Uk
Home lending in UK up by 8.5%, but some sectors seeing falls in recent months
Lending for home purchases in the UK increased by 8.5% year on year to £43.5 billion in the third quarter of 2015, according to the latest data from the Bank of England. However, the data also shows that the proportion of lending to first time buyers decreased in the quarter by 0.3% to 20.4% while the value of residential loans advanced to first time buyers increased by £0.6 billion from the third quarter of 2014 to £12.7 billion. The buy to let proportion of lending also decreased from 15.8% in the second quarter of 2015 to 15.6% in the third quarter of 2015 but increased by 1.3% from the third quarter of 2014. Advances, which include by to let remortgages, increased over the past year from £8 billion advanced in the third quarter of 2014 to £9.7 billion in the third quarter of 2015. This is the highest level of advances since the first quarter of 2009. Buy to let balances outstanding were £174 billion in the third quarter of 2015, which, at 14.5% of total residential balances is the highest proportion since the series began in 2007. The data also shows that the proportion of remortgages decreased from 26.2% in the second quarter of 2015 to 24.1% in the third quarter while the proportion of other new lending decreased from 3.6% to 3.4%. The proportion of gross advances at a loan to value (LTV) of over 90% decreased by 0.7% to 2.8% in the third quarter of 2015 while the proportion of gross advances to borrowers with a single income multiple of more than four time increased by 0.9% to 10.3%. According to Peter Rollings, chief executive officer of Marsh & Parsons, we can expect to see borrowing advance further after the Chancellor’s stimuli unveiled in the Autumn Statement. ‘With £15 billion of funding for housing measures taking prominence in his agenda, this will have given the green light to a queue of first time buyers, particularly in London, where there will be a designated Help to Buy scheme to reflect the accelerated house price growth in the capital, and the extra booster needed to help buyers onto the ladder,’ he said. ‘First time buyers have already been making tracks in the third quarter and in London we’ve seen this as part of wider demographic shift as domestic players and mortgage buyers become more prevalent in the housing market, while overseas investors take a temporary step back to digest the higher stamp duty payable on top-end purchases,’ he explained. ‘But proportionally, across the country, remortgaging activity has been taking up a larger chunk of the lending pie recently, as existing home owners try to build up their defences ahead of an expected interest rate rise in 2016. But the rankings may change in the run up to April’s stamp duty increase for second homes, and buy to let lending is likely to rev up quickly, as investors… Continue reading
Property listings fall across the UK, more than usual seasonal drop off
New property listings in the UK fell by 21.5% across the country in November following three months of small rises, the latest research shows, with London particularly affected. The data from the Property Supply Index compiled by online estate agents House Simple recorded the biggest drop in property supply in any one month since the index launched in May 2015. The worst fall was in Bath with a wall of 42.6% in November and the data also shows that five of the 15 towns that saw the biggest drop in supply were in the north west of England. Property supply in London fell by 21% and not a single London borough saw a rise in property listings in November while Salford and Chichester were the only locations to see a rise. Indeed Bath has seen a steady decline in supply each month since June, according to the index which tracks the number of new properties listed on Rightmove every month in more than 100 major towns and cities across the UK and all London boroughs. Only 135 new properties in Bath were listed in November, compared to a high of 284 in June. The West Midland cities of Worcester and Solihull saw new property listings drop 41% and 39% respectively in November. While Chichester and Salford saw rises of 14.8% and 11.6% respectively. According to Rightmove figures, Bootle and Swansea have seen the biggest swing in property supply in the past two months, with October seeing a 47.4% and 36.6% rise respectively in property supply compared to September, followed by a 35.1% and 23.9% fall respectively in supply in November compared to October. In London Richmond upon Thames saw new property listings drop almost a third at 31% in November. While, the boroughs of Bromley and Hillingdon, each experienced a 30% drop off in new property listings last month. The figures reveal that there wasn’t a single London borough that saw an increase in new listings in November. Greenwich and Barking and Dagenham experienced the smallest falls in supply, with new listings down just 5% and 9% last month compared to October. More than half the capital’s boroughs, some18 of the 32, saw new stock levels fall by more than a fifth in November compared to October. ‘Everyone knows by now that we have a property supply issue in this country, but these latest figures reveal just how severe that problem is as we head into the New Year. The total number of new property listings in November across the UK was just over 65,000, that is nearly 20,000 less than in October, and the lowest level since we launched the index in May,’ said House Simple chief executive officer Alex Gosling. ‘Historically, as we get closer to Christmas, the property market does start to slow down, so a fall in property supply levels is not unexpected. However, the drop off is too dramatic to be simply attributed to seasonality factors alone,’ he pointed out. He… Continue reading
New residential rents in UK flat or down slightly across the UK
Rents on new tenancies remained flat or fell slightly over the three months to November in 10 out of the 12 UK regions compared to the three months to October, the latest index data shows. Across the country as a whole, excluding London, the average rent on a tenancy signed during the three months to November was £743 a month, a slight 0.7% fall on the previous three month period. In Greater London the average rent was £1,544, down 1%. The HomeLet Rental Index also shows that just two regions saw rents on new tenancies rise over the period. In Yorkshire and Humberside rents on new tenancies were 0.8% up, averaging £626 a month, while in the East Midlands rents were 1.2% up at £635 a month. Year on year average rents on new tenancies outside of London were 3.8% higher at £743 a month while Greater London has seen even higher increases, up 7.5% compared to a year ago at an average of £1,436 per month. However, the annual growth in rental values in London has slowed from a peak of over 12% in January to 6% in September. In contrast, the rest of the UK saw a marked increase in average rents throughout the spring and summer months. The East Midlands has also seen higher rents year on year, up 6.2% over the last 12 months and rents in both Scotland and the South East of England were up by 6%. ‘We saw rents rise particularly quickly during the first half of the year, before the pace of acceleration slowed in most parts of the country over the autumn. There has been continuous growth in London on a month to month basis in 2015 with the exception of a slight drop in September and November, ending the year with rents in the capital now 108% higher than the rest of the UK,’ said Martin Totty, chief executive officer of HomeLet’s parent company the Barbon Insurance Group. HomeLet has also published new research into landlords’ views about the rental market and their expectations for the year ahead. It found that the vast majority, 91%, of landlords do not plan to increase the amount of rent they charge on their properties in the next six months. In the next year just 34% plant to do so. Totty said that the research suggests that most landlords have a strong relationship with their tenants and are keen to keep them. Indeed, just 4% said they were unhappy with their current tenants, while 18% said high tenant turnover was the most stressful part of being a landlord, more than cited on any other single issue. ‘Being a landlord is a long term investment and attrition of tenants is not something landlords desire; our own clients tell us they would rather retain a good tenant over the longer period than seek additional income,’ he added. Continue reading
