Tag Archives: shows
UK property market cooling in run up to general election in May
Almost a third of house sales in the UK are going to first time buyers but overall the market is cooling in the run up to the general election, according to estate agents. Some 30% of total house sales in February were to people getting on the housing ladder for the first time, the highest number since September 2014, says the latest monthly survey from the National Association of Estate Agents (NAEA). The data also shows that 46% of NAEA members have seen a cooling in the property market as the May general election approaches and 27% think the election will have the biggest impact on the housing market this year. Findings in February also show that demand for property is up, with 366 house hunter’s registered per NAEA member branch, up from 353 in January. With supply marginally down from 44 houses per branch last month, to 43 this month, there’s still a significantly higher demand than supply of housing, a problem that is unlikely to be solved anytime soon. The total number of sales agreed in February remained the same as previous months, with eight house sales going through per NAEA member branch. ‘It’s clear from the findings in the report that things are starting to ease for first time buyers, which could be down to reduced property prices or more accessible funding, especially following December’s stamp duty reforms,’ said Mark Hayward, NAEA managing director. ‘We will all be waiting with bated breath to see if the first time buyer figures increase following the new Help to Buy ISA, and whether we see real momentum in the market. It still remains notoriously hard to get cut through in the property market, especially for first time buyers, so any green shoots are encouraging,’ he added. When it comes to policy proposals in the run up to the election some 45% of agents think that the Conservatives’ pledge to build 200,000 more homes will have the best impact on the housing market. On the downside, 57% of agents think Labour’s proposed Mansion Tax will have a negative impact on the housing market. ‘Demand is still vastly outweighing supply in this country, so it is clear something needs to be done to aid this growing problem. It will be interesting to see the outcome of this year’s General Election, but whoever wins it is vital that building more affordable homes is top of their agenda,’ Hayward concluded. Continue reading
Duty for UK lettings agents to publicise fees welcomed
Measures which impose a duty on UK lettings agents to publicise fees both on websites and in branches have been welcomed by a leading industry organisation. The new Consumer Rights Act stipulates that charges displayed must include a description of each fee and the service it covers and state clearly if the charge applies to the property being let or each individual tenant. The Association of Residential Lettings Agents (ARLA) said that it supports the view that letting agent fees should be transparent and this will help consumers understand what services they are paying for. ‘In the interests of consumer protection, we would have liked to see legislation go further than it did and continue our call to make it mandatory for letting agents to be members of a client money protection scheme,’ said David Cox, managing director of ARLA. ‘We urge the next government to review this after the general election as the schemes provide guaranteed protection to both landlords and tenants should a letting agent abscond or misuse any money they are holding for either party; such as a deposit or rent,’ he added. However, the association, which backs the eradication of unnecessary bureaucracy and red tape, it believes that further measures outlined in the Deregulation Act will have a detrimental and unintended effect on the UK lettings market. ‘ARLA greatly welcomes the new tenancy deposit legislation contained within the Act. However, the provisions in the Act designed to prevent retaliatory evictions by landlords, creates a number of unintended consequences,’ said Cox. ‘ARLA supports the principle of legislation seeking to stop landlords from evicting tenants in response to a genuine disrepair issue. The measures will mean that protections previously afforded to compliant landlords may be eroded by dishonest tenants using the new powers to defend against legitimate possession proceedings, possibly by intentionally causing damage to properties,’ he explained. He pointed out that Section 44 of the new Act, relaxing the restrictions on the use of residential properties for short term lettings in London, will have an adverse effect on the capital’s long established and unique communities. ‘The added ability for residential homeowners to use their properties as ‘pseudo-hotels’ will lead to a constant churn of short term tenants, eroding the foundations of existing communities. Moreover, the new measures may lead to longer term, more established tenants being forced out, an increase in anti-social behaviour, reduced security and an increased risk of crime for permanent residents. London’s success is predicated upon its varied but long established community identities, coupled with the ever growing strength of its booming lettings market,’ Cox added. Meanwhile, the National Landlords Association (NLA) is claiming a victory for landlords in Liverpool after gaining two significant concessions from Liverpool City Council (LCC) in the run up to the launch of their city wide licensing scheme. Although the council has refused the NLA’s request to postpone the launch of the scheme that is due to go live on… Continue reading
Apartment prices likely to remain high in Hong Kong despite promise of more supply
The Hong Kong government has signalled that it is determined to tackle the imbalance between housing demand and supply and confirmed that it will make residential sites available for construction. This year’s land sale programme will inlcude 29 residential sites and the Hong Kong Monetary Authority has announced a seventh round of cooling measures for the residential small to medium sized apartments market which is likely to reduce transactions in the short term. Most of the enw residential sites are likely to be in the New Territories and provide around 16,000 new homes. Taking into account land supply in general it is expected that some 19,000 units could be provided in 2015/2016, meeting the government’s supply target. According to the latest monthly Hong Kong Review report from Knight Frank prices in the small to medium sized sector have been rising since 2010 despite the implementation of various cooling policies. The international real estate firm thinks the latest measures may affect sales in the coming months but will have a limited effect on prices due to strong demand from first time buyers. For residential properties worth HK$7 million or below, the maxium Loan to Value ratio (LTV) has been lowered to 60% from the previous 60% to 70%. For borrowers buying a second property the maximum debt servicing ratio has been lowered from 50% to 40%. Office sales have also been slow. In February only a few major transactions were recorded, but the report says there were signs of investors returning to the market. Grade A office prices in major business districts have not seen notable growth since the end of 2014. ‘However, rental growth is expected to support capital appreciation and we expect investors to continue to increase their focus on the office sales market this year,’ the report explains. In the office leasing market divergent trends have been seen. On the one hand finance, insurance and medical beauty companies are continuing to expand and driving up office demand. But sourcing and logistic firms face intense competition from cities such as Shanghai and Singapore and prefer to relocate to reduce costs. ‘Looking ahead we believe Grade A office rents on Hong Kong island will continue to increase in 2015, mainly driven by strong demand from companies looking to expand in these areas with limited supply and where vacancy rates remain low,’ it concludes. Continue reading
