Tag Archives: housing
South east and east of England and Scotland seeing strongest house price growth
The south east and east of England are likely to see the strongest house price growth in the UK in 2015 with Scotland also likely to be a strong performer, according to the latest outlook report. The south east is expected to see overall growth of 5.8% this year with the east of England and Scotland both at around 5.8%, according to the report from Strutt & Parker, with Greater London at 5.1%. The firm’s five year outlook also sees these regions having some of the strongest growth with price inflation of 22.8% predicted for the east of England, 22.7% for the south east, 19.8% for Greater London and 18.5% for Scotland. Other areas of interest include the south west with five year growth of 16.5% expected. ‘From our Housing Futures research we know that there is a huge aspiration to live there,’ said Stephanie McMahon, Strutt & Parker’s Head of Research ‘Our national survey showed that 15.6% of respondents who said they had plans to move within the next five years wanted to live in the south west, particularly for retirement and lifestyle reasons,’ she explained. ‘That said, our survey also showed that taking into account all respondents, and analysing by age, that the south west was one of the areas that would experience a large exodus of people between the ages of 18 to 29, indicating that older people have perhaps greater flexibility in their working styles,’ she added. The outlook report predicts house price growth of 15.7% for Northern Ireland over five years, 15.4% for the east midlands, 14.2% for the west midlands, 13.4% for the north west, 11.7% for Yorkshire and Humber, 11.3% for Wales, and 10% for the north east. The report also explains how major developments and events are likely to affect house prices. For example, central London, most notably locations such as Farringdon and Shepherd’s Bush are seeing rises due to the Crossrail infrastructure project. Outside of London, the electrification of the Great Western line with the first stages due to open in 2017 between London, Oxford, Newbury, Bristol and Cardiff means that property prices could rise and homes in the south east, Oxford and Bicester could benefit from the train line from Marylebone being brought into Oxford. The report mentions that there is real concern about potential interest rate increases in 2016 even although they are likely to come incremental shifts. This could affect first time buyers and also home owners with interest only mortgages. Another concern on the horizon is the Bank of England having powers over the buy to let market which could limit the sector and looking further ahead the referendum on whether the UK should remain in the European Union has the potential to have an effect on markets. ‘The EU Referendum will take place before the end of 2017. The lobbying has already begun and will escalate over the coming months. Although an immediate and direct impact on the majority… Continue reading
Pending home sales fall across the United States, latest index shows
Pending home sales in the United States cooled in September for the second month in a row, taking them to their second lowest index reading in 2015, according to the latest index. All four major regions experienced a pullback in activity in September, the Pending Home Sales Index, a forward looking indicator based on contract signings, from the National Association of Realtors shows. The index declined 2.3% to 106.8 in September from a slightly downwardly revised 109.3 in August but is still 3% above September 2014 when it was 103.7. With last month's decline, the index is now at its second lowest level of the year but has still increased year on year for 13 straight months. Lawrence Yun, NAR chief economist, said that a combination of factors likely led to September's dip in contract signings. ‘There continues to be a dearth of available listings in the lower end of the market for first time buyers and realtors in many areas are reporting stronger competition than what's normal this time of year because of stubbornly low inventory conditions,’ he explained. ‘Additionally, the rockiness in the financial markets at the end of the summer and signs of a slowing US economy may be causing some prospective buyers to take a wait and see approach,’ he added. Despite contract activity softening from the more robust levels seen earlier this year, Yun believes the housing market will still likely be one of the brighter spots in the economy in coming months. ‘With interest rates hovering around 4%, rents rising at a near eight year high, and job growth holding strong, albeit at a more modest pace than earlier this year, the overall demand for buying should stay at a healthy level despite some weakness in the overall economy,’ he added. The PHSI in the Northeast fell 4% to 89.6 in September, but is still 3.9% above a year ago. In the Midwest the index declined 2.5% to 104.7 in September, but remains 4.3% above September 2014. Pending home sales in the South decreased 2.6% to an index of 118.3 in September and are now 0.1% below last September. The index in the West inched back 0.2% in September to 104.4, but is still 6.6% above a year ago. Continue reading
Rural homes in the UK £43,490 more expensive than those in urban areas
Property prices in the countryside in the UK are, on average, £43,490 or 22% higher than in urban areas, according to the latest annual Halifax Rural Housing Review. There is a rural premium in all regions with countryside homes typically commanding a significant price premium over urban areas, although there are large variations across the country. In rural areas of West Midlands the average house price of £252,927 is £84,610 or 50% higher than in the region's urban areas at £168,317, the largest difference in the index. In the East of England, the premium is £16,806 or 6%, the smallest difference. House prices in rural areas are less affordable than in urban areas, the research also shows. The average property price in rural areas is seven times average annual earnings compared with a ratio of 5.9 in urban areas. The least affordable rural local area district is Tandridge in Surrey where the average house price of £433,932 is 10.8 times local annual average earnings of £40,266. All 10 of the least affordable rural districts in Britain are in southern England, including East Dorset where the average house price of £329,056 is 9.6 times local annual average earnings. This is followed by Purbeck in Dorset at 9.4, Mid-Sussex, Cotswold and North Devon all at 9.2. The least affordable rural district outside the south are Hambleton at 8.2 and Ryedale at 8.1, both in the North York Moors. Copeland in West Cumbria is the most affordable rural district with an average house price of £140,364 that is 3.7 times local average annual earnings of £38,367 while Chiltern is the most expensive with an average house price of £465,970. The next most expensive rural districts are Waverley in Surrey at £462,145, Tandridge and South Oxfordshire at £396,287. The average house price in Chiltern is four times higher than in East Ayrshire at £115,394 which is the least expensive rural district. Despite the higher price for buying in the countryside the gap with urban prices is narrowing, and property prices have risen more slowly in rural areas during the past five years, according to the research. Between 2010 and 2015, the average price of a home in the countryside rose by 13% compared with an average increase of 23% in urban areas. Between 2014 and 2015, the average price of a home in the countryside has risen by 5% compared with an average 8% increase in urban areas, excluding Greater London. Overall, the rural/urban premium has narrowed from 34% or £52,279 over the last decade. First time buyers account for 42% of all mortgage financed purchases in rural areas. This is significantly lower than in urban areas where first time buyers account for 54% of such purchases. Affordability difficulties are the key factor behind the lower level of first time buyers in rural areas. Due to the high level of property prices, getting on the rural property ladder is at its most challenging for first time… Continue reading
