Tag Archives: sales

UK asking prices down apart from in Scotland, latest index shows

Asking prices have fallen across the UK apart from Scotland, month on month, according to the latest data from the Home.co.uk index, but are expected to growth by 7% in 2015. Prices fell 0.7% overall in England and Wales during the last month and that means annual growth dropped to 7.6% while Scotland saw asking prices go up by 0.3%. Looking at annual asking price growth, most of it was in London and the South. Indeed, Greater London experienced growth of 15.9% over the last 12 months. The data also shows that supply in the capital region has risen considerably since last year, up by 39%, and according to Doug Shephard, the firm’s director this will serve to attenuate price rises in 2015. ‘Looking ahead, we anticipate that 2015 will be a more consistent year for UK property prices than 2014,’ he said but pointed out that with the prime central London market showing signs of slowing down average prices are likely to rise less quickly next year. ‘Record low mortgage rates will stoke demand whilst record prices in London and the South East will encourage more potential vendors to cash in. Hence, both supply and demand is expected to rise, thereby increasing the volume of the sales market towards more normal levels,’ he explained. Prices are predicted to rise 7% overall in 2015 and most pronounced in the South, especially the South East and East Anglia, although the northern markets will continue to improve, albeit slowly. The report also suggests that price rises will be less pronounced in London than they were in 2014, rising by around 10% and the supply of property for sale will increase by around 25% over the course of 2015. ‘East Anglia and the South East look set to be the leading regional markets next year owing to their much improved marketing times. Supply of property for sale remains low historically in these regions and this will keep prices on an upward trajectory, although we do anticipate market volume to steadily increase over the course of 2015,’ said Shephard. ‘The East Midlands also looks primed for a good year ahead. We expect above average price growth and lower marketing times in 2015. Looking further afield, the North of England property market, hampered by employment problems and austerity measures, will continue to improve slowly, as will Wales,’ he pointed out. ‘Across in the South West and West Midlands, further market improvements are to be expected, but growth there is likely to be slightly lower than the national average,’ he added. However he also pointed out that these predictions are based on there being no change in interest rates. ‘Should there be even a small rise in the Bank of England base rate, market sentiment would be severely dampened. A more dramatic hike of 1% would likely bring down price growth to zero for 2015,’ he concluded. Continue reading

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New UK property tax measures set to boost buy to let

The UK’s new property tax rules are set to provide a boost to both the sales market and buy to let market, it is claimed. The new rates will give the biggest savings to buyers at the lower and middle end of the market and according to Stephen Ludlow, chairman of lettings age Ludlow Thompson, as buy to let landlords usually invest in properties below £937,500 the changes will give almost all investors in this market a boost. ‘The changes in stamp duty will see the biggest increase in net returns for more modestly investments such as smaller properties in Zone three of London, city centre apartments, flats above shops, ex-local authority property and property in secondary locations,’ he said. ‘The reforms could encourage those who may have been delaying their purchase until after the election to reconsider. The new rates should also provide a boost to the sales market and result in an increased number of purchases in this usually quiet time for residential property deals,’ he added. Graham Davidson, managing director of Sequre Property Investment, also believes the change is a positive one for the buy to let market. For example, a buyer of a high end two bedroom Manchester city centre apartment at a price of £150,000 will now pay just £500 stamp duty, a saving of £1,000. ‘However the impacts on the £925,000 plus market will certainly be felt throughout the industry, in particular by the higher end London property market. We would expect to see this contribute to a further slowing of the market there,’ he added. Alison Platt, group chief executive of Countrywide, said the change is likely to attract more home buyers to the market. ‘So for those who are thinking of selling their property, there has never been a better time. Equally for buyers, a stable interest rate environment and the availability of a range of attractive mortgage products, means that now is an ideal time to purchase a home,’ she explained. But Jamie Lester, head of Haus Properties, thinks it send shockwaves through the London market, particularly in the £1.5 million to £2 million price range. ‘This market has been especially active with buyers sticking below the 7% stamp duty and proposed mansion tax thresholds. These buyers will now have to pay a significantly higher amount,’ he said. ‘For example, someone purchasing a £1.9 million property would have paid £95,000 under the old stamp duty rules, whereas under the reforms they will be paying almost £50,000 more at £141,750. However, those buying just above £2 million won't be quite so heavily hit, for example, someone purchasing at £2.1 million will now be paying £165,750, an increase of £18,750,’ he explained. Camilla Dell, managing partner of independent property buying agency, Black Brick, said there is no question that the old stamp duty bands were in desperate need of reform and overhaul. ‘For 98% of the UK population these changes are therefore clearly good news. But… Continue reading

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Home price growth in the US continues to moderate

National home price gains in the United States fell to 6.7% year on year and 1% quarter on quarter in November, according to the latest index from Clear Capital. National trends were echoed at the regional level, with the West seeing the strongest moderation across the country and overall growth has slowed now for 11 months in a row. In fact, for the first time since the start of the recovery three years ago, the West’s yearly rates of growth fell below 10%, a sure sign of more moderation to come over the next several months for the nation, according to the firm. At the height of the recovery in 2013, national prices including distressed sales outperformed the performing only sale segment of the market by 4.2%. Now the all sale segment is outperforming the performing only sale segment by 3%. These segments’ rates of growth will likely continue to fall in line with each other as investor engagement dwindles, a result of fewer distressed sale opportunities. As this occurs, markets will be more reliant on performing only sale demand and price growth,’ the index report explains. It also points out that improvements in the broader economic landscape have not instilled confidence in traditional home buyers and the general lack of demand in the performing only segment, coupled with a dwindling supply of distressed inventory, leaves the future of home prices squarely in the hands of traditional home buyers, who have yet to show any signs of re-engaging. It says that performing only sales are not yet strong enough to support recovery sized market growth without distressed sales. The data also shows that it has been a steady descent for national yearly rates of growth. They have dropped 5% from a high of 11.7% in December 2013. This is due in part to the market’s natural normalisation as the correction to the correction subsides and distressed sale inventory dries up. While this is healthy for markets overall, the weakness of price growth in the performing only segment is further cause for concern. Excluding distressed sales, performing only national home price growth over the last year was just 4.4%, down from a recovery high of 7.2%. Even more concerning is the performing only segment’s drop in quarterly growth to 0.6%, nearly cut in half over the last rolling quarter which saw quarterly rates of growth at 1.1%. ‘Reduced reliance on distressed sales and diminishing gains in the performing only sale segment could be too much for the recovery to overcome as we enter winter. The recovery is at a tipping point. Markets need non investor demand to ramp up, and home buyer confidence restored,’ said Alex Villacorta, vice president of research and analytics at Clear Capital. ‘Should this turn into a negative feedback loop, the likelihood for quarterly price declines at the national level could turn into yearly price declines by the end of 2015. Performing only sale trends are a bellwether for what’s to come next year,’ he explained. ‘Think of… Continue reading

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