Tag Archives: housing
UK property industry welcomes Help Buy extension, mourns lack of Stamp Duty reform
As expected the first phase of the Help to Buy scheme in the UK is to be extended and this move announced by the Chancellor George Osborne in his Budget speech in Parliament has been widely welcomed by the property industry. He also announced that from midnight anyone buying a property worth £500,000 or more through a company scheme will be subject to 15% Stamp Duty, reducing the threshold for the tax from £2 million. But properties that are rented out will not be affected. He confirmed that a new garden city will be built at Ebbsfleet in Kent and claimed that the extension of Help to Buy to 2020 will be accompanied by 120,000 new homes. ‘We’re extending the Help to Buy equity loan scheme for the rest of the decade, so we get 120,000 new homes built and we’re making further reforms to our planning system and offering half a billion pounds of finance to small house building firms,’ the Chancellor said. He also said that he would be asking the Financial Policy Committee to be ‘particularly vigilant over house prices. Some experts have suggested that the extension of Help to Buy could fuel a property price bubble, especially in London and the South East. But Osborne has been heavily criticised for failing to reform the Stamp Duty tax as a whole. It is widely regarded in the property industry as being unfair and in need of change. In particular organisations like the Royal Institution of Chartered Surveyors saying that the current slab system hinders rather than helps the property market recovery. ‘The much trailed extension of Help to Buy to 2020 is not a game changer. While it provides certainty and clarity to the market, creating another 120,000 new build properties is still a modest target. We need over 230,000 just to meet current demand. Much more needs to be done,’ said Simon Rubinsohn, RICS chief economist. ‘Yet again, the Chancellor has failed to overhaul the stamp duty system, with wages well below inflation and rents rising rapidly for years, many have been struggling to save for a deposit, let alone meet a huge tax bill. Helping more buyers to enter at the lower end of the market would have resulted in more movement and transactions, freeing up stagnant property chains and bringing badly-needed housing onto the market,’ he explained. He also didn’t think much of the garden city plan, calling it ‘a garden village’ and saying that even with other new homes being built the announcements will contribute only a little housing in the South East. ‘These numbers are a drop in the ocean and do nothing to help others in the UK. More importantly, they don’t deliver the mix of homes we need across society, from the private rented sector to affordable and social housing,’ he pointed out. ‘RICS has long called for an investors’ prospectus for garden cities, which we welcome today. But we need a more ambitious approach than 15,000 homes at a… Continue reading
Property value growth in Australian capital cities slows, latest monthly index shows
Residential property value growth in capital cities in Australia didn’t really move last month with the market pausing for a breather, according to the latest RP Data Rismark home value index. The combined capital cities index recorded no change overall during February with Sydney, Hobart and Darwin the only capital cities to record a slight lift in dwelling values. The index recorded zero month on month growth. This follows eight successive monthly increases where dwelling values rose by 10% and values are up 13.2% since June 2012. Also, recent growth has taken capital city dwelling values to 4.8% higher than their previous peak in October 2010. ‘The February market results are in stark contrast to earlier readings where capital city dwelling values moved 2.6% higher over the past three months. The likelihood is that the weak reading for February is an adjustment from the strong readings in December and January rather than the beginning of a flat to negative growth phase across the macro level housing market,’ said TP Data research director Tim Lawless. Additional metrics tracked by RP Data show that buyer demand remained very strong in February with RP Data’s valuation platforms recording a record month for average daily levels of mortgage related activity. Also, auction clearance rates remained strong and with little slippage in vendor discounting levels or average selling times. However, Lawless said there will need to be further months of flat to negative movements before it can be said confidently that the housing market is slowing. ‘Our view is that housing market conditions will start to wind down later this year as affordability constraints and low rental yields dampen market conditions. Additionally, with a belief that mortgage rates are likely to start tightening later this year, it may help to quell some of the exuberance we have been seeing,’ he explained. Rismark International chief executive officer Ben Skilbeck, pointed out that Sydney continued to be the standout performer. ‘When looking at individual capital cities, the Sydney market has had a surprising run of nine successive month end increases totalling 14.1%. In keeping with what other capital cities have experienced, we would have expected some dips along the growth trajectory over a nine month period,’ he said. ‘Despite the recent strong Sydney capital gains, over the past decade Sydney values have compounded at just 2.9% per annum. Arguably this market is playing catch up before settling into a more sustainable rate of growth,’ he added. The February results show that the premium end of the housing market continued to gather pace while at the more affordable end of the market, capital gains have been slowing. Dwelling values across the most expensive quarter of capital city housing markets are up 3.8% over the three months to February 2013, and 6.8% over the past six months while homes at the most affordable end of the market have seen values remain flat over the past three… Continue reading
What’s different about the London housing market?
Taylor Scott International examines the many ways in which the housing market in London differs from the rest of the UK, and even from the rest of south east England. London is a global city, with governance arrangements that are … Continue reading
