TSI
Gazumping is back in the UK with buyers in Brighton most affected
Brighton leads the way as the gazumping capital of Britain with 34.9% of residents losing out in this way, new research has found. As if getting a foot on the property ladder wasn’t already hard enough for some, the danger of being gazumped is now becoming a reality again for property buyers, according to a study by online estate agent eMoov. It found that on average across the UK some 22% have experienced the turmoil of being gazumped which can leave prospective buyers out of pocket and back to square one in the buying process. In the London market gazumping is over the national average with 31.9% in the capital have come within touching distance of a purchase before it was snatched from their grasp. The tactic of sealed bidding, particularly rife in the capital, provides the ideal environment for potential gazumpers. Outside of the South East the average drops from 22% to 18%. Birmingham figures show 27% of property buyers in the area have been gazumped with Sheffield at 22%, Bristol at 21%, Leeds and Nottingham at 20%. Although gazumping is not a new concept it has become a more regular occurrence across the country. The research also found that the higher the price of the property, the more likely you are to be gazumped. Of those that had been previously gazumped 27% were over properties of £500,000 or above. This dropped to 25% for properties valued between £200,000 and £500,000 and a further 6% for properties under £200,000. ‘It is one of those things in the current structure of property purchasing unfortunately. Buyers that have displayed honest interest in a property only to be let down by owners with pound signs in their eyes, often encouraged by traditional estate agent looking to increase his fee percentage,’ said Russell Quirk, the firm’s chief executive officer. Liverpool was the least affected area of England for gazumping at just 13%, however this doesn’t necessarily put an end to unethical behaviour during the buying process. ‘If these markets cool off too much, we could see gazundering coming back in. This is a tactic in areas with little demand where the buyer calls up just before the exchange of contracts and demands to pay less,’ explained Quirk. Continue reading
Home building reaches a new high in Australia
This year has seen a record number of new homes being built in Australia, according to the latest outlook report from the Housing Industry Association. However, the growth in new residential construction has been slower to gather momentum and breadth in terms of both geographical location and dwelling type, it says. According to HIA chief economist, Dr Harley Dale, this means that the ‘look and feel’ of this building cycle is different to historical experience. ‘In aggregate, we will commence nearly 190,000 new dwellings in 2014, surpassing the previous record of 187,000 back in 1994,’ said Dale. ‘The momentum culminating in this milestone has provided a substantial boost to Australia’s economy at a crucial juncture in the cycle. Below trend economic growth and weak labour market outcomes would be considerably worse without the reach a new home building recovery is exerting into the broader economy,’ he explained. He pointed out that against this backdrop the HIA believes it is unfortunate that policy makers have failed to grasp the reform initiative required to compliment record low borrowing costs and send new home building levels higher still in 2015 and 2016. ‘Australia’s economic growth and labour market performance will be weaker than otherwise as a consequence of this lack of policy action. Record low borrowing costs have combined with other factors such as high net overseas migration to unleash substantial pent-up demand for new housing,’ said Dale. ‘These factors will keep the level of new homes commenced at historically elevated levels. However, what the economy needs is further growth in new home building over the next couple of years, but that will only occur as a consequence of taxation and regulatory reform,’ he pointed out. ‘It is still an impressive achievement to build a record number of new homes, at a level that approaches what the average build rate will have to be if we are to adequately house our growing and ageing population in coming decades,’ he said. He explained that renovations investment has not joined the new housing ride this cycle, increasing by only 0.3% in 2013/2014 from a decade low. ‘Unemployment concerns, a lack of available credit, and an elevated household savings rate are but three elements in the current environment which mean there has not been room for a renovations recovery alongside new home building activity and existing property price growth,’ said Dale. But he pointed out that that situation looks to be slowly changing as growth of 0.9% in renovations investment in 2014/2015 is forecast to accelerate to 2% growth in the subsequent three years. ‘That would be a great outcome, but it is a long road back for this important sector of Australia’s domestic economy,’ Dale concluded. Continue reading
Rents fall across majority of UK regions in October, latest monthly index shows
Most regions in the UK saws rental prices fall in October and while they are still higher than a year ago the last three months data indicates a cooling in the market, according to the latest index. Outside of London the average monthly rent is now £708, according to the HomeLet index which also shows that Plymouth, Cardiff and Leeds most affordable major cities to rent in the UK while London, Edinburgh and Birmingham are least affordable. Overall the rents landlords are charging on new tenancy agreements are continuing to fall across the UK with rental prices dropping in seven out of 12 regions of the country in October 2014. While rents for new tenancies in October were still higher than in the same month of 2013, HomeLet has now recorded lower rental prices in each of the past three months in many regions, indicating a cooling in the rental market. Regions that have previously recorded high growth such as Greater London, East Anglia the South East and the South West of England are now recording falling rental prices. In Greater London, for example, rents levied on new tenancies signed in October 2014 were 3.8% lower than September 2014. In the South East, rents fell 3.1% and in East Anglia prices dropped 5.4%, while the South West saw the biggest monthly drop with rents falling by 9.3% Meanwhile, in areas of the country where rents have not been rising quite so fast, October saw continued growth. In the North East of England, rents on new tenancies rose by 3.8% in October and in the East Midlands, October’s increase was 3.4%. A breakdown of the figures show that in Scotland the average monthly rent it £587, down 4.4% month on month but up 2.6% annually while in Wales it is £597, down 1% month on month and up 3.3% year on year. Northern Ireland saw monthly rents fall 6.3% to £578 but up just 0.9% year on year. The average monthly rent in East Anglia is £781, down 5.4% compared with September but up 8.5% annually. In the South West it is £787, down 9.3% month on month and up 3.6% annually while the South East saw rents fall 3.1% to £880, an annual rise of 7.3%. In the North West rents increased by 1.7% on a monthly basis to £671 and are up 7.5% year on year. Yorkshire and Humberside also saw a monthly rise with rents up 0.2% to £608 and up 4.8% annually. In the North East rents increased by 3.8% to £528 and are up 2.3% year on year while the West Midlands saw a rise of 0.6% to £660 but rents are 11.7% higher than a year ago. The East Midlands also saw a rise with rents up 3.4% to £605 and up 2.9% annually. London, which tends to be on a different trajectory to the rest of the country, saw rents fall by 3.8% compared to September,… Continue reading
