Written By Em

Em

Em Morley

Manchester property prices to boom in next decade

Published On: October 8, 2015 at 2:21 pm

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Categories: Property News

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An interesting new survey has predicted the top ten English locations where property prices are likely to soar during the next ten years.

Manchester tops the list, while surprisingly, London is nowhere to been seen.

Predictions

The research was conducted by online estate agents HouseSimple and suggests that locations such as Rotherham, Leicester and Surrey will see property prices increase substantially during the next decade.

Of the locations in the top ten, there are a mixture of cities and commuter towns, with a strong variation of house prices. HouseSimple made their predictions using key indicators, such as good transport links, young populations and upcoming, trendy eating locations.

The top ten locations were:

  • Manchester
  • Rotherham
  • Harborne, Birmingham
  • Leicester
  • Hythe, Kent
  • Norwich
  • Hove
  • Ipswich
  • Ilkley, Bradford
  • Woking, Surrey

Unsurprising

Peter Armistead of Armistead Property noted that, ‘it’s no surprise that Manchester has come out on top thanks to the expansion of the MetroLink tram system, the trendy Nothern Quarter and the BBC Media City.’ He said that, ‘Manchester has been voted, for a second year running, the best place in the UK to live. It has an amazingly vibrant restaurant, bar, club and music scene, not to mention its galleries and museums.’[1]

‘We have an amazing student scene and our Universities and teaching/research facilities are truly world class. Manchester is home to nearly 100,000 students, making it one of the largest student cities in Europe,’ Armistead continued. He feels that, ‘Despite all of its many advantages and attractions, Manchester is actually a very affordable place to live and many students chose to carry on living here after they graduate, as well as graduates from other areas moving to Manchester.  There’s a very important young professional scene in Manchester.  The cost of wages relative to property costs is a very important factor in attracting these people.  House prices in London are about five times what they are in Manchester, but salaries are only 30% higher.’[1]

Manchester property prices to boom in next decade

Manchester property prices to boom in next decade

 

Affordable

Mr Armistead said that an, ‘average residential property in Manchester is just £155,000, while a flat in a good area costs as little as £120,000. It’s not surprising that many investors, especially from the South, are targeting Manchester as a great place to invest. 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]

‘Manchester is a great place for investors.  I have built a successful, mid-sized portfolio of buy-to-let properties in South Manchester.  Over the last 12 months I have enjoyed average rental yields of 6% per cent across my 80 properties,’ Armistead concluded.[1]

[1] http://www.propertyreporter.co.uk/property/manchester-predicted-to-boom-in-the-next-ten-years.html

 

 

Experts Discuss Pension Tax Relief

Published On: October 8, 2015 at 1:58 pm

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Categories: Finance News

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Thomas Selby, Head of News at Money Marketing, was joined by a panel of experts today (8th October 2015) to discuss pension tax relief.

He began by asking Dr Yvonne Braun, Director of Long-Term Savings Policy at the Association of British Insurers, what is wrong with the current system.

Experts Discuss Pension Tax Relief

Experts Discuss Pension Tax Relief

She responded by simply stating: “The complexity of it.”

She explains that alongside being expensive for the Treasury, the people who need to save “don’t actually understand how it works”.

She reports: “70% of pension tax relief actually goes to higher and additional rate tax payers. Since 2013, we’ve said we need to see reform.”

She believes the complexity arrives through additional rules being added over time and the name. “Call it something different,” she suggests.

And Mick McAteer, the Director of the Financial Inclusion Centre, reinforces Yvonne’s point that the current system “disproportionately benefits the better off”. He wants to see the “maximum number of people in society” benefit from reform.

Although Fiona Tait, a Pensions Specialist at Royal London, believes we need to “sit back and look at the current system”, she thinks there are positives. One is the incentive, which she insists people like. She would want to see this continue, but believes we should “get away from calling it tax relief”.

On the new pension freedoms, Adrian Boulding, the Principal Consultant at Dunstan Thomas, observes that “people with small pots are taking money out” as they are “aware of the freedoms”. But among those with larger sums of savings, he’s seen them “behaving responsibly”.

If the pension system becomes an ISA scheme, Adrian says it will be difficult to keep the employer on board, as the “third leg – the Chancellor” will be removed.

He states: “Workplace ISAs don’t work, workplace pensions do.”

He thinks that if ISAs are introduced, individuals will be on their own, “trying to fund for their retirement through an ISA”.

“You need those two other legs too – the employee, employer and the Chancellor,” he believes.

