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Spanish property expert says Brexit will affect demand from British buyers
A weak pound, plus the uncertainty about what comes next following the UK's decision to leave the European Union, will undermine British demand for property in Spain, especially in the short term, it is suggested. This should be a concern as British demand has been growing strongly since 2013 and according to Mark Stucklin of Spanish Property Insight there could now be a reversal in that trend. He believes that this will have a negative impact on the markets where British demand is dominant, namely Alicante and Malaga, and to a lesser extent the Balearics, the Canaries, and Murcia. ‘Thanks to this Brexit vote, there will just be fewer British buyers about,’ he said. One reason is that British demand in Spain is driven by the strength of the pound. When the pound goes up against the euro, British acquisitions inscribed in the property registry rise with a delay of around two quarters. ‘Now we have a weak pound plus the dramatic situation of a Brexit, so falling sales in coming quarters are almost a given,’ Stucklin explained. He pointed out that it won’t be good for British vendors either. ‘They now have a smaller pool in which to find a buyer. Price expectations may have to adjust even further down,’ he added. He also expects fewer British people to move to Spain until the deal for exit is struck and that will take a minimum of two years. ‘British expats in Spain will now be in limbo until the new order is established. That could take years, and in that period I expect to see more British expats leaving than arriving,’ he pointed out. British owners of holiday homes in Spain with no plans to sell won’t be affected much for now. A much bigger worry for them is what will happen to the UK, or whatever is left of it when the dust settles. Figures from the registrar of Notaires confirm that British demand for property in Spain grew strongly last year on the back of a strong pound and attractive Spanish property prices. Buyers from the UK were the biggest group by a wide margin, making up 21% of the foreign market and increased the most by up by 42% last year. Indeed, in some regions like Alicante on the Costa Blanca and Malaga on the Costa del Sol, the British dominate the overseas buyer market. On the other hand for those who want to buy in Spain properties will be cheaper due to the Pound falling making currency exchange more favourable for changing into euros. However, those wishing to move permanently to Spain who are reliant on a British pension will get fewer euros for their money. Continue reading
Survey suggests UK property owners carry out work to create their dream home
British home owners renovate their property for living in for the long term with the majority not doing so to increase the price, new research suggests. Some 67% are planning to stay in their home for over five years and carry out work with the aim of creating their dream home, according to the research by Zopa with kitchens the top target for change. The survey, of over 1,200 people who had taken a Zopa home improvement loan, found that 27% either have had or plan to get their home revalued after renovations, and only 9% said they would need to move to be in their ideal home. So far in 2016, Zopa customers have borrowed over £50 million to improve their homes, a 54% increase on home improvement loans compared to the same period last year. Some 34% used their home improvement loan to revamp their kitchens and, of those who said their homes are not yet perfect, 19% cited a bigger kitchen as top of their wish list. After renovations two out of five people say they are now in their perfect home. Of those who still don’t think their property is perfect, 22% said they would need to move. The most commonly cited areas for improvement were better decoration at 31%, bigger kitchens at 19% and more bedrooms also at 19%. The research also found that the majority, 73%, used professionals to complete their home improvements, with 45% using skilled professionals for the entire job while 13% undertook all the renovations themselves and the same number sourced help from family and friends. Some 77% said they’d be happy to do painting, with 51% ready to take on wallpapering and 32% happy to complete tiling but people were least confident when it came to masonry work at just 6%, bricklaying at 7% and plastering at 10%. The survey also found that 4.2% were considering moving to unlock the increased property value with 98% agreeing that their renovations have added value to their home. Some 27% believed the increase to be worth between £11,416 and £19,027, adding between 6% and 10% to the price while 19.4% said it would be an increase of between £20,930 and £28,541, a 11% to 15% rise in value and 11.4% expected to see an increase in value of over 21%. Continue reading
Residential property price growth in Australian capital cities slowing
The pace of growth in residential property prices across Australia’s eight capital cities is slowing amid signs that sales momentum is waning, the latest data shows. In the March quarter of 2016 prices were 6.8% than 12 months previously, according to the figures from the Australian Bureau of Statistics (ABS). But this was slower than throughout 2015 when growth averaged 9% per annum. ‘This deceleration is largely being driven by developments in the Sydney residential property market, where annual price growth eased back into single figure territory in March this year. Sydney prices grew at an annual rate of 9.7%, beating the national average, but are also the city’s slowest pace of growth in almost three years,’ said Diwa Hopkins, Housing Industry Association economist. ‘This deceleration in price growth has occurred against a backdrop of waning momentum in property transfers, particularly amongst non-detached housing. The volume of attached dwelling transfers across Australia grew strongly in 2013 and 2014. The volume of transfers was virtually unchanged in 2015 and signs of a pullback in 2016 are now emerging,’ she explained. A breakdown of the figures shows that price growth remained strongest in Melbourne with an increase of 9.8%, followed by Sydney up 9.7%, then Canberra up 4.6, Hobart up 4.2%, Brisbane up 4.1% and Adelaide up 3.1%. In other capital cities prices growth has fallen, led by Darwin with a fall of 4.9% and in Perth prices fell by 4.5% in the year to the March 2016 quarter. Meanwhile, the HIA’s latest bi-annual Housing Scorecard shows that there were over 220,000 dwellings commenced in Australia during 2015, a new annual record. However, there were significant divergences in conditions for residential building around the country. The eastern seaboard states have been the strongest performers, the mining states are sliding down the order, while South Australia and Tasmania are facing the most challenging conditions, according to said HIA economist Geordan Murray. The report shows that there is little to separate the top two ranked states, but it is Victoria that has edged out New South Wales to take the top spot. With nearly 70,000 dwellings commenced in 2015, it is not all that surprising that Victoria was number one, but Victoria also ranked as the strongest market for renovations. Western Australia is off the pace of the top two states, but still ranks third. But Murray pointed out that the high ranking for Western Australia belies the challenging conditions emerging for residential building, as evidenced by nearly 18 months of falling home prices. ‘The state’s overall ranking is propped up by strong performances in indicators of residential building that is already underway. The leading indicators highlight the recent deterioration in conditions and the prospect of weaker conditions ahead, which the HIA has been warning of for a considerable time,’ he explained. He also explained that Queensland is not performing as strongly as Victoria and New South Wales, but the housing recovery is being tempered by the… Continue reading
