Tag Archives: news
Prime property in south west London outshines rest of capital
Price growth in the prime south west London property market marginally outperformed the prime London average in the second quarter of 2015 with values rising 2% and 1.6% respectively. The data from the latest analysis report from Savills shows that the large leafy district running south from Fulham to Wimbledon and stretching west from Clapham to Ham, also shows that annual growth was 0.8% compared with year on year falls in other prime London markets. The strongest growth across all the prime south west London submarkets was recorded for properties below £1 million, where buyers benefited modestly from the stamp duty reform announced in the Autumn Statement of December 2014, the report says. However, price growth was just 2.1% as the mortgage market review continues to restrict the amount people can borrow and at the top end of the market, buyer caution has been most evident, with properties valued over £2 million seeing small price falls of 0.7% over the past year. The report points out that this has particularly affected some of the higher value markets such as Fulham and Battersea, where values of property worth over £1.5 million fell by 2.5% and 3.5% respectively over the past year. Price falls were largely a result of the stamp duty changes and the uncertainty surrounding a mansion tax in the run up to the general election, the report suggests and since the election, some of the deferred demand is beginning to flow back into the market, although the new stamp duty rates are still keenly felt by buyers. This has restricted any significant boost to prices and transaction numbers and we expect this to continue over the rest of 2015. Nonetheless, Savills is forecasting price growth to return to the market in 2016 and values to rise by 22.7% over the five years to the end of 2019. In the rental market average rents in prime south west London have increased by 1.7% over the past 12 months, despite seeing very small falls of 0.1% over the three months to the end of June. This compares to a more subdued annual increase of just 0.5% across all prime London. The report explains that the area attracts a wide range of tenants. Corporate relocators, both from the UK and overseas, account for 42% of tenants, and the higher value markets of Richmond and Battersea are particularly popular. Additionally, many affluent families are becoming more flexible in their location preferences and increasingly attracted to south west London where the average rent per square foot is £28 per year, less than half of that in prime central London. In the first half of 2015, 17% of tenants moved from either the borough of Kensington and Chelsea or City of Westminster, compared to 13% of tenants in 2014. This is particularly evident in Fulham which, despite being the most expensive south west London rental market, is 42% cheaper than neighbouring Chelsea. A potential risk to the sector is… Continue reading
First time US buyers rent an average of six years before buying a home
Americans are renting more than twice as long before buying their first home as they did in the 1970s, new research has found. Aspiring home buyers are now renting for six years compared to an average of 2.6 years compared to 40 years ago, according to an analysis from real estate firm Zillow. The analysis report also shows that first time buyers are older and less likely to be married than they were in the past and overall Americans are buying increasingly expensive first homes and spending more relative to their incomes than any time in the past 40 years. In the 1970s, first time buyers bought homes that cost about 1.7 times their annual income. Now they're buying homes that cost 2.6 times their annual income. The firm says that part of this can be attributed to the housing markets where people are moving which are more expensive cities on the coasts, where there are growing job markets. The average first time buyer is about 33 with a median income of $54,340, which is about the same as what first time buyers made in the 1970s, when adjusted for inflation. In the late 1980s, some 52% of first time buyers were married but today that has fallen to 40% married, the research also shows. ‘Millennials are delaying all kinds of major life decisions, like getting married and having kids, so it makes sense that they would also delay buying a home,’ said Zillow chief economist Svenja Gudell. ‘We know millennials value home ownership and want to buy. The next challenge will be figuring out how they can save for a down payment and qualify for a mortgage, especially while the rental market is so unaffordable all over the country. The last hurdle will be finding a home they like amidst very tight inventory, especially among starter homes,’ added Gudell. Continue reading
July sees subdued valuation and survey activity in UK housing market
Housing market activity in the UK in July was more subdued than normal but is still up 57% compared to the same month in 2014, the latest survey and valuation research shows. However, overall valuation activity in July dipped 24% compared to June 2015, according to the report from Connells Survey & Valuation. But, according to John Bagshaw, the firm’s corporate services director, the housing market momentum is only getting stronger and the slight monthly wobble is more than outweighed by the annual growth across all sectors. ‘July has been a little more subdued than normal as the post-election feel good factor began to taper out. But, fundamentally, the high pace of annual growth demonstrates that the property market is strong. As wages continue to outstrip inflation, job security increases and interest rates remain at record lows, people young and old are feeling ever more confident about the property market. There’s every reason to feel very optimistic,’ he explained. The report also shows that the number of valuations for existing owner occupiers seeking to move home in July was down 33% compared to the previous month of June. However, yearly activity has climbed 48% on July 2014. Similarly, despite the number of first time buyer valuations slipping 25% on June 2015, year on year activity accelerated 40% compared to July last year but Bagshaw believes that home movers and first time buyers are in a strong position. ‘At first glance the monthly figures might suggest we’ve endured a slow July. However, this is mainly because home movers and first time buyers are most affected by housing market seasonality. These two groups possess neither the capital of most buy to let investors or the pre-existing property of remortgagors. First time buyers in particular tend to be more sensitive to headwinds,’ he pointed out. ‘Moreover, the yearly figures indicate that first time buyers are showing no real hesitancy in getting on the ladder. Government schemes such as Help to Buy, alongside local authorities attempting to drive up property development, are giving the home mover and first time buyer markets a vitality not seen for many years,’ he said. Meanwhile, valuations in July for buy to let investors and remortgagors increased on a year on year basis. Buy to let and remortgaging valuation activity grew 76% and 75% respectively, when compared to July 2014. However, on a monthly basis, July’s buy to let valuation activity fell back 21% on June, while remortgaging activity declined by 16% over the same period. ‘Remortgagors and those in the buy to let business have had an exceptional year’s stretch. Since the first glimmers of the economic recovery, remortgaging was the first sector to make up lost ground because it was viewed as the least risky by lenders and that momentum has obviously continued into this month. Meanwhile, the latest threats… Continue reading