On a flat-rate system, Yvonne says the message needs to be improved: “Ditch the expression tax relief.”

She suggests a name such as “saver’s bonus”, which is “very plain that you get something on top; if they don’t save, they’ll miss out”.

The full session can be viewed on demand on the website later today: http://www.moneymarketing.co.uk/mmwired-what-next-for-pension-tax-relief/

Home Sales at 16-Month High, Reports RICS

Published On: October 8, 2015 at 12:58 pm

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Categories: Property News

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Home sales have risen across the UK, hitting a 16-month high, according to the Royal Institution of Chartered Surveyors (RICS).

Home Sales at 16-Month High, Reports RICS

Home Sales at 16-Month High, Reports RICS

It reports that agreed sales have increased at the fastest rate since May 2014 and prices have grown further across all parts of the UK, as demand continues to outweigh supply.

This is the fifth consecutive month that the RICS has recorded a rise in sales and this sixth for which an increase in demand was witnessed.

However, the RICS warns: “Although activity is picking up, the ongoing lack of new instructions and the resulting limited stock on the market continue to be an issue for the sustainability of the market.

“The number of new instructions has fallen in 13 of the last 14 months.”1

Chief Economist at the RICS, Simon Rubinsohn, explains: “The indications are that we are locked in a cycle where the lack of available properties on agents’ books is itself deterring some potential vendors from thinking about putting their own property on the market.

“Against this backdrop, it is hard not to see prices continuing to move higher over the coming months and into the early part of 2016, notwithstanding the present concerns regarding the affordability of housing in some areas of the UK.”1

The RICS has seen a similar picture for the lettings sector, with tenant demand rising, outstripping supply.

Peter Mockett, of Hilbery Chaplin Residential in Essex, responds to the findings: “Prices being forced upwards due to acute shortage of new instructions. First time buyers competing with buy-to-let investors so we welcome proposed changes in tax allowance on mortgage interest. No first time buyers, no market.”1

And John Williams, from Brennan Ayre O’Neill in The Wirral, comments: “The limited stock coming to the market is encouraging some unrealistic pricing as agents compete for market share.”1

1 http://www.propertyindustryeye.com/sales-pick-up-to-16-month-high-as-rics-warns-on-lack-of-instructions/

 

 

 

 

 

 

 

 

 

 

 

New House Price Record Set in Every Month This Year

Published On: October 8, 2015 at 12:04 pm

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Categories: Property News

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New House Price Record Set in Every Month This Year

New House Price Record Set in Every Month This Year

The average house price in England and Wales has risen by 4.2% over the last year, reaching £284,742, according to the latest LSL Property Services House Price Index.

The data reveals that last month was the strongest September for house sales since 2007, fuelled by an increase in activity in the north and high annual price growth in the South East.

September’s 0.4% monthly price inflation on August also means that a new house price record has been set every month this year.

Director of e.surv chartered surveyors, Richard Sexton, reports: “The speed of house price growth across England and Wales may not be setting the world alight, but it’s certainly showing it has stamina – September marks the 42nd successive month of positive annual growth.

“Typical property prices are now £11,500 higher than a year ago and house price growth continues to outdo rises in wages and consumer prices.

“This growth is primarily being underpinned by sturdy demand and solid activity at the bottom of the property ladder.

“The most frequent paid property price across England and Wales is just £125,000, mirroring the level at which Stamp Duty becomes payable, and reflecting the impetus that has been injected in the first time buyer market recently.

“The shift in Stamp Duty bands continues to slow growth at the higher end of the market, and prices above £600,000 are largely stationary.”1 

The greatest annual price rise was experienced in the South East, with homes now costing 5.8% more than last year, at an average of £333,539.

Prices in Greater London increased by 3.9% over the year, and the East Midlands and South West also witnessed substantial yearly growth, of 4.8% and 4.5% respectively.

The lowest rises were experienced in the North of England at 1.8% and Wales at 1%.

1 http://www.propertyindustryeye.com/house-prices-rise-by-more-than-4-year-on-year/

 

 

 

 

 

 

 

 

 

 

 

 

 

New property listings surge in September

Published On: October 8, 2015 at 12:01 pm

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Categories: Property News

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The latest research from by HouseSimple.com has revealed that September was a good month for new property listings.

According to data from the report, listings increased by 9.1% between August and September and by 27.1% in London.

Return to form

Following a summer lull, in which housing supply fell to critically short supply levels, in excess of 60% of British towns and cities saw a rise in property listings in the last month.

