Posts with tag: average house price

Which Feature Adds the Most Value to House Prices?

Published On: April 20, 2016 at 10:45 am

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Having a spare bedroom is the number one feature that adds the most value to house prices, according to the latest survey by eMoov.

The estate agent asked over 1,000 UK homeowners what they think adds the most financial value to a property when looking to buy a new home.

A spare bedroom topped the list, with a quarter (25%) of those asked believing that this would justify a higher house price. Not only is a spare room great for guests, but it can also be used as an office or nursery. You may also like to rent the room out, now that the tax-free lodgers allowance has been increased.

And while the British summer is usually brief, outdoor space is the next feature that adds the most value to homes, with 19% of homeowners believing it justifies a higher price.

The garage is the third best feature, according to 16% of respondents, and an ensuite bathroom to the main bedroom came out in fourth, with 13% of homeowners believing this adds the most financial value.

Completing the top five is an extra car parking space, cited by 11% of respondents.

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Which Feature Adds the Most Value to House Prices?

Which Feature Adds the Most Value to House Prices?

5% of homeowners think good local amenities will add the most value, while 4% believe a strong internet connection is the most justified. A strong mobile phone signal was considered the best feature to boost a property’s price by 3% of respondents.

Just 2% believe a good community spirit will add value to a house price.

The CEO and founder of eMoov, Russell Quirk, says: “Often those looking to sell will pour money into additional DIY projects around the house, in an attempt to increase the value of the property and justify pushing up their asking price by a few thousand pounds or more. Unfortunately, a lot of the time they may as well be pouring it down the drain, as potential buyers will care little for aesthetic improvements, due to having their own long time view of how they want the property to be.”

He continues: “This research goes to show that it’s the fundamentals people are concerned about: the number of bedrooms in case they want friends to stay or wish to start a family; outside space to entertain or for the kids to play in; a garage to store that accumulated clutter as the years pass by; an ensuite so you can have a bath in peace; or that extra parking space for when the 17th birthday rolls round.”

Quirk adds: “It is a little disappointing that a good community atmosphere ranks so lowly amongst homeowners. I know it doesn’t necessarily add value, although on the flip side, a bad atmosphere can certainty lower an asking price, however, it goes to show that the community spirit that has been so prevalent in years gone by is rarely thought about now.”

House Prices Lower than Previously Thought After ONS Revises Figures

Published On: April 13, 2016 at 10:09 am

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Homeowners may be surprised to learn that their properties aren’t worth as much as they previously thought, after the Office for National Statistics (ONS) revises its January house prices.

Londoners will be especially surprised to find out that their property price has fallen by an average of £27,000 – much different to the previous figures released by the ONS.

It appears that the ONS massively overestimated the rate of house price growth, however, the Government department denies this suggestion and reports that it has merely updated its index.

House Prices Lower than Previously Thought After ONS Revises Figures

House Prices Lower than Previously Thought After ONS Revises Figures

The original data, released last month, led homeowners to believe that property prices in London were rising by around £500 per day. However, it now seems that that was not the case.

The ONS claimed that the average price of a UK property soared by almost £4,000 in January to hit £291,500. However, the latest data shows that the average house price actually dropped by £1,700 at the start of the year.

A further decline of just over £2,000 in February puts the average house price at £283,700. This is the lowest figure recorded since July 2015.

Property owners in London will be surprised to know that the value of their homes has plunged.

In March, the ONS reported that the average London house price hit a record high of £551,000 in January. This was up £15,000 on December’s figure of £536,000, suggesting that the capital was powering ahead.

However, the latest figures dispel this data. The ONS now claims that the average London property in February was worth £524,000, down £12,000 on December and £27,000 lower than the figure reported for January.

In its new report, the ONS does not address the revisions directly, although it does say that London is one of the regions that has fallen back “from the record levels witnessed in previous months”.

When asked to explain the data, a spokesperson for the ONS explains that every January, the index weights are updated to ensure the index keeps up to date with changes in the types of properties being purchased, therefore reflecting the price of the average home.

They add: “In updating the weights for 2016, there have been small decreases in weight for London and the South East, with increases seen in other areas. This shift in weight towards areas with lower average prices has brought down the UK average.

“Similarly, there has been a shift in weight from existing owners and existing properties to first time buyers and new builds, which has also contributed to reducing the UK average.”

Regarding London, the spokesperson says that a decrease in the average price between January and February is not unusual: “Between 2008 and 2015, there have been seven falls in average price between January and February and one increase… So it seems this is a seasonal observation. This isn’t an effect isolated to London: seasonal falls between January and February can also be seen in the South East.”1 

We will continue to keep you updated with changes in the property market at LandlordNews.co.uk.

1 http://www.theguardian.com/money/2016/apr/12/london-property-values-plummet-after-office-national-statistics-revises-figures

Annual House Price Growth at 7.9%, According to ONS

Published On: March 23, 2016 at 12:30 pm

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UK house price growth rose to 7.9% in the year to January, up from 6.7% in the 12 months to December 2015, according to the latest house price index from the Office for National Statistics (ONS).

Annual house price inflation was 8.6% in England in January, -0.3% in Wales, 0.1% in Scotland and 0.8% in Northern Ireland.

The large increase in house prices in England was fuelled by an 11.7% rise in the South East and 10.8% growth in London, shows the data.

Excluding London and the South East, UK house prices rose by 5.1%.

On a seasonally adjusted basis, average house prices grew by 0.9% between December and January.

The average UK house price is now £292,000, according to the ONS. Earlier this week, Rightmove reported that the average property is now worth over £300,000.

Many industry experts have commented on the new figures:

Stephen Smith, the Director of Legal & General Housing Partnerships, says: “House prices continue their steady upwards march, as they are likely to do for some time, unless Britain can address the lack of housing supply in this country.

“With the cost of owning a home continuing to rise well above both earnings and inflation, the gap between supply and demand is pumping up prices and making affordability an impossible dream for many – especially in London and the South East.”1

More and more young people believe that they will never get on the property ladder, as it is believed that it takes the average single first time buyer 13-and-a-half years to save a deposit.

Annual House Price Growth at 7.9%, According to ONS

Annual House Price Growth at 7.9%, According to ONS

Worryingly, three quarters of young Britons expect to stay in the private rental sector forever.

The Sales Director at New Street Mortgages, Adrian Whittaker, continues: “The ONS figures show a market that’s continuing the strong annual growth that characterised much of 2015. Competition for property is still fierce, and in this sellers’ market, the speed at which a buyer can secure a mortgage can be the difference between first and last place in the race to buy property.”1

Mark Posniak, the Managing Director of Dragonfly Property Finance, adds: “This latest annual house price data once again throws into sharp relief the contrast between the housing markets of England, Wales, Scotland and Northern Ireland. They may be geographical neighbours but they could be thousands of miles apart in terms of house prices.

“For annual prices in the South East to have outperformed London underlines an ongoing shift in demand away from the capital as people look for more value elsewhere. London will remain a formidable bastion of the UK’s property market, but for many its prices are an insurmountable obstacle.

“However, the strength of demand in the months ahead may well be reduced by worries about the impact of a potential Brexit, causing many would-be buyers to sit on their hands.

“The Government’s move against landlords, which officially starts next month, is a fundamental shift and has the potential to reshape the property market in the years ahead.”1

From 1st April, landlords will face changes to their taxes, notably the 3% Stamp Duty surcharge, which was confirmed in last week’s Budget.

Finance expert Paul Mahoney of Nova Financial has explained how the Budget announcements will affect landlords: /budget-reasonably-positive-believes-finance-expert/

Jan Crosby, the Head of Housing at KPMG, explains the ONS data: “Today’s ONS figures show a record high, with England outpacing the other areas of the UK for house price growth. When you look further into the facts, the rise is driven by ever by the South East of England, London and the East of England, with the percentage increase in the capital over the past 12 months more than double the rest of England when London and the South East’s rises are excluded.

“Of course, this comes as no surprise, and highlights both the broken and atypical nature of the market in those areas. As ever, the issue is down to supply versus demand, and while last week’s Budget did have measures, such as the Lifetime ISA, which are in part designed to help buyers onto the property ladder, the record didn’t change when it came to generating supply, with announcements effectively repeating or slightly extending previous reforms.”

