Tag Archives: shows
Demand for homes in UK falls to three year low, according to estate agents
Uncertainty created by the UK’s decision to leave the European Union has triggered demand for property to fall to the lowest level seen in three years, according to a new report. The number of house sales agreed in May dropped in the run up to the referendum and the majority of estate agents believe that demand will fall further in the short term, according to the latest housing report from the National Association of Estate Agents (NAEA). Estate agents recorded an average of 304 house hunters registered per member branch in May, as uncertainty in the lead up to the referendum stalled buyers. This was down 6% from April, and the lowest recorded since November 2013 when 292 buyers were registered per branch. The data also shows that compared to May 2015 when 383 house hunters were recorded, demand has decreased by 21% year on year. In line with falling demand in May, the supply of houses available to buyers increased marginally from 35 properties available to buy per branch in April to 37 in May. The number of sales agreed in May decreased to an average of eight per branch, a drop from nine in April falling to the same level seen during the seasonal slowdown in January. In May some 41% of agents predicted that house prices will fall and 30% expect demand will also decrease as a result of a the referendum result. Although the number of house hunters registered per branch and sales agreed fell in May, sales to first time buyers increased marginally. Some 27% of the total sales completed last month were to first time buyers, an increase of one percentage point from April. ‘The EU referendum without doubt meant that May was a month of uncertainty for potential house buyers and demand dropped significantly and is currently at the lowest level we have seen in the last three years,’ said Mark Hayward, NAEA managing director. ‘As a result of the vote for a Brexit, we expect international investors to look a lot harder at the UK as a potential market to buy in and this will have a knock on effect on the house building sector, as investments may be delayed or put off completely,’ he pointed out. ‘Although in the short term, we believe that house prices will remain stable, we cannot be certain about the next quarter as political uncertainty and market unrest could affect the housing market,’ he explained. He also pointed out that the supply of available housing is still extremely low compared to this time last year, which is particularly worrying. ‘As we continue to say, there are simply not a sufficient number of homes available in this country to cater for everyone’s needs and a Brexit could impact the skills required to drive property developments in the UK,’ said Hayward. ‘This means that… Continue reading
Research reveals how student debt is affecting the US housing market
New research suggests that the vast majority of would be first time buyers in the United States believe they can’t afford to buy because of student debt. Some 71% of non-homeowners repaying their student loans on time believe their debt is stymieing their ability to purchase a home, and slightly over half of all borrowers say they expect to be delayed from buying by more than five years. The survey from the National Association of Realtors (NAR) and SALT, a consumer literacy programme provided by American Student Assistant, also revealed that student debt postponed four in 10 borrowers from moving out of a family member's household after graduating college. Nearly three-quarters of non-homeowners polled in the survey believe their student loan debt is delaying them from buying a home. Broken down by each generation and debt amount, the percent share is the highest among older millennials approximately aged 26 to 35 at 79% and those with $70,000 to $100,000 in total debt. Regardless of the outright amount of student debt, more than half of non-homeowners in each generation report that it's postponing their ability to buy. The survey, which only polled student debt holders current in their repayment, yielded responses from borrowers with varying amounts of debt from mostly a four year public or private college. Some 43% of those polled had between $10,001 and $40,000 in student debt, while 38% had $50,000 or more. The most common debt amount was $20,000 to $30,000. Lawrence Yun, NAR chief economist, said that the survey findings bring to light the magnitude student debt is having on the housing market and the budget of even those financially able to make on-time payments. He pointed out that while obtaining a college degree increases the likelihood of stable employment and earning enough to buy a home, many graduating with this debt are putting home ownership on the backburner in part because of the multiple years it takes to pay off their student loans at an interest rate that's oftentimes nearly double current mortgage rates. ‘A majority of non-home owners in the survey earning over $50,000 a year, which is above the median US qualifying income needed to buy a single family home, reported that student debt is hurting their ability to save for a down payment,’ he said. ‘Along with rent, a car payment and other large monthly expenses that can squeeze a household's budget, paying a few hundred dollars every month on a student loan equates to thousands of dollars over several years that could otherwise go towards saving for a home purchase,’ he added. Among non-homeowners who believe student debt is delaying their ability to buy, over three quarters, including over 80% of millennials, said their delay is because they can't save for a down payment. Additionally, 69% don't feel financially secure enough to buy, and 63% can't qualify for a mortgage because of high debt to income ratios. Some 52% of those polled expect to be… Continue reading
Fewer affordable homes being built in England, latest data shows
There were over 33,300 new homes started in England in the 12 months to March 2016, excluding parts of London, of which the majority were affordable properties but fewer than the year before. Overall there were 33,332 housing starts on site and 25,315 housing completions delivered through programmes managed by the Homes and Communities Agency (HCA) in England, excluding London for all programmes except those administered by the HCA on behalf of the Greater London Authority between 01 April 2015 and 31 March 2016. The data shows that while the majority, 21,304 or 64%, of the housing starts on site in 2015/2016 were for affordable homes, this is a fall of 19% on the 26,458 affordable homes reported in 2014/2015. The data also shows that of the 16,544 affordable homes started in 2015/2016 were for affordable rent, a decrease of 24% on the 21,879 started in 2014/2015 but the number for shared ownership sand other affordable schemes at 4,158 rose by 25%. The remaining 602 were for social rent, a decrease of 52%. Some 17,394 or 69% of housing completions in 2015/2016 were for affordable homes, a fall of 57% on the 40,864 affordable homes completed in 2014/2015 but the report says that this reflects the normal peaks and troughs in delivery between programme periods, as the AHP 2011/2015 drew to a close in March 2015. And 13,100 affordable homes completed in 2015/2016 were for affordable rent, a decrease of 58% on the 30,834 completed in 2014/2015 while 2,801 were for intermediate affordable housing schemes, including shared ownership, a decrease of 60% and the remaining 1,493 were for social rent, a decrease of 50%. Of the affordable homes completed in 2015/2016, the AHP 2015/2018 accounted for 37%, the Affordable Homes Guarantees programme for 30% and the Affordable Homes Programme for 19%. Richard Connolly, chief executive officer of Rentplus, described the figures as disappointing. ‘Given investment from the Homes and Communities Agency helps to build around half of new homes in England each year, today’s data makes for a disappointing read,’ he said. ‘Affordable housing starts have been on a steady decline over the last three years and in view of population growth and the endemic housing affordability crisis in the UK, this is the wrong track to be heading down. Our belief is that mixed tenure communities, offering a range of housing options to suit different needs, including rent-to-buy, are crucial to building a strong and sustainable UK property market,’ he explained. ‘Completions of homes for affordable rent also fell 58% annually which will put more pressure on an increasingly diminishing resource for people in housing need. Affordable rent to buy homes provide a viable and complementary alternative to traditional rented homes, helping the many people struggling to save for a deposit to buy due to rent now consuming around half of young people’s salaries,’ he added. He also pointed out that the recent vote for the UK to leave the European Union… Continue reading
