Tag Archives: shows
As US home price growth continues to soften, expert says market is not back to normal
Home price growth across the US has softened for six months in a row with experts warning that the overall health and recovery of the residential real estate market is far from guaranteed. National home prices in April were up 5.1% year on year but while the quarterly rate of growth continued its path to normalisation coming in at 0.5%, according to the latest data from real estate firm Clear Capital. Most of the regions sustained price growth through the winter, but the Midwest is already seeing negative quarterly declines of 0.10% Midwest and the region remains volatile. The report points out that for nearly seven years, it has struggled to get on equal footing with the nation. Within the top performing markets for April, eight are Western markets. While the West’s market by market performance may exceed the other regions, gains have been softening since the beginning of 2014 and this is leading to softening gains at the national level, the firm says. Three Florida markets that rank among the top performers boast high levels of distressed and short sales. All three markets have distressed saturation rates that are at least 10% higher than the national level, at 16.5%, suggesting growth is dependent on a higher propensity of distressed inventory in this area. The report also points out that the stigma once associated with REOs has turned around and today, REOs and short sales signal opportunity to investors and traditional home buyers alike, and an indication that market level gains could be ahead. ‘While spring brings renewed confidence and demand, the numbers through April are mixed. Sales may be up, but subsiding gains imply the recovery is at a critical inflection point,’ said Alex Villacorta, vice president of research and analytics at Clear Capital. ‘As the market normalises, which is a good thing for housing overall, small losses could have greater impact, forcing a standstill or even worse, a return to negative territory in certain areas across the country,’ he explained. ‘Confidence is down in April, suggesting consumers aren’t quite convinced that the economy, much less housing, is as rosy as some early spring metrics suggest. Yet, we continue to see blooms of opportunity as distressed properties continue to provide fertile ground for investors of all sizes to take advantage of a red hot rental market. As we saw back in early 2013, this type of inventory can be the catalyst that revives confidence and re-engagement,’ he added. ‘The early spring numbers are encouraging but rest assured, the overall market is far from being back to normal. There is reason to be hopeful, but arm yourself with accurate data and remember to read headline numbers with the right perspective,’ he concluded. Continue reading
UK buy to let landlords increasingly looking for semi-detached properties
There has been a big jump in UK landlords looking to buy semi-detached property with demand for terraced houses almost half previous levels, new research shows. Landlords are also planning for steady growth in the buy to let property sector as optimism rises, according to the latest landlord research by Paragon Mortgages. The data shows that landlords on the lookout for a semi-detached property amongst those expecting to purchase buy to let property soon, have increased from 23% in the fourth quarter of 2014 to 35% in the first quarter of 2015. The specialist lender’s Private Rented Sector Trends survey, which has been tracking landlord confidence and views on the buy to let market for 13 years, also shows that the proportion of landlords looking to buy terraced property had fallen from 67% to 35%. The lenders says that this sharp turnaround in demand for these two different property types results in a more even distribution of interest across the broad spectrum of property types from landlords than previously. Overall, among those looking to buy, 30% of landlords expressed interest in adding a flat to their portfolio, 35% were on the look-out for a semi-detached house, 35% for a terraced house and 22% said they were considering more specialist units such as multi-unit blocks and HMOs. The report also finds a higher proportion of landlords are optimistic about the prospects for their property portfolios, with 27% feeling positive about the future and an increase in those expecting to buy sometime soon, up from 15% to 18%. ‘The growing proportion of landlords looking to purchase buy to let property sometime soon points to continued, steady growth in the private rented sector,’ said John Heron, the firm’s director of mortgages. ‘Meanwhile, a closer look at interest levels for different property types suggests landlords are taking a broader perspective in order to cater for the wider range of households looking for a suitable home in the rental sector,’ he added. Continue reading
New analysis reveals severe home planning shortfall in England
The property planning shortfall in England could grow to 180,000 over the course of the next parliament unless local authorities work together, it is claimed. The planning system is not delivering housing where need and market demand is greatest, according to a new analysis from real estate firm Savills. Its shows that the number of homes planned by local authorities in England is likely to result in a shortfall of around 36,000 homes a year, unless local planning authorities take greater account of housing need both within and beyond their boundaries. ‘Failure to cooperate on housing requirements across local authority boundaries is likely to result in an accumulated planning shortfall of 180,000 homes over the next five years. This is before we consider what house builders and other developers can deliver relative to these targets,’ the report points out. Figures shows that last year building starts reached 136,000 in England. However, according to analysis undertaken on behalf of the Town and Country Planning Association (TCPA), at least 240,000 new homes a year in England are needed from now to 2031. The greatest requirement is in London and the South East where the property market has been strongest. However, the Savills analysis shows that these are the areas where the deficiency in the number of homes being planned is likely to be the greatest. Housing targets adopted so far are 80% of the corresponding Strategic Housing Market Assessment (SHMA) figures across the country. ‘A continuation of this trend would result in a shortfall of 26,000 homes a year in the south and east of England, including London. This figure equates to 74% of total housing shortfall for the whole of England,’ the report says. Of a total 114 local authorities in the south and east of England, 31 or 27% have neither an adopted local plan nor a recent SHMA published since the National Policy Planning Framework (NPPF) was introduced in 2012, the report points out. Yet these local authorities currently accommodate a quarter of all existing households in the region and will face pressure to meet the requirements for housing emerging from London and surrounding local authorities,’ it adds. The 31 local authorities without post-NPPF local plans include Sevenoaks, Elmbridge and Epping Forest. These are strong housing markets where over 50% of the authority is designated as green belt. Shortfalls are less pronounced in the North, Midlands and west of England. Assuming targets adopted by the local authorities that still lack a post-NPPF plan are 80% of their SHMA, the annual planning shortfall could amount to 7,349 homes in the Midlands and west of England and 2,038 in the North. Despite the increase in planning permissions towards 200,000 homes per year in England last year, 20,000 were granted through appeal. A closer analysis reveals persistent problems in maintaining an adequate supply of land for housing and that this problem is most notable where the level of housing need is greatest. Continue reading
