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Em Morley

Scotland Leading House Price Growth Across the UK

Published On: October 20, 2017 at 8:05 am

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The Scottish property market continues to defy the slowdown elsewhere in the UK, with Scotland now leading house price growth across Britain, reports Your Move.

The average house price grew for the seventh consecutive month in August, by 0.5%. On an annual basis, house prices have risen by 4.8% since August 2016, compared to a rate of 2.1% in England and Wales.

Only the East of England (4.5%) comes close to the annual growth seen north of the border, while the average house price in London is down by 0.7% on last year.

These changes leave the average property value in Scotland at £176,876 – up from £168,726 in the same month last year.

Scotland Leading House Price Growth Across the UK

Scotland Leading House Price Growth Across the UK

On a monthly basis, Scotland’s local authority areas continue to experience mixed fortunes. Exactly half of the 32 locations in Scotland saw prices rise in August, headed by the Scottish Borders, where the average value was up by 5%, to reach £187,879. West Dunbartonshire, where the average house price is just £115,208, was next, up by 4.2%.

At the other end of the scale, prices in Angus dropped by an average of 4.7%. The Shetland Islands saw a greater decline, of 5.1%, but low transaction volumes there often mean big swings in monthly prices.

Year-on-year, however, there’s much more consistency, with just four areas seeing prices drop. The greatest fall (of 2.7%) was recorded in Inverclyde, following a strong 2016 as a result of sales of new build detached houses.

By contrast, there’s been good growth for a number of areas. Prices rose by 8.8% in the City of Edinburgh – the most expensive location to purchase a property in Scotland, at an average value of £262,092 – while the Scottish Borders saw an average increase of 9.7%. Prices were up by 8% in the Orkney Islands and South Lanarkshire, while Clackmannanshire saw growth of 20.5% – although this again reflects that the area has few sales.

A number of other spots also saw significantly higher than average rises, including North Lanarkshire and East Ayrshire (both up by 7.8%), and Midlothian (up by 7.6%).

Your Move reports that low interest rates and unemployment at a 42-year low are supporting a market that doesn’t suffer from the same affordability problems as London and the South East, which both lower the average in England and Wales.

To date, Scotland has also avoided a slowdown in property sales. May, for which the latest Office for National Statistics (ONS) figures are available, saw 8,241 homes sold in Scotland. That means that, for the first five months of the year, sales were 2% higher than in the same period of 2016 and up by 6% on 2015.

The Managing Director of Your Move Scotland, Christine Campbell, says: “Housing
 in Scotland continues to shake off the uncertainty we’re seeing elsewhere in the UK economy. Here, low interest rates, high employment and prices that are still affordable are supporting continued robust growth.”

Alan Penman, a Business Development Manager for Walker Fraser Steele, one of Scotland’s oldest firms of chartered surveyors, adds: “Scotland’s housing market is now leading Britain, and that simply reflects very strong fundamentals. It’s always dangerous to speak too soon, but the market currently looks in good shape.”

It may be wise to consider a property purchase north of the border for strong capital growth!

Government Plans to Regulate all Letting and Management Agents in England

Published On: October 19, 2017 at 9:25 am

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Yesterday, Government ministers outlined plans to regulate all letting and management agents in England.

Government Plans to Regulate all Letting and Management Agents in England

Government Plans to Regulate all Letting and Management Agents in England

The proposals are designed to protect leaseholders and tenants from unfair costs in the property management system.

The Department for Communities and Local Government (DCLG) said that it wants to clamp down on a “small minority of rogue agents” operating property management services who force consumers to pay over-inflated charges, and will consider changing the law so that all letting and management agents must be qualified and regulated to practice.

The Communities Secretary, Sajid Javid, is launching a six-week “call for evidence” to establish whether a regulatory overhaul of the sector is necessary.

David Cox, the Chief Executive of ARLA Propertymark (the Association of Residential Letting Agents), and Mark Hayward, the Chief Executive of NAEA Propertymark (the National Association of Estate Agents), have commented on the plans: “ARLA and NAEA Propertymark welcome this announcement; we have long called for greater regulation of the housing sector. It will give consumers greater control over who manages their property, create long needed transparency, and raise the bar for those wishing to work in the housing sector. However, it’s concerning that estate agents don’t fall under the Government’s initial scope – we urge ministers to widen the remit to include the whole housing market.

“We are committed to ensuring consumers receive the best level of service when looking to buy, sell, rent or lease a property. Our members are required to have deposit and Client Money Protection schemes in place, and undertake regular training. However, this doesn’t stop some rogue agents from giving the industry a bad name. Blanket regulation is the right approach if we are to give consumers the confidence they deserve and reassurance that they will be treated fairly, no matter which agent they use.”

Adam Joseph, the CEO of The Happy Tenant Company, has also responded: “Enforcing transparency is the best way to give landlords, renters and leaseholders greater confidence that their managing agent is acting professionally and ethically. Whilst it may only be the minority of unscrupulous agents that load invoices with excessive charges for menial tasks, it tarnishes the reputation of the whole sector and must be stopped.

