Posts with tag: house price growth

Final Pre-Brexit House Price Data Revealed

Published On: July 21, 2016 at 8:43 am


Categories: Property News

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The final pre-Brexit house price data to be released has been published by the Land Registry, which found that annual price growth has been led by London, while the North East storms ahead with the highest monthly increase.

The figures, for May 2016, show that house prices across the UK have risen by 8.1% on an annual basis, taking the average property value to £211,230. On a monthly basis, house prices rose by 1.1% on April.

The year-on-year growth for the UK was led by England, where house prices increased by 8.9% over the last 12 months, taking the average value to £226,807. Monthly house price growth stood at 1.0% in May.

Final Pre-Brexit House Price Data Revealed

Final Pre-Brexit House Price Data Revealed

Wales saw an annual price rise of just 3.6%, which takes the average property value to £142,568. Over the month, house prices were up by 0.9% in May.

However, the greatest annual price increase was recorded in London, where values are up by 13.6% since May 2015 and the average price now stands at £472,163. On a month-on-month basis, values rose by 1.5%.

Regional house price data

Although London experienced the greatest increase in annual house price growth, the North East recorded the highest monthly increase, at 2.1%.

Despite this, the North East saw the lowest annual price growth, of 3.2%.

The most significant monthly price fall was experienced in the North West, with a decline of 0.3%.

Property sales 

Following a surge in property sales in March 2016, ahead of the Stamp Duty deadline for buy-to-let landlords and second homebuyers, transactions fell by 42.3% in April to the lowest level since May 2013. Data for May 2016 shows that sales have only recovered slightly since this substantial decrease.

Figures for March, the most up-to-date Land Registry data available, show that the amount of completed house sales in England soared by 52% to 102,597 annually.

Wales also saw a huge increase, of 49%, to 5,002 sales. However, London experienced the greatest rise in property sales, of a huge 60.6%, reaching 14,783 in March.

The founder and CEO of, Russell Quirk, comments: “The latest official house price index for May and last of the pre-Brexit property landscape echoes that of its predecessors from Halifax and Nationwide.

“A healthy annual increase of nearly 9% across England, with May continuing the upward trend seen for a while now, with a further 1% increase.”

He adds: “However, despite London seeing the largest annual growth, perhaps the shock of the bunch is the North East outperforming the capital with the greatest monthly growth of 2.1%.

“We’ve monitored the slow but steady demand growth in the North East, and it seems that this is starting to translate into an increase in prices, albeit marginal at the moment.

“In terms of sales volume, the market has certainly levelled out since the artificial spike of April’s Stamp Duty deadline. Although there has only been a slight recovery, this is to be expected and will probably take a month or two more before it returns to a level we might expect for this time of year.”

Buy-to-let investors looking North

Published On: July 12, 2016 at 10:44 am


Categories: Landlord News

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A new report has revealed that buy-to-let investors’ rush to beat the Stamp Duty deadline saw property prices in Britain’s largest 20 cities rise at the highest rate for 12 years.

During the opening quarter of 2016, house price growth in these UK cities reached 10.8%, which outstripped the 8.7% recorded in the rest of Britain.

City rises

Liverpool, Cardiff and Southampton saw some of the largest quarterly price rises, as investors searched for cheaper cities in which to invest. The largest house price rises during the quarter were recorded in Liverpool and London, where prices rose by 4.1%.

A typical home in Liverpool is valued at £113,100 and in London £468,100.

Cardiff saw the second largest rises at 3.5%, with Bristol and Southampton seeing increases of 3.3%. However, the smallest rises were recorded in Belfast and Newcastle, where prices rose by just 0.9%.

Savvy investors

Peter Armistead, of Armistead Property Ltd, believes that the most savvy investors will be looking to the North of England. Here, yields are a typically higher, with lower capital investment.

