Tag Archives: london
Survey confirms certain groups facing difficulties due to UK mortgage reforms
Mortgage Market Reforms (MMR) in the UK are making it more difficult for certain customers to get a mortgage including over 40s and the self-employed, new research has confirmed. When the rules changed in April there were warnings that they could impact adversely on the home lending market and now research from buy to let lender Paragon Mortgages shows there was a 3% reduction in average mortgages introduced by intermediaries in the third quarter of the year. Intermediaries thought it was more difficult for certain customer groups to get a mortgage in the third quarter compared to the previous quarter and this comes after other firms have reported difficulties for people aged over 40 trying to secure a mortgage. The specialist lender’s quarterly Financial Advisers Confidence Tracking (FACT) survey highlights intermediaries’ views on the performance of the mortgage market, also revealed that people borrowing into retirement, people wanting interest only mortgages and people with irregular incomes have experienced difficulties. Indeed, the stark figures show that more than 90% of the 186 respondents in each case reported these difficulties. During the third quarter the average number of mortgages introduced by intermediaries was 22, which was down 3% on the second quarter. Nevertheless, compared with the third quarter of 2013, this shows a 12% increase in the average number of mortgages introduced. This, however, was significantly lower than the 30% year on year increase seen in the second quarter. Intermediaries appeared more positive about the buy to let market with 24% of all mortgages introduced being buy to let mortgages, a modest increase from 23% in the second quarter of the year. In particular, 43% of intermediaries surveyed thought the availability of buy to let finance had improved since the second quarter, a significant increase of 7% over the period from 36%. In addition, only 8% of intermediaries stated the availability of buy to let finance had deteriorated, compared with 12% in the previous quarter. ‘The market has seen significant structural changes following the Mortgage Market Review. This is a result of both the regulations themselves and the way the lending industry has responded to them,’ said John Heron, managing director of Paragon Mortgages. ‘This could be one factor behind the softer levels of business that intermediaries are reporting in the third quarter. Indeed CML data shows us that buy to let lending was up 14% in quarter three compared with quarter two, and up 24% on the third quarter of 2013, which could suggest that the buy to let market is proportionally more important for lenders in the current market,’ he explained. ‘A healthy availability of buy to let finance is significant to maintaining a competitive and high quality Private Rented Sector, so it is pleasing to see increased confidence amongst intermediaries, for this type of business,’ he added. Continue reading
Paris office market see strong year despite poor economic conditions
Despite the difficult economic background in France, the Paris office market has turned in a strong performance over the first nine months of this year, according to a new report from Knight Frank. Office take up increased by 13.2% and investment volumes rebounding by 39% compared to the same period in 2013, the report shows. Occupier take-up reached 1.4 million square meters in the first nine months of 2014 and is expected to reach two million square meters for this year as a whole. The increase has been driven by a number of significant deals over 5,000 square meters to major corporates such as KPMG and L’Oreal. The overall office vacancy rate has stabilised and stood at 7.2% at the end of the third quarter, although there is a disparity between the city’s different submarkets. Vacancy rates in La Défense and Western Crescent are at 11%, while in the CBD the vacancy rate is less than 6%. The report suggests that the office investment market remains buoyant and somewhat decoupled from the leasing market, with the current strong interest in trophy assets expected to continue. Transaction volumes for 2014 look set to reach their highest since the peak of 2007, having surpassed €11 billion in the first nine months. With a strong final quarter in prospect, deal volumes for 2014 as a whole are expected to end up in the region of €15 billion. International investors remain very active in the market and are showing interest in higher-yielding assets outside the core, as well as prime opportunities. ‘The Paris office market has bucked the wider economic backdrop and, while the economic outlook remains somewhat uncertain, the recently released positive GDP figures for quarter three will provide a boost for both occupiers and investors as we move towards the year end,’ said Darren Yates, head of global capital markets research, Knight Frank. According to Luke Condon, partner, Knight Frank Paris, the size and on-going resilience and stability of the Paris occupier market provides comfort to investors, as demonstrated by the increasing proportion of international capital attracted to the market. ‘This, coupled with improved financing conditions, has also led to significantly improved demand for non-core products. Market sentiment is positive but more product is required to satisfy demand,’ he added. Continue reading
Latest index confirms that UK house price growth continues to moderate
UK house prices in the three months to the end of November were 0.7% higher than in the previous three months, according to the latest quarterly figures from the Halifax. This quarterly rate was marginally down from 0.9% in the previous month and the data also shows that prices in the three months to November were 8.2% higher than in the same three months a year earlier. On this measure, annual house prices are now growing at their slowest rate since February and on a month on month basis they are up o.4% which reverses the 0.4% monthly decline recorded in October. However, home sales fell in October to 98,490, the first time they have been below 100,000 in 2014. Nonetheless, current estimates suggest that housing transactions in 2014 will total in excess of a million for the second consecutive year. This is the first time since 2006 and 2007 that home sales have exceeded a million in successive years, according to HMRC, seasonally adjusted figures. The index also points out that mortgage approvals continue to fall. The volume of mortgage approvals for house purchases, a leading indicator of completed house sales, fell in October, to 59,426, data from the Bank of England shows. Approvals have now fallen by 22% from 76,574 in January 2014. Private housing completions in the first three quarters of 2014 were 10% higher compared with the same period in 2013, at 68,930, according to the department of Communities and Local Government. It means that levels of house building remain well below those required to keep up with the pace of household formation, but these latest figures show signs of a revival. A continuation of this upward trend in house building would help to bring demand and supply into better balance, curbing upward pressure on house prices. ‘Receding buyer interest combined with a revival in private housing completions has brought supply and demand into better balance. These factors have in turn contributed to the easing in house price growth since the summer,’ said Martin Ellis, Halifax housing economist. ‘But housing demand continues to be supported by a strengthening economy, rising employment levels, still low mortgage rates and the first gain in real' earnings for several years,’ he explained. ‘We expect a further moderation in house price growth over the next year with prices nationally expected to increase in a range of 3% to 5% in 2015. The prospect of higher interest rates at some point in the year and the deterioration in affordability over the past year are expected to be key factors curbing housing demand,’ he pointed out. ‘Housing demand should be supported by solid economic growth, higher employment, still low mortgage rates and the first gain in real earnings for several years. We expect to see a more even regional pattern in house price growth during 2015,’ he added. Continue reading
