TSI
Total value of UK homes now stands at £5.75 trillion, new research shows
The total value of homes across the UK now stands at £5.75 trillion, an increase of £543 billion in one year and £966 billion in five years, new research shows. London and the South East account for a growing share of the total, with a combined value of over £2.5 trillion, with average values per property now at £428,988 and £282,168 respectively. Five year total value growth has been seen in all regions with the exception of the North West and North East and Northern Ireland, the detailed analysis of the nation’s housing stock from real estate firm Savills also shows. The firm includes all tenures in its valuation and has found that the total value of owner occupied stock reached £3.9 trillion in 2014 split broadly evenly between that subject to a mortgage and that owned outright. Owner occupied homes remain the dominant tenure, accounting for almost 15 million households and the number of homes owned without a mortgage rose 437,471 in the past five years, to over 8.3 million, with values rising £325 billion to almost £2 trillion. By contrast, as a result of the credit crunch and subsequent constraints on mortgage lending, homes owned with a mortgage have fallen by almost 800,000 over the past five years. For similar reasons, the total value of stock in the private rented sector has passed the £1 trillion mark, having risen in value by 17% in one year, 57% in five years. The total number of private rented homes has risen by almost 1.2 million since 2009, taking the total to over 5.4 million, compared to 4.7 million in the social rented sector. The value of housing stock in London stands at £1.485 trillion, an increase of 20% or £247 billion in one year and 61% in the past five years. Continue reading
Singapore and Hong Kong are most expensive for foreign property investors
Singapore and Hong Kong are the most costly places for a foreigner to invest in real estate as they are subject to more property taxes, new research has found. They are more expensive as they are locations where the disparity between the tax burden on foreign and local investors reflects a ‘foreigner premium’, according to an analysis from international real estate firm Knight Frank. Cooling measures in Hong Kong amount to a 15% Buyer’s Stamp Duty and in Singapore there is also a 15% Additional Buyer’s Stamp Duty and a higher tax for foreign investors. Australia, Malaysia and Thailand also work out more expensive due to taxes which effectively amount to higher real estate tax levels for foreign buyers. In Australia, Thailand and Singapore foreign buyers acquiring a property for investment are subject to more taxes than if they were buying for their own use. On the other hand, Cambodia, Japan, Malaysia and South Korea do not impose such premium on both foreign and local investors. In the analysis, the Special Stamp Duty and Seller’s Stamp Duty in Hong Kong and Singapore respectively are found to be the most potent policies to deter property flipping. The report explains that following the global financial crisis and its significant impact on fiscal revenues for countries around the world, the global tax landscape has been rapidly changing. ‘Not only has there been more aggressive clamping down on loopholes and a pressure to improve tax governance, we are seeing more cooperation between countries on an international scale,’ it explains. The tax burden ranges between 12.6% and 15.5% in Australia mainly because stamp duty varies among states. In Cambodia, if the investor opts for a ‘hard title’ registered with the national Land Office, as opposed to a ‘soft title’ issued by local authority, he will incur the 4% transfer tax which accounts for the huge cost difference. Some markets effectively charge an investment premium, according to the report. For example, a foreigner buying a property in Australia for investment is subject to 7.4% more taxes than if he purchases it for self use, excluding income tax on rents which is not applicable to an owner occupier. For a local buying a second property for investment purposes, the premium varies considerably depending on the reference point. If the second home is for self use instead, he pays only slightly less in tax. The huge difference in premium implies that Australia taxes more on the purchase of a second property per se than on the purpose of the purchase. Similarly, the cooling measures in Hong Kong and Singapore target the number of properties owned but do not distinguish between investment and self use homes. In contrast, Thailand taxes on investment properties, regardless of the number of houses possessed. Even though Australia and Cambodia do not tax according to holding period, average annual tax burden is lower for long term ownership mainly because one off costs, namely stamp duty and… Continue reading
UK home owners would rather improve than move, new research suggests
Most home owners in the UK would rather spend money improving their current property than moving, new research suggests. An overwhelming majority (94%) of UK homeowners would rather spend money improving their current home than sell up and move on, research reveals today. Despite the recent reduction in stamp duty and 0.7% rise in house prices, 49% of the nation’s respondents plan to stay put and renovate in 2015, and are happy to spend over £5,500 doing so. Indeed 94% would rather spend money and 43% say one of their main reasons for renovation is to make their home look nicer, whereas only 6% cite it for the purpose of selling in 2015. The survey, commissioned by Wooden Blinds Direct, questioned home owners from across the UK on their home improvement spending in 2014 and projected spend in 2015. Regionally there were differences. Just 35% of Scottish home owners are planning a renovation in 2015, with an average £4,576.21 spend. In contrast, South West home owners plan to spend over double this, forking out an average £10,430 for their extensions, decorating and other renovations. The home improvement survey also found that men plan to spend on average £1320.78 more than women on home renovations in 2015 who would spend on average, £6216.52. Northern Ireland is set to have the biggest increase in home renovation during 2015, rising 173.5% while Wales the biggest drop in home renovation, falling 51.18%. Some 43% of North East home owners would like to invest in their homes to reduce energy bills, compared to only 17% of Scottish households. ‘The housing market is still volatile and that’s reflected in the results of our survey. People are more concerned with making the house they’re in more comfortable than moving out. Whether that’s by extending and building or even by simply redecorating rooms it’s obviously a much cheaper alternative,’ said Lee Fisher, marketing manager at Wooden Blinds Direct. Most home owners in the UK would rather spend money improving their current property than moving, new research suggests. An overwhelming majority (94%) of UK homeowners would rather spend money improving their current home than sell up and move on, research reveals today. Despite the recent reduction in stamp duty and 0.7% rise in house prices, 49% of the nation’s respondents plan to stay put and renovate in 2015, and are happy to spend over £5,500 doing so. Indeed 94% would rather spend money and 43% say one of their main reasons for renovation is to make their home look nicer, whereas only 6% cite it for the purpose of selling in 2015. The survey, commissioned by Wooden Blinds Direct, questioned home owners from across the UK on their home improvement spending in 2014 and projected spend in 2015. Regionally there were differences. Just 35% of Scottish… Continue reading
