Tag Archives: news
Asking prices down 1.3% in England and Wales, but seasonal dip lower than usual
Asking prices in England and Wales fell 1.3% month on month but are still up 6.2% year on year, taking the average to £292,572, according to the latest index data. It is the smallest drop in new seller asking prices during the seasonal November slowdown since 2011, according to the Rightmove report and the online portal says that it is indicative of even higher prices next year. Prices fell in all regions with Wales seeing the biggest monthly fall of 3.7%, taking the average asking price to £196,471 and both the South West and the North East saw a fall of 2.3% taking the averages to £279,643 and £142,917 respectively. Yorkshire and Humber saw a monthly fall of 2.2% to an average of £167,343, in the North West there was a fall of 1.9% to £171,709, while the South East and the West Midlands recorded a decline of 1.1% to £384,001 and £196,471 respectively. There was a 1.6% fall in asking prices in Greater London taking the average to £619,866, a fall of 0.6% in the East Midlands to £187,148 and a decline of 0.3% in the East of England to £315,568. The report points out that sellers who come to market in the run-up to Christmas typically set lower asking prices as buyers are harder to attract at this time of year. However, this November’s price dip of 1.3% or £3,977 is much less marked than usual, and is the smallest seen at this time of year since 2011. According to Rightmove director and housing market analyst Miles Shipside this indicates a positive underlying outlook for the year ahead among home owners, with research by Rightmove showing them to be in a confident mood and largely unfazed by the risk of higher interest rates in 2016. Given these findings, and the likelihood that demand will continue to outstrip supply, prices look set to increase again in many locations in 2016. Shipside expects it to be a short lived dip in asking prices. High home owner confidence is demonstrated by Rightmove research, with a sample size of over 23,000, which reveals that the majority, 85%, don’t think their financial situation will worsen in the next year. Despite the possibility of a 2016 rate rise that could increase mortgage repayments for many, 41% of home owners said they thought their household’s financial situation would get better over the next 12 months. Another 44% said things would stay the same, with only 15% forecasting they would get worse. Some 69% were also of the opinion that property would continue to rise in price over the next 12 months, with only 7% expecting prices to be lower. ‘Home owners have had a smooth ride over the past six or so years with a 0.5% base rate, so you would think that more might have concerns about the extra drain on their financial resources when the base rate inevitably goes up. Whether in 2016 or early… Continue reading
Number of first time buyers in the US falls for third year in a row
The share of first time buyers in the United States fell for the third year in a row and remained at its lowest point in nearly three decades, according to a new survey. The overall strengthening pace of home sales over the past year was driven more by repeat buyers with dual incomes, according to the annual survey released by the National Association of Realtors. The survey also found that nearly 90% of all respondents worked with a real estate agent to buy or sell a home which pushed for sale by owner transactions to their lowest share ever. The number of first time buyers was down to 32% from 33% a year ago, which is the second lowest share since the survey began in 1981 and the lowest since 1987 when it was 30%. Historically, the long term average shows that nearly 40% of primary purchases are from first time buyers. According to Lawrence Yun, NAR chief economist, the housing recovery's missing link continues to be the absence of first time buyers. ‘There are several reasons why there should be more first–time buyers reaching the market, including persistently low mortgage rates, healthy job prospects for those college educated, and the fact that renting is becoming more unaffordable in many areas,’ he said. ‘Unfortunately, there are just as many high hurdles slowing first time buyers down. Increasing rents and home prices are impeding their ability to save for a down payment, there's scarce inventory for new and existing homes in their price range, and it's still too difficult for some to get a mortgage,’ he explained. Yun pointed out that this year's survey perhaps offers additional clues to why fewer first time buyers are reaching the market. ‘First time buyers reported that debt in all forms delayed saving for a down payment for a median of three years, and among the 25% who said saving was the most difficult task, 58% said student loans delayed saving,’ he said. ‘With a median amount of student loan debt for all buyers at $25,000, it's likely some younger households with even higher levels of debt can't save for an adequate down payment or have decided to delay buying until their debt is at more comfortable levels,’ he added. With strong price growth in many markets and fewer first time buyers, the results in this year's survey reveal a market with a higher share of married couples at 67% percent, up from 65% last year, who have higher household income than previous years. Married repeat buyers have the highest income among all buyers at $108,600, while the share of single female buyers decreased from 16% to 15% and male buyers remained flat at 9%. ‘Similar to some of the obstacles facing first time buyers, tighter credit conditions and having less purchasing power than households with dual incomes likely led to the share of single female buyers declining to its… Continue reading
Prime central London sales down 14% year on year
Sales levels across the prime central London property market have fallen by 14% year on year from the third quarter of 2014 but the rate of change is slowing, according to a new report. The regular analysis report from W.A. Ellis points out that the annual rate of change is an improvement from the first quarter when transactions were falling at an annual rate 27%. It also shows that the average price paid per square foot across the prime central London sector now sits at £1,832 up by 1.4% over the third quarter of 2014. However, the very top of the market over £5 million has already witnessed the greatest correction in prices with flats and houses being sold for 11.5% less per square foot than in the third quarter of 2014. ‘It would appear that the bubble may already have burst in prime central London but the effect is not as decimating as reports from UBS and Deutsche bank suggest. The government’s intervention in December 2014 by raising Stamp Duty has indeed cooled the very top of the market and the continuous upward spiral has been halted,’ said Richard Barber, the firm’s director. He pointed out that 36% of all properties currently on the market across the sector are now being marketed at a lower price than they were originally listed at, with the average reduction in price being 8.5% of the original asking price. ‘Continuous capital growth in any market is an unrealistic expectation. However, we believe that the correction has already happened and the above statistics bear this out. Whilst there continues to be pessimistic outlooks on the market supported by strong economic arguments, market activity suggests a different story,’ Barber explained. ‘Affordability will undoubtedly remain the key issue within prime central London but news that the population of the UK is likely to grow by 4.4 million in the next 10 years, will undoubtedly impact on both the letting and sales market. This unprecedented level of population growth will prove to be a continuing factor within the supply and demand chain’ he added. Meanwhile, in the lettings sector the report says that the short term outlook for the rental market is looking positive as supply continues to outgrow demand over the next few years. Across Greater London, the firm predicts rental values will increase by 5% in the next year and by 21.7% over the next five years to the end of 2020. Within prime central London, the firm predicts a rise of 3.5% over the coming year, with a slightly more modest prediction of 15.9% over the next five years, which Lucy Morton, head of residential agency at JLL Kensington says still represents a very healthy growth in rental values. ‘This outlook is particularly pleasing given that rental growth over the past two to three years has been minimal… Continue reading
