Tag Archives: real estate
Buy to let demand keeping UK housing market buoyant say surveyors
The UK housing market saw an unseasonal rise in demand in December with anecdotal evidence suggesting this is due to an increase in buy to let investors. An extra 3% stamp duty levy due to come into force in April which will affect buy to let property and second homes could be behind the lift in demand, says the latest monthly residential report from the Royal Institute of Chartered Surveyors (RICS). It says that demand for properties reached a three month high in December and the month saw the first rise in new instructions since the beginning of 2015 with anecdotal evidence pointing to a jump in buy to let interest leading this demand. Since the Chancellor George Osborne announced the extra stamp duty levy in his Autumn Statement last November some 16% more chartered surveyors reported a rise in new buyer enquiries. ‘The housing market has experienced an unusually buoyant December. Those in the industry have been speculating that this is the result of the Chancellor’s announcement last November,’ said RICS chief economist Simon Rubinsohn. ‘Potential buy to let investors are looking to pick up properties before the increased stamp duty levy comes into force next April. If that is the case, then we can expect to see the housing market heating up further over the next few months,’ he explained. The belief that demand was fuelled by announcements included in the Autumn Statement was further supported by qualitative responses to the survey. ‘December was busier than normal as stamp duty changes have brought buyer back to the market, ahead of April,’ said chartered surveyor Robert Green of Chelsea based estate agent John D Wood & Co. While James McKillop of Knight Frank in London said: ‘The 3% Stamp Duty Land Tax (SDLT) proposal in the Autumn Statement has led to more buyers firming up their intention to buy additional residences in my region before April 01’. The RICS report also says that house prices in London, the South East and East Anglia look set to rise by a further 5% per annum in each of the next five years, compared to a UK average of 4.5%, despite offering the poorest value for money in the UK. Some 62% of respondents said that homes in the South East were either expensive or very expensive given the relative benefits they offered, with 57% of contributors in the capital taking the same view. By way of contrast, 100% of Northern Irish respondents and 92% from the North of England believe that homes in their areas offer fair value for money. A net balance of 50% of respondents reported that UK house prices had risen since November, with East Anglia and the South East of England witnessing the strongest growth. Robert Grigg, managing director of Property Finance at Hampshire Trust Bank, said that the report highlights that 2015 was yet another year in which becoming a home owner was out of reach for many. ‘The government’s Help… Continue reading
Property prices in New Zealand outside of Auckland reach new record
Property prices and sales in New Zealand increased in December with median home values, excluding Auckland, reaching a new record. Sales were up 3.5% year on year but fell 9.1% compared with November, according to the latest index from the Real Estate Institute of New Zealand. The median prices of a home nationwide increased by 1.2% month on month and 3.3% year on year to $465,000, a rise of $15,000. Excluding Auckland the rise was 8%, taking the median to $379,000. It is the fourth consecutive record median in 2015 and there was also a new record median prices also Waikato/Bay of Plenty, Hawke’s Bay, Wellington, Nelson/Marlborough and Otago. In Auckland median prices increased by 13.6% year on year to $770,000, and increased by 0.7% month on month. REINZ chief executive Colleen Milne pointed out that regional markets, particularly Northland, Waikato/Bay of Plenty, Hawkes Bay and Central Otago Lakes, are now setting the pace for the New Zealand real estate market, with Auckland, in a relative sense, now in the middle of the pack. ‘The decline in sales volume in Auckland, while noticeable, is likely transitory as the region gets to grips with the new LVR rules for investors, although the median price continues to firm,’ she said. ‘Over the past six months regional markets have demonstrated large declines in the levels of inventory, a significant decline in the number of days to sell, and noticeable increases in the median price, with a number of regions setting new median price records more than once over 2015,’ she added. In addition, Wellington, Manawatu /Wanganui and Otago are also seeing positive movements in days to sell and median prices. ‘This breadth of the improvement across New Zealand suggests that there is more is at play than just an Auckland halo effect, although that has contributed in the northern regions,’ Milne explained. Sales volumes excluding Auckland were down 8.1% from November but up 17.5% on December 2014. On a seasonally adjusted basis, Auckland’s sales volumes were up 8.3% compared to November, indicating that while the headline number showed a sharp drop in sales compared to November, after taking into account seasonal effects, sales were in fact stronger than would have been expected. Northland, Waikato/Bay of Plenty and Hawke’s Bay continued to see the most robust sales growth. Aside from Auckland, Hawke’s Bay was the only region to record increased sales volumes compared to November, with volumes growing 0.4%. Year on year nine regions recorded increases in sales volume, with Northland recording the largest increase of 39%, followed by Waikato/Bay of Plenty with 30% and Taranaki with 27%. Continue reading
Prime property prices in UK set to vary in 2016 according to location
The rate of overall house price growth in the UK prime property market is expected to continue at much the same pace in 2016 as in 2015, with the regional variations remaining too. Average UK house prices rose 4.5% in 2015, according to the latest residential market update from real estate firm Knight Frank. Average values in prime central London rose by 1% last year on average, but the rate of growth varied across the capital while prime country house prices rose by 3.1% in 2015. The report says that the Bank of England’s decision to keep interest rates on hold in January, coupled with the continued fall in oil prices has prompted some economists to push back the date on which the first UK rate rise is expected to 2017. ‘A longer period of low mortgage rates, alongside firmer wage growth and a continued lack of new and second-hand housing stock, should continue to underpin overall pricing during 2016. Activity has been gradually picking up in recent years, but this trend is likely to be hampered by the continued lack of supply of homes coming to the market across the country,’ said Grainne Gilmore, head of residential research at Knight Frank. She also pointed out that the Government has announced a raft of new policies to boost the supply of housing, a recognition that housing is now one of the key areas of focus for the electorate. A breakdown of the figures in the report show that in prime central London the biggest rise in prices has been in Islington with growth of 6.4%, followed by City and Fringe at 5.7%, Marylebone at 4.7%, Mayfair at 3%, and Kensington at 2.5%. In St John’s Woods prices were unchanged and south of the river Southbank saw prices rise by 1.7% and Riverside growth of 4% but elsewhere prices fell, most notably a decline of 6.1% in Knightsbridge. Prices were down 3.8% in Notting Hill, by 3.7% in South Kensington, by 2.7% in Chelsea, by 1.8% in Hyde Park and by 0.2% Belgravia. Average rents across the country rose by 2.7% in the year to September, with the strongest rental growth across Greater London at 4.1% but rental growth in prime central London eased in the second half of last year, and now stands at 0.7%. This comes after prime central London rents peaked at 4.2% growth in May. ‘This market is quite seasonal, and closely linked to the financial services sector. As a result, rents have been affected by restructuring plans announced by major European banks,’ explained Gilmore. Prime rents increased by 2.7% in the South East and the East of England, by 2.1% in the East Midlands, by 1.9% in the West Midlands, by 1.8% in the South West, by 1.6% in Scotland, by 0.9% in Yorkshire and the Humber, by 0.7% in the North West and by 0.5% in Wales and the North East. The report points out that certain sections… Continue reading