In particular, the Scottish market saw a rise in new property listings during September, with supply up by 171.1% in Dundee, 48.8% in Aberdeen, 28.3% in Edinburgh and 24.7% in Perth.[1]

Sunderland saw the most substantial rise in property listings in England, which rose by 46.7% in the region. Cambridge also saw a significant increase of 35.5%.[1]

Capital gains

London saw almost 25,000 new listings in September, with the largest increase seen in the borough of Kensington and Chelsea, with a rise of 122.2%. Camden recorded an increase in listings of 95.7%.[1]

Just two of the thirty-two London boroughs-Croydon and Lambeth- saw a dip of property supply during August and September.

New property listings surge in September

New property listings surge in September

Alex Gosling, CEO of online estate agents HouseSimple.com stated, ‘The current housing shortage in the UK has been a major contributory factor in rising property prices. We are in the grip of a severe property shortage and if September hadn’t seen a spike in new property listings we really could have been looking at a full-blown supply crisis.’[1]

‘Fortunately it seems sellers have woken from their summer slumber and September figures are far more encouraging,’ Gosling continued. ‘Almost 60% of UK towns and cities have seen stock levels rise between August and September. But it’s too early to breath a huge sigh of relief that a property crisis has been averted. Stock reservoirs still remain dangerously low.’[1]

Gosling believes that, ‘September needs to provide the catalyst,’ and that, ‘we need to kick on from here and gather some momentum for the rest of the year. Concluding, he sad,’ with demand so high, it’s the perfect time to sell. The housing market still has a long road to travel to rebalance supply and demand, but these latest listings figures show that we are finally moving in the right direction.’[1]

[1] http://www.propertyreporter.co.uk/property/september-sees-91-rise-in-new-property-listings.html

 

 

If Interest Rates Rise, More Than Half Would Struggle to Pay Their Mortgage

Published On: October 8, 2015 at 11:01 am

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Categories: Finance News

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If interest rates rise, more than half of borrowers state that they would either struggle or fall behind with their mortgage repayments, according to a report by the Building Societies Association (BSA).

The research reveals that one in ten would experience “real financial problems”.

Also, one in four claim that they would experience difficulty “from time to time”.

Almost one in five said that a rate increase would force them to cut down on essentials, such as food and clothing, in order to meet their monthly repayments. Furthermore, 15% believe they would have

If Interest Rates Rise, More Than Half Would Struggle to Pay Their Mortgage

If Interest Rates Rise, More Than Half Would Struggle to Pay Their Mortgage

to work more hours to keep on top of their finances.

Over one fifth (22%) of respondents said that they would not have to make changes to their lifestyle in order to meet their mortgage repayments.

Head of Mortgage Policy at the BSA, Paul Broadhead, comments on the findings: “Concern from borrowers is natural when it comes to interest rate rises.

“There are at least 1.85m homeowners that have never experienced a rate rise. We have had a record low base rate for so long, it is unsurprising that some people are concerned that a rise in rates will affect their lifestyles and ability to make mortgage repayments.

“Clearly some of the actions borrowers say they would take may not be within their control, for example, working additional hours.

“Our advice to those concerned about interest rate rises is to start thinking about how they will manage the increased costs.”

He suggests: “This could include creating a household budget, to taking a look at mortgage calculators and rescheduling unsecure loans such as credit cards. Free money advice is available for those that are concerned.

“The good news is that the results of our survey show nearly a quarter (22%) of borrowers will not have to make any changes to their lifestyle when interest rates rise. With the economy more stable than it has been for years, this is a positive result.

“That said, with inflation near zero and the Monetary Policy Committee voting by a majority of eight to one to maintain the bank rate at 0.5%, it is looking unlikely that things will change before well into 2016.”1

Chief Executive of the Money Advice Trust, which runs the National Debtline, Joanna Elson, adds: “After years of low rates, borrowers’ minds are beginning to focus on the prospect of higher interest rates, and what this will mean for their finances.

“Nevertheless, many mortgage payers are still in for a big financial shock when rates do start to climb – and we remain concerned that many will fall into problem debt as a result.

“We must not forget that renters, too, are likely to be affected as extra mortgage costs are passed on by landlords.

“Households now have a window of opportunity to re-assess their budgets, look again at their borrowing and think about how they will cope with higher interest rates.

“It is crucial they take advantage of this and prepare themselves now.”

She advises: “Anyone who is concerned should speak to their lender and seek free debt advice from a charity-run service such as National Debtline as soon as possible.”1

1 http://www.propertyindustryeye.com/interest-rate-rise-would-leave-more-than-half-struggling-to-pay-mortgage/