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UK mortgage market sees lending fall off toward end of 2014
Lending trends to first time buyers, home movers and remortgaging in the UK have declined but there has been an annual rise in buy to let lending, according to the latest data from the Council of Mortgage Lenders. Lending to first time buyers fell 11% in November 2014 compared to the previous month and was down 3% on November 2013. By value, there was £3.8 billion advanced to first time buyers, 12% down on October but 6% up on November last year. Lending to home movers also declined month on month by 13% and by 10% on November 2013. By value, lending to movers totalled £5.4 billion, down 14% on October and 5% on November last year. Remortgage lending activity saw an 8% decline month on month and was 16% down on November 2013. The value of these loans at £3.6 billion was down 10% on the previous month and down 14% on November of the previous year. There were 17,700 buy to let loans in November, representing lending of £2.4 billion, a 10% decrease on the previous month, however, compared to November 2013, the number of loans increased 9% and the value of these loans went up 14%. Paul Smee, director general of the CML, said that the easing back of activity is not completely unexpected as there is usually a seasonal lending dip in the winter months, adding that the major industry changes and more restrained market sentiment have inevitably caused month to month fluctuations over the last 12 months. ‘Our forecasts are for gross lending to continue to grow over the next two years and this reflects our belief that there are more stable conditions in the market than a year ago,’ he explained. According to Steve Bolton, founder and chairman of Platinum Property Partners (PPP), significant increases in average house prices over the past year have made buy to let a very attractive investment prospect. He pointed out that recent research from Savills shows that property investors with buy to let assets have experienced capital appreciation of 17% over the last 12 months. ‘There are also positive signs for further growth in the buy to let market. Our recent research shows that two in five landlords plan to expand their portfolios this year and it is anticipated that the pension freedoms coming into play in April will encourage further buy to let investment,’ he said. ‘Rental demand shows no sign of slowing, as more than 8.5 million people in England now rent from a private landlord. But there is still a worrying imbalance between supply and demand. Landlords have a responsibility to look at ways of providing more rental accommodation that is of a high standard but also affordable,’ he explained. ‘Buy to let models such as Houses in Multiple Occupation (HMO) are an efficient way of making use of existing housing stock as well as providing quality accommodation at much lower costs, enabling… Continue reading
Scotland’s house prices dip after post referendum boost
Residential property prices in Scotland fell 0.1% in November, reversing October’s uplift in the wake of the independence referendum vote, the latest index shows. There was also a slowdown in annual growth to 4.3%, less than half the 10.6% yearly rise across England and Wales, according to the Your Move/Acadata index. It takes the average house price to £164,607 and sales were up 6% annually in November, however the data shows that a quarter of all activity was concentrated in Edinburgh and Glasgow. But prices in Midlothian have seen their highest annual jump, up 10% with this being put down to a 30% leap in local first time buyer sales. According to Christine Campbell, regional managing director of Your Move, the Scottish property market is only just starting to recalibrate after the temporary disruption of the referendum. ‘The immediate feel good factor following the vote led to an artificially upbeat October, but the dust is settling. Average house prices across Scotland dipped as normal business resumed and familiar market trends reappear,’ she explained. The data shows that overall, property values fell in over half of Scotland’s local authority areas in November and it means annual house price growth in Scotland is currently lagging well below the pace being set across England and Wales. ‘However the underlying upwards momentum is robust. Scottish property values have climbed a healthy 4.3% in the year to November, equal to £6,750 on average. In the last 12 months, fourth fifths of the nation’s local authorities have witnessed increases in house values,’ Campbell pointed out. ‘But the overwhelming majority of Scotland is experiencing annual property price growth in excess of inflation. The lion’s share of home owners are enjoying real tangible growth in the value of their home beyond the 1% Consumer Price Index rate of inflation,’ Campbell said. ‘For example, the highest annual leap in values was found in Midlothian, with prices soaring 10%, more than double the wider nationwide average. Here, prices have been driven up by a considerable 30% uplift in sales of flats and terraced properties in the past 12 months. This burst of activity has pushed the typical cost of a flat in the area to £120,000, up from £100,000 a year ago,’ she explained. She also pointed out that while prices may have slipped back on a monthly basis, activity is still making stable progress. ‘This has been the strongest November for sales in seven years, with transactions up 6% on 2013. As first time buyers continue to pour into the market, the most frequently purchased type of property in Scotland are flats, with sales of this type of property growing 9% year on year in the three months to November 2014,’ said Campbell. ‘Argyll and Bute saw the biggest monthly jump in prices, up 5.8% since October, and this was propelled by a 24% annual surge in sales in the three months to November 2014, including a 50% climb in flat transactions…. Continue reading
London Mayor announces new £10 million loan for affordable housing in London
The Mayor of London is forming a partnership with Big Issue Invest to renovate empty properties into much needed new affordable homes in the UK’s capital city. Boris Johnson has awarded a £10 million loan from his Housing Covenant to Big Issue Invest who help small community organisation's to renovate empty homes or buildings to convert them into good quality affordable housing for Londoners to rent or part buy. The funding will revolve over a 10 year period and result in up to 400 empty homes being transformed into good quality low cost housing. In addition it will provide long term unemployed people, veterans and out of work young people from across London the opportunity of employment and training in construction. The Mayor's Housing Covenant supports organisations proposing innovative ways of delivering affordable housing through a Revolving Fund and is one of a number of housing schemes the Mayor is delivering to boost affordable housing, stimulate building and fast track the delivery of thousands of much needed new homes. The proportion of empty homes in the capital has fallen dramatically under the Mayor, and at 0.7% is now at the lowest level since the 1970s. Over 5,000 empty homes have been brought back into use through GLA housing programmes since 2008. ‘With the huge demand for housing it's essential we get empty properties back into use, which is why I'm helping innovative projects renovate them back into much needed affordable homes,’ said Johnson. ‘Big Issue Invest are masters of boosting community social enterprise and delivering key employment and training skills to the homeless and unemployed people who need our extra support. This funding sits alongside my affordable home programme which is on track to deliver 100,000 new low cost homes across the city,’ he added. The Big Issue Group's chairman, Nigel Kershaw, described it as an exciting opportunity. Big Issue Invest is a specialist provider of finance to social enterprises. It provides investment from £50,000 to £1.7million and develops innovative financial solutions which help organisations tackle poverty and create opportunity. Since 2005 Big Issue Invest has invested over £27 million across the UK in more than 330 social enterprises, directly benefitting over 1.8 million people. The new loan will allows Big Issue Invest to finance and support more innovative housing projects undertaken by social enterprises and charities. These projects will serve to increase the volume of affordable housing available in London. The Mayor's commitment to getting empty homes back into use and boosting affordable housing is part of a package of wider measures he is promoting to stimulate house building. Continue reading
