Tag Archives: stumbleupon
US housing market set to see strong demand from first time buyers in 2015
The growing gap between housing's low and top tiers in the United States is expected to restore healthy demand for first time buyers and those moving up the housing ladder. 2015 has the promise of a transitional year where full buyer momentum in the low and mid tiers reinforce a strong housing recovery, according to the latest analysis report from Clear Capital. It says that sustained national price growth in the low tier segment, once driven by investor activity, is good news for first time buyers and also encouraging is the number of potential buyers locked into underwater mortgages has been steadily decreasing. The recent rise in home prices continue to bring more home owners out of negative equity and with more equity to play with, mid-tier home owners could move up, creating more opportunity and driving healthy demand in the low and mid tiers of the market. ‘While we are expecting price growth to moderate across all tiers in 2015, the top tier’s quarterly growth rate fell to 0.3% in the fourth quarter, where it had been holding steady at around 1% through the first three quarters of 2014,’ said Alex Villacorta, vice president of research and analytics at Clear Capital.. The report shows that year on year this tier experienced the lowest price growth rate of 3.6% among the three national tiers. At its current pace, continued moderation in the top tier could push quarterly price growth into negative territory in 2015. January data also reveals the low tier holding on to double digit gains year on year at 10.2% and healthy quarter on quarter gains of 1.5%. The firm believes that this divide between a healthy low tier and stalling top tier could kick off a domino effect. Stalling prices in the top tier of the market could create the perception of a good deal. This instils confidence in mid-tier home owners, motivating them to move up to the top tier. In turn, this opens up more opportunity for low tier home owners to move up to the mid-tier. Creating new opportunity in the low tier could entice potential first time buyers to enter the market. This domino effect could be the catalyst for balanced demand across all sectors of the market. Regionally, the Midwest continues to lead the growth and year on year held on to double digit gains in the low tier segment at 13.6%, while the top tier fell to 3.3%. This gap between growth in the low and top tiers was also recorded on a quarterly basis, with the low tier growing at 1.7% and relatively flat growth in the top tier at 0.5%. The Midwest led the nation in the all tier segment, with quarter on quarter growth at 0.9%, narrowly edging the West at 0.7%. The Midwest is the only region currently seeing price appreciation in the low and mid tiers, growing concurrently above 1%. The firm explained that a moderating top tier could incentivize… Continue reading
UK house prices up 2% in first month of 2015, latest index sho
House prices in the UK increased by 2% between December and January, the biggest rise for January since 2009, according to the latest property index figures. The data from the Halifax also shows that in the three months from November to January prices were 1.9% higher than in the previous three months and the quarterly rate of change increased for the first time since July 2014. But it remains below the rates recorded between June and September last year and overall the Halifax expects a moderation in house price growth during 2015. It predicts that house prices nationally will increase by 3% to 5% compared with 8% in 2014. Prices in the three months to January were 8.5% higher than in the same three months a year earlier. This was an increase from 7.8% in December. This measure of annual house price growth was at its highest since October 2014 when it was 8.8%, but remains significantly below the peak of 10.2% in July 2014. It points out that sales increased by 15% in 2014 but despite this annual rise, sales peaked in the first quarter before steadily declining during the course of the year with sales in the final quarter 5% lower than in the first quarter and 1% lower than in the third quarter. ‘This bounce-back in house price growth in January coincides with reports of the first rise in mortgage approvals for six months in December. These improvements may indicate that the recent declines in mortgage rates, the reform of stamp duty and the first increases in real earnings for several years are providing a modest boost to the market,’ said Martin Ellis, Halifax housing economist. ‘It is, however, too early to draw any firm conclusions. The monthly figures in January can be particularly volatile due to the lower volumes of activity at this time of year and there have been unusually large rises on occasion in the past, such as in 2007 when it was 2.3% and 2.4% in 2009,’ he explained. ‘Housing demand should continue to be supported by an expanding economy, continuing low mortgage rates and a boost to households’ spending power resulting from lower consumer price inflation and reduced fuel bills. Nonetheless, we expect the overall downward trend in house price growth seen since last summer to continue over the coming months. Nationally, house prices are predicted to increase in a range of 3 to 5% in 2015 compared with 8% last year,’ he added. According to Rob Weaver, director of investments at property crowdfunding platform Property Partner, the figures confirm that the property has still got some punch. ‘A strong January and the first quarterly rise for six months could suggest another buoyant year but I suspect we are more likely to see a period of gentle and sustained growth,’ he said. ‘It's hard to see how the property market could under-perform in 2015. Undershoot 2014, yes, but under-perform, no. Economic conditions at home… Continue reading
Sydney and Melbourne continue to see strong home price growth at start of year
The Australian housing market has started the year on a strong footing with strong gains recorded across Sydney and Melbourne, pushing capital city dwelling values 1.3% higher. But the latest home value index from Core Logic RP Data shows that a two tier housing market persisted over the first month of 2015 as performance varied substantially between capital cities. The largest cities, which have more influence over the combined capital city index due to the high number of dwellings, continued to push the aggregate index higher. Melbourne values were up 2.7% compared with December and Sydney values increased by 1.4%. Hobart also recorded a strong monthly result with values up 1.6%. Three capital cities recorded a decline in values over the month, with Darwin down 1.3%, Adelaide down 1.2% and Perth values down 0.6%. The quarterly data shows a clearer picture for housing market conditions, with the combined capitals index recording a 1.9% over the three months ending January 2015. While Sydney continued to be the standout for capital gains, the most significant increase in values over the past three months was recorded in Hobart with a rise of 4.4%, eclipsing the 2.4% capital gain in Sydney, which was the second highest quarterly reading across the capitals. According to the firm’s head of research, Tim Lawless, having Hobart produce the strongest results over the past quarter is certainly a unique occurrence. ‘Generally, Hobart has recorded the lowest rate of capital gain since the onset of the global financial crisis, however housing market conditions have been improving,’ he said. ‘Local economic conditions have been improving and Hobart homes are the most affordable of any capital city. Additionally the market is benefitting from the return of lifestyle buyers. After Darwin, the southernmost capital is also showing the second highest gross rental yields of any other capital city,’ he added. Despite Hobart’s strong quarterly capital gain, Sydney still holds as the city with the highest rate of capital gain over the past 12 months where property values are currently 13% higher. The annual gain in property prices across the combined capitals index was 8% at the end of January, ranging from a 13% gain in Sydney to a 0.3% reduction in Canberra. Sydney has also shown the highest aggregated capital growth of any capital city in the years since the global downturn. Lawless pointed out that since the beginning of 2009, Sydney has been a stand out housing market. From January 2009 through to January 2015 Sydney home values have increased by 57%. The second highest rate of growth over the same period has been in Melbourne where values are 50% higher. There is a significant gap between the next best performers over the same six year period. Darwin has seen less than half the level of growth at 24%, followed by Canberra at 18% and Perth at 17%. At the other end of the spectrum is Hobart where homes values are unmoved over the… Continue reading
