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Demand for new properties in Miami impacts on existing home market
Demand for new construction properties continued to impact the Miami existing real estate market in August as reflected by sales activity, prices, and rising inventory, according to the latest report from the Miami Association of Realtors. Sale prices again increased for existing single family homes in August, while the median sale price for condominiums dipped slightly. The MAR said that prices remain at affordable 2004 levels despite 33 months of consistent increases for single family homes. Condo prices had increased for 38 consecutive months and began increasing long before that of single family homes. Condo prices declined in August for the first time in more than three years. The median sale price for single family homes increased 6.4%, up to $250,000 from $235,000 in August 2013. The average sale price for single family homes increased 24.7% from $364,960 in August 2013 to $455,108 last month. Compared to August 2013, the median sale price for condominiums decreased by 4.2% to $182,000 from $190,000 a year prior. The average sale price for condominiums decreased -6.9% to $346,847 from $322,743 in August 2013. ‘The Miami real estate market continues to normalize as the new construction sector gains momentum and generates strong demand for additional new supply, impacting the existing condominium market,’ said Liza Mendez chairman of the MAR board. ‘Despite declines in sales and condo prices, the performance of the Miami residential market continues to be comparable to what it was in during periods of record sales activity,’ she added. Single family home sales in Miami-Dade County decreased 4.4% relative to August 2013, from 1,210 to 1,157. Compared to August 2013, condominium sales declined 21.4% from 1,592 the previous year to 1,252 last month. Combined, residential real estate sales decreased 14% to 2,802 compared to 2,409 in August of last year. The report points out that Miami real estate continues to sell at a rapid pace and at nearly asking price, reflecting strong demand. The median number of days on the market for single family homes sold in August was just 47 days, an increase of 34.3% from August 2013. The average percent of original list price received was 95.4%, down a negligible 0.8% from a year earlier. The median number of days on the market for condominiums sold in August was 53 days, an increase of 15.2% compared to the same period in 2013. The average sales price was 94.7% of the asking price, a decrease of 2.6%. ‘Although the Miami market continues to normalize creating more balance between buyers and sellers, some price points, particularly for single family homes, still reflect strong demand coupled with limited supply,’ said Francisco Angulo, MAR residential president. ‘In certain market areas and price points, homes for sale are still generating multiple offers, sales above asking price, and competition between prospective buyers,’ he added. The data also shows that cash sales in Miami continue to decline as more financing becomes available. Still, access to mortgage loans for condominium buyers remains limited, impeding further market strengthening. In Miami-Dade County, 54.4% of… Continue reading
Under 35s pay thousands more for housing than pensioners in England and Wales
A soaring divide in housing means older people pay just a fraction of the money towards housing that younger people in England and Wales, new research shows. On average the under 35s pay over £6,600 more per household than the over 65s and around £4,400 per household more than the 50 to 64 year olds, says new research from Savills published at RESI, the annual housing conference run by Property Week. The research also shows that households where the main householder is the under the age of 35 spend some £37 billion per year on housing equivalent to £8,600 per household of which 56% is paid in rent to private landlords. In contrast for the over 65s it is just 12 billion or £1,939 per household, reflecting both the extent to which those holds have been able to initially access home ownership and pay off their mortgage. ‘These figures reflect the generational divide in the housing market that needs to be reflected in housing policy. The youngest households have reduced access to homeownership, are paying more rent and have less opportunity to accumulate housing wealth. In London alone they pay around £8.3 billion in private rent,’ said Lucian Cook, director of UK residential research at Savills. He pointed out that significant investment is needed in the private rental sector to meet their needs, with a concerted effort to bring in institutional investment through build to let. But at the other end of the scale, more needs to be done to encourage downsizing, particularly in terms of the new housing we build. Not only would that mean more efficient use of our housing stock, but it would also help housing wealth to be passed down the generations and recycled in the housing market to limit the decline in homeownership. For those in the 35 to 44 age group, whose housing bill of £53 billion or just under £7,700 per household, the key short term focus is on interest rates. Some 63% of their housing costs are taken up by mortgage payments and that a 2% interest rate rise would add 18% to their total housing bill. ‘While the under 35s are protected from an increase in interest rates over the short term, given more of them are renting, this may impact their future access to home ownership because if they do get a mortgage the cost of servicing it will be a greater constraint, particularly given stress testing of affordability following the mortgage market review,’ said Cook. Continue reading
Property sales in UK down 1.7%, says latest seasonally adjusted figures
Property sales in the UK fell by 1.7% between July and August but were 8.4% higher than a year ago, according to the latest seasonally adjust figures from HMRC. There were 99,930 residential and 9,090 non-residential transactions. The data also shows that since the beginning of the 2013/2014 financial year there has been a general month on month increase in transactions for the seasonally adjusted data. In February 2014 there was a gradual decrease followed by a flattening out of transaction numbers. July 2014 and August 2014 have seen new peaks for recent non-seasonally adjusted Transactions to their highest level since November 2007. According to Peter Rollings, chief executive officer of Marsh & Parsons, after a stirring start to the year, the UK property market has calmed, and trading conditions are beginning to look reassuringly more familiar again. ‘Steep house price growth during the first three months has softened to a steadier and more sustainable upward slant, as demand is finally being matched by an encouraging amount of new housing stock on the market,’ he said. ‘The volume of house sales dipped in the month to August 2014, but if we look at the figures through a longer term lens, there has still been a healthy step forward compared to the same point last year,’ he explained. ‘The market may have wound down for summer as it recovered from the adjustment of tighter lending regulation coming into force, but there’s still plenty of gas left in the tank. We expect sales to move up a gear in the autumn, as calmer competition for available homes boosts the confidence of home buyers and pedals the wheels of activity,’ he added. Meanwhile, the latest figures from the British Banking Association show that gross mortgage lending of £11.1 billion was 15% higher than in August last year. But gross mortgage lending in August remains below the £11.3 billion per month average of the last six months. The overall mortgage stock continues to rise in response to stronger demand and is 1.4% higher than a year earlier and sustained growth in business lending is beginning to be seen in the manufacturing, retail and wholesale sectors. Overall net business lending to non-financial companies was £1.5 billion in August, up from minus £0.9 billion in July. According to Duncan Kreeger, director of lender West One Loans, property market activity will remain muted unless lenders do something active about it. ‘High street banks have lent in the same way to the same customers against very similar properties for the last hundred years. In the 21st century, we shouldn’t expect old ways of doing things to power a red blooded recovery,’ he said. ‘Lending must be about getting homes on to the market as well as simply getting them off the market. In other words lenders will solve the biggest problem for the property industry by increasing supply, as well as demand,’ he pointed out. ‘Alternative finance is… Continue reading
