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Prime property market in UK remains subdued but growth is forecast
The top end of the UK property market remains difficult at present but the prime central London sales market saw a quarterly rise in the second three months of the year, new research shows. Overall sales in the prime central London market increased by 24% compared to the first quarter of 2015, according to the latest data from estate agent Strutt & Parker. However, when compared to the same period last year, the results are less positive, down by 9% on the second quarter of 2014. The data also shows that properties over £2 million are 27% down in terms of the number of transactions in the same period last year, but 40% up on the first quarter of 2015. Properties under £2 million are 1% down on the second quarter of 2014 and 20% up on the first quarter of 2015. Strutt & Parker is forecasting price growth of 2.5% in the prime central London market overall in 2015, and in the medium term, the outlook for 2016/2018 remains for 6% growth per annum. For the UK as a while it expects growth of 5% in 2015, rising to 6% in 2016, followed by 7% for 2017/2018. ‘The increase to stamp duty, along with the general election uncertainty and the recent changes to non-dom status, have meant that individuals have been more hesitant with purchases as they seek additional advice,’ said Charlie Willis, head of London residential at Strutt & Parker. ‘However, this has not stopped buyers purchasing our highest quality stock as prime central London remains a very attractive place to live,’ he added. Continue reading
New law means Wales is first part of UK to introduce training for landlords and agents
Rent Smart Wales. A new law that is being introduced this autumn which will affect all private sector landlords and housing agents in Wales. Everyone who owns and rents out private property in Wales will have to register with a central licensing authority and obtain a new type of licence under a new law from this autumn. It means that Wales will become the first part of the UK where managing landlords and agents will need to undertake training to ensure they are aware of their rights and responsibilities. The new Rent Smart Wales scheme aims to raise standards in the private rented sector and will replace the existing voluntary Landlord Accreditation Wales scheme, which has been operated by Cardiff Council on behalf of all local authorities in Wales. It is intended that the new legislation will also result in raised awareness by landlords and agents of their respective rights and responsibilities and in turn, raised awareness by tenants of their respective rights and responsibilities. All private landlords who have a rental property in Wales must register themselves and the addresses of their rental properties in Wales and those who undertake defined letting or property management activities at a rental property in Wales must apply for a licence. If a landlord instructs an agent to do such work on their behalf, it is that agent who must become licensed and in order to get a licence a person must be adequately trained, and also declare themselves ‘fit and proper’. Licensing training will be offered through Rent Smart Wales or people can choose to attend Rent Smart Wales approved training courses delivered by other bodies. The Welsh minister with responsibility for housing, Lesley Griffiths, is encouraging landlords and agents to subscribe for important news and information ahead of the changes. ‘We know approximately 184,000 homes in Wales, around one in seven, are now privately rented. With so many people renting, a strong sector with good working practices is absolutely essential,’ she said. ‘The new legislation we are introducing will not only improve the situation for tenants, informing them of their rights and responsibilities, it will also help good landlords by improving the sector’s reputation,’ she explained. ‘When Rent Smart Wales is introduced this autumn, it will provide a simple way for landlords to register and for them and their agents to become licensed. Ahead of the changes, I encourage landlords and agents to subscribe to register their interest and to receive useful news and updates,’ she added. Cardiff Council, which currently operates the existing voluntary Landlord Accreditation Wales scheme, will be the licensing authority for the new statutory scheme, Rent Smart Wales, on behalf of all local authorities. ‘The scheme demonstrates the value of training and the development of positive relationships with landlords based on a better understanding of responsibilities and the potential risks of getting things wrong,’ said Bob Derbyshire, Cardiff Council cabinet member for the environment. ‘Rent Smart Wales is the next step, building on this early… Continue reading
Prime residential development land prices in Asia slowing
The price of prime residential development land in Asia slowed to 1.1% in the first half of 2015, down from 3% in the previous six months, but prime office land increased to 3.6%, up from 2.5%. The latest prime Asia development land index from international real estate firm Knight Frank also shows that Phnom Penh in Vietnam recorded the strongest increase in both prime residential and office land price. Prime residential and commercial land prices surging by 14.1% and 9.7% respectively. The report says that foreign investment continued to fuel strong performance in the residential sector but growth decelerated in the second quarter, suggesting that prices are peaking and the momentum will likely moderate in the second half of the year. Land sales in China plummeted by 54.8% year on year at a time when local governments in the country reduced land supply and maintained aggressive pricing as this is their main source of revenue. ‘As a result, developers in China face a double whammy of high land prices and weak sales. With the recent stock market crash, their ability to raise capital is further restricted. Anecdotally, more developers are partnering other firms to pool financial resources and pursue an asset light strategy,’ the report explains. ‘However, there is a silver lining as a recent survey conducted by China Household Finance and the Survey Centre registered signs of capital leaving the stock markets for the housing sector in the second quarter of 2015,’ it says. ‘Against this backdrop, along with a nascent recovery in the residential markets, land prices rose moderately in Beijing, Shanghai and, to a lesser extent, Guangzhou. Moving forward, land prices will continue to be supported by these factors,’ the report adds. Both residential and commercial land enjoyed robust capital appreciation in Hong Kong. The report explains that in addition to the existing healthy demand extra cooling measures, such as a lower maximum loan to value ratio and debt servicing ratio introduced in February 2015 targeting the mass residential market appeared to have channelled demand to the luxury sector. Office space continued to see strong leasing demand from financial institutions amid limited supply. Demand for land is set to increase when the ASEAN Economic Community (AEC) gets underway at the end of this year. The report explains that as a result of a freer flow of goods, services and skilled labour could encourage the movement of industries, driving demand for both commercial and residential space. In Bangkok, the price index for office land stalled in the first half of 2015 as developers turned their attention to the luxury condominium market, where continued capital appreciation afforded them higher profit margins. Even so, the prices of residential land grew at a slower but more sustainable pace. Jakarta saw a similar deceleration in price index movements. The economic slowdown has hurt both business and consumer confidence in the country, according to the report. ‘In addition, the government lacks the room to manoeuvre,… Continue reading
