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US home prices expected to rise 3% in next 12 months, says latest forecast report
US property prices are expected to rise 3% in the next 12 months but growth will depend on location, according to the latest real estate market report from Zillow. The Zillow Home Value Index rose to $169,200 in February, up 5.6% year on year and the number of homes listed for sale on Zillow was up 5.5% annually. However, the firm says that as the spring home buying season heats up, buyers and sellers nationwide can expect very different experiences when it comes to negotiating power. According to the latest Zillow analysis of national buyers' and sellers' markets, sellers in the West will likely have the upper hand in negotiations when selling their home, while buyers in Midwestern and East Coast metros will likely face less competition and have more room for bargaining on prices. The Bay Area, San Antonio and Los Angeles are the top prospects for sellers and Cleveland, Philadelphia and Tampa the top of the list for buyers, according to Zillow. In this analysis, a sellers' market is not necessarily one where home values are rising, but rather one in which homes are on the market for a shorter time, price cuts occur less frequently and homes are sold at prices very close to, or greater than, their last listing price. In buyers' markets, homes for sale stay on the market longer, price cuts occur more frequently and homes are sold for less relative to their listing price. The real estate data in markets on both coasts are telling markedly different stories, the report says. ‘Relatively strong job markets in the West are helping spur robust demand, which is being met with limited supply, causing rapid home value appreciation and giving sellers an edge. In the East, housing markets are appreciating a bit more slowly, and homes are staying on the market longer, which helps give buyers the upper hand,’ said Zillow chief economist Stan Humphries. ‘In general, buyers in sellers' markets this spring can expect tight inventory, increased competition and a greater sense of urgency. Sellers in buyers' markets may need to be prepared to lower their asking price, or to wait longer for the perfect buyer to come along,’ he explained. ‘As we put the housing recession further in the rear view mirror, the broad based dynamics that applied during those days, when all markets were reacting similarly to nationwide economic conditions, are fading. Real estate has always been local, and as the spring market gains momentum, this old adage will only become more pronounced,’ he added. He also pointed out that but both monthly and annual US home value appreciation slowed to their lowest paces in months. National home values were almost flat in February from January, and were up 5.6% from February 2013. The pace of home value growth has slowed in recent months as more inventory of for sale homes has helped meet demand. Nationwide, while inventory remains tight, the number of homes listed for sale on Zillow was up 5.5% annually… Continue reading
Lending for homes in UK up 43% compared to a year ago, latest figures show
Gross mortgage lending in the UK was £15.2 billion in February, down some 6% compared with January but still 43% higher than the £10.6 billion lent in February last year, the latest data from the Council of Mortgage Lenders shows. The CML also pointed out that it is the highest total for a February since 2008. CML chief economist Bob Pannell said that housing market indicators have continued to be strong over recent months, once seasonal factors have been taken into account. ‘First time buyers have benefitted most from the government’s Help to Buy initiatives, with the more recent mortgage guarantee scheme now starting to push typical loan to value levels higher,’ he explained. ‘The housing market got a further boost from this week’s Budget. This, together with benign developments in the economy more widely, should bolster short term sentiment and activity,’ he added. Experts believe that more new homes are needed to help the property market continue its recovery as lack of supply is holding it back. Duncan Kreeger, director of West One Loans, a privately funded short term lender, comments, believes that the market can only go so far without a sustainable supply of new homes. ‘While mortgages might be catching up with pre-recession levels, house building in the UK still falls considerably below these peaks,’ he said but added that building may have got a boost in yesterday’s Budget. ‘However, there are still many questions left unanswered. Some 200,000 new homes looks good on paper but we still don’t know where these will be placed. It’s all very well to build a garden city in Ebbsfleet, but if demand is greatest in urban areas, it’s unclear how this will help,’ he explained. ‘The hard truth is that to really increase the supply of homes where they are most needed requires complex property conversions and refurbishments and it’s still almost impossible to get mainstream funding for these types of projects,’ he added. According to Ian McGrail, managing director, FirstMortgage, the data supports the level of growth that his firm as seen at a company level year on year, as demand for mortgages from first time buyers and home movers remains consistently strong. ‘The results, showing the highest total for a February since 2008, pair well with our in house monthly figures, where similarly we have seen record levels of production. This growth looks set to continue steadily into the year, although we would expect activity to slow down temporarily at the end of April when the Mortgage Market Review comes into effect, as lenders get to grips with the reality of the reforms imposed,’ he added. However, Peter Williams, executive director of the Intermediary Mortgage Lenders Association (IMLA), warned that growth could slow this year partly because regulatory changes on 26 April will act as a temporary buffer and also because the bar was significantly raised in the second half of last year. 'But the recovery is well underway and should continue to… Continue reading
Neighbourhood plans take up edging towards maintaining status quo, research finds
The take up of neighbourhood plans, a cornerstone of the UK government’s Localism agenda, is concentrated in the south of England, according to new research. They are generally in more affluent areas within Conservative led authorities, with a mixed picture of providing for or resisting development, says the research published by planning consultancy Turley. To date, over 980 applications have been made by neighbourhood organisations for formal approval to draw up a neighbourhood plan. Of these, over 750 areas have been approved by local authorities to proceed. The research also shows that 75 neighbourhood plans have been published for consultation, but only six Neighbourhood Plans were formally in place at the end of February 2014. Of those plans published, 73% have been produced in areas with Conservative led councils, with just 9% having been produced in areas which are Labour controlled and 75% of all published plans have been produced in the south of England. The Turley research also highlights that areas of below average affluence have so far been less involved in the neighbourhood planning processes, with just nine plans published in areas categorised as ‘most deprived’. ‘We have reviewed over 4,000 pages of draft neighbourhood plans and a clear picture is emerging. The preparation of neighbourhood plans is popular but is being recognised more by communities in the south of England compared to the North. It also appears that less affluent communities are not yet engaging fully in the neighbourhood planning process,’ said Rob Peters, executive director in Turley’s Bristol office who led the research. The research found that, of the plans published so far, the smallest population of a neighbourhood plan area is Walton in Wakefield in West Yorkshire, representing just 225 people. The largest is Winsford in Cheshire representing over 30,000 people, highlighting the difference in size, scale and geography of the plans. Some 67% of all published plans cover rural neighbourhoods and one third relate to urban areas while 55% of all neighbourhood plans seek primarily to resist new development, with that number increasing to 63% in rural areas. ‘I am not yet convinced that neighbourhood planning is an emphatic success or that the plans are making satisfactory provision for development, as the government has suggested, when so few plans have been made (i.e. adopted),’ said Peters. He pointed out that neighbourhood plans have been stalling in their progress to adoption with adjourned examinations in Winslow, Aylesbury Vale, rejections by Examiners in Slaugham, and legal challenges in Tattenhall, Cheshire. ‘The picture that emerges from the published neighbourhood plans is one of the majority seeking to maintain the status quo and restricting new development, with a smaller minority of plans encouraging growth. This suggests a potential for conflict between localism delivered through neighbourhood planning and the positive presumptions and growth that underpin Government policy,’ he added. The Turley research recognises that neighbourhood forums can provide a useful route to achieve meaningful engagement, but in some cases the views of land owners and… Continue reading
