owners out of negative equity and with more equity to play with, mid-tier home owners could move up, creating more opportunity and driving healthy demand in the low and mid tiers of the market. ‘While we are expecting price growth to moderate across all tiers in 2015, the top tier’s quarterly growth rate fell to 0.3% in the fourth quarter, where it had been holding steady at around 1% through the first three quarters of 2014,’ said Alex Villacorta, vice president of research and analytics at Clear Capital.. The report shows that year on year this tier experienced the lowest price growth rate of 3.6% among the three national tiers. At its current pace, continued moderation in the top tier could push quarterly price growth into negative territory in 2015. January data also reveals the low tier holding on to double digit gains year on year at 10.2% and healthy quarter on quarter gains of 1.5%. The firm believes that this divide between a healthy low tier and stalling top tier could kick off a domino effect. Stalling prices in the top tier of the market could create the perception of a good deal. This instils confidence in mid-tier home owners, motivating them to move up to the top tier. In turn, this opens up more opportunity for low tier home owners to move up to the mid-tier. Creating new opportunity in the low tier could entice potential first time buyers to enter the market. This domino effect could be the catalyst for balanced demand across all sectors of the market. Regionally, the Midwest continues to lead the growth and year on year held on to double digit gains in the low tier segment at 13.6%, while the top tier fell to 3.3%. This gap between growth in the low and top tiers was also recorded on a quarterly basis, with the low tier growing at 1.7% and relatively flat growth in the top tier at 0.5%. The Midwest led the nation in the all tier segment, with quarter on quarter growth at 0.9%, narrowly edging the West at 0.7%. The Midwest is the only region currently seeing price appreciation in the low and mid tiers, growing concurrently above 1%. The firm explained that a moderating top tier could incentivize… Continue reading
