Tag Archives: shows
Fewer homes coming onto the market in UK, despite positive election result
Hopes for a post-election supply bounce in the UK residential market fail to materialise and selling instructions fell for the fourth month in a row, according to the latest monthly report. Indeed, the average stock of houses per surveyor has fallen by around 12% since the start of 2015, the data from the May report by the Royal Institution of Chartered Surveyors shows. But prices are not suffering with 38% more surveyors expecting higher house prices over three next three months and new buyer enquiries are rising at the fastest rate in over a year. The RICS report shows that house prices rose again in May, and at a quicker pace than in April, as the stock of homes per UK surveyor fell to a record low since the data series began in January 1978. While 34% more surveyors saw prices rise in May, the same month in which the Nationwide Building Society estimated that the average price of a home in the UK has now climbed to £195,000, supply to the market declined with 19% more surveyors reporting a drop in new instructions. Despite the rise in new buyer enquiries, which increased from a net balance of 4% in April to 18% in May, many respondents to the survey expressed some surprise at the lack of post-election bounce in fresh supply following the unexpectedly decisive outcome to the poll. The North West and London saw the sharpest drop in instructions compared with April. More ominously, UK wide listings have now failed to see any meaningful growth since the middle of 2013. Additionally, although respondents' reported a slight improvement in credit conditions with higher perceived loan to value ratios on mortgages to first time buyers and existing home owners, the average number of newly agreed sales per surveyor rose only very marginally to 19, down from 23 in May 2014 and up from 18.9 in April 2015. At a regional level, unbalanced price growth continues to be particularly marked across the market. Surveyors reported the highest price growth over the last three months in the North West, Northern Ireland, East Anglia and the South West. But London is now seeing a slight turnaround, following seven consecutive months in which the net balance for prices was in negative territory, it has now been positive for two months in succession. In the lettings market, tenant demand continued to increase in May on a non-seasonally adjusted basis extending an uninterrupted run of demand growth into a fifth straight month and respondents' anticipate rents will rise across all parts of the UK over the next three months, with expectations most elevated in the East Midlands and the South West. ‘There had been some hope that the removal of political uncertainty would encourage more properties onto the market but the initial indications are that this is not proving to be the case. As a result, it is hardly surprising that prices across much of the… Continue reading
Prime London lettings market sees demand exceed supply post-election
The prime London lettings market has experienced a complete shift this month from a quiet lull before the election to a mass influx of new applicants registering since polling day. The latest market report from agency W.A. Ellis, part of the JLL Group, indicates that while the mid-term break is normally a quiet period this year the firm has seen a 20% increase in tenancies starting year on year with the seasonal student market in full swing and demand exceeding supply. However, Lucy Morton, director at the firm, pointed out that when trying to secure accommodation for the start of the school year in September, few landlords will agree to their property sitting empty until then so it may be necessary for students to wait until July or August before starting their search, or take their chosen property now in order to secure it. ‘Our market share in super prime continues to rise month by month with huge success in the super prime sector of the London lettings market recently,’ she explained. This included a six bedroom house in Herbert Crescent with a guide price of £8,950 per week and a seven bedroom house in Justice Walk with a guide price of £8,500 per week. ‘This time last year we informed you of Mayor of London Boris Johnson’s launch of the London Rental Standard (LRS). People differ in opinion as to whether this scheme has been a success or not, however, the Mayor’s office has pointed to figures showing 331 lettings agents managing an estimated 121,000 properties have already signed up. We fully support the initiative,’ added Morton. Continue reading
UK’s regional office investment market strengthening
The UK’s regional office investment market experienced a slow start at the beginning of the year but investor appetite strengthened, according to the latest analysis of this market. Indeed, turnover in the investment market reached £1.48 billion in the first quarter of 2015, s almost double the turnover during the same period last year, and 5% higher than the previous quarter and the highest single quarter since the end of 2006. The regional office market report from Knight Frank also shows that Birmingham and Manchester proved to be the most popular destination for investors in the first quarter of 2015 with two major transactions of £131 million and £92 million. The report points out that given the substantial weight of money targeting regional offices, and following further yield compression both Birmingham and Manchester now command a premium over the UK’s other core markets, at 5%. These cities are closely followed by Bristol and Leeds, at 5.25%. At the other end of the spectrum prime office yields in Sheffield moved up 50 bps to 6.75% in the first quarter. This gives a 175 bps spread of prime yields, which is the largest seen in over 10 years since the fourth quarter of 2003. However the report also points out that prime headline rents remain under upward pressure. Two markets saw headline rents increase during the first quarter, with Birmingham rising to £30.50 per square foot and Leeds to £26 per square foot. The firm anticipates further rises in office rents during the remainder of the year and given current named requirements of 4.58 million square feet, which is the highest in five years, it expects to see higher levels of occupational demand in the second quarter back above the five year average. ‘We could potentially be heading towards a perfect storm of improving occupational markets and sustained capital markets, which hopefully will trigger new developments .With the growth of PRS also, this will be provide a major boost to regeneration schemes,’ said Stephen Hodgson, head of regional offices, Knight Frank. Continue reading
