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Rents increase in UK as demand outstrips supply
The average UK rent is now £836 per calendar month, an increase of 2% year on year as demand, especially for quality homes outstrips supply. The data from the latest analysis report from lettings agency Countrywide also shows that one and two bedroom properties saw the greatest increase in rent up 8.5% and 3.6% to £751 and £810 respectively. While three bedroom properties recorded a 1.6% increase to £930, however, four bedroom plus properties experienced a 3% decrease to £1,345 per calendar month. On a regional basis Greater London had he largest annual increase in rent, up 10.6% to £1,265, followed by Wales up 6.1% to £666 and the South West up 4.1% to £765. The only region to see a decrease in rent year on year was the South East, down 4.1% to £1,035 and the firm said that was due to a fall in demand for rental accommodation in the region as more tenants move out of the private rented sector and into the owner occupier sector. A breakdown of the figures shows that the average rent for newly let properties was £883, an increase of 2.8%. In this sector one and two bedroom properties saw the largest growth in rents year on year, increasing 3.3% and 1.9% respectively Renewed tenancies averaged £835 per calendar month with one bedroom properties in this sector recording the greatest annual increase in rent with a rise of 3.3%, followed by two bedroom properties up 1.9% and three bedroom properties up 1.7% to £875. Four bedroom plus homes saw rents stay broadly the same with just a 0.2% decrease. The majority of UK regions saw an increase in rent for renewed tenancies in January 2015. Scotland sees the greatest increase up 5% year on year to £634, followed by Greater London, up 4.7% to £1,110 and the Midlands with a 3% increase to £622. Some regions see a decrease in rents, most notably the North of England with a decline of 1.2% to £599, followed by Wales down 0.7% to £592 and the South East down 0.5% to £1,010. Year on year average rents have increased for all property sizes with the smaller properties leading the way. One bedroom properties see the greatest increase in rent up 2.7% to £688, followed by three bedroom properties up 2.2% to £875, two bedroom properties up 1.9% to £768 and four bedroom plus properties up 1.3% to £1,328. The data also shows that arrears have decreased year on year in all regions apart from the North of England where they have stayed the same, and central London where there has been a marginal increase of 0.6%. ‘Renting is a flexible and relatively hassle free way of living which suits many people's lifestyles. It allows them to settle in a location where perhaps they couldn’t afford to buy but they enjoy living in. With a growing population of lifetime renters, increasing the amount of good quality,… Continue reading
Good start to the New Year for property markets in England and Wales
House price growth in England and Wales has slowed to a 10 month low but there are signs of prices climbing in January. Prices are up 0.3% compared to December 2014, taking the average house price to £277,857, according to the latest LSL house price index. On an annual basis average prices are up 7.5% but when London and the South East is excluding from the figures the year on year price growth for the rest of the country is 4.5%. Property prices in the North are experiencing the biggest boost at the start of the year and the strongest sales growth is in the North and Yorkshire which seems to be due to a surge in demand from first time buyers. Adrian Gill, director of Reeds Rains and Your Move estate agents, pointed out that January’s 7.5% annual growth is the smallest yearly improvement for 10 months and represents a deceleration from 8.9% in December as house price inflation continues to flag. ‘After some recent price falls, average property values haven’t taken any steps forward from where they stood in November and what we’re seeing is a far cry from the marathon of monthly increases that set off this time last year,’ he said. ‘In a reversal of fortune, London is leading this slowdown. The capital has long been the propeller driving forward growth, but after cruising ahead at full speed in 2014, the London property market has run aground momentarily,’ he added. Indeed, average London house prices experienced the biggest drop during December at 1.1%, but Gill said this is just a symptom of the unsustainable rate of growth that the market stretched to last year, as the capital now takes a pause. He also pointed out that while a prospective mansion tax and the higher rate of Stamp Duty on million pound homes may be a blot on the buying landscape at the top end, everyday buyers are simply able to take their time to deliberate and get their finances in order now that market conditions have rationalised again. ‘With a greater supply of available homes on the market, we are striking a better balance between sellers and buyers, and at the bottom rungs of the ladder in particular, demand remains vibrant. The lowest priced London borough, Barking and Dagenham, has seen the biggest boost in home sales during the fourth quarter of 2014, up 33% on the same period a year previously, helping to drive annual house price growth of 14.4%,’ he explained. ‘The London story acts as a miniature model of what’s happening in the rest of the UK housing market. The market is temporarily treading water at the higher end, but fast moving in areas where price growth has been more modest, and where cheaper properties are within reach of new buyers and borrowers who can access Help to Buy,’ said Gill. ‘For instance, when you London and the South East from the equation the slowdown in annual… Continue reading
New home building market in Australia gets boost
Loans to both investors and owner occupiers for house building in Australia increased at the end of 2014, pointing to ongoing strength in new home building in 2015. In December 2014, the number of loans to owner occupiers for the construction of dwellings edged higher by 0.8% and over the December 2014 quarter, these loans increased by 1.1% to a level 9.8% higher than in the December 2013 quarter. The data published by the Australian Bureau of Statistics also show that lending to owner occupiers purchasing newly constructed homes fell by 1.8% during December, and down 4% over the quarter. The value of lending to investors for the construction of new housing jumped by 44.2% during the month of December 2014 and over the quarter the value of lending increased by 16%. ‘Housing construction loans, in both the owner occupier and investor segments of the market, finished 2014 on a strong note. This provides a very positive signal for activity in the residential construction sector in 2015,’ said Housing Industry Association economist, Diwa Hopkins. ‘Investors are likely to continue playing a key role in adding to the stock of new housing in 2015. The owner occupier side of the market, however, appears to be losing some momentum,’ she explained. ‘While overall owner occupier lending levels remain strong, some signs have emerged that the growth typical of 2013 and much of 2014 may now be moderating,’ she added. The housing finance release follows substantial upward revisions by the ABS to the level of activity among first time buyers and shows that their participation in the market is much higher than earlier thought. In 2014, lending to first time buyers accounted for around 15% of the total, higher than a decade ago. ‘The key to housing affordability for first home buyers and trade up buyers alike is a supply of dwellings commensurate to the needs of a growing population. The strong performance of the residential construction sector in 2014 has provided vital assistance in this regard,’ Hopkins pointed out. A regional breakdown of total number owner occupier loans for new housing in December 2014 compared with the same month in 2013 shows the strongest increase occurred in Tasmania with growth of 74.2%. The Northern Territory saw growth of11.8%, Western Australia was up 11.1%, the Australian Capital Territory up 5.9%, New South Wales up 2.9%, Queensland up 2.8% and South Australia up 0.3%. Victoria was the only state to see a fall at 1.9%. Meanwhile, the latest result for the HIA New Home Sales Report, a survey of Australia’s largest volume builders, highlights a second consecutive rise for sales in the month of November 2014. ‘Renewed upward momentum in the multi-unit segment drove growth in overall new home sales in late 2014, a trend unlikely to be reversed when the December result comes through,’ said HIA chief economist Harley Dale. Total seasonally adjusted new home sales increased by 2.2%… Continue reading
