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NZ prices up year on year but down month on month, latest index shows
Residential property sales in New Zealand increase by 18.6% year on year in October but where down 4.1% compared to the previous month, according to the latest index figures. The national median price was $460,000, up $30,000 or 7% on October 2014 and down 5.1% on September, the data from the Real Estate Institute of New Zealand shows. Excluding the impact of the Auckland region, the national median price rose $28,500 to $370,000 compared to October 2014 to reach a new record high and rose 1.4% on September. There was a new record national median price excluding Auckland of $370,000, up 8.4% compared to October 2014 and up 1.4% on September and new record median prices for Northland, Manawatu/Wanganui, Wellington and Nelson/Marlborough. But the market paused in Auckland with a year on year rise of 16.8% with month on month median prices down by 3%. The data also show that there was a 57% rise nationwide in the number of sales over $1 million year on year and a 47% rise in the number of properties sold by auction. ‘The drop in the number of sales in Auckland in October is the result of a softening of demand over the past few months and the new IRD and bank account rules introduced at the start of October,’ said REINZ chief executive Colleen Milne. ‘However, the fundamental supply and demand drivers of the Auckland market remain in place, and the result for October is indicative of the market adjustment phase as it adapts to these new requirements,’ she explained. ‘Elsewhere across the country we are seeing increasing demand and rising prices as buyers of all types emerge to take advantage of low interest rates. It is further evidence of the halo effect of Auckland based buyers searching for value in regional markets,’ she pointed out. ‘During winter and into early spring, the property markets in a number of regions have been far more active than would normally be expected, thus a slowdown or pause is not surprising following this burst of activity,’ she added. Overall 10 regions recorded increased sales volumes compared to September, with Central Otago Lakes volumes growing 31%, followed by Southland with 21% and Canterbury/Westland, 15%. Compared to October 2014, all regions recorded increases in sales volume, with Waikato/Bay of Plenty recording the largest increase of 54%, followed by Hawke’s Bay with 52% and Central Otago Lakes with 50%. On a seasonally adjusted basis, the national median house price fell 5.5%, indicating that prices fell slightly more in October than would normally be expected at this time of year. Northland, Manawatu/Wanganui, Wellington and Nelson/Marlborough all reached new record median prices in October. Northland recorded the largest percentage increase in median price compared to October 2014, at 18%, followed by Auckland at 17% and Taranaki at 12%. Hawke’s Bay recorded the largest percentage increase in median price compared to September, with a 9% increase, followed by Northland with 7% and Nelson/Marlborough with 5%. Continue reading
Price growth in the UK’s prime country house market slowed in 2015
The annual change in prime property values in the UK over the year to September was 2.7% on average, down from a high of 5.2% last year, according to a new analysis report. Stamp duty reform, announced in December 2014, continues to weigh on activity and price growth at the top end of the market in England and Wales while in Scotland the new Land and Buildings Transaction Tax (LBTT) is also affecting the market. Indeed, the level of LBTT for sales between £750,000 and £2 million is on average 55% higher than the equivalent Stamp Duty payable across the rest of the UK, the Prime Country Winter Review from real estate firm Knight Frank says. Meanwhile, price growth in prime town and city markets including Oxford, Bath and Bristol has been relatively robust and farmland values remained steady in the third quarter of 2015 as the market enters a period of equilibrium. According to Knight Frank indices, prime property values for homes located in town and city markets have risen by 26% since 2005 and are now 3% above their 2007 peak. In comparison, more rural properties have risen in value by 7% since 2005 and remain 13% below peak levels. Over the past year this outperformance has continued. This has been particularly evident in prime cities with strong commuting links to London, notably locations such as Oxford, Bath, Bristol and Winchester, the report explains. ‘In recent years, a return to economic growth has given a number of these towns and cities an additional lift with an improving business environment helping contribute towards higher demand for housing as people relocate to an area for work, or look to move up the ladder locally,’ said senior analysts Oliver Knight. He pointed out that a recent report from the British Bankers’ Association noted that banking jobs are shifting from London to some smaller regional locations, with particularly strong growth in Tunbridge Wells, South Gloucestershire, Chelmsford and North Tyneside, all of which outperformed London in terms of employment growth over the last year. The report explains how in 2005 there was quite an equal distribution of prime sales across the country, but by 2014 there had been changes across the Midlands, North West and Yorkshire as transactions clustered more around urban centres. A closer look at the data shows that while the volume of sales fell by 13% across the country between 2005 and 2014, in key town and city markets sales volumes at the top end of the market increased by an average of 25%. Looking ahead, the trend for urban living is expected to continue. ‘As the economy continues to recover and house prices outside of London show further growth, the trend for more London buyers to move will gain more traction and this will boost the ripple effect of house price growth from the capital,’ said Knight. ‘Infrastructure improvements, such as faster road or rail connections or the creation of new transport hubs will enhance… Continue reading
House prices start seeing growth again in Scotland
House price growth in Scotland has quickened after a tempestuous year with prices up 1.4% year on year, more than double the 0.6% annual growth seen in the previous month. Month on month prices were up 0.5% taking the cost of an average home to £167,505, according to the Your Move house price index. Growth is yet to hit a third of the speed seen in September last year when annual growth was 5.4% but sales have soared to reach their highest rate for the month of September for eight years, up 10% on a year ago. Christine Campbell, Your Move managing director in Scotland, explained that usually there is a decline in house purchase activity between August and September, as a lagged effect of the summer holidays. ‘However, this month’s figures go against this trend. Despite other headwinds, this could be down to Scotland’s rising employment rate, increasing by 3,000 in the three months to September to 2,614,000 according to the ONS. With interest rates unlikely to change until 2017, low borrowing costs and near zero inflation should also help to pull up prices in the future,’ she said. Regionally, this means that 23 of Scotland’s local authorities have seen annual price growth, up from 22 last month. However, prices are still lower in seven of the nine most expensive local authorities, and Campbell said that the Land and Buildings Transaction Tax is still preventing the top end of the market from taking off. There have been fewer high value sales since the introduction of the tax. She also pointed out that if September’s pace of growth has been seen throughout the year it would translate to 6.2% annual growth but year on year growth is four times slower than the 5.4% recorded in September 2014. ‘Looking back at the past half decade, Scotland has seen the second lowest price house price growth across Great Britain. Only house prices in the North of England have risen slower. Scotland’s house price increases have been generally steadier, growing by a total of 4.3% over five years, an increase of £6,866. However, this house price growth is much more sustainable than the 26.7% total increase in Scottish house prices, seen between 2005 and 2010 when prices shot up by £33,826,’ said Campbell. But Scotland’s sales have bucked the usual seasonal trend, increasing 3% over the previous month, while sales in England and Wales fell by 1.5% over the same period. ‘In Scotland, sales will typically fall by 6% during this period which make the growth particularly significant. This month Scotland has had the strongest September sales since 2007, with 10% more sales this month than last year,’ Campbell added. Continue reading
