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House prices in UK cities up 11% year on year, latest index shows
House prices in cities across the UK increased by 11% year on year in February, taking the average value to £234,900, according to the latest index. This was up from 8.1% a year ago and the highest rate of growth for almost 18 months, the Hometrack UK cities house price index shows. The report says that there has been a notable and unseasonal acceleration in house price growth in the last three months across most large regional cities thanks, in part, to a temporary increase in demand from those looking to beat the stamp duty increase for second homes from April onwards. It also explains that increased demand from existing home owners in cities where the economic recovery has been less pronounced is an important underlying theme given that the majority of housing sales 80%, continue be driven by home owners. Some 16 of the 20 cities covered by the index have registered an increase in the annual rate of house price growth increase in the last year. Some regional cities are recording their highest growth rates for over a decade as the recovery in house prices gains momentum. Four cities have seen the rate of growth slow with the greatest slowdown in Aberdeen and a loss of momentum in Belfast where a modest recovery appears to have stalled with house prices still 45% down on their 2007 levels. The data also shows that in Portsmouth and Leeds house prices are rising much faster than earnings at between 8% and 9% per annum and Portsmouth, Nottingham and Birmingham are recording the highest rates of annual house price growth for over 10 years while Leeds and Glasgow have the highest growth rates for over eight years. All these cities have seen a continued pick up in house price growth since 2013 on economic growth, an improving employment outlook, earnings growth and low mortgage rates, the report adds. However, there are no consistent patterns as to the types of property driving higher growth in these five cities. In Portsmouth detached homes are rising at twice the rate of the city which is the same trend, with a lesser degree of magnitude, in Nottingham. In Birmingham the highest growth rate is being recorded for flats at 11.3% against 7% for the city while in Leeds terraced houses with growth of 11% are recording the highest growth compared to the city at 7.8%. The four high growth cities of London, Bristol, Oxford and Cambridge continue to record double digit rates of house price inflation but there are signs that the rate of growth is starting to slow. All these cities recorded a small drop in the headline rate of growth over February as affordability and sentiment factors impact pricing levels A closer analysis of the 46 local authorities that cover the London City area shows the average growth rate in the last quarter is approaching half the rate recorded, on average, over the last 12 months. The report suggests that… Continue reading
Rental prices in UK up by 2.6% in year to February 2016
Private rental prices paid by tenants in Great Britain rose by 2.6% in the 12 months to February 2016, unchanged when compared with the year to January 2016. A breakdown of the figures from the Office of National Statistics shows that rents grew by 2.8% in England, 0.2% in Wales and 0.7% in Scotland. The data also shows that rental prices increased in all the English regions with London seeing the biggest rise at 3.8% but down slightly from 3.9% in January. If London is excluded from the calculation the growth was 1.9%. The annual rate of change for Wales continues to be below that of England and the Great Britain average while rental growth in Scotland has gradually slowed to 0.7% in the year to February 2016, from a high of 2.1% in the year to June 2015. The ONS index report said that annual price increases have been stronger in London than the rest of England since November 2010. Since the beginning of 2012, English rental prices have shown annual increases ranging between 1.4% and 3% year on year, with February 2016 rental prices being 2.8% higher than February 2015 rental prices. Excluding London, England showed an increase of 2.1% for the same period. The next biggest regional rise after London was the East of England at 3%, up from 2.9% in January 2016, and the South East at 2.9% which was unchanged over the same period. The lowest annual rental price increases were in the North East at 0.9%, unchanged from January 2016, followed by the North West at 1%, also unchanged for this period and Yorkshire and the Humber at 1.3%, up from 1.2%. Continue reading
Prime London property market still adjusting to tax changes
Prices of prime London residential properties fell marginally in the first quarter of 2016, as uncertainty regarding the global and domestic economic outlook continued, says a new analysis. Overall values across the whole of the prime property market in London fell by an average of 0.3% in the three months to the end of March, according to the report from real estate firm Savills. But there continues to be a distinction between the higher value, discretionary prime central London markets and the more domestic, needs-based outer prime London locations. In the most expensive markets of prime central London prices fell by 0.8% in the first quarter. This leaves values at the very top end of the market some 6.7% below their 2014 peak, when an adjustment was triggered by the Chancellor’s announcement of new stamp duty rates for higher value properties in his autumn statement. By contrast, in the less expensive and more domestic outer prime London housing markets, which run from Richmond and Wimbledon, though Battersea and Wandsworth in the south and west, and Islington, Wapping and Canary Wharf in the north and east, prices remained flat in the first quarter of the year, having risen between 2.6% and 4.2% over the past 12 months. The report points out that it is notable that price growth across all prime London markets has been slower than the mainstream over the past three years. It says that this is because the lower value outer London markets were slower to recover post downturn, have benefited from stamp duty reform and remain more accessibly priced. ‘Unlike other parts of the London housing market, the prime markets remain fairly price sensitive and increasingly dominated by needs based buyers,’ said Lucian Cook, Savills head of UK residential research. “’he recent Budget statement confirmed that the stamp duty take form the top end of the market has risen following the reforms of December 2014, despite lower transactional activity, effectively signalling that this policy is here to stay and will continue to influence buying and selling decisions and assessment of value,’ he explained. ‘Given historic levels of price growth, the increased tax burden and political uncertainty stemming from the pending mayoral election and EU referendum, our view is that we are unlikely see any price growth over the course of 2016 as the market continues its adjustment,’ he added. Continue reading
