Uk
English farmland prices fall in first quarter of 2016
English farmland values fell by 3% in the first quarter of 2016 with average prices dropping back below £8,000 an acre, according to the latest index. Year on year farmland prices fell 2% but they are still up 32% over five years, up 176% over 10 years and up 4,886% over 50 years, the data from the Knight Frank Farmland Index shows. However, the drop was the largest quarterly decline since the 5% slide that occurred during the final three months of 2008, following the collapse of Lehman Brothers bank. ‘Given the significant issues weighing on the market at the moment, a period of readjustment is perhaps unsurprising. Agricultural commodity prices remain low with little prospect for a strong rebound in the short term, while the potential implications of a UK exit from the European Union are adding further uncertainty,’ said Andrew Shirley, head of rural research at Knight Frank. ‘To put the drop into context it should also be noted that the average value of farmland is still only £18 an acre lower than it was at the end of 2014, and remains almost 180% higher than it was 10 years ago. And despite falling in the two quarters after Lehmans’ collapse, farmland values had recovered all of their lost value and more by the end of 2009,’ he explained. Shirley also pointed out that while last year the feeling was that the In campaign was going to win the EU referendum relatively comfortably, now the polls are predicting a much tighter result, with neither side of the argument yet to establish a convincing lead. ‘Predicting where values will head in 2016 and beyond is almost impossible until we know the results of the EU referendum in June. In the case of a Brexit much will depend on for how long DEFRA commits to providing a replacement system of support payments,’ he said. ‘But if sterling weakens for a prolonged period as some analysts predict, this would make UK grain and meat more competitive on global markets. UK land, which is already cheaper than in some EU countries, may also become more attractive to international investors,’ he added. ‘Whatever the outcome, we are still seeing strong demand from farmers who are either not reliant on EU subsidy payments or have taken the long term view that expansion is the way forward for their businesses,’ he concluded. Continue reading
UK house prices up 7.6% year on year, down slightly from previous month
UK house prices increased by 7.6% in the year to February 2016, down from 7.9% in the year to January 2016, taking the average price to £284,000, the latest official figures show. House price annual inflation was 8.2% in England, 2.8% in Wales, and 2.4% in Northern Ireland. But prices fell by 0.8% in Scotland, the data from the Office of National Statistics (ONS) also show. Annual house price increases in England were driven by year on year growth of 11.4% in the South East, growth of 10.3% in the East and growth of 9.7% in London. Excluding London and the South East, UK house prices increased by 5% in the 12 months to February 2016. Also excluding London and the South East, the average UK mix-adjusted house price was £216,000. On a seasonally adjusted basis, average house prices increased by 0.4% between January 2016 and February 2016, compared with an increase of 0.8% in average prices during the same period a year earlier. The index also shows that in February 2016, prices paid by first time buyers were 8% higher on average than in February 2015 while for existing owners prices increased by 7.4% for the same period. London continued to be the English region with the highest average house price at £524,000 and the North East had the lowest average house price at £158,000. London, the South East and the East all had prices higher than the UK average price of £284,000. David Brown, chief executive officer of Marsh & Parsons, explained that while annual growth was down slightly he believes that UK property prices are certainly on a solid footing and despite the regulatory knocks over the past year, London remains one of the leading regions out in front. ‘Government intervention has prompted a lot of yo-yoing in the housing market of late, and the last week of March was one of the busiest we’ve ever experienced. A sense of urgency was palpable in the last few working days leading up to the implementation of higher stamp duty on second homes and buy to let purchases, and solicitors were working around the clock to service more than quadruple our average number of purchase completions per day,’ he explained. ‘Now we’re over the hump and this immediate buy to let incentive has passed, activity is sure to level out into the summer months, but continued high levels of buyer demand will help to keep London house prices strong,’ he added. Rob Weaver, director of Investments at property crowdfunding platform Property Partner, pointed out that first time buyers are still feeling the pinch, with average prices paid by them of £214,000. He believes that as the rate of inflation on new builds is accelerating more than existing housing stock, demand is still outstripping supply but a mood of uncertainty over the June referendum on the country’s future in the European Union could slow house price growth. He also believes that a dip… Continue reading
Property asking prices in Ireland rebound at start of 2016
The residential property market in Ireland is set to rebound in 2016 as price momentum has already been growing in the first quarter of the year, according to the latest survey report. But Dublin is likely to lag behind the rest of the country according to the latest house price survey from MyHome.ie. The data shows that having declined towards the end of 2015, asking prices for newly listed properties for sale rose by 2.1% nationally and by 0.9% in Dublin in the first quarter of 2016, the first gain in Dublin since the first half of 2015 and follows two quarters where prices declined marginally. The report predicts Irish house price inflation will register another solid gain of close to 5% in 2016, with the rest of the country leading Dublin, due to affordability constraints in the capital. The mix adjusted asking price for new sales nationally is €220,000, an increase of €5,000 compared to the final quarter of 2015 while the corresponding figure for Dublin is €315,000, an increase of €2,600. The author of the report, Conall MacCoille, chief economist at Davy, said a key factor supporting house prices this year will be a tighter housing market and he pointed out that the stock of properties listed for sale on the MyHome website in the first quarter fell to a fresh low of 21,650, down 6% on the year. ‘Despite popular opinion, the immediate impact of the Central Bank lending rules was to make it easier to buy as sellers anticipated the slowdown in Dublin house prices and decided to bring their properties to the market in 2015,’ said MacCoille. ‘This won’t be repeated this year while housing supply in the capital is likely to pick up less sharply through the summer months. This is because the ambitious goals set under the last government’s Construction 2020 strategy are unlikely to be attained with no stable coalition yet formed for the new Dail. Overall, home building levels look set to remain depressed for some time and while this will support Irish house prices, it will hurt activity levels,’ he added. The report’s analysis of the Property Price Register indicates that Dublin and the commuter belt counties last year accounted for 75% of transactions that exceeded €220,000, the threshold below which lenders require a 10% deposit. Of the 48, 374 residential property market transactions recorded in 2015, just 35% or 16,893 exceeded €220,000. Of these Dublin accounted for 60% or 9,987. Put another way 59% of Dublin transactions exceeded the €220,000 threshold, whereas outside of the commuter counties just 17% of transactions, or 4,300, exceeded that mark. ‘The Central Bank mortgage lending rules have prevented households from reacting to the lack of housing supply by taking on ever more highly leveraged loans and bidding up house prices further. However our analysis shows this has been mainly a Dublin/commuter belt phenomenon where the lack of housing supply is most severe and affordability… Continue reading
