Posts with tag: Fine & Country

Government UK House Price Index shows annