Tag Archives: real estate
Prime property market across UK not picking up, new analysis suggests
Prime property outside of London increased by just 0.6% in the second quarter of the year, suggesting there has been little sign of a post-election bounce at the top end of the UK housing market as buyers remain cautious. A lack of upward pressure on prices has been consistent across all regions beyond London, with a lack of urgency among buyers in part stemming from a relatively sluggish market in the capital, according to the latest prime residential market report from real estate firm Savills. The report says that this has combined with relatively high levels of stock available on the market, built up largely as a result of a relative dearth of transactional activity in the run up to the general election. ‘For the time being this has slowed the ripple effect, despite the significant value gaps between London, the commuter zone and beyond, which would normally drive a flow of demand through the different segments of the prime housing market at this stage in the cycle. As a result, annual price growth in the prime regional markets stands at a subdued 1.6% on average,’ it explains. Though the threat of a mansion tax has now evaporated, the report suggests that the market continues to be held back by tax considerations. ‘In London and at the top end of the country market, the increased cost of stamp duty, following the Autumn statement of December 2014, remains a barrier to both price growth and activity,’ is says. Illustrating this fact, in the regional housing market over £2 million prices are 1.7% below their June 2014 level. In Scotland the introduction of the Land and Buildings Transaction Tax, which replaced stamp duty in April has introduced higher rates of tax at lower price points, has caused prime values to fall by an average of 0.6% in the past quarter and by 0.9% year on year. In England and Wales the markets under £1 million and between £1 million and £1.5 million have been less affected by these tax concerns but more affected by weak buyer sentiment and the restricted availability of mortgage debt feeding up from the mainstream markets. The report points out that despite a continued benign interest rate environment, transactions in the mainstream market appear to have plateaued at around 1.2 million per annum. With the mortgage regulations restricting the amount of debt prospective buyers are able to obtain and restricting their ability to trade up the market, this is still well short of pre-crunch norms, it adds. Although mortgage availability has a less significant direct impact in the prime markets, it will impact on some buyers in their 30s and 40s, the report also suggests. ‘While restricting the amount they can borrow, this may act as a catalyst for them to move into the commuter zone as they look to stretch their debt and equity further in less expensive markets,’ it explains. While sellers need to remain realistic in… Continue reading
Approved home lending in UK up in June month on month
The number of loan approvals for house purchase in the UK increased by 2.7% in June compared to the previous months, the latest Bank of England data shows. Loan approvals reached 66,582 compared to the average of 62,971 over the previous six months and the value of these loan approvals has increased 6.48% month on month, the data also shows. The number of approvals for remortgaging was 36,620, compared to the average of 33,759 over the previous six months while the number of approvals for other purposes was 10,800, compared to the average of 9,918 over the previous six months. It is good news for the homes market according to Adrian Gill, director of Your Move and Reeds Rains estate agents. ‘Mortgage approvals have filtered into a faster lane, and are speeding away from May’s speed bump. Compared to a year ago, lending has also covered a fair distance, and the road ahead looks promising,’ he said. ‘Both house prices and sales are driving forward steadily, as renewed confidence fuels the market this summer. But this is increasingly witnessed by a congestion of buyers. The supply of properties is struggling to keep up and needs a serious boost if the upwards trend in borrowing continues,’ he added. Peter Rollings, chief executive officer of Marsh & Parsons, pointed out that the month on month boost has nearly brought lending back into line with April activity, and the energy building up in the housing market should carry it further forward. ‘There’s now plenty of clear blue sky between borrowing totals now and a year ago, as buyer demand continues to mount. In London, we saw new buyer registrations climb 27% from January to June, and properties are changing hands quickly,’ he explained. ‘This will cause further price rises over the summer, but buyers have plenty of cause for confidence, as cheap mortgage finance and smaller Stamp Duty fees keep home ownership within grasp,’ he added. Continue reading
London new housing zone target met ahead of schedule
The Mayor of London Boris Johnson has announced that his key target of 50,000 new homes for Londoners as part of a landmark Housing Zone scheme has been met ahead of schedule. A three further zones already announced will fast track much needed development in the boroughs of Brent, Westminster and Sutton along with continued efforts to free up land for new housing, he added. Other measures include the creation of the London Land Commission to identify all public land in London and strengthen its redevelopment alongside new transport infrastructure, the release of 99% of all land held in the Mayor’s own portfolio, and the establishment of the London Housing Bank to provide finance to accelerate the build-out of large sites. Eighteen out of a promised 20 Housing Zones across London have now been announced, bringing the total number of homes to be built to 50,965 of which nearly one third will be affordable to buy or rent. There will be two further zones confirmed by the late summer. Housing Zones are a collaborative effort between the Greater London Authority, the government and local boroughs to streamline approval processes and speed up development in target areas where it has previously been held back, unlocking valuable brownfield land to meet London’s growing need for housing. The Mayor will invest nearly £44 million in three new Housing Zones in vastly different areas of London which will together provide nearly 6,600 new homes as well as improved transport links, more than 13,000 construction jobs and new retail precincts, transforming these areas into new urban districts for generations of Londoners. ‘We have worked very hard to reach our goal of 50,000 homes, and we’ve done it with two more Housing Zones to go. This scheme has proven extremely popular with boroughs, who have clearly been looking for just that extra bit of assistance in revving up their housebuilding to answer clear demand from Londoners,’ said Johnson. Deputy Mayor for Housing, Richard Blakeway, visited a development at Wembley Park which will deliver 1,200 new homes in the shadow of the famous stadium, situated within the bounds of a second Housing Zone within Brent. In addition, the Edgware Road Housing Zone in the borough of Westminster will provide 1,113 new homes in the heart of London, adjacent to the major commercial centres of the West End and Paddington, of which 537 will be affordable. The borough will regenerate two existing estates with higher density housing, adding to the total number of affordable homes in the area. Once the Crossrail interchange is operational at Paddington Station from 2018, residents will also have access to this new transport link a mere 15 minutes away. ‘This is a great outcome for Westminster and the local community. The Futures Steering Group, comprised of residents and local businesses, has worked closely with the Council to help regenerate and improve this area for the benefit of local residents and businesses,’ said Westminster City Council’s cabinet member… Continue reading