Armistead noted, ‘though London gives investors unparalled capital growth, it comes at a cost. Yields in the capital are not as good as many other cities and property prices are very high. Investors buying in the north can acquire two to three properties for the price of one in London. Landlords that are looking to invest, post the stamp duty rise, will be looking carefully at any investment, to ensure it maximises profits.’[1]

Manchester and Liverpool deliver some of the best rental yields in the UK, with Manchester recording average annual rental yields of 6.02% over five years, followed by Liverpool with 5.15% yields. An average residential property in Manchester is just £155,000, while a flat in a good area, costs as little as £120,000,’ he continued.[1]

Buy-to-let investors looking North

Buy-to-let investors looking North

Northern Stars

Mr Armistead went on to observe that, ‘A property in Manchester can provide a 5% minimum cash rental yield and a typical 12% total cash yield, including 7% capital appreciation.  Demand for rental accommodation is strong and by comparison with other regions, housing is cheaper.’[1]

In comparison, yields in London and the South-East are much lower – around an average of 4.86% in outer London and 4.71% in the City, according to LendInvest. House prices in London are about five times what they are in parts of the North West, but salaries are only 30% higher.’[1]




Annual House Price Growth Eases in June

Published On: July 7, 2016 at 8:36 am


Categories: Property News

Tags: ,,,,

Annual house price growth eased off in June, down from 9.2% in May to 8.4%, according to the latest House Price Index from Halifax.

The report found that the annual rate of house price growth seen in the three months to June is the lowest since July 2015, when it was 7.8%.

Over the quarter, house prices were 1.2% higher in the three months to June than in the preceding three months (January to March). This was slightly below May’s 1.5% increase and is the lowest

Annual House Price Growth Eases in June

Annual House Price Growth Eases in June

rise on this basis since December 2014.

On a monthly basis, house prices rose by 1.3% between May and June, following a 0.9% increase in May. However, the report notes that month-on-month changes can be erratic, and the quarterly data is a more reliable indicator of underlying trends.

The average house price in the UK now stands at £216,823.

The Housing Economist at Halifax, Martin Ellis, comments on the figures: “There is evidence that the underlying pace of house price growth may be easing. House prices in the three months to June were 1.2% higher than in the previous quarter, down from 1.5% in May. The annual rate of growth fell from 9.2% in May to 8.4%, the lowest since July 2015.

“House prices continue to increase, albeit at a slower rate, but this preceded the EU referendum result, therefore, it is far too early to determine any impact since.”

The latest research by estate agents suggests that property sales and new instructions have surged since the Brexit outcome.

Halifax has found that home sales stabilised in May, following the introduction of the 3% Stamp Duty surcharge for buy-to-let landlords and second homebuyers in April.

A rush to complete sales ahead of the tax hike caused a sharp rise in March, followed by a significant decline in April. However, sales stabilised in May, rising by 1.5%. Despite this, the number of sales recorded over the month (89,700) remained 16% below the average over the six months to February.

The index also shows that mortgage approvals rose modestly in May, after the Stamp Duty change affected the market. The volume of mortgage approvals for house purchase – a leading indicator of completed property sales – rose by 1.3% between April and May. However, approvals in the three months to May were 6% lower than in the previous three-month period.

The founder and CEO of online estate agent, Russell Quirk, comments on the data: “Today’s figures show, even in the wake of Brexit, that the UK housing market is fundamentally strong. With a continuing, acute shortage of new housing being built and a growing population, even if immigration numbers are now curtailed, the demand vs. supply imbalance and the prospect of even low interest rates will underpin the market – even if there are short-term confidence wobbles fuelled by a media hungry for bad news.”

House Price Growth Continues to Rise in June

Published On: July 1, 2016 at 9:38 am


Categories: Property News

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Annual house price growth in the UK continued to rise during June, despite unpredictable demand levels and uncertainty surrounding the EU referendum, according to the latest House Price Index from Nationwide.

The building society reports that the north-south divide across the UK continued to widen during the second quarter (Q2) of the year, while the average rate of house price growth rose to 5.1%.

Over the past 12 months, annual house price growth in the UK has remained fairly stable, ranging between 3-6%. This trend was maintained in June, with price growth standing at 5.1% on average, up slightly from the 4.7% seen in May. The average house price in the UK is now £204,968, up from £204,368 in the previous month.

