Uk
Sales of UK property priced over a million fell in first half of 2015
The number of property sales worth at least a million pounds in the UK has fallen in the first half of 2015, down by 11% compared to the same period in 2014. This is in stark contrast to the 46% increase seen in the first half of 2014 and is the first decline in sales since the first half of 2012 when the number of property transactions in this market segment fell by 7% over the corresponding period in 2011. However, since the first half of 2005 million pound home sales have grown by 264%, the data from the latest research report from Lloyds Bank also shows. It adds that whereas last year the top end of the market outperformed the rest, the decline in million pound home sales this year has tracked the rest of the market with sales of properties under £1 million also falling by 11%. Despite falling sales nationally, some areas continue to buck the trend. Virginia Water, Cobham and Beaconsfield are the most expensive towns, with an average house price of over £1 million. This is the first time the average property price has hit £1 million outside of London. Virginia Water, in the historic Borough of Runnymede, where the Magna Carta was signed 800 years ago, is Britain's most expensive town with an average house price of £1,168,992. To live amongst the celebrities of Cobham in Surrey will require paying, on average, £1,042,552 for a home, making it the second most expensive town. In third place is Beaconsfield where the average property price is £1,003,367. ‘The number of homes sold for over £1 million has fallen sharply over the past year, with a pronounced slowdown in the prime and central London market. This may be the effect of the new Stamp Duty rates introduced last December and uncertainty generated by the election in May,’ said Sarah Deaves, private banking director at Lloyds Bank. However, the regional picture is much more mixed and we’re seeing the emergence of towns where the average price is at least £1 million. Whilst there are several London neighbourhoods where prices are already at this elevated level, outside of the capital this is a first,’ she added. Overall there is a mixed regional picture, as sales fall in London but rise in Scotland. Sales of million pound homes in London fell by 15%, the largest decline in the capital since the first half of 2009 when transactions fell by 43% during the lowest point of the housing downturn. In the South East sales in this sector fell by 9% in the first half of 2015 compared to a year earlier. However, in Scotland the sale of million pound homes has more than doubled with a rise of 158%. The only other regions to have seen an increase in sales were Yorkshire and the Humber with growth of 10% and the East of England up 8%. In Wales transactions rose by 29%, albeit… Continue reading
Sales to first time buyers in UK jump almost 10% month on month
The number of sales made to first time buyers in the UK increased in September by 9% compared to the previous month, according to the latest data from the National Association of Estate Agents (NAEA). Buyers taking their first step on the housing ladder accounted for 29% of all sales compared to 20% in August, the highest since May this year when sales to the group made up 29% of total sales. ‘It’s obviously very positive to see that the number of sales being made to first time buyers has risen this month. We saw an average nine sales going through per branch in September, which means that for each branch, around three sales were made to the group,’ said Mark Hayward, NAEA managing director, . ‘We’re seeing a whole range of new competitive mortgage products coming on to the market, which is likely to be encouraging first steppers to take the plunge, as well as the fact that the ‘impending’ interest rate rise has now been pushed back to next year at the very earliest,’ he explained. ‘However, in order to ensure there is enough affordable housing on the market for first time buyers we need the issue of supply and demand to be addressed in a big way. Until substantial numbers of new houses are built, we won’t see every first time buyer reach the bottom rung of the ladder,’ he added. The NAEA monthly report also shows that the number of house hunters registered per estate agent branch dropped in September, following a period of high and unsustainable demand in July and August. On average, there were 342 prospective buyers registered at each NAEA member branch in September. This is a drop of 16% from the 408 recorded in August, and a 26% drop from July when demand reached an 11year high with average 462 house hunters per branch. The number of properties available to buy dropped marginally to 37 per member branch in September. This followed a huge fall in the availability of housing stock the month before, when the number of properties available fell from 55 in July to 38 in August, a decrease of 31%. ‘If we could just get supply and demand to meet in the middle, the housing market would be functional again as it’s a real issue across the market at the moment. Developers are struggling to secure planning permission and labour is in short supply. This means that the army of house hunters looking to buy has out-grown the number of housing available at a rapid rate, and it’s completely unsustainable,’ Hayward pointed out. He explained that the introduction of the Housing and Planning Bill announced last week is good news, however, it includes an extension of the Right to Buy to Housing Association properties, which should help to increase supply in the housing market as homes that are… Continue reading
Bank of England already has power to regulate buy to let, it is confirmed
The UK’s expanding buy to let sector could be hit if plans announced by Chancellor George Osborne to regulate mortgages in this part of the lending market go ahead. The sector has been taken aback by Osborne’s announcement during a Treasury Committee hearing that he has already given the Bank of England additional powers to regulate the buy to let market. He had already said he would consult about such a move after Bank Governor Mark Carney said that the buy to let market could be a threat to the UK’s economic recovery. But now it seems that the Bank can regulate the sector anyway, should it wish to do so. It already has the power to regulate the rest of the residential mortgage market in a move that was designed to prevent the housing sector from overheating as demand is pushing prices ever higher. Banks must now ensure that no more than 15% of residential mortgages are given to people borrowing more than 4.5 times their income and are also required to ensure that borrowers can repay their loans even when interest rates rise. However, it was thought that until now these rules do not currently apply to buy to let mortgages which account for around a sixth of the home lending market. Indeed, Osborne confirmed that he took Carney’s views on the buy to let market ‘very seriously’, adding that one of the biggest challenges is managing credit booms and house price cycles. ‘We have given the FPC powerful tools to, for example, tighten mortgage standards if they feel there’s a credit bubble developing. The governor of the Bank and the FPC have asked for additional powers over buy to let mortgages which weren’t included and we have granted those powers so they have that tool as well,’ he told the committee. Peter Williams, executive director of the Intermediary Mortgage Lenders Association (IMLA), said he is disappointed that the promised consultation does not seem to be happening. ‘The Government stated its intention earlier this year to hold a post-election consultation to assess the evidence for granting powers of direction over buy to let lending to the Financial Policy Committee (FPC),’ he pointed out. He explained that the Chancellor’s statement to the Treasury Select Committee suggests ‘stage of evidence-led policy making has been removed, and that the consultation may be limited to what those powers will be when, rather than if, they are granted’. ‘It seems somewhat ironic that this development comes just days after Mark Carney also spoke to the Select Committee about the need for a wider stock take of financial regulations. There is a common interest in ensuring we have a stable market for buy to let, and we feel this would be aided by an open debate about the case for additional FPC powers based on the strength of evidence,’ he added. He also pointed out that the FPC itself recently judged that there is ‘no immediate cause to take action… Continue reading
