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UK housing price growth slowed at end of 2014, index data confirms
House prices in the UK in the last three months of 2014 were 0.3% higher than in the previous quarter and are expected to increase by up to 5% in 2015, according to the latest index report. A monthly rise of 0.9% took the average price of a home to £188,858, the data from the Halifax shows. However, growth is clearly slowing. The quarterly rate of increase declined for the fifth consecutive month and was the lowest since November 2012 when it was 0.3%. Prices in the three months to December were 7.8% higher than in the same three months a year earlier and based on this annual house price growth has fallen from a peak of 10.2% in July and is now at its lowest rate since January 2014 when it was 7.3%. The Halifax expects a further moderation in house price growth over the coming year. House prices nationally are predicted to increase in a range of 3% to 5% in 2015. The index points out that home sales at 98,490 in November were below 100,000 for the first time since November 2013.Overall, sales in the three months to November were 1% lower than in the previous three months. Despite this recent modest decline, sales during September to November were 5% higher than in the same period last year. ‘The deterioration in housing affordability as a result of rising house prices, earnings growth that has been consistently below consumer price inflation until very recently and speculation of an interest rate rise, have combined to temper housing demand since the summer. The weakening in housing demand has led to a reduction in both price growth and sales in recent months,’ said Halifax housing economist Martin Ellis. ‘We expect a further moderation in house price growth over the coming year with prices nationally predicted to increase in a range of 3 to 5% in 2015. Housing demand, however, should continue to be supported by a growing economy, rising employment levels, still low mortgage rates and the first gain in real earnings for several years,’ he added. Peter Williams, executive director of the Intermediary Mortgage Lenders Association (IMLA), said that the falling rate of house price increases at the end of 2014 might suggest greater market stability. 'But this should not disguise the need for ground breaking action on housing policy in the upcoming election. Declining affordability has tempered demand and the housing market in its present state is still a long way from supporting the nation’s home owning ambitions,' he pointed out. 'Housing policy is in need of fundamental reform rather than short term voter appeasement that has brought a host of temporary measures and tinkering at the edges without a long term plan. Successive governments have failed to address changing housing needs and left us on a downwards trajectory that will see owner occupation drop to 59% by 2020 if current trends continue,' he explained. … Continue reading
Call for review of UK housing policy
The UK government needs to review its current housing policy and commit to a managed withdrawal of current property market support as a priority, according to the Intermediary Mortgage Lenders Association (IMLA). It has published its criteria for housing and mortgage policy pledges in the build-up to the 2015 election and says that with owner occupation set to fall from 64% to 59% in the next parliament, an ‘open and frank debate’ is needed about whether conservative lending benefits all. The IMLA argues that a clear overarching housing strategy is an essential requirement for the next government. This would replace a policy focus that has frequently favoured short term, eye catching and also conflicting measures over the last 30 years. As a result, successive governments have prioritised specific market segments at the expense of others rather than following a cohesive strategy across tenures and parliaments. In its paper UK Election 2015 – criteria for housing and mortgage policy pledges, IMLA also asserts that regulators’ response to the financial crisis and lenders’ responses to the new rules and their supervision have created a more conservative mortgage market. With owner-occupation set to fall from 64% to 59% over the next five years over the next parliament, the IMLA calls for the next government to ensure a more appropriate balance of choice and protection for consumers, in place of fragmented policies and regulatory interventions. The document sets out five specific requirements that should be tackled by the next government. These include establishing a programme for a properly managed withdrawal of government measures supporting the housing market and implementing a state or privately backed mortgage indemnity guarantee (MIG) to succeed Help to Buy and support high loan to value (LTV) borrowing in the long term. It also includes introducing measures to support downsizing by older households and increase liquidity in the housing market, carrying out a full review of the cumulative impact of regulatory changes for mortgage lending, including new capital adequacy requirements, macro-prudential rules and affordability assessments and engaging in an open discussion on the role of the sub-prime mortgage market in helping to meet consumer needs. ‘There are difficult and worsening housing problems across most of the UK, which mean the housing and mortgage markets will be a dominant issue in the 2015 election. A number of key agendas demand a response from politicians, and the consequences of their actions are likely to be felt for many generations to come,’ said Peter Williams, IMLA executive director. ‘We need to recognise that tenure patterns are changing and there is a wider diversity of housing needs in modern society than ever before. Home buyers face much greater challenges as a result of house price rises and financial services regulation. Private renters are confronted by high rental inflation and variable quality and social renting no longer provides an adequate safety net for those who cannot afford to house themselves via the market,’ he explained. He pointed out that a… Continue reading
NAEA issues advice for selling a property in the cold, dark winter months
Selling a home in the UK in winter can be difficult but ensuring the garden looks it best even in these darker months can help, according to estate agents. For the best chance to sell your home it is important to make sure the property stands out and taking steps to make sure it looks welcoming, says the guide from the National Association of Estate Agents (NAEA). ‘Winter can be cold, dark and wet, which often means properties are unable to promote some of their best features. By incorporating a few simple tips, sellers can enhance their property’s look and feel and increase their chance of attracting an offer,’ said NAEA president Simon Gerrard. ‘Quite often, it is the smallest changes to a property that can make it stand out over others. A warm, inviting atmosphere in the dreary winter months is key. Simple things such as making sure a home is warm and well lit can improve saleability during the darker months and additions such as welcoming garden lights to enhance the entrance to your home can appeal to buyers’ imaginations,’ he explained. The NAEA said sellers need to realise that first impressions still count and 0utside is where the biggest impact of the bad weather will be and this is obviously the first sight a prospective buyer will have. Winter can make the front garden and paths look dull and dirty, so ensuring these are clean and clear of leaves will improve the attractiveness of the property. Home owners are advised to check the gutters and drain covers are properly cleared of dead leaves and other debris as leaky gutters and down pipes cause damage and are unsightly. Also, a messy garden can signal the need for too much work and thus detract buyers. If possible, vendors should clear patio furniture away, if not at least ensure they are securely covered. Fix or secure any loose fence panels or gates. It is also advisable to cut back overhanging branches as this will help brighten the property. People are urged to ensure the property is well lit. This means making sure all lights work, including the security lights. If a viewing takes place during the day, open all of the curtains and blinds to ensure as much natural light as possible can enter the home. Making sure the doorways, entrance, stairs or porch are clear of clutter can help create an inviting home. The NAEA also says it is important to make your house feel warm and homely. If a buyer enters a property that is cold they’re unlikely to stay long. Smell is also important. You are going to get a bad reaction from buyers if there is an odd aroma or damp smell hanging around. So freshen up, let some fresh air circulate and the old cliché of fresh bread or roasting coffee really does work. If you are going away for any period over the winter the heating should… Continue reading
