Posts with tag: house price values

UK property growth rate being hampered by uncertainty

Published On: August 7, 2017 at 9:58 am

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UK residential property prices rose by 0.4% in July, according to the most recent data released from the Halifax.

However, during the three-month spell between May to July, they were down by 0.2%, while annually, prices were up by just 2.1%.

Property Prices

The report shows that the average price of a property is now £219,266. While the property is still growing, it is doing so at a slower rate than many observers expected. In fact, the annual rate of growth is at its lowest since April 2013, when it stood at 2%.

Nationally, house prices in July 2017 were 10% above the peak seen in August 2007, with the average price now 42% greater than the low point seen in April 2009.

Unsurprisingly, London continues to play home to the country’s most expensive property locations on a per square meter basis. The average price per square meter in Britain has risen by an eye-watering 236% in the last 20 years, from £672 in 1997 to £2,260 in 2017.

Russell Galley, Managing Director of Halifax Community Bank, said: ‘House prices continue to remain broadly flat, as they have since the start of the year. Prices in the three months to July were marginally lower than in the preceding three months, while the annual rate of growth has edged down from 5.7% in January to 2.1% in July, the lowest rate since April 2013.

‘The rise in the employment level by 175,000 in the three months to May helped push the unemployment rate down to 4.5%, the lowest since June 1975. However, this improvement in the jobs market has not, as yet, boosted wage growth, resulting in earnings rising at a slower rate than consumer prices,’ he explained.[1]

Spending

Continuing, Mr Galley said: ‘This squeeze on spending power, together with the impact on property transactions of the stamp duty changes in 2016 now being realised, along with affordability concerns, appear to have contributed to weaker housing demand.’

‘However, a continued low mortgage rate environment, combined with an on-going shortage of properties for sale, should help continue to support house prices over the coming months.’[1]

UK property growth rate being hampered by uncertainty

UK property growth rate being hampered by uncertainty

Uncertainty

Jeremy Duncombe, director of the Legal & General Mortgage Club, suggests that the market is resilient in the face of both political and economic uncertainty driven by Brexit. However, he feels that a long-term plan to address Britain’s chronic lack of supply remains crucial.

Mr Duncombe feels that the, ‘Government and industry must come together, and soon, to make a conscious effort to resolve the housing crisis and create enough homes for our growing population, across all tenures, renters and buyers.’[1]

Russell Quirk, Chief Executive Officer of eMoov, believes the figures are positive, noting: ‘Although prices are still down on the previous quarter and price growth is likely to remain fairly subdued for the remainder of the year, they continue to be up on an annual basis and given the current seasonality an increase no matter how small is a good sign during the peak of the summer months.’[1]

[1] http://www.propertywire.com/news/uk/uk-property-prices-edge-growth-still-hit-political-economic-uncertainty/

 

Asking prices in England and Wales virtually unmoved in July

Published On: July 31, 2017 at 11:54 am

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Property asking prices in England and Wales were virtually static during July, according to the most recent data released from Rightmove.

Values increased by just 0.1% during the month, with prices flat or falling in seven of the ten regions covered by the Index.

Property Prices

In the North East, prices fell by 1.3% month-on-month. However, they were still up by 1.6% year-on-year. Yorkshire and Humber saw falls of 1% but values here were 4.1% up during the twelve-month period.

Property prices in the North East also fell by 0.7% to hit £186,999. Despite this, values here were still up by 2.4% annually.

In addition, data from the report shows that asking prices in the East and East Midlands fell by 0.7% and 0.4% respectively. Values here however were still up by 3.8% and 4.9% year-on-year.

Greater London saw asking prices rise by 1.1% in July, to hit an average of £641,388. The West Midlands saw monthly rises of 0.7%, while Wales experienced increases of 0.6%.

Sales

What’s more, the investigation shows that sales remained strong in the year to July 2017, with the number of properties sold nearly identical to those seen at the same time in 2016.

Would-be buyers are also seeing the highest proportion of properties on the market at any time during the last seven years. There are 7.6% more sellers coming onto the market in July, in comparison to the same time last year.

Miles Shipside, Director and Housing Market Analyst at Rightmove, feels that limited buyer affordability is acting as a natural price brake.

Asking prices in England and Wales virtually unmoved in July

Asking prices in England and Wales virtually unmoved in July

Shipside observed: ‘Sellers coming to market at this time of year have to price more keenly as the traditionally bubblier spring selling season is over and prospective buyers are distracted by their own summer holiday plans.’

