TSI
Prime London market sees more first time buyers
More first time buyers are active in the prime London property market with fewer real estate investors in the sector in the first quarter of this year, new research shows. While investors continue to account for the majority of house purchases made across prime London, this margin has narrowed significantly, according to estate agent Marsh & Parsons’ latest London Property Monitor. Some 29% of prime London property purchases were made by an investor in the three months to March 2015, down from 37% at the end of 2014 but first time buyer sales increased from 21% of all purchases in the last quarter of 2014 to 28% in the first quarter of this year. The rise in first-time buyers has caused the number of prime transactions funded by mortgages to jump 17% in the past three months and over the past three months, demand for prime London homes has risen by 20%. As a result, heightened competition for available homes on the market has pushed the ratio of registered buyers per property up from 10 in December 2014 to 12 in March 2014, the data also shows. ‘First time buyers have been riding a wave of fortuitous circumstances recently with almost unheard of mortgage rates, reduced up-front stamp duty costs, and support schemes like the Help to Buy ISA inflating confidence,’ said Peter Rollings, chief executive officer of Marsh & Parsons. ‘Combined with a more accessible pace of property price growth so far in 2015, many more have been able to take the plunge into the property market. Prime London property has always been a bastion of investment, but it’s encouraging to see the drawbridge being lowered for everyday Londoners who live and work in this city,’ he explained. ‘However, there is, and has always been, some aspirational prime central areas that are out of grasp for new buyers, and will remain an investment stronghold. Addresses like Kensington and Chelsea resonate around the world, and will forever entice buyers looking for unparalleled capital returns,’ he added. The report reveals that as a result of this strong demand for starter homes, one bedroom properties in prime London have seen the biggest increase in value over the past 12 months with average values up 5%, compared to 1.7% annual growth across the market as a whole. This means the price of a typical one bedroom property in London has risen by £75 a day over the past year. Similarly, one bedroom properties are highly sought after as buy to let investments, with rents appreciating at the fastest rate of all property types across the capital. The average weekly rent for a one bedroom property has risen 5.8% year on year in more affordable outer prime areas of London, popular with young professional renters. ‘With more and more young professionals climbing onto the property ladder, one bedroom properties have outperformed the market across prime London…. Continue reading
Property prices in England and Wales down 0.8%, latest official figures show
Property prices in England and Wales fell by 0.8% in March, taking the average house price to £178,007, according to the latest data from the Land Registry. It means that the annual price change now stands at 5.3% and the data also shows that sales have fallen. From October 2013 to January 2014 there was an average of 76,056 sales per month. In the same months a year later, the figure was 71,090. But in London property prices are still going up with a monthly increase of 0.2%. At 11.3% the annual change for London is considerably higher than most other regions. The average price of property in the capital is £462,799 in comparison with the average for England and Wales of £178,007. The London borough with the highest annual price rise is Newham, with a rise of 19.8% and Hackney experienced the highest monthly increase, up 1.6%. Kensington and Chelsea saw the lowest annual growth of 5.2% also experienced the greatest monthly fall with a drop of 1.6%. On a regional basis the North East saw the only annual price fall with a drop of 2.9%, the South East experienced the greatest monthly price rise of 0.8% and the North East also saw the largest monthly decrease with a fall of 4%. Bracknell Forest and Hertfordshire experienced the greatest annual price increase in March with a rise of 13.6% and Darlington saw the greatest annual price fall with a drop of 6.2%. The index report shows that price index volatility is greater in areas where recorded sales volumes are low. Index volatility leads to erratic and high changes in reported price. Some of the areas that typically have very low transaction volumes include, but are not limited to, the City of London, Rutland, the Isle of Anglesey, Merthyr , Blaenau Gwent, Ceredigion and Torfaen. The number of properties sold in England and Wales for over £1 million in January 2015 decreased by 19% to 851 from 1,049 in January 2014 while the number of properties sold in London for over £1 million in January 2015 decreased by 23% to 571 from 746 in January 2014. However, Edward Heaton, of Heaton and Partners search agency, pointed out that the headline figures only tell part of the story. ‘In London, for example, there may indeed have been an 11.3% increase in greater London over the last year, but in prime central London prices have actually dropped,’ he said. ‘The biggest increases have been in second tier areas such as Wandsworth, Battersea, Clapham and some of the up and coming areas to the East of London. In the South East, most of the activity and increases in price have been in the mainstream market below £1 million,’ he explained. ‘Certainly above £2 million prices have remained pretty stable, although there is an expectation that prices will start rising rapidly after the election, almost regardless of its result,’ he added. Nicholas Leeming, chairman of national estate agents Jackson-Stops &… Continue reading
Rents in Scotland continue upwards but still 30% below England and Wales
Residential rents in Scotland accelerated again in March with annual growth of 1.3%, up from 1.1% in February, according to the latest buy to let index. Average monthly rents in Scotland now stand at £539 and they are some 30% lower than the typical rent in England and Wales, the index from lettings agent network Your Move also shows. Total annual returns on rental properties in Scotland reached the highest level on record at 9.7% on average in the 12 months to March 2015, up from 7.2% a year ago. This is equal to £15,000 per property before any mortgage payments or maintenance costs, but taking into account property price growth and void periods between tenants. Buy to let investors in Edinburgh have experienced the strongest annual returns in the last year of 13.4%, equivalent to £27,135 in cash terms. In the month to March, Scottish rents increased 0.3% overall, the strongest monthly uptick witnessed since October 2014, after a winter downtrend. ‘Despite surging demand for homes in the private rented sector, Scottish rents have been treading water in recent months, allowing tenants some valuable breathing space over the winter. Now we’re starting to see growth scale up again in the spring, as the rental cycle starts to gain momentum,’ said Brian Moran, area lettings director at Your Move. ‘But even this is still at very modest levels compared to the rest of the UK with rents rising at less than half the pace as being seen in England and Wales,’ he added. A breakdown of the figures show that on an annual basis, rents have risen across three of five regions in Scotland. In Glasgow and Clyde, rents have seen the biggest increase over the past 12 months, with rents now 3.6% or £19 higher than in March 2014. Edinburgh and the Lothians have experienced a 2.3% jump in rent prices year on year, and the East saw a more modest 0.8% annual rise in rents. Rents have fallen across two regions of Scotland in the last year. The Highlands and Islands witnessed the most significant annual drop, with rents falling 1.9% and in the South of Scotland rents are now 0.1% lower than a year ago. Compared to last month, rents are higher in only two of five Scottish regions. Rents in the South of Scotland saw the biggest monthly uplift in March, but still have the cheapest monthly rents across the country, at £489. Rents in this area have climbed 1.8% since February 2015, as rent growth starts to get back into its stride a long spell of price drops in the latter half of 2014. The only other location to experience a boost in rents in the past month was Glasgow and Clyde, with rents rising 0.3% during March. The majority of regions have witnessed a fall in rents month on month. The steepest drop in rents was in the Highlands and Islands, down 0.6% since February. Edinburgh and the… Continue reading