However, the Chief Economist at the Nationwide, Robert Gardner, notes that it has been difficult to record levels of demand: “It has become difficult to gauge the underlying pace of demand in recent months, due to the surge in house purchase activity in March ahead of the introduction of Stamp Duty on second homes on 1st April.

“It will therefore be difficult to assess how much of the likely fall back in transactions in the quarters ahead is because buyers brought forward purchases to avoid additional Stamp Duty liabilities, and how much is due to increased economic uncertainty following the referendum result. Gauging the likely impact on house prices will be even more difficult.”

House Price Growth Continues to Rise in June

House Price Growth Continues to Rise in June

Gardner explains how the recent Brexit result will affect the property sector: “Ultimately, conditions in the housing market will be determined by conditions in the wider economy, especially the labour market. It is too early to assess the impact of the referendum vote on the economy. However, it is encouraging that the labour market had remained robust in recent months, with solid employment growth and the unemployment rate declining to an 11-year low in April. Borrowing costs also remained close to historic lows.

“Moreover, the lack of homes on the market – with estate agents continuing to report a record low number of properties on their books – will also provide underlying support for prices, even if demand softens.”

The latest index reveals that regional house price growth has also maintained the trend recorded in recent quarters, with southern parts of England seeing faster rates of growth than the north.

Nationwide reports that the outer metropolitan region again experienced the strongest rate of annual house price growth in Q2, at 12.4%, up from 12.2% in Q1. Despite a slowdown in Q2, London was still the second strongest region, with prices up by 9.9% to a new all-time high – some 54% above pre-recession levels, compared with 10% for overall UK house prices.

The north of England is the only area to record an average house price decline in Q2. As a result, it has replaced Northern Ireland as the UK’s least expensive place to live. Average prices in the north are currently 9% below their pre-crisis peak.

Gardner comments: “It remains the case that the pace of house price growth tends to decline as you move from the south to the north of the country, even though prices in the south are already well above pre-crisis levels, while in Northern Ireland, Scotland, Wales and the north of England, prices remain well below their 2007 highs.

“It remains unclear how long this pattern will persist, and whether the north-south divide in house price levels will continue to widen.”

So how will the London property market fare in the coming years?

“The outlook for London is even more difficult to assess, because landlords and overseas buyers play a larger role in the market, and the outlook for demand from these sources is particularly uncertain,” says Gardner. “It is unclear how recent Stamp Duty changes and upcoming changes to the tax deductibility of landlords’ expenses will affect investor demand in the years ahead.”

He continues: “Similarly, it is difficult to gauge how sentiment from overseas buyers will be impacted by increased economic uncertainty on the one hand, and the sharp decline in sterling on the other (which, if sustained, reduces the cost of UK property in foreign currency terms).

“Property prices in the capital have been supported by extremely robust labour market conditions, as well as strong investor demand in recent years. Employment is now over 17% higher than its pre-crisis peak, compared to 6% higher in the UK overall. How labour market conditions evolve will be key, though valuations in the capital are already stretched by historic standards – the price of a typical London property on our measure (£472,384) is 12 times average earnings in the capital.”

The CEO of online estate agent, Russell Quirk, comments on the figures: “This month’s Nationwide House Price Index has shown that the housing market is sound and defined by a cemented imbalance between low supply and ever increasing demand, low mortgage costs and a deeply-ingrained aspirational home owning culture.”

House Price Growth in Bristol Surpasses London

Published On: June 29, 2016 at 9:35 am


Categories: Property News

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Bristol has become the first city outside of the South East to record greater house price growth than London for more than six years, according to the latest UK Cities House Price Index from Hometrack.

House Price Growth in Bristol Surpasses London

House Price Growth in Bristol Surpasses London

Annual house price growth in Bristol reached 14.1% in May, surpassing London (13.8%) and Cambridge (13.4) to top the chart.

Hometrack reports that this trend has seen large regional cities experiencing the highest growth rates over the past three months, led by Liverpool (5.4%), Bristol (4.2%), Manchester (3.9%) and Leeds (3.7%), driven by an improving economic outlook and strong demand from landlords ahead of the 1st April Stamp Duty deadline. Overall, city level house price growth rose from 10.8% in April to 11.2% in May.