‘A year on from the shock referendum result and subsequent dent in activity levels, the fundamentals remain strong. Low unemployment, low interest rates, strong demand and historic undersupply of homes are mitigating any wobbles in confidence and as a result nearly half the properties on the market, over 45%, have sold. Compared to the period around the referendum a year ago, more sellers have come to market and more buyers are buying. The number of sales agreed is up by 4.6% in June 2017 compared to June 2016, and the number of sellers coming to market is also up on the same period a year ago, with a 7.6% increase in fresh choice,’ he continued.[1]

Comparisons

Mr Shipside went on to point out that, ‘The half way point of 2017 is a useful time to make a comparison with the previous year and the number of sales being agreed by agents is uncannily within fractions of a percent of the number at the same half way point of last year. This year and last year have had their own shocks and distortions, but these statistics show that the distractions have been short-lived and have now evened themselves out.’[1]

‘We can see now that price rises are muted despite high housing demand, indicating we have left the stage of the cycle where price rises exceed the rate of inflation. High demand will continue to underpin prices, but we are seeing stretched affordability limiting the pace of rises, especially in the south of the country,’ he concluded.[1]

[1] http://www.propertywire.com/news/uk/asking-prices-barely-moved-england-wales-june-latest-index-shows/

 

Outer London boroughs driving property price growth in the capital

Published On: July 18, 2017 at 10:53 am

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Property prices in London have started to show a recovery since the economic downturn, with prices in some regions doubling during the period.

This has been driven by growth in outer boroughs, according to new research released by Lloyds Bank.

Rises

Average property prices in Greater London have risen by 59% from £362,641 in 2009 to £578,381 in 2016. This was in comparison to growth of 31% across England and Wales as a whole during the same timeframe.

In the City of London, prices have doubled since 2009 to £908,759. This was closely followed by the borough of Waltham Forest, which saw a rise of 97% to £433,105.

On the other hand, Tower Hamlets has seen the worst performance in the capital since the financial crisis, with average property prices rising by 54% between 2009-2016.

Prime Stagnation

The capital’s prime boroughs of the City of London, Westminster and Kensington and Chelsea saw an average increase of 80% between 2009-2014. However, there has been only small growth during the last two years.

Prices in the City of London almost doubled between 2009-2014, from £455,020 to £894,046 – a rise of 97%. Values also rose by 86% in Westminster and by 74% in Kensington and Chelsea. Since then, prices have barely shifted, with a rise of just 2% in City of London and Westminster.

Indeed, the largest growth in the last two years has been seen in London’s outer boroughs. These regions have recorded typical growth of 19% over the period, in comparison to just 4% for prime boroughs and 12% for inner boroughs. 9 of the top 10 growth areas during the same two-year period are within outer boroughs.

Outer London boroughs driving property price growth in the capital

Outer London boroughs driving property price growth in the capital

Olympic Gains

Newham and Barking and Dagenham, the two boroughs most impacted by the financial downturn, are now recording substantial growth. The Lloyds report suggests that this is due largely to the regeneration of the regions following the magnificent 2012 Olympic Games.

Average house prices have increased from £269,529 in 2014 to £356,638 in 2016- an increase of 32%. Barking and Dagenham saw an increase of 32%, to £285,129.

Andy Mason, Mortgage Director at Lloyds Bank, said: ‘The financial crisis saw average house prices in London generally remain stable during 2007 and 2009. Following the crisis, the growth in average prices in prime boroughs outpaced other areas in London by nearly double to create its own distinct market.’[1]

‘More recently, our analysis is showing house price growth in outer London boroughs is increasing at a greater pace than inner London boroughs. Average house prices in the most expensive areas are starting to flatten, whereas London’s most affordable areas are showing healthy growth,’ he continued.[1]

Concluding, Mr Mason observed:’ A possible explanation for this is the ongoing legacy from the 2012 Olympic Games and that outer borough areas like Newham will benefit from the Crossrail link to the City due for completion at the end of 2019.’[1]

[1] http://www.propertywire.com/news/uk/prices-london-recovered-economic-downturn-led-outer-boroughs/

 

House Prices Fall by 0.6%: ONS

Published On: May 16, 2017 at 10:18 am

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The most recent House Price Index from the ONS shows that average property prices in the UK slipped by 0.6% between February and March 2017.

This data seems to indicate that the general slowdown in annual growth rate seen since mid-2016 is continuing.

Property Prices

The average UK house price currently stands at £216,000- £9,000 greater than in March 2016 and £1,000 less than in February 2017.

England saw the largest growth in UK house prices, with property values increasing by 4.4% over the course of the year to March 2017. In Scotland, values edged up by 0.7% to hit £137,000.

Regionally, the East of England and the East Midlands saw the highest annual rate of growth, with prices in both locations rising by 6.7% over the period. The lowest rate of annual growth was seen in the North East, where prices fell by 0.4%.

London saw the next slowest rate of growth, with prices increasing by 1.5%.