He adds: “However, one particular Budget announcement could have an underlying effect on house prices; it will be interesting in a year’s time to see how much prices in the north have inflated, specifically around areas like Manchester and Liverpool, which are set to benefit following the Chancellor’s renewed commitment to infrastructure projects, including HS3, the trans-Pennine tunnel and improvements to the M62.

“It is certainly likely that property investment, especially from abroad, will increase in the north, and this will include housing projects – while this might be good for the economy, it could be bad news for those hoping to buy a home.”1 

We continue to provide you with the latest landlord updates on all issues regarding the sector.

1 http://www.financialreporter.co.uk/finance-news/ons-annual-house-price-growth-rises-to-79.html

Average House Price Breaks Through £300,000 Mark

Published On: March 21, 2016 at 11:16 am

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The average asking price of a property new to the market in England and Wales has broken through the £300,000 mark for the first time, according to new data.

The average house price is now £303,190, says Rightmove.

The news arrives exactly ten years since new asking prices passed the £200,000 barrier. This means that house prices have soared by 50% in a decade.

Average House Price Breaks Through £300,000 Mark

Average House Price Breaks Through £300,000 Mark

Despite the housing market crash occurring during this period, new asking prices did not go back down below the £200,980 reported in 2006 when prices fell.

Figures also show that average wage growth has been significantly lower than house price inflation over the last ten years, rising by just 22%.

Rightmove has found that new asking prices increased by 1.3% on February’s figure – the second highest monthly rise seen at this time of year.

The director of Rightmove, Miles Shipside, comments: “On average, 30,000 properties have come to market each week over the past month, up by 3% on this time last year. But there are insufficient numbers of newly listed properties in many parts of the country to meet demand.

“Visits to Rightmove are up by 14% in early March compared to the same period in 2015, so it’s no surprise that those buyers who can borrow more or can find some extra cash are keeping the price merry-go-round spinning, even though increasing numbers of aspiring home movers cannot afford the ride.”1

Surprisingly, the rise in new asking prices is not being driven by London, where the market is stagnant.

Six out of ten regions have experienced house price growth, while three of the top four are northern regions – the West Midlands, North West and Yorkshire and the Humber came after the South West, and ahead of all other southern regions.

Although new asking prices in the capital have remained steady month-on-month, homes in London are still worth more than double the average, at a huge £644,045 – an annual increase of 11%. This is the greatest rate of annual house price growth of anywhere in England and Wales.

Rightmove’s research also shows that the average time to sell a property last month was 68 days, down from 79 in the same month last year. In London, the typical time a house is on the market is 47 days, lower than at any point last year.

Average stock per agent – including properties under offer or sold subject to contract – was 54 in February, down from 59 last year.

Last month, Rightmove reported that the average house price was almost at £300,000, and expected the barrier to be broken soon. It will be interesting to see how prices move on from the current record high.

1 http://www.rightmove.co.uk/news/300000-milestone-hits-new-high

British Homes are Earning More Than Their Owners

Published On: March 5, 2016 at 9:31 am

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Last year, British homes earned more than nearly half of all workers, according to a new study.

The average house price in Britain increased by £18,000 last year – more than the salary of almost 40% of the workforce, says Post Office Money.

The Cost of Buying and Moving report reveals that the average price rise almost matched the starting salaries of many professionals, including nurses, teachers, junior hospital doctors and police officers, who all start on around £22,000 per year.

British Homes are Earning More Than Their Owners

British Homes are Earning More Than Their Owners

In London, the average property price increased by £46,000 in 2015, compared to an average annual salary of £36,000 in the capital.

A recent report from the Halifax discovered that the largest gap between wages and property price rises was in Three Rivers, Hertfordshire, where house prices have risen by £148,000 in the past two years, exceeding average earnings by a huge £98,000.

Three Rivers is becoming increasingly popular with London commuters, due to the Metropolitan line.

The second biggest gap was in Harrow, northwest London, which often features in the top ten areas with the fastest rising prices.

Greenwich was in third place thanks to becoming a regeneration hotspot. It is just minutes from Canary Wharf on the DLR and Jubilee line, and will boast a new Crossrail station in 2018, making it even quicker for workers to get to the City of London.

The average house price rise in the UK was £5,800 lower in December last year compared to the year before, while workers’ wages increased by an average of £400, to £26,400.

