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House price growth continued across the UK in November, latest ONS data shows
House prices in the UK increased by 7.7% in the year to November 2015, up from 7% the previous month, according to figures from the Office of National Statistics. House price annual inflation was 8.3% in England, 1.3% in Wales, 0.4% in Scotland and 4.6% in Northern Ireland. The ONS data also shows that house price growth in England were driven by an annual increase in the East of 10.2%, the South East at 9.8% and London also at 9.8%. Excluding London and the South East, UK house prices increased by 5.8% in the 12 months to November 2015. On a seasonally adjusted basis, average house prices increased by 0.8% between October and November 2015 and prices paid by first time buyers were 7.4% higher on average than in November 2014. The continued upward trend is likely to exacerbate affordability issues for first time buyers, according to Steve Bolton, founder of Platinum Property Partners who added that it is a result of the current dearth in property supply. ‘Recent initiatives aimed at addressing the challenges faced by first time buyers show little signs of reversing this trend. The Chancellor’s decision to levy a 3% surcharge on stamp duty for landlords and second home owners may be with first time buyers’ interests at heart, but in reality this is likely to drive up house prices further in the short term as buyers rush to compete purchases before spring,’ he explained. ‘The stamp duty changes and restriction on buy to let tax relief gives the impression that a strong private rental is a barrier to popular home ownership. However, the reality is that by attacking private landlords and increasing buy to let costs, tenants are likely to face rising rents which is a huge barrier to future home ownership,’ he pointed out. ‘The tax grab is targeted purely at landlords with mortgages, excluding the wealthiest landlords. This is unfair and undemocratic, which is why we’re currently co-heading a legal challenge to fight these changes. Having received considerable industry support, as well as raising funding for the initial stage in a matter of days, its clear many landlords agree the tax changes pose a serious threat to the future of the buy to let market,’ he added. Rishi Passi, chief executive of Oblix Capital believes that the lack of supply is unlikely to change in the short term. ‘Better job prospects, wage improvement and recurring delays in interest rate rises mean that it’s likely this surge in house sales and price inflation will continue, for the meantime at least,’ he said. ‘Further investment is needed to encourage house building, stem the supply imbalance in crowded markets, and ensure that small and medium sized developers have access to the finance they need,’ he added. Jonathan Hopper, managing director of buying agents Garrington Property Partners, pointed out that overall first time buyer prices are rising more… Continue reading
Total value of housing in Britain moves past £6 trillion for first time
The total value of Britain’s housing stock has passed the £6 trillion mark for the first time after gains of £385 billion in 2015, according to new research. Housing wealth stands at £4.84 trillion, net of mortgage debt, or 2.7 times GDP and for owner occupiers with no mortgage total property wealth exceeded £2 trillion for the first time, the analysis from real estate adviser Savills shows. It also reveals that the private rented sector’s total value is now £1.29 trillion, up 55% in five years with number of homes in the sector up 28%. Net wealth passed £1 trillion in 2015, overtaking that held by mortgaged owner occupiers for the first time. The total value of homes in London exceeded £1.5 trillion for the first time at £1.612 trillion, accounting for more than a quarter of the total value of housing stock in the UK and having risen by £589 billion in five years. The South of England saw total value growth of £179 billion, exceeding London growth for the first time in five years while Bristol saw the biggest increase in total housing stock value outside of London, up £4.5 billion to £44 billion. The report points out that residential property has become an increasingly important store of wealth. Total equity now stands at around £4.8 trillion net of borrowing, equivalent to over 2.7 times the GDP of the UK. Over the past 10 years the total value of the UK’s homes has risen by over £1.6 trillion, but the biggest growth, almost £1.2 trillion, was seen in the past three years. This means the UK’s 28.2 million homes of all tenure now have an average value of £218,474, up 18.9% in five years. ‘Value and gains vary sharply according to location and ownership. Gains have been concentrated in equity rich markets, notably London and the south east, particularly benefitting those who own their homes outright. In 2015, for the first time, the total value of owner occupied homes without a mortgage exceeded the total value of those with a mortgage,’ said Lucian Cook, head of residential research at Savills. ‘While the difficulties faced in getting on and trading up the housing ladder and the consequential rise in private renting is well documented, these figures show the scale of the change and challenges faced by Government,’ he added. London and the South East accounted for 57% of total value gains at £218 billion in 2015 and now have a total value of almost £2.8 trillion. This means that 26% of the UK’s homes now account for 45% of the total value, and takes the average value of a home in London to £430,436 and £284,805 in the South East. At the other end of the spectrum, the total value of homes in the North East equates to less than a tenth of London’s value, having risen just 2.2% in 2015. At a total of £135 billion, the region’s… Continue reading
Property market in England and Wales sees active start to year with price rise of 0.5%
Property prices in England and Wales have increased 0.5% month on month, with the residential market seeing an active start to 2016, according to the latest index figures. Prices are also up 6.5% year on year taking the average price of a home to £290.963, the data from Rightmove also shows, making it the second highest festive period rise since 2007. However, the good news for those getting onto the property ladder is that prices in the lower end of the market where first time buyers are usually found, typically two bedroom homes, have only increased by 0.1%. Demand as measured by visits to the Rightmove website in the first working week of 2016 is up by 21% on the same period in 2015. ‘Upwards price pressure remains, with the second highest rise seen at this time of year for nine years but encouragingly for first time buyers there’s more fresh choice with more property coming to market in their target sector,’ said Miles Shipside, Rightmove director and housing market analyst. ‘With their asking prices pretty much the same as a month ago, perhaps the knock-on effects of the more punitive landlord tax regime have arrived early and they now face a dilemma over whether to buy now or wait to see if prices drop in this sector over the next few months,’ he added. While the 0.5% rise in new seller asking prices is lower than the 1.4% recorded in January 2015, Shipside pointed out that it is higher than every other January since 2007, before the credit crunch began. A breakdown of the data shows there are variations across locations. Prices fell by 0.9% in Greater London to an average of £610,741 and are up 7.8% year on year. They also fell by 1.8% in the East Midlands to £182,318 and by 0.2% in Yorkshire and Humber to £165,722, but are up 2.9% and 2.8% respectively year on year. The biggest monthly rise was in the South West, up 3.5% to £282,373, and up 5.5% year on year. They increased by 2.3% in the West Midlands to £198,595 and up 4.9% year on year while they rose 1.8% in the North East to £142,006 with annual growth of 5.1%. In Wales prices increased by 1.6% month on month to £166,051 but are down 0.5% compared to a year ago. They rose by 1% in the East of England to £312,921 and up by 9.8% year on year, by 0.6% in the South East to £383,787 and by 7.3% year on year while in the North West prices were up just 0.2% to £171,588 and up annually by 4.9%. The report also shows that a lack of property coming to market has been an upwards driver of both prices and unfulfilled demand, though encouragingly there has been a slight 1.8% year on year uplift in the number of newly marketed properties. However, the only sector that has increased is that of… Continue reading