“Landlords and tenants should be able to see invoices from contractors and, in most cases, be given the option of two to three quotes to choose from before the work is carried out, particularly on more expensive maintenance works, such as boiler installations. Proptech software has made the sharing of maintenance works and associated costs really easy to facilitate, and any reputable managing agent should be happy to disclose all costs.”

Do you support the Government’s plans?

Further Increase in New Lettings Listings Recorded in September

Published On: October 19, 2017 at 9:05 am

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Prime London Lettings Report is showing that demand is outstripping rental supply.

A further increase in new lettings listings was recorded in September, according to the latest Property Activity Index from Agency Express.

Across the UK, the number of new lettings listings rose by 0.9% over the month to September, yet the amount of properties let during September dropped for a second consecutive month, by 2.8%.

Further Increase in New Lettings Listings Recorded in September

Further Increase in New Lettings Listings Recorded in September

Looking at the index’s rolling three-monthly data, figures remain down, with new lettings listings dropping by an average of 1.9% and the number of properties let down by 1.2%.

Around the country, seven of the 12 regions included in the Property Activity Index recorded growth in new lettings listings, while five saw increases in the amount of properties let during September.

The month’s top performer was the North East. Following a slumber market in August, lettings activity bounced back, returning robust growth for both new listings, which were up by 17.8%, and the number of properties let, which rose by an average of 20.9%.

Wales followed suit, reporting a record best increase in the amount of properties let during September, which was up by 18.6%.

Other regional hotspots included:

New lettings listings 

  • South West: +8.4%
  • North West: +7.1%
  • East Midlands: +6.4%
  • East Anglia: +4.4%

Properties let

  • Wales: +18.6%
  • East Anglia: +9.2%
  • West Midlands: +1.7%
  • East Midlands: +1.7%

The greatest declines witnessed over September were in Scotland. On a monthly basis, the number of new lettings listings dropped by 17.9%, while the amount of properties let during the month was down by 16.2%. Looking over Agency Express’ historical records, the decreases recorded this September are greater than those experienced in 2016 and 2015.

The Managing Director of Agency Express, Stephen Watson, comments: “This month, we have witnessed some growth across the UK lettings market. One or two regional pockets have reported record bests, while others performed consistently.

“The index’s rolling three-monthly data does show that we are still recovering from the slower pace experienced during June and July, but, as we move into October, we would hope to see further increases.”

Will Stamp Duty be Cut for First Time Buyers in Autumn Budget?

Published On: October 19, 2017 at 8:45 am

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The Government is considering a Stamp Duty cut for first time buyers when they purchase their first homes, according to new reports.

Stamp Duty has soared over recent years, as house prices have spiralled out of the reach of many, with industry experts claiming that the tax bill is a major barrier for first time buyers and a huge extra expense for buyers of larger homes – meaning that they stay put and clog up the property ladder.

Will Stamp Duty be Cut for First Time Buyers in Autumn Budget?

Will Stamp Duty be Cut for First Time Buyers in Autumn Budget?

Now, the Evening Standard has reported that Conservative backbench MPs are lobbying the Chancellor, Philip Hammond, to offer first time buyers a Stamp Duty holiday when he delivers the Autumn Budget on Wednesday 22nd November.

Rumours have also been rife of plans to release land owned by public bodies for further housing stock.

A cut in Stamp Duty would save first time buyers thousands of pounds on the purchase of their first homes, especially in areas of the country where house prices are particularly high.

Currently, anyone buying a property worth more than £250,000 must find an extra 5% of the home’s value in cash to settle their Stamp Duty bill with HM Revenue & Customs (HMRC).

According to the Land Registry, the average price paid by first time buyers in London is now a whopping £428,546 – meaning a £11,427 Stamp Duty levy.

Even on a property worth £250,000, buyers face a £2,500 Stamp Duty bill on top of their deposit, legal and valuation fees, and moving costs.

The latest official house price figures can be found here.

The Founder and CEO of online estate agent eMoov.co.uk, Russell Quirk, comments on the proposals: “Stamp Duty is an archaic and anti-aspirational land tax that should be scrapped altogether or, at the very least, become the responsibility of the seller, which I pitched to Eric Pickles MP many years ago when he was Shadow Secretary of State for Communities and Local Government – to no avail.

“Despite efforts to level the playing field with the abolition of the traditional slab style system and the increased tax on high-end, second home or buy-to-let properties, homeownership has remained out of reach for many.”

He believes: “If the Chancellor does reduce Stamp Duty for first time buyers in next month’s Budget, it will certainly be a step in the right direction and act as a massive shot in the arm for the sector as a whole.

“While positive, one can’t help but be skeptical and see this reduction as a smokescreen of sorts, masking the real issue of a severe lack of affordable property stock and the Government’s failure to address it.”

He continues: “Lowering the barrier to entry is a step in the right direction, but the issue is an imbalance in the supply and demand for property that continues to keep prices overinflated and out of reach.

“Should Mr. Hammond bolster his intent to help readdress this balance with the addition of freeing up unused land owned by various public bodies, he will be showing a real intent to tackle the housing crisis head on, and it will no doubt put him on the Christmas card list of first time buyers across the nation. But, as we’ve seen time after time, a great deal of positive speculation often amounts to little else than just that.”

