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Latest data shows UK help to buy schemes attracting strong support
New figures show the UK government’s flagship Help to Buy scheme is helping more people onto the property ladder and getting more homes built. The Help to Buy schemes have created over 54,000 home owners in England with over 39,000 households buying new built properties through the equity loan and NewBuy options, and 15,000 households buying through the mortgage guarantee. A further 3,400 new homeowners have been created in Scotland, Wales and Northern Ireland through the Help to Buy mortgage guarantee scheme, Housing Minister Brandon Lewis has announced. A breakdown of the figures show that around eight out of 10 sales went to first time buyers and as a direct result thousands of new home owners were created and private house building starts rose by a third. House building has climbed to the highest level since 2007, construction output has seen the sharpest expansion for eight months, and companies are now taking on workers at the fastest rate since 1997. ‘The figures clearly demonstrate the continuing success of the Help to Buy in supporting creditworthy, hardworking people who want to buy a home of their own. Over 54,000 new homeowners have now used the schemes as a valuable alternative to the Bank of Mum and Dad, enabling them to buy with a fraction of the deposit they would normally require,’ said Lewis. ‘But it’s also got Britain building and since the scheme’s launch private house building starts has increased by a third,’ he added. Sales of new build homes have been strong across the country. The highest number of equity loan sales were in Wiltshire with 603 sales, Leeds with 559 sales, and Central Bedfordshire with 499 sales and 20 local authorities have all achieved over 300 sales. The average price of a home is below the national average at £210,000 under the equity loan and £153,000 under the mortgage guarantee. Continue reading
Scottish house prices at their highest since records began
Scottish houses prices are at their highest level since records began, according to official statistics published by Registers of Scotland (RoS). The average house price in Scotland in the second quarter was £170,190, up 5.2% on the same period in 2013. This is the highest figure since RoS began compiling quarterly house price statistics in 2003. From July to September this year, the total volume of sales was also up, with an increase of 9.1% on the same quarter in the previous year. This figure represents the highest volume of sales for any quarter since quarter one of 2008/2009. ‘This is the second consecutive quarter in which the annual increase in average house price has risen by over 5%, bringing the average property price above pre-economic downturn levels, to just over £170,000,’ said Registers of Scotland’s director of commercial services, Kenny Crawford. ‘Combined with the increase in sales volumes, this has brought the total value of sales across Scotland to just under £4.5 billion for the quarter, up 14.8% on the same period last year,’ he added. Renfrewshire recorded the highest percentage rise in average price compared with the same quarter of the previous year, up 17.2% to £137,072. The City of Edinburgh recorded the highest average at £235,402, a rise of 5.6% compared with the same quarter in the previous year. The largest percentage fall in price was in the Scottish Borders which showed a drop of 5.7% with an average price of £164,448. The City of Edinburgh remains the largest market with sales of just under £759 million for the quarter, an increase of 17.9% compared with the same quarter last year. The data also shows that East Dunbartonshire showed the highest percentage rise with the value of sales increasing by 36.4% compared to the previous year. All property types showed an increase in average house price in this quarter, the biggest increase being in terraced properties at 5.3%. The largest sales volumes came from detached properties, which went up by 11.2% on the previous year. These statistics cover all residential sales, including those that did not involve a mortgage. Continue reading
Residential development land growth in England and Wales moderates
Residential development green field land prices in England and Wales rose by 0.2% in the third quarter of the year but the growth rate is moderating. According to the latest figures from Knight Frank the annual increase in the third quarter of the year was 3.7%, down from the 5.6% annual rate of growth in the second quarter of 2014. The firm says that while the appetite for the best sites is still strong, rising material costs and a shortage of skilled labour is starting to weigh on prices. Prices in London are still advancing faster than the rest of the country, the average annual rate of growth for sites in prime central London slowed from 18.9% to 18.7% in the third quarter. ‘While house price growth is starting to slow, there is still room for more growth in development land, especially in commuter zones around London and other key cities,’ said Grainne Gilmore, head of UK residential research at Knight Frank. ‘However the disparity between the best sites and those that are compromised may become more entrenched and competition for good development sites remains strong throughout the country. But there is no doubt that developers are becoming more selective about the sites they consider,’ she explained, adding that this has been reflected by a slight slowing in sales volumes in recent months. Mirroring the trend in house prices, there has been a ripple effect from central London, with sites in key commuter towns close to the capital proving the most alluring for developers. ‘While planning remains a thorny issue for developers and house builders, these concerns have been somewhat overshadowed of late by the rising cost of construction and the difficulties in sourcing workers with suitable skills to build out sites,’ said Gilmore. ‘Shortages of material have contributed to rising prices, and this, a well as the shortage of labour, can be dated back to the financial crisis, when construction activity all but ground to a halt,’ she pointed out. ‘The very moderate growth in house building in the years following the zenith of the financial crisis were not enough to power up the industry for the sharp rise in activity seen over the last 18 to 24 months. So the delivery of materials and a workforce with the necessary skills is now proving problematic,’ she added. The report also shows that there has been a sharp rise in the number of respondents to the RICS survey saying that labour shortages and rising material costs are limiting levels of construction activity. These factors are now starting to weigh on development land prices, with developers being cautious about future material and labour costs in such an environment. ‘While the rising cost of materials will directly impact margins, difficulties in accessing suitable labour could add to the length of time that elapses before units can be sold, which will also, in turn, push up costs,’ said Gilmore. ‘As a result, buyers are applying downward pressure to offers for development land…. Continue reading