In London, the average property price growth fell by £11,300 from £57,600 for the previous year. However, the average home in the capital still costs £536,000. Elsewhere, the average price is £365,000 in the South East and £315,000 in the East of England.

The Head of Mortgages at Post Office Money, John Willcock, analyses the data: “Although the rate at which property prices have increased has slowed compared with the dramatic rises seen in 2014 and early 2015, we have still seen a big increase in prices over the last year.

“This has been driven by demand for housing outstripping supply, with the number of properties coming to market failing to match the needs of people looking to buy.”

He remarks: “While this is good news for those who already own their home and will see their property wealth increase, our study highlights the uphill struggle that buyers and movers looking to climb the property ladder continue to face, especially when attempting to get on that all-important first rung.”

Willcock offers his predictions for the rest of the year: “Forecasts seem to indicate a year of two halves in 2016, with prices pushed up before April, as buyers race to beat the new Stamp Duty surcharge on second homes, but then weakening following its introduction and uncertainty around the UK’s position in Europe.

“In the medium term, house prices look likely to continue to rise, as demand for property continues to outstrip the supply of new homes.”1 

As of 1st April, buy-to-let landlords and second homebuyers will be charged an extra 3% in Stamp Duty. Reports have found that landlords are rushing to complete on property purchases to beat the deadline.

It has also be claimed that home movers are delaying their plans ahead of the EU referendum on 23rd June, deciding whether to move once the outcome is confirmed.

Additionally, questions were raised this week over whether housebuilders are restricting housing supply in order to boost profits.

1 http://www.homesandproperty.co.uk/property-news/british-houses-earn-more-than-their-owners-average-home-rose-by-almost-20k-across-the-country-and-a99506.html

Average House Price Hits £196,930, According to Nationwide

Published On: March 3, 2016 at 12:28 pm

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The average house price increased by 0.3% in February, hitting £196,930, according to figures from Nationwide.

Although activity in the mortgage market was strong at the start of the year, Nationwide’s data – based on loans it approved during February – shows that prices have remained steady.

Average House Price Hits £196,930, According to Nationwide

Average House Price Hits £196,930, According to Nationwide

The monthly growth recorded for February matches that seen in January, and although the annual rate of growth rose to 4.8% from 4.4%, Nationwide claims that it has remained in a fairly narrow range – between 3% and 5% – since last summer.

The Chief Economist at Nationwide, Robert Gardner, believes recent activity was likely to have been driven by a rush of landlords seeking to complete on property purchases ahead of the 3% Stamp Duty surcharge, set to be enforced on 1st April.

“This is likely to have brought forward a significant number of purchases, which in turn will probably result in a fall back in approvals during the spring-summer,” he says. “Looking through this volatility, we expect the underlying pace of activity to increase in the quarters ahead, as improving labour market conditions and low borrowing costs provide ongoing support.”1

The Chief UK Economist at Pantheon Macroeconomics, Samuel Tombs, notes that Nationwide’s house price index is showing lower price growth than other measures, which could be down to the sample it was based on.

He states: “Nationwide’s measure of house prices underplays the extent to which the housing market is heating up again. The latest growth rates of all the other main measures of house prices have been significantly stronger over the last six months.”

For January, the Land Registry recorded an average price increase of 2.5% and annual growth of 7.1% – considerably higher than Nationwide’s figures.

However, Nationwide’s data covers the whole of the UK, while the Land Registry only reports on England and Wales, with growth in England typically higher in recent years.

Tombs adds: “We still expect the strengthening labour market, falling mortgage rates and a dearth of homes for sale to result in punchy house price increases this year.”1

Howard Archer, the Chief UK Economist at IHS Global Insight, expects the average house price to rise by 6% over the rest of the year. However, he adds that the EU referendum, scheduled for 23rd June, is a “potential major downside risk to housing market activity and prices”.

He comments: “A vote for Brexit would be liable to see a marked hit to UK economic activity over the rest of this year and in 2017 amid heightened uncertainties, which would likely weigh down heavily on the housing market.”1 

Rightmove has predicted that the average house price will reach £300,000 in the near future. 

1 http://www.theguardian.com/money/2016/mar/03/house-price-creeps-up-nationwide-mortgage-stamp-duty