Posts with tag: property

House price growth stays strong in February

Published On: March 3, 2016 at 12:35 pm

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House prices in Britain continued to rise at a substantial rate during February, according to the latest survey from the Halifax.

Data from the report shows that property prices were up by 9.7% in the last month, in comparison to the same time one year ago. However, prices were slightly down on January’s figures.

Growth

The Halifax said that house prices in the three months to the end of February were up by 3%, in comparison to the last quarter. It also revealed the average price of a property in Britain has now risen to £209,495. However, property values were actually down by 1.4% in comparison to January.

Martin Ellis, housing economist at the Halifax, said, ‘prices continue to rise at a robust pace driven by significant imbalance between supply and demand. Whilst this position is likely to continue over the coming months, there are some tentative signs that the supply situation may be beginning to improve.’[1]

‘Further ahead, increasing affordability issues, as house price increases continue to exceed wage growth, are likely to curb housing demand and cause price growth to ease,’ Ellis added.[1]

House price growth stays strong in February

House price growth stays strong in February

Comparison

These findings from the Halifax marry up with the results of a separate report by the Nationwide, which also indicates a steady rate of growth in UK house prices.

In addition, the building society said that the number of mortgage approvals rose in January, to hit almost 75,000.

Nationwide’s chief economist, Robert Gardner, noted, ‘much of the increase is likely to be related to the impending increase in stamp duty on second homes, which is due to take effect in April.’[1]

‘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 and summer,’ he added.[1]

[1] http://www.bbc.co.uk/news/business-35714443

 

One in five has property regrets

Published On: March 2, 2016 at 12:48 pm

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Categories: Finance News

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Some of the biggest financial mistakes that people can make are getting into debt, not saving enough and making the wrong investment choice

A survey by specialist insurer Partnership quizzed 2,000 people on what they felt their greatest financial mistakes were. 23% noted that choices involving property as ones that they had not made correctly.

Regrets

The vast majority of those questioned said that they wish they had made different financial decisions. Just 5% said that they had no regrets.

9% said that they regretted putting money into an investment that hadn’t performed as well as they would have liked. 7% said that they made a mistake by delaying on a house purchase. 5% said that they regretted not purchasing a property that was good value, while 2% said they wouldn’t delay on remortgaging if they could make the choice again.

The largest financial mistakes attributed to property were found to be:

Biggest Financial Mistakes Linked to Property All 18 – 39 40 plus
I put money into an investment (inc. property) that did not perform 9% 5% 12%
I delayed buying a house 7% 6% 7%
I bought a property which was not ‘good value’ 5% 6% 4%
I did not re-mortgage when I should have 2% 2% 2%

[1]

Other property related regrets included one in ten wishing they had never got married and subsequently divorced! This often leads to the family hold being sold and a number of people being unhappy.

One in five has property regrets

One in five has property regrets

Huge decision

Mark Stopard, Head of Product Development at Partnership, said the fact that one in five regret choices around property is ‘understandable as for most people buying a home will be the single largest purchase decision they will make in their lives.’ He believes however that, ‘when you look at what these mistakes were, some of them could have been avoided if they spoke to a mortgage broker.’[1]

‘A good broker would not only highlight when the best time to remortgage is but also warn people about overextending themselves and putting choices on hold-problems which could well be the root causes of some of these regrets,’ Stopard added.[1]

[1] http://www.propertyreporter.co.uk/finance/property-regrets-for-1-in-5-claims-report.html

 

London commercial property rents rise in 2015

Published On: March 2, 2016 at 11:40 am

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New analysis has discovered that a growth in commercial property rents across the capital drove average total returns of 18.1% from investments during 2015.

The London markets analysis report by Levy Real Estate and MSCI looked at more than £30bn worth of assets across 20 prominent submarkets. This research found that rental growth in the capital increased year-on-year from 7.8% in 2014 to 8.5% in the last twelve months.

Capital growth

Rental growth in London during 2015 was found to be strongest in the Camden/King’s Cross Central submarket. The success of the King’s Cross Central development saw rents grow by an average of 17%.

Large occupier demand and a lack of room in other submarkets was also found to be driving rents. In Mayfair, the continued conversion of office property to residential homes has cut supply of new space and caused rental growth of 11.9% in the last year.

Simon Hellpern, Levy Real Estate Investment Partner, noted, ‘the latest research shows a market which still has significant momentum. Returns are now increasingly being driven by a growth in rents and this suggests that London’s commercial property investment sector can expect further sustainable growth in values.’[1]

London commercial property rents rise in 2015

London commercial property rents rise in 2015

Greatest returns

Progressive rents in and around King’s Cross meant that the Camden and King’s Cross saw the highest return for a single submarket of 27.3%. This was followed in the total returns rankings by the Eastern Fringe with 24.7% and Marleybone and Euston at 23.1%.

Mayfair retained its rank as the submarket with the highest valued property, but the typical equivalent yield here was just 3.7%. The largest inward yield shift in the last year was in the Western Fringes of Clerkenwell, Smithfield and Farringdon, where average yields rose 80 basis points to hit 5.2%. However, the larger picture shows a slowing in yield shift, which highlights the importance of rental growth.

Attractive

Colm Lauder, MSCI vice president, noted, ‘the London investment market had another good year in 2015, with strong returns on the back of healthy rental value growth across the commercial property market. As in 2014, fringe markets outperformed last year with locations such as Camden/King’s Cross and the Eastern Fringe remaining attractive to both occupiers and investors.’[1]

‘Pricing in the London market also strengthened further during the course of 2015, but the rate of yield compression has slowed as key market locations begin to reach record yield levels which question price fundamentals. This has resulted in rental growth taking over as the main performance driver, as confident and expansionary, businesses compete for space,’ Lauder went on to say.[1]

[1] http://www.propertywire.com/news/europe/london-commercial-property-rents-2016030211623.html

Tenants optimistic despite rising costs of housing

Published On: March 2, 2016 at 10:21 am

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The latest report from Your Move has indicated that tenants remain optimistic, despite rises in housing costs, mortgage and deposit fees.

In January, a number of tenants were asked when they planned to buy their first home. 15% said that they were confident of doing this within the next year. This was a rise from the 6% who were equally as confident in September 2015.

Homeownership dream

Additionally, the number of renters who said that they would never realistically be able to make it onto the property ladder was 10%, down from 12% in September and 13% in February 2015. Those in rental accommodation who want to own a property remains very high, with 94% of tenants dreaming of their own home.

This optimism towards home-ownership goes against the soaring costs attributed to owning a property. The average first-time buyer deposit was £28,393 in January, a rise of 6.3% year-on-year and the highest since August 2013. In turn, this has impacted on the number of initial buyer income taken up by deposit costs. In January 2015, a property deposit accounted for 70.3% of first-time buyer income. By January 2016, that figure had increased to 72.2%, the greatest since December 2013.

Similarly, the LTV rate is starting to decline, with January’s total of 82.9% showing a 0.5% monthly fall. This means that first-time buyers will be able to borrow less against the value of their desired home. As a result, they will be forced to pay more upfront. However, the absolute number of higher LTV loans increased in January by 7.3% in the month, according to the Mortgage Monitor from e.surv.

Tenants optimistic despite rising costs of housing

Tenants optimistic despite rising costs of housing

Fearless

Adrian Gill, director of estate agents Your Move and Reeds Rains, noted, ‘first-time buyers are moving from weariness to fearlessness. They are long-used to the housing market being a sellers’ arena and have come to expect daunting deposit costs and prohibitive property prices.’ He went on to say however, ‘the desire among first-time buyers to own their own home is outweighing those considerations as they resolve to get on the property ladder sooner rather than later-be that through saving money or compromising on their property specifications.’[1]

‘Moreover, despite the gloomy headline figures, there are still enough positive fundamentals in the property market to make taking the plunge a worthwhile investment. High LTV loans are plentiful , the average mortgage rate is still at rock-bottom levels-bolstered by the Bank Of England’s refusal to contemplate raising rates anytime soon-and the economic outlooks remains mostly sunny. Indeed, first-time buyers getting on the ladder now are demonstrating cunning as well as courage-they understand that, while the homeownership costs may not be ideal, conditions could be worse. After months of turbulent fortunes, they’ve come to know better than to look a gift horse in the mouth,’ Gill concluded.[1]

[1] http://www.propertyreporter.co.uk/landlords/tenants-remain-optimistic-in-the-face-of-rising-home-ownership-costs.html

Brexit referendum increasing market uncertainty

Published On: February 29, 2016 at 11:38 am

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The upcoming Brexit referendum is fuelling existing housing market uncertainty, according to concerning new research.

