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Home sales fall slightly in Canada, latest monthly index shows
National home sales activity edged slightly lower on a month on month in July with prices up 8.9% on average nationwide, according to the latest real estate index. The data from the Canadian Real Estate Association (CREA) shows that sales were down 0.4% from June to July while actual, not seasonally adjusted activity is up 3.4% compared to a year ago. While the national sales price is strong, when Greater Vancouver and Greater Toronto are removed from the calculation then annual price growth drops to 4.1%. It is the second consecutive monthly decline in sales activity but CREA pointed out that transactions in May, June and July reached their highest monthly levels in more than five years. July sales were down from the previous month in about half of all local markets, led by declines in Hamilton-Burlington and in the Durham Region of the Greater Toronto Area (GTA). The monthly decline in sales for these two markets represents a pullback from record levels in June and CREA says it likely reflects an insufficient supply of listings. By contrast, sales in Newfoundland and Labrador were up the most on a month on month basis, marking a rebound from a quiet month of June for the province. ‘National sales activity remains solid, fuelled by strength in British Columbia and the Greater Toronto Area, where listings are in short supply or trending that way,’ said CREA president Pauline Aunger. According to Gregory Klump, CREA chief economist, markets elsewhere across Canada are largely well balanced and in some cases have an ample supply of listings. ‘It’s fair to say that the strength of national sales is still a story about two cities, but it’s equally about how trends there are spreading out in their respective provinces,’ he explained. ‘Trends in British Columbia and Ontario have a big influence on the national figures, since they account for about 60 per cent of national housing activity. As a result, the national picture reflects how demand is running high for the short supply of single family homes in and around the GTA while the balance between supply and demand is tightening in B.C.’s Lower Mainland. These remain the only places in Canada where home prices are growing strongly,’ he added. Actual, not seasonally adjusted, sales were up from year-ago levels in just over half of all local markets, led by the Lower Mainland region of British Columbia and the GTA. While Calgary continued to post the largest year on year declines in sales compared to last year’s record levels, activity there is nonetheless running roughly in line with five and 10 year averages for sales during the month of July. The number of newly listed homes was little changed, up 0.2% in July compared to June, marking the fourth consecutive month in which new listings have held steady. New supply was up in a little more than half of all local… Continue reading
New land reform bill in Scotland too vague and timetable too tight, says RICS
The New Land Reform Bill in Scotland is set to have a substantial impact on the country’s land and property markets but it is too vague, subjective and inconclusive, according to the Royal Institution of Chartered Surveyors. RICS is urging the Scottish Government to consider undertaking a full impact assessment before any of the provisions are implemented and to introduce more clarity regarding a number of its parts and provisions. While the organisation is ‘fully supportive’ of the Scottish government’s aims to modernise and rejuvenate the rural landscape, it also believes that the current timescale for reform is too tight and therefore will be dependent on regulations which will be deduced after the passing of the Bill. There is also concern about the cessation of sporting estate tax relief. The Bill’s Policy Memorandum states that many small scale shootings would be expected to eligible for rates relief under the existing Small Business Bonus Scheme. RICS believes that research into how many estates will, and how many will not, benefit from rates relief needs to be undertaken before this provision is taken forward. Furthermore, it points out that the Scottish government has, thus far, not indicated whether the Small Business Bonus Scheme (SBBS) will endure beyond until 2016/2017, the proposed date where business rates exemptions will cease. ‘We believe it would be prudent of the government to inform the sector of its plans for the future of SBBS one way or another,’ said Sarah Speirs, director Scotland of RICS. ‘Whilst RICS welcomes a Land Rights and Responsibilities Statement (LRRS), as it will provide an indication of legislative travel, we do not agree that it should be a statutory requirement to be updated every five years, as currently specified,’ she added. Speirs explained that regular and changeable legislative modifications do not create favourable conditions for property and land markets and these markets require consistency to reach the necessary degree of stability to create confidence. ‘As such, RICS believes a balance needs to be struck between the land reform process and the establishment of stable, consistent legislative and economic conditions. Removing the statutory requirement for a review of the statement is one way of creating these conditions. Sarah on the proposal to create a Scottish Land Commission,’ she said. ‘we welcome the provision to establish a Scottish Land Commission, but still believe there would be merit in having separate Land Commission and Tenant Farming Commission office to ensure transparency,’ she pointed out. ‘Whilst the Commission’s work may result in increased costs to the public purse, the potential outcomes of the Commission’s research, evidence gathering and positive impact on land, should it follow the remit outlined above, should outweigh the costs. It is imperative that all work undertaken by the Commission is open, transparent and accessible to the Scottish public,’ she added. Agricultural holdings account for a substantial quantity, almost half, of the Land Reform Bill. RICS is concerned that agricultural holdings is too substantive an issue to be… Continue reading
A competitive price and quality amenities demanded in London super prime market
People buying the most expensive properties in the London are increasingly seeking the highest quality and amenities such as concierge services, secure parking and leisure facilities, new research has found, and price still matters. Also, after exceptionally strong price growth in the so-called golden postcodes such as Kensington and Chelsea, buyers are looking further afield for value in the super prime London real estate market. Indeed, according to the latest research from international real estate firm Knight Frank, the market is still sensitive to the Stamp Duty changes introduced at the end of last year and price and amenities matter. Richard Cutt, of Knight Frank’s prime residential team, pointed out that while the idea of a mansion tax has fallen from the political agenda, December’s increase in stamp duty for properties worth more than £1.1 million means the transaction tax on a £10 million property has risen to £1.1 million from £700,000, a difference equivalent to 4% of the sale price. Despite this increase, the election of a majority Conservative government caused some sellers to anticipate a short term spike in prices, which failed to materialise. ‘Nobody assimilated the stamp duty changes while the election was on the agenda. Meanwhile, those who expected the market to strengthen after the election are realising that it is still finely balanced, sensible pricing being the key,’ said Cutt. He explained that while reality has begun to set in with some vendors, it will be telling to see what impact the changes have on overall stamp duty revenues when the figures are released later this year. Despite this Knight Frank super prime sales rose by a quarter in the year to the end of June 2015 even although a series of factors, including political uncertainty and the new stamp duty rates meant volumes across the whole super prime market shrank by a fifth. Furthermore, price growth at the £10 million plus level has underperformed the prime central London average, growing 4% in the two years to June versus 10.3% in prime central London. Further changes in July’s Budget ended the permanent status for non-dom residents and widened the inheritance tax net to property held offshore. It comes on top of a succession of tax changes in recent years that make it increasingly difficult to argue that high value residential property is under taxed. ‘It’s too early to detect a discernible impact on sentiment at this stage, though there may be a marginal effect further down the line,’ said Tim Wright, also from the prime property team, in relation to the non-dom change. The research shows that the area covered by £10 million plus sales in London in the year to 30 June 2015 is wider than three years ago and now encompasses areas like the Southbank. ‘A number of best in class developments are coming through and, crucially, achieving critical mass in areas perhaps not considered super prime in the past,’ said Cutt. As well as casting the net further, the… Continue reading
