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Prime property prices in prime central London up for first time since Sept 2014
Prime property prices in central London increased slightly, up by 0.8% in the second quarter of 2015, the first rise since September 2014, according to the latest index. Pimlico has seen the strongest growth in the last year with values up 5% or £66,000 compared with the second quarter of 2014, the data from estate agent Marsh & Parsons. The second quarter has also seen a 17% rise in demand for property in this sector but at the same time supply increased by only 10% while overall 42% of sales are now made by investors, a rise of 8% year on year. At the same time, there has been an upswing in foreign buyers who accounted for 34% of all sales in the second quarter of the year, up from 30% in the second quarter of 2014 although then firm says this has much to do with European buyers of all nationalities coming to live and work in London. Overall property in this sector costs 27% more per square foot than across London as a whole with the average square foot of property in central locations such as Holland Park, Notting Hill or Kensington and Chelsea valued at £1,516, some 27% higher than the capital wide average. In contrast, overall in Prime London, the typical price per square foot stands at £1,192. ‘The excellent capital appreciation and secure nature of property in prestigious central addresses of Kensington, Chelsea and Holland Park have long made them appealing particularly to the investor and it’s encouraging that we’ve seen such a rise recently,’ said Peter Rollings, chief executive officer of Marsh & Parsons. ‘Investors are a good gauge of the overall health of the London market. If there was any cause for concern about the future property market, investors would be upping sticks and moving elsewhere,’ he explained. ‘But that fact they are still putting down roots in the capital shows how fertile current conditions are. While there may not be much action to see at the moment, prices are still growing, and the foundations for fruitful capital returns are strong,’ he added. He also pointed out that price growth turned a corner and started to improve again with a 0.8% quarterly rise compared to a 0.6% drop in the first quarter of the year. Outer Prime areas of the capital have seen the strongest resurgence in price growth, experiencing 1% growth. However, house price growth in this sector is still much slower than last year, and on an annual basis, values have dipped across the prime London property market. Rollings said that it is important to place this into a longer term context, and since June 2013 the value of the average prime London home has increased by 12.1%. In terms of property type, family sized homes have experienced the biggest rise in price with four bed properties across prime London appreciating by 1.3%… Continue reading
Portuguese residential property market recovery ongoing
The residential real estate market in Portugal is seeing an ongoing steady recovery in prices, supported by rising demand and increasingly strong growth in sales activity, according to the latest index. While the lettings market has seen rents stable for a fourth month in succession following years of persistent decline, the index survey from the Royal Institution of Chartered Surveyors (RICS) and Confidencial Imobiliário shows. The data also shows that new buyer interest continued to rise at a firm pace across all regional markets, with growth particularly pronounced in Porto during June. But the market is still open to the weakness of the euro zone, particularly Greece. At the same time, newly agreed sales increased at the sharpest monthly pace since the survey was launched back in 2010, and have now risen continuously for around a year and a half. Going forward, sales expectations are pointing to further robust growth in the near term, even if the net balance eased slightly from the record high set in May. Given the sustained improvement in both enquiries and sales, prices continued to recover for a sixth month in succession, the index report explains. It also points out that the pace of house price growth accelerated a notch, driven primarily by the strong gains posted in Lisbon and looking ahead, near term price expectations continue to point to a stronger pick-up on the horizon. Over the next 12 months, respondents are now anticipating prices will rise by 2.7% at the national level. Again, the strongest recovery is anticipated to come in Lisbon and the Algarve at around 3%, while projections are for 2% growth in Porto. The national confidence indicator, an amalgamation of near term price and sales expectations, now stands at +36 equalling the third highest reading on record, despite easing compared to May’s exceptionally strong result. In the lettings market, solid growth in demand continues to be met with a decline in the number of new listings by landlords. As a result, rents remained more or less unchanged for a fourth consecutive month, while expectations suggest a further period of stability lies ahead. ‘It is important to see the Portuguese market’s resilience in the face of the uncertainty caused by the Greek crisis,’ said Ricardo Guimarães, Director of Ci. ‘Risks were highlighted by the agents but, nevertheless, activity indicators remained clearly positive, regarding both sales and prices. This was a critical test for the market, reinforcing its potential,’ he added. RICS chief economist, Simon Rubinsohn, believes that the recovery in sales market activity appears to be gathering momentum, driven by improving economic fundamentals and rising confidence. ‘However, significant risks remain within the euro area which could damage sentiment if a resolution is not found,’ he warned. Continue reading
UK property prices down slightly between June and July, says latest index
Residential property prices in the UK fell slightly by 0.6% between June and July and annual house price growth has slowed to 7.9%, according to the latest monthly index from the Halifax. It shows the fragility of the housing market recovery as different lenders show prices rising and falling, but only by marginal amounts so there is some stability in the housing market. Just a few days the Nationwide reported in its monthly index data that prices increased by 0.4% in July and annual property price growth edged up to 3.5%. Meanwhile one set of data said that prime property prices in central London are still falling and another showed a slight rise. Both the Halifax and the Nationwide show that the average home price is now nudging £200,000. Today’s data from the Halifax put it at £198,883. The Halifax index also shows that sales increased by 5% between May and June. Confidence in the outlook for house price growth remains substantially higher than at the beginning of 2015, according to Stephen Noakes, managing director of retail customer products at the Halifax. He believes that the market is robust, pointing out that house prices in the three months to July were 2.4% higher than in the previous quarter. However, this measure of the underlying rate of house price growth has eased and annual house price growth also declined, to 7.9% from 9.6% in June and is at its lowest since December 2014. ‘The underlying pace of house price growth remains robust notwithstanding the easing in July. Continuing economic recovery, earnings growth in excess of consumer price inflation and very low mortgage rates all underpin housing demand,’ said Noakes. ‘Supply is highly restricted with the stock of homes available for sale falling further to new record lows. This combination of well supported demand and tight supply is likely to ensure that house price growth remains relatively strong in the near term,’ he added. He also pointed out that the Halifax housing market confidence tracker shows that confidence in the outlook for house price growth hit its highest level in four years following the general election in May, but dropped back in June. Price Optimism (HPO) hit +68 in May 2015, and although it slipped back slightly in June to +64, it remains substantially higher than at the beginning of 2015 when it was +52. Jonathan Samuels, chief executive of Dragonfly Property Finance, pointed out that despite the fall in prices during July, house prices overall are still rising. ‘The dominant narrative within the UK property market continues to be weak supply and strong demand,’ he said. He explained that demand is strong because of mortgage rates being at record lows, more people in work, low inflation and a generally positive economic outlook, however, the increasing likelihood of an interest rate rise in the not too distant future has the potential to recalibrate demand and the market as a whole. ‘After so many years of 0.5% rates, even a… Continue reading