Hometrack’s UK Cities House Price Index suggests there has already been a 2% drop in sales in major British cities.

Worrying

Forthcoming changes in stamp duty land tax and alterations to landlords’ tax relief are already contributing to buyer uncertainty. The upcoming vote is likely to drive worries still further.

According to the Index, city level house price values were still up by 10.2% in the year, in comparison to the 8.6% rise recorded one year previously.

On average, UK city house values stand at £231,700. Typical values range from just £109,000 in Glasgow to £455,000 in London.

However, transactions in what were former hotspots dropped significantly, with prices down by 7% in London and by 20% in Cambridge.

Impact

The UK Cities House Price Index suggests that the Brexit vote will further impact on future volumes.

Unfortunately, the referendum falls at the same time when changes in stamp duty are expected to hit investors in the pocket. After making up one in five transactions during 2015, the impact of the alterations is yet to be seen, but the report questioned further house price growth, with volumes invariably slowing.

Annual rate of growth in cities across the South of England is already starting to slow, with sales down and affordability pressures growing.

Brexit referendum increasing market uncertainty

Brexit referendum increasing market uncertainty

Lower turnover

Richard Donnell, insight director at Hometrack, noted, ‘slower growth in sales volumes has been a trend seen over the last three years across high-value, high-growth cities such as Cambridge, Oxford, Aberdeen and London, where house prices have been rising for six consecutive years.’[1]

‘High housing and moving costs are limiting access to the market for a growing number of households which, in our view, will result in lower turnover and slower house price growth. A vote to remain in the EU should see a return to business as usual whereas a vote to leave will create additional uncertainty,’ he added.[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2016/2/brexit-adds-to-housing-market-uncertainty

Which locations are the best for quick property sales?

Published On: February 29, 2016 at 10:23 am

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New research has revealed the locations of Britain where property takes the least time to sell.

According to the investigation by Home.co.uk, accommodation in Peterborough and Milton Keynes sells quciker than anywhere else in the country. The investigation studied the number of property sales over a 180-day period and found that in these two towns, it takes just 13 days to agree a sale.

Factors

One key factor in the short-time taken to sell a property in these regions is their easy access to London. Homebuyers and investors alike are increasingly looking outside of the capital to secure the best possible value.

Another region where the property market is thriving is Bristol. In Home.co.uk’s list of hotspots of fastest-selling areas outside of Greater London, the city secured five out of the top-ten postcode areas.

A continued investment in student accommodation is also a factor in the Woodley area of Reading being highlighted as another prominent property location. Here, it takes just 15 days on average to sell a home.

In addition, suburban Glasgow is another hotspot. Clarkston and Giffnock, both offer access to the city centre and these two regions take up two places in the top ten in regards to time taken to sell a home outside of Greater London.

Which locations are the best for quick property sales?

Which locations are the best for quick property sales?

Speedy

Greater London’s key property hotspots are also dominated by suburban region, with larger interest in commuter belt homes.

However, with ten areas outside of Greater London have a median time to sell of 15 days or less, only two areas of the capital can boast a similar turnaround. These regions are namely Uxbridge and Sidcup.

‘Our figures show that the really hot areas in the current property boom are now outside of the M25,’ notes Doug Shephard, director at Home.co.uk. ‘These top sellers’ markets are typically well-to-do districts where already, premium prices are going through the roof, as buyers compete for the very limited supply of properties for sale.’[1]

[1] http://www.propertyreporter.co.uk/property/which-location-takes-just-13-days-to-sell-a-property.html