Tag Archives: london
Over half a million UK home owners plan to pay off mortgage with pensions pot
Just over half a million people, some 631,000, in the UK intend to use all or part of their pension to help repay their mortgage balance, new research has found. While the majority of 40 to 70 year olds with mortgages, 71%, intend to continue to meet their obligations via monthly repayments and 25% through additional lump sum contributions, up to 9% or 631,000 intend to use their retirement savings to repay their mortgage. The research from financial firm Paternership, shows that this is lower than the figure recorded last year when it was 14% and said that more people are looking to more traditional methods to repay the outstanding balance on their mortgages. It also shows that 8%, or 561,000 people, say that they intend to rely on an inheritance to repay the outstanding balance on their property and 7% or 491,000 confess they don’t know how they will meet their obligations. ‘While it is still shocking that over half a million people in the UK intend to use all or part of their retirement savings to repay their mortgage, it has fallen from over a million in 2014,’ said Andrew Megson, managing director of retirement at the firm. ‘This is fascinating as it suggests that the Pension Freedoms which allow people to access their entire pension in cash have encouraged people to take a more holistic view of how they use their pension rather than focusing on one off expenditure. This in turn appears to have focused peoples’ minds on paying off their home loan before they retire,’ he explained. ‘The work that the lenders have done in communicating with interest only mortgage customers about their options and obligations is also likely to have had a positive impact as it will have encouraged more people to move to capital repayment. That said, while a debt free retirement is the ideal, some people may find they reach traditional retirement age with an outstanding balance,’ he pointed out. ‘Using their pension may well seem like an option but it is not the only option as working longer, downsizing or considering a lifetime mortgage may be more appropriate. Ideally, pension savings should be used to provide an income in retirement, and with the state pension only providing a very basic safety net, making this choice could lead to hardship in later life,’ he added. Continue reading
European commercial property investment activity at highest since 2007
Commercial property investment activity in Europe reached its highest level since 2007, totalling €102.5 billion in the first half of 2015, the latest market analysis report shows. The investment volume across the 16 participating countries was 25% up on the same period last year, according to the European Investment Briefing report from international real estate advisor Savills. The firm says that in line with its quarter one forecasts, the European investment market is on track to top €230 billion by the end of this year as commercial property investors continue to favour core markets, with the UK, Germany and France still accounting for 67.8% of the total volume. ‘However, the share of the markets outside of the top three countries is increasing, due to stronger investor interest for non-core countries, which offer attractive pricing and supply of large assets and portfolios,’ said Lydia Brissy, director at Savills’ European research team. ‘Overall, investors are more open to move up the risk curve. They seek future yield compression by targeting secondary or alternative assets in core cities, or prime assets in secondary markets,’ she added. The report shows that the office sector continued to dominate the investment activity in most countries across Europe, capturing about 39% of the transaction volume per country on average. The only exceptions where retail properties accounted for a higher share of property investment deals were Germany at 42%, Finland at 43%, the Netherlands also at 43%, Norway at 62% and Portugal at 83%, which saw the sale of large scale retail portfolios in the past quarter. Savills has also reported that cross border investment increased in nearly all countries across Europe and especially in the peripheral markets, where US investors have been notably active. There has also been growing interest from investors from Asia Pacific and the Middle East. The share of non-domestic investment ranged from 10% in Sweden to over 80% in markets such as Italy, Poland and Portugal. Marcus Lemli, head of European Investment at Savills, explained that international investors have continued to drive up volumes, particularly the equity funds from the US, which have been acquiring retail portfolios or landmark office buildings. This has enabled some of the more peripheral countries to record the strongest rises in investment volumes over the first six months of 2015, notably Portugal at 720%, Norway at 391% and Italy at 154%. In the second quarter of 2015 the share of US money invested out of the cross border volume has been remarkable, according to the report, averaging 40% per country, and accounting for as much as 93% in Portugal, and 66% in Ireland. ‘With healthy investor interest, Europe has seen a shift towards larger transactions. The most significant rises in portfolio deals were noted in Germany and the Nordic markets and consequently, there has been a marked uplift in activity in the regional markets,’ said Lemli. In the first half of this year, the volume of investment in regional markets rose to more than… Continue reading
New development set to boost London’s Canary Wharf as a place to live
Canary Wharf in London is known as being one of Europe’s largest financial services employment clusters but it is also a leading prime London residential market with a new wave of development set to get underway. The new home building is accompanied by new infrastructure and amenities which will reinforce the area’s position as a prime residential address, according to a new report from international real estate Knight Frank. Already home to one of the busiest and most vibrant shopping malls in the city, as well as more than 300 shops, cafés, supermarkets, bars and restaurants, it says that Canary Wharf is already an attractive residential environment as well as a business centre. According Gráinne Gilmore, head of UK residential research at Knight Frank, the development planned for this area, which includes a new primary school, will augment its appeal to a wider demographic, attracting families as well as young professionals, and serve to further change perception away from ‘pied a terre’ to ‘home’. Meanwhile, the opening of Crossrail will enhance Canary Wharf’s connectivity. Property prices in Canary Wharf have risen by 27% since early 2013, comfortably outstripping the 10% growth seen across prime central London over the same time, according to Knight Frank’s index. Gilmore pointed out that such strong growth is partly underpinned by the improving UK economy, something which is also reflected in the commercial property market in Canary Wharf, with vacancy rates falling and upward pressure on office rents. The other effect at play on prices is the return of the ‘ripple effect’, with house price growth spreading outwards from central London, as it did in previous UK housing cycles. ‘However, despite this outperformance in price growth, average values are still significantly lower than those in more established prime residential neighbourhoods in West London,’ said Gilmore. She pointed out that Canary Wharf and its surrounds are also emerging as a hub for culture and entertainment as London’s ‘cultural centre of gravity’ is enhanced by activity in the East. There is a popular arts and events programme already hosted on the Canary Wharf Estate, with live music shows, outdoor dance performances, sporting events, open air theatre and exhibitions. There are 14 schemes of around 400 units or more already under construction or with full planning on the Canary Wharf Estate and nearby on the Isle of Dogs. Some of these schemes are in the very early stages of development and will take some years to deliver. Canary Wharf Group has already begun work on Canary Wharf Residential, a mixed-use scheme of over 3,000 new homes, including over 600 affordable units, a school and a medical centre. The scheme will expand the estate from 100 acres to 122 acres. Berkeley Homes has permission to build a residential tower on Marsh Wall, which, once complete, will be the UK’s tallest residential building, surpassing the 181 meter St George Wharf Tower in Vauxhall. Meanwhile Eco World-Ballymore is constructing twin residential towers at Wardian, just across the… Continue reading
