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New single house price index for whole of UK planned
Official house price statistics are due for a revamp in the UK where there are currently a number of different indices. This follows are consultation launched last year by the organisations responsible for publishing house price data in the UK; the Land Registry, Land and Property Services, Northern Ireland and the Office for National Statistics Registers of Scotland It looked at a proposed methodology for a single definitive House Price Index (HPI), and gathered views on whether it would meet requirements. It also asked interested parties how removing the indices currently published by Land Registry and the Office of National Statistics would them. The majority of respondents welcomed the proposal for a single official house price index and the clarity this would bring to the use of house price statistics. They also backed the continued publication of supplementary analysis and data alongside the House Price Index, for example, the Land Registry Price Paid Dataset, but also welcomed extra detail if available. Respondents also want a better explanation of the methods used to produce the House Price Index and consistent back data using any new methodology as far back as possible. While the majority thought the proposed methodology was sensible, there were areas that needed further analysis. They were happy with how long the proposed new index would take to publish, accepting the additional time required to process the new index and the greater accuracy and coverage it would provide. But they wanted further clarity on how the new index will be published due to concerns about the same data being published across a number of different websites. As a result a business case has been drawn up recommending the implementation of the proposed new single official house price index and there will be further work to ensure a full and consistent back series for the proposed new index that can be published back to 1969. Officials will also investigate using GOV.UK as the central publication point for the new monthly index publish a final version of the methodology by early summer 2015 if the new index is approved. Continue reading
Edinburgh prime housing market heads sales growth in Scotland
Estate agents in Scotland had expected to see a house price boom following the No vote in the independence referendum last September but this has not happened, it is claimed. However, there are some areas that are doing well, according to the annual Scottish Property Briefing report from Strutt & Parker. It says that the luxury new build market has definitely taken off in central Edinburgh and the firm forecasts continuing growth in this area. It also predicts a 4% to 5% growth in the £400,000 to £1 million mature markets, although selling properties over this price will continue to be challenging and there is likely to be 0% growth in this area. Last year there were 66 house sales of over £1 million in Edinburgh, which represented almost half of all Scottish properties in this range, of which Strutt & Parker sold almost 20% including one house at almost £4 million which is one of the Scottish capital's most expensive sales in recent years. According to Blair Stewart, who heads up the firm’s Edinburgh residential department, despite the new Land and Buildings Transaction Tax and continuing political uncertainty there are still many people willing to invest and live in the city. In the Country House market over the last year there has been a 27% increase in prime market transactions of £400,000 and over. Areas that have performed well have been those within commuting distance to Edinburgh, with a 50% increase in transaction numbers in Fife, a 69% increase in the Borders and an 85% increase in Midlothian. ‘The legacy of the Referendum continues to affect the prime country house market with continued uncertainty. Land and Buildings Transaction Tax will cause the top and middle of the prime market to readjust and capital values are expected to reduce by 2% to 4%,’ said Malcolm Leslie. ‘It is also expected that some would be buyers will make the most of their existing home by extending or renovating rather than moving home and incurring the increased tax. The quality of life that a Scottish country house can offer, together with the increasing value gap between southern England and rural Scotland, will encourage inward investment,’ he explained. ‘Finally I predicted that with the stability in the macro economic situation, the long term prospects for growth in the prime country house market look good,’ he added. There are two major factors affecting property prices in the UK, according to Stephanie McMahon, head of Strutt & Parker's research team. ‘Emerging countries with weak institutions has led to a flight of money from these markets to places such as the UK that has, for example, very strong property rights,’ she said. ‘Secondly, the population growth and rise in single person households leads to demand outstripping supply. However, the country as a whole is affected differently. Prices in London have risen by 35% since 2007, yet in Scotland it has fallen by 7%,’ she added. She pointed out that… Continue reading
Home building in Australia reaches new record high
Home building approvals in Australia soared to a new record high in January 2015, up 5% on the previous monthly record of November 2014, the latest data shows. The figures from the Australian Bureau of Statistics also shows that the total number of new homes approved in January 2015 was 7.9% higher than in December 2014. Detached house approvals held steady in the month, down a marginal 0.4% and remain at similar levels compared with a year ago. In contrast, multi-unit approvals jumped by 17.5% in January 2015 to a level 24.3% higher than a year earlier. ‘Once again, the multi-unit sector continues to be the key driver of building approval results,’ said Housing Industry Association economist, Geordan Murray. He pointed out that a sharp spike in multi-unit approvals in Queensland in January has combined with solid levels of multiunit approvals in New South Wales and Victoria to lift the national total. ‘These three states typically account for around 80% of all multi-unit residential building and when you have all three performing strongly, it’s a recipe for a strong national result in this segment of the market,’ he explained. He also pointed out that January 2015 was only the second month on record when the total number of multi-unit dwellings approved eclipsed the number of detached houses approved. ‘But this is certainly no indictment on the performance of the detached house market which continues to maintain healthy approval numbers. Changing consumer preferences, demography, affordability challenges and aspects of the policy environment are all contributing to the current situation where a larger share of new homes are in the form of attached dwellings,’ he added. During January seasonally adjusted new dwelling approvals increased most strongly in Queensland with growth of 47.8% followed by South Australia at 22.3% and Victoria at 3%. Declines in new home approvals were recorded in New South Wales with a fall of 4.2%, Western Australia down 11.6% and Tasmania down 9.3%. In trend terms, new dwelling approvals fell in the Northern Territory by 10% and the Australian Capital Territory saw a decline of 5.7%. The HIA’s most recent national outlook report identifies 2014/2015 as the year when a record number of new homes will be built although it says that wide geographical divergences are still evident, trading conditions are more competitive than ever, and the renovations part of the market is still soft. ‘National new home building activity is the star of the housing show with a record level of 195,936 new dwelling commencements forecast for 2014/2015. That result would represent growth of 7.7% and cap a third year in a row where new home construction has headed higher,’ said HIA chief economist, Harley Dale. He pointed out that record building needs to continue to ensure that supply in coming years meets the requirements of a growing and ageing population. Continue reading