John Goodall, CEO and Co-Founder of Landbay observed: ‘While it may look as though house price growth is beginning to slow down, affordability remains a key concern for many aspiring homeowners struggling to get a foot on the ladder. Furthermore, rising inflation and recent warnings from the Bank of England that a year of falling wages lies ahead means we’re unlikely to see any immediate relief.’[1]

‘Now more than ever, the private rented sector will be relied upon to support those unwilling or unable to buy a house outright. As the General Election draws closer, we hope to see some ironclad commitments on house building from policy makers. Encouraging institutional investment in large scale developments, specifically designed to rent rather than buy, will help to control house price growth while also improving living standards for those relying on a well-served buy-to-let market,’ he added.[1]

House Prices Fall by 0.6%: ONS

House Prices Fall by 0.6%: ONS

‘Flat and Stagnant’

Andy Sommerville, Director at Search Acumen, noted: ‘Today’s figures show that UK house prices are continuing to slow, falling from 5.6% growth in February to 4.1% in March. This trajectory is no doubt reflective of the wider sentiment of the UK housing market, with the industry remaining flat and stagnant in the face of ongoing uncertainty.’[1]

Mark Harris, chief executive of SPF Private Clients, highlights last year’s rush to beat the Stamp Duty deadine as a reason for the slowdown:

‘The housing market in March was bound to be quieter compared with a year ago because back then investors and second homeowners were rushing to purchase in order to beat the stamp duty hike at the beginning of April. This year there is no such impetus to focus the mind, with the market ticking along as usual.’[1]

‘The impending general election is having little impact on the market, apart from the upper end where there may be people just waiting for the sake of three or four weeks before making a decision.’[1]

 

[1] http://www.propertyreporter.co.uk/property/ons-house-prices-down-06.html

 

Bristol and Manchester lead annual price growth

Published On: January 23, 2017 at 10:56 am

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The latest Hometrack index has revealed that Bristol and Manchester led the way for price growth in key cities in the UK during 2016.

Bristol recorded growth of 9.6% and Manchester saw property values increase by 8.9%.

Highs

In Manchester, house price inflation hit a 12 year high, with demand far higher than supply. London however fell to seventh position.

Overall, average house price values rose by 2.2% in the final quarter of 2016, up by 0.3% from the previous quarter. Annual growth stood at 7.7%, slightly down on 2015.

The report suggests that lower unemployment and increasing earnings are continuing to increase demand in more affordable markets. Buyers are using to low mortgage rates to increase housings costs.

However, the headline growth rate is obscuring a shift in underlying growth at city level. Growth is shifting from London to regional cities, with more attractive affordability for further inflation.

Bristol and Manchester lead annual price growth

Bristol and Manchester lead annual price growth

Capital Slowdown

It is predicted that house price growth in London will slow to 1% during 2017. Average prices increased by 7.3% during last year, the slowest annual growth rate since July 2013.

Other cities recording higher price growth than London, apart from Manchester and Bristol, were Oxford, Portsmouth and Southampton. These cities recorded growth of 8.1%, 8% and 7.9% respectively.

At the other end of the scale, Aberdeen saw annual price rates slide by -3.2%. However, house prices did recover by 2.9% in the final quarter of 2016. Despite this, Aberdeen has seen a 11% drop in average house prices since the year 2014.

 

Property price values stay fairly static in September

Published On: October 20, 2016 at 2:26 pm

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Property prices in England and Wales stayed fairly constant during September to record an annual rise of 3.5% in comparison to one year ago. However, there are regional variations, according to the latest Your Move Index.

Ups and downs

The average price of a property now stands at £292,763, making the typical price of a property almost £10,000 more than a decade ago. Some regions are seeing strong annual growth, but prime property in London has seen the biggest slowdown.

Further analysis of the Your Move figures indicates that London saw average property prices fall month-on-month to £580,930. Prices were also down by 0.3% in Wales, the South West and Yorkshire and the Humber to hit £168,051, £265,170 and £176,174 respectively. In addition, prices slipped by 0.2% in the North East to hit an average of £145,623.

Locations where values increased the most were 0.3% in the North West, the West Midlands and the East of England, to reach averages of £177,670, £203,507 and £309,835 respectively. Prices also rose by 0.2% in the East Midlands to hit £193,601 and by 0.1% in the South East to reach £361,211.

Year-on-year, values increased most in the East of England. Annual growth here was 7.5%, closely followed by the South East (7.2%), the South West (4.2%) and the East Midlands (3.6%).

However, transaction numbers fell in September to around 74,000 sales.

Property price values stay fairly static in September

Property price values stay fairly static in September

Established

Adrian Gill, director of Your Move estate agents, said: ‘We’re seeing a two speed market become firmly established as cheaper parts of the capital and the regions record price increases while prime London property stalls.’[1]

‘At the same time transaction levels are showing how much the market has changed, with the number of properties now held by private landlords changing market dynamics. This all creates big challenges for Government housing policies, which are going to have to be flexible enough to allow regions to make use of the solutions that work best for their different needs,’ he added.[1]

[1] http://www.propertywire.com/news/europe/house-prices-england-wales-flat-september-agents-index-shows/