Tag Archives: yahoo
UK house prices see high growth in East and South East
UK house prices increased by 0.8% in September and were 6.1% year on year, according to the latest data from the Office of National Statists (ONS). House price annual growth was strongest in Northern Ireland at 10.2% followed by England at 6.4% and there was a 1.1% rise in Wales and Scotland. Annual house price increases in England were driven by the East with year on year growth of 8.4% and the South East up 7.4%. But excluding London and the South East, UK house prices increased by 5% in the 12 months to September 2015. The data also shows that in September 2015, prices paid by first time buyers were 4.3% higher on average than in September 2014. For owner occupiers prices increased 6.9% for the same period. Neal Hudson, associate director of Savills research, pointed out that the continued growth in the ONS house price index highlights the impact of increasing competition by mortgage lenders on a low stock housing market. ‘Potential buyers that have a deposit are benefiting from historically low mortgage rates, increasing net lending, and are now able to borrow record high multiples of their income. That is despite the introduction of tougher affordability tests following MMR last year. The average buyer no longer has an average income, and so home ownership remains a dream for the many who still aspire to it,’ he added. The growth is being driven by constricted supply and fewer home owners selling, according to Rishi Passi, chief executive officer of Oblix Capital. ‘Improving economic conditions, rising wages and postponed interest rate rise expectations are all also bringing more buyers to the market, stoking up demand and inflating prices in the lower end of the market,’ he said. ‘The good news is that rising prices in this band will attract further investment and provide opportunities for developers, especially SMEs and should lead to an increase in attention paid to providing houses for this underserved end of the market,’ he added. Alex Gosling, chief executive officer of online estate agents HouseSimple, believes that there is likely to be a slight cooling in price growth in the coming weeks leading up to Christmas. ‘But, while demand continues to significantly outstrip supply, and interest rates remain static, we could well see a price spurt at the beginning of 2016. The market desperately needs a boost in new properties being listed if supply is ever to come close to catching up with demand,’ he added. First time buyers could be being outbid by existing home owners because they are more reliant on mortgages which are constrained by tougher lending criteria, according to Rob Weaver, director of Investments at property crowdfunding platform Property Partner. ‘Despite cheap finance, the tightening of the lending rules has made it increasingly difficult to get a mortgage and hence may be having a negative impact on supply. Longer term, property remains a good, solid investment… Continue reading
UK property prices set to rise by over 4% next year
Overall UK house prices are expected to tie by 4.1% in 2016 and by 20.3% cumulatively in the five years to the end of 2020, according to new research. However, as always national average performance disguises large regional variations that still characterise the UK market, the analysis report from international real estate firm Knight Frank shows. In the prime London and prime country markets higher transaction costs will continue to weigh on activity and price growth in 2016 as the market absorbs stamp duty, it points out and prime central London prices are forecast to rise by 2% in 2016 and by 20.5% cumulatively by 2020. Overall, values are growing more strongly in the South of England, particularly London and the South East, compared to slower growth in the North of England, Scotland and Wales. ‘These regional differences are unlikely to unwind significantly in 2016, although the improving economic and employment picture, especially in the regions, will underpin pricing,’ the report says. It also explains that interest rates continue to play a key role in the market. ‘While capital values will continue to be supported by ultra-low interest rates, the discussion has now turned to when, not if, the Bank of England will start to raise rates and markets are pricing in a rise in the second half of 2016,’ it adds. The report also points out that current ultra-low base rate, alongside an increased appetite for lending among banks, has led to record low mortgage rates, and mortgage lending has risen during 2015. The flip-side of this trend however, is that the best mortgage rates are generally only available to those who have access to sizeable deposits or equity. ‘While there are now more mortgage deals available to those with only a 5% deposit, a trend which will continue into 2016, the MMR mortgage rules mean that clinching a mortgage deal will continue to be challenging for some, especially for first time buyers,’ the report says. ‘Activity in the market has stabilised at around 100,000 transactions a month, although it is interesting to note that the cut in stamp duty for homes worth less than £1.1 million in December last year and the definitive general election result failed to produce an increase in activity. This was closely linked to a lack of stock on the market, particularly second hand stock,’ it adds. The analysis also looks at supply and demand and says that a lack of available homes to buy will likely continue to put a floor under pricing in 2016. ‘There is now even more emphasis on the delivery of new homes, and while levels of house building have picked up in recent years, the supply of new build dwellings is still far below Government targets,’ it points out. It also points out that the prime London property market faced a number of headwinds in 2015, led by the increase in stamp duty and higher transaction costs will continue to… Continue reading
Homes in London, the south east and south west sell more often
Homes in London and the South East and South West of England change hands much more frequently than those in other parts of the country, according to a new analysis. Properties are held by their owners for an average of just 16 years in the South East and 17 years in London and the South West. By contrast, home owners in the North East are keeping their homes the longest, with property changing hands every 22 years on average, 36% longer between sales than the South East. The research report from mover conveyancing services firm My Home Move, says that a higher rate of property ‘turnover’ between owners is a sign of a healthy housing market as people move to new areas for work, upgrade to a larger home to accommodate a growing family or downsize when they no longer need the extra space. ‘Homes in healthy property markets change hands often, as people move up the housing ladder or move to new areas for jobs or a change of lifestyle. Our research reveals that the stronger job market and higher incomes in the South mean that people buy and sell homes more often than in the North,’ said the firm’s chief executive officer Doug Crawford. ‘Interestingly, it’s not just the South East that has a relatively healthy number of homes changing hands as the West Country is also thriving. Regional towns like Exeter, Bath and Bristol have vibrant housing markets and the region as a whole also benefits from people moving there from other parts of England for a slice of the good life,’ he added. The research also found that the amount of time between house sales has fallen dramatically over the last five years, down by 24% across England as a whole from once every 25 years to an average of every 19 years. The greatest improvement was seen in the Yorkshire and Humberside region which saw the time between sales fall from once every 28 years to once every 19 years. This was followed by the East Midlands, improving from once every 25 years to once every 18 years. Crawford believes that it is reassuring to see that homes are changing hands much more often than they were five years ago. ‘This has been a period of economic growth and the house market has been improving hand in hand with the economy. The combination of low inflation, reduced unemployment and improving wages means that people feel confident in their prospects and are more enthusiastic about moving to a new home,’ he explained. ‘At the same time, improving mortgage availability and low interest costs have made it easier for consumers to finance a home purchase. With interest rates set to stay low for longer, according to the latest Bank of England predictions, the next 12 months could see a further improvement in the housing market across the country,’ he added. Continue reading