The National Landlords Association and Residential Landlords Association have already put forth their proposals to the Chancellor ahead of the Autumn Budget next month.

Do you believe that cutting Stamp Duty for first time buyers will help to get more young people on the property ladder?

House Prices in 28 Locations Fail to Recover to Pre-Crisis Levels

Published On: October 19, 2017 at 8:04 am

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House prices in 28 towns and cities across the UK have failed to recover to pre-financial crisis levels, a decade after the market crash.

Property owners in these locations have suffered a lost decade of house price growth since the start of the crisis on 9th August 2007.

House Prices in 28 Locations Fail to Recover to Pre-Crisis Levels

House Prices in 28 Locations Fail to Recover to Pre-Crisis Levels

The latest Office for National Statistics (ONS) and Land Registry house price figures, for August 2017, sparked fears of a two-speed economy, as it emerged that the only places to suffer this fate outside of Wales were in the north of England, analysis by housebuilding investment platform Homegrown shows.

The most recent data gives us a clear picture of the devastating impact of the crash in the ten years since the start of the crisis on 9th August 2007 – the day when BNP Paribas froze three of its funds, suggesting that it could not value the sub-prime loans contained in the complex financial instruments on its books. Doomed Northern Rock chief Adam Applegarth later described it as “the day the world changed”.

Since then, house prices in Belfast, Hartlepool and Blackpool have suffered worse than anywhere else in the UK.

The average house price in the Northern Irish capital is now 43.7% lower than it was in August 2007, at just £120,351. Hartlepool has also failed to recover, with a 19.5% drop to an average value of £100,957, while prices in Blackpool are still 16.4% down, at an average of £105,057.

Even Liverpool and Newcastle – two of the cities centred in the idea of the Northern Powerhouse – never recovered. Liverpool is still 1.7% down, with an average house price of £126,862, while Newcastle is 1% down on ten years ago, at £162,876.

A stark north-south divide means that properties in the North East are still worth 5.6% less than they were a decade ago, while the North West is struggling with growth of just 5.5% over the past ten years.

Meanwhile, London, the South East and South West are 62.7%, 37.7% and 19.2% higher on average respectively.

Bradford, Oldham, Lancaster and Falkirk only just escaped lost decades of house price growth, recovering their ground to finish just £1,039, £1,765, £235 and £196 higher on average in the last decade respectively.

The Founder of Homegrown, Anthony Rushworth, says: “This is two-speed Britain in action. It’s now clear that great swathes of the UK have suffered terribly in the aftermath of the financial crash, while areas in high demand have shrugged it off and surged ahead.

“We are too reliant as a country on a small number of densely populated areas, particularly in London and the South East. The technology exists to take a much more balanced approach to where Britons live and work.”

He continues: “The Northern Powerhouse promised exactly that, but it will take more than a marketing campaign by one chancellor to really shift the balance and create a more stable property market for future generations.”

Landlords, do you own property in one of the locations that have failed to recover to pre-crisis levels? How has this affected your investment plan?

Why First-Year Students are Shunning University Halls

Published On: October 18, 2017 at 10:13 am

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A growing number of first-year students are opting for private, more luxurious student accommodation, rather than the traditional halls of residence, according to accommodation provider Collegiate AC.

Why First-Year Students are Shunning University Halls

Why First-Year Students are Shunning University Halls

The firm’s figures show that first-year students are increasingly shunning university halls in favour of more luxurious private student accommodation.

The CEO of Collegiate AC, Heriberto Cuanalo, says: “Today’s freshers have more choice than ever before when it comes to student pads. They are making the most of that choice by opting for alternatives to university halls. The image of the university lifestyle has changed dramatically over the past decade or so, and university halls are no longer in line with what students demand as part of their experience, so they’re voting with their feet.”

Collegiate AC’s data shows that first-year students accounted for 20.19% of its residents back in 2015/16. That figure rose to 21.66% in 2016/17 and to 22.06% in 2017/18. The proportion of freshers opting for private pads is rising slowly but steadily, year-on-year.

So why is this happening? First-year students are increasingly expecting a wide range of features from their accommodation. Not only do students now want en-suites in their rooms, but private fitness centres, club lounges, concierge services and dedicated study zones are also in high demand.

“Part of what makes the appeal of accommodation like this so strong is the blend of private space and outstanding social spaces,” explains Cuanalo. “Tuition fees nowadays mean that students have to pay a great deal of money in order to attend university, so it’s not surprising that they want to make the most out of every minute of that experience.”

Many purpose-built accommodation providers are also using the location of their sites to tempt first-year students away from university halls. Sites are not only well located for the university, but also for pedestrian access to the city centre – something that many university halls lack.

Cuanalo comments: “With location as well, it’s about going over and above that which is offered by traditional university accommodation. Most first-years are excited to experience all that their new town or city has to offer, and that means shopping, eating and socialising in the city centre. The more conveniently a property is located for this, the better.”

With demand for luxury student accommodation continuing to grow, there’s an opportunity for landlords to cater to the needs of first-year students with each new academic year – perhaps a new investment option is on the horizon!