TSI
Nationally home prices in Canada up 17% year on year
Residential property sales across Canada edged upwards from December to January with annual transactions increasing by 8% compared to a year ago. The data from the Canadian Real Estate Association (CREA) also shows that home prices were up 17% year on year but not everywhere with British Columbia and Ontario seeing values fall slightly. Month on month sales increased by 0.5% and this lifted national sales activity to the highest level since late 2009. The number of local housing markets was almost equally split between those where sales were up from the month before, and those where sales were down. Monthly sales increases in the Greater Toronto Area (GTA) and Lower Mainland of British Columbia fuelled the national sales increase and offset monthly sales declines in Calgary, Edmonton and the Okanagan Region. ‘Single family home buyers in the GTA and Lower Mainland of British Columbia had been expected to bring forward their purchase decisions before tightened mortgage regulations take effect in February 2016,’ said CREA president Pauline Aunger. ‘If listings in these and nearby markets were not in such short supply, January sales activity would likely have reached even greater heights. Meanwhile, other major urban housing markets have an ample supply of listings, particularly where some home buyers have become increasingly cautious amid an uncertain job market outlook,’ she added. CREA chief economist Gregory Klump pointed out that single family homes in the GTA and Greater Vancouver areas were in short supply amid strong demand in contrast to side lined home buyers and ample supply in a number of Alberta housing markets. ‘Tighter mortgage regulations that take effect in February may shrink the pool of prospective home buyers who qualify for mortgage financing and cause national sales activity to ease in the months ahead,’ he added. A breakdown of the figures shot that actual, not seasonally adjusted, is now 2.6% above the 10 year average for the month of January. Activity was up compared to January 2015 among roughly two thirds of all local markets. B.C.’s Lower Mainland and the GTA again contributed most to the national increase. Greater Vancouver saw the biggest rise in annual prices with growth of 20.56% followed by the Fraser Valley up 16.94% and Greater Toronto up 10.69%. Home prices in Victoria increased 7% and were up 5.5% in Vancouver Island. By contrast, home prices fell by 3% in Calgary, by 2% in Saskatoon, and by less than 1% in Regina. While home prices have begun to decline in Calgary and Saskatoon only fairly recently, they have been trending lower in Regina since early 2014. Prices crept higher on a year on year basis in Ottawa by 1.10%, increased by 1.48% in Greater Montreal and were up 6.57% in Greater Moncton. The actual, not seasonally adjusted, national average price for homes sold in January 2016 was $470,297, up 17% year on year but continues to be pulled upward by sales activity in Greater Vancouver and Greater Toronto, which are among Canada’s most… Continue reading
UK buyers choose renovation properties to try to save money, research suggests
Some 35% of home owners in the UK who bought a property that needed renovation had to as it was the only way that could afford to buy a home, according to new research. Some 8% bought a home needing renovation but found that in reality they could not afford to do the work and 10% ended up living on a ‘building site’ for a year or more before starting the work. The research from price comparison site Confused.com also found that for those who persevere the hard work can be worth it 19% made a profit of between £25,000 and £50,000 from a successful renovation project. The sale prices of properties that need renovation are normally much lower than the prevailing market price in that particular locality. On average, home owners who have bought a renovation property have saved themselves £44,037. Home renovators are paying on average £152,792 for a property that needed some work done to it, compared to the average UK house price which is valued at £196, 829. Some 38% admitted to buying a property that needed some work as it saved them thousands of pounds compared to buying a home that needed no work. In fact, 40% of home owners admit they would buy a property that needed renovation if it saved them money. On average, home owners spent £33,089 on doing up their properties with 12% spending more than £50,000 renovating their home. Some 62% did work on the kitchen and 61% on the bathroom. However, renovating a property can often be more expensive than first anticipated with 45% of home owners saying they spent more than intended, with many spending £2,886 over their budget. Indeed, some 26% ended up going over their budget by more than £5,000 and 22% said that they would never buy a renovation project again. And the research also found that 41% who have carried out renovation work on their property have not let their insurer know. ‘As house prices seem to be continuing to rise, it would appear that more and more people are resorting to buying properties that need renovation. Deciding to renovate a property is a big decision and often more expensive than first anticipated,’ said Gareth Lane, head of home insurance at the firm. Continue reading
UK mortgage lending expected to see steady growth in next two years
The value of home lending in the UK increased across all residential sectors in December but there is a mixed picture in terms of growth and decline, according to the latest data from the Council of Mortgage Lenders. New data from the Council of Mortgage Lenders reveals a mixed picture on lending in December to November. However, on an annual basis, the value of lending grew across all lending types and the CML expects steady growth in the next two years. First time buyers borrowed £4.5 billion for home owner house purchase, up 7% on November and 18% on December last year. This totalled 29,300 loans, up 6% month on month and 11% year on year. Home movers borrowed £6.6 billion, up 2% on November and 20% year on year. This totalled 33,400 loans, up 3% month on month and 12% compared to December 2014. However, home owner remortgage activity was down 16% by volume and 16% by value compared to November. Compared to December 2014, remortgage lending was up 14% by volume and up 24% by value. Gross buy to let saw month on month decreases, down 3% by volume and 3% by value, but the growth year on year continued. The data also shows that first time buyers took out 87,100 loans totalling £13.3 billion to purchase homes. This was up by volume 3% on the third quarter and 14% on the fourth quarter 2014 and by value it was up 3% quarter on quarter and 8% year on year. Home movers took out 101,900 loans, down 1% quarter on quarter but up 9% compared to the fourth quarter 2014. This totalled £20.3 billion, down 3% on quarter three but up 18% year on year. Home owner remortgage activity was up 4% by volume and 6% by value compared to the third quarter. Compared to the fourth quarter 2014, remortgage lending was up 21% by volume and up 35% by value. Gross buy to let saw a slight quarter on quarter decrease, down 1% by volume and 1% by value, but year on year growth continues. First time buyers borrowed £46.7 billion for home owner house purchase in 2015, which was up 4% on 2014. This totalled 311,700 loans, unchanged from the previous year. First time buyer lending was at its highest since 2007. Home movers took out 365,800 loans, down 0.2% on 2014, but the amount borrowed totalled £72.1 billion was up 7% on 2014. Lending was at its annual highest since 2007. Home owner remortgage activity was up 11% by volume and 20% by value compared to 2014. The value of remortgage lending was at its highest since 2008. Gross buy to let also saw year on year increases, up 28% by volume and 39% by value. Buy to let lending was at its highest since 2007. ‘Improving economic conditions, boosted by government schemes like… Continue reading