However, London was one of eight cities to record slower annual house price growth, down from 14.2% in April to 13.8% in May.

House price growth across UK cities

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Hometrack expects to see a rapid deceleration in house price growth over the next six months, particularly in the capital, as buyers approach a wait-and-see approach to assess the short-term impact of the Brexit.

The Insight Director at Hometrack, Richard Donnell, comments: “House price inflation in major cities outside of London and the South East, such as Bristol and Liverpool, has been accelerating, but it is now expected to slow towards low single digits in the coming months, as demand cools on the back of the EU referendum result. At present, we expect housing market turnover to bear the brunt of increased uncertainty rather than house prices.

“Standing back from the immediate turmoil in financial markets, the reality is that the fundamentals of the housing market remain unchanged, with record low mortgage rates and a wide imbalance between supply and demand. The UK doesn’t have a problem with housing demand – the more important question is how many buyers and sellers feel confident to participate in the market in the near term.”

He adds: “Market sentiment can change quickly, and the sooner a clear picture emerges over the likely impact on the economy and the outlook for jobs and mortgage rates, the sooner transaction volumes should stabilise and more buyers return to the market.”

EU Referendum Has Little Effect on House Price Growth

Published On: June 15, 2016 at 8:39 am


Categories: Property News

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The forthcoming EU referendum is having little effect on house price growth across the UK, according to the Resolution Foundation.

In response to the Government’s latest house price data, the organisation reports that there is little sign of a slowdown in growth, despite uncertainty surrounding the EU referendum and concerns over whether a housing bubble could burst.

The house price index found that the average UK house price rose by 8.2% in the year to April. The Resolution Foundation believes that the rush to purchase buy-to-let properties ahead of the introduction of the 3% Stamp Duty surcharge on 1st April has only marginally reduced the rate of growth, down from 8.5% in March.

EU Referendum Has Little Effect on House Price Growth

EU Referendum Has Little Effect on House Price Growth

Similarly, signs of property market confidence declining, particularly in London, have not yet fed through into house prices.

The Resolution Foundation has found that across the UK, house prices have increased by more than 2.5 times the rate of average weekly earnings growth since April 2011. The average house price rose by 24% over the last five years, while weekly earnings have increased by just 9% in the same period.

London continues to dominate when it comes to the difference between incomes and house prices, with property values rising by 15% in the last year alone. However, the body warns that the contrast between incomes and house prices is not unique to the capital, with other parts of the country, such as the East of England, also under stress.

The Senior Policy Analyst at the Resolution Foundation, Lindsay Judge, says: “Despite the turbulent political background, house prices continue to rise sharply. Hopes that the house price hare would slow down and allow tortoise-paced income growth to catch up are not showing up in today’s data.

“The wedge between house prices and incomes continues to grow with real implications for living standards for many households. Large parts of the UK remain unaffordable for below-average earners hoping to buy.”

The Director of e.surv chartered surveyors, Richard Sexton, also comments on the data: “There has been a noticeable stumble ahead of the EU referendum, but the housing market remains in great shape. UK house prices have certainly come a long way over the last couple of years, and in this era of flexibility and adaptability, there’s little sign of a sustained let-up. This growth has not just centred around London; it’s spilling out across the nation, with the East and South East looking to challenge the capital’s housing prowess.

“Despite the short-term uncertainty of next week’s EU referendum, regional property markets are receiving a pre-summer swell, giving homebuyers more choices. And whilst a lift in prices doesn’t spell completely bad news – marking real demand and strong local housing momentum – it does mean more work is needed for first time buyers. As deposits climb alongside asking prices, the housing market demands a new flexibility from lenders in assessing affordability and creditworthiness.”

Sexton adds: “But whilst this is already happening, driving growth out to the regions around London, many prospective buyers are looking further afield. The North East is a land of opportunity, with lower growth and prices just over half of the UK average. Small-deposit lending totalled 18.4% across the UK in May, so for those prepared to take a leap of faith and venture out of the capital, lenders are keen to help.”