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New home building in the UK up by 15% year on year
There were over 131,000 new homes completed in the UK in the last 12 months, some 15% higher than in the previous year and the highest annual total since June 2009, the latest figures shows. Housing Minister Brandon Lewis welcomed the figures but promised that the rate of new building would keep rising to meet the government’s target of 275,000 per year by 2020 which he said would represent the fastest rate of building for 20 years. ‘This has provided a real boost to the UK’s construction industry and is delivering the homes that hard-working people rightly deserve. However, we know there is more to do,’ he said. Part of that will be to boost the number of starter homes for first time buyers and he pointed out that some £10 million has been made available to bring forward brownfield sites to build new home which will be available to young first time buyers at a 20% discount. The latest figures from the Office of National Statistics have shown that output in the construction industry increased by 2.7% in June compared to the same month last year. Work on private new housing between April and June rose by nearly 3.9% on the previous quarter. Lewis said that the government has also given local people the powers they need to drive forward housing development with the number of homes in locally led plans up by a quarter. Before March 2012 the average number of homes planned for by local authorities stood at 573 per year. But he explained that radical reforms put Local Plans and housing delivery at the heart of the planning system and this has helped expand the housing pipeline with those Local Plans published after the reforms containing on average 717 homes per year. Continue reading
Existing home sales up again in the US, but number of first time buyers falls
Existing home sales in the United States steadily increased for the third consecutive month in July, according to the latest data from the National Association of Realtors (NAR). However, stubbornly low inventory levels and rising prices have resulted in sales to first time buyers falling to their lowest share since January. The data shows that total existing home sales increased 2% to a seasonally adjusted annual rate of 5.59 million in July from a downwardly revised 5.48 million in June. Sales in July remained at the highest pace since February 2007 when they were 5.79 million and have now increased year on year for 10 months in a row and are 10.3% above a year ago when they were 5.07 million. Lawrence Yun, NAR chief economist, explained that the increase in sales in July solidifies what has been an impressive growth in activity during this year's peak buying season. ‘The creation of jobs added at a steady clip and the prospect of higher mortgage rates and home prices down the road is encouraging more households to buy now,’ he said. ‘As a result, current home owners are using their increasing housing equity towards the down payment on their next purchase,’ he added. The data also shows that the median existing home price for all housing types in July was $234,000, which is 5.6% above July 2014. July's price increase marks the 41st consecutive month of year on year gains. ‘Despite the strong growth in sales since this spring, declining affordability could begin to slowly dampen demand. Agents in some markets reported slower foot traffic in July in part because of low inventory and concerns about the continued rise in home prices without commensurate income gains,’ Yun pointed out. Total housing inventory at the end of July declined 0.4% to 2.24 million existing homes available for sale, and is now 4.7% lower than a year ago when it was 2.35 million. Unsold inventory is at a 4.8 month supply at the current sales pace, down from 4.9 months in June. The percent share of first time buyers declined in July for the second consecutive month, falling from 30% in June to 28%, the lowest share since January of this year when it was also 28%. A year ago, first time buyers represented 29% of all buyers. ‘The fact that first time buyers represented a lower share of the market compared to a year ago even though sales are considerably higher is indicative of the challenges many young adults continue to face,’ said Yun. ‘Rising rents and flat wage growth make it difficult for many to save for a down payment, and the dearth of supply in affordable price ranges is limiting their options,’ he added. Properties typically stayed on the market for 42 days in July, an increase from 34 days in June but below the 48 days in July 2014. Short sales were on the market the longest at a median of 135 days in… Continue reading
Prime property market in UK remains subdued but growth is forecast
The top end of the UK property market remains difficult at present but the prime central London sales market saw a quarterly rise in the second three months of the year, new research shows. Overall sales in the prime central London market increased by 24% compared to the first quarter of 2015, according to the latest data from estate agent Strutt & Parker. However, when compared to the same period last year, the results are less positive, down by 9% on the second quarter of 2014. The data also shows that properties over £2 million are 27% down in terms of the number of transactions in the same period last year, but 40% up on the first quarter of 2015. Properties under £2 million are 1% down on the second quarter of 2014 and 20% up on the first quarter of 2015. Strutt & Parker is forecasting price growth of 2.5% in the prime central London market overall in 2015, and in the medium term, the outlook for 2016/2018 remains for 6% growth per annum. For the UK as a while it expects growth of 5% in 2015, rising to 6% in 2016, followed by 7% for 2017/2018. ‘The increase to stamp duty, along with the general election uncertainty and the recent changes to non-dom status, have meant that individuals have been more hesitant with purchases as they seek additional advice,’ said Charlie Willis, head of London residential at Strutt & Parker. ‘However, this has not stopped buyers purchasing our highest quality stock as prime central London remains a very attractive place to live,’ he added. Continue reading
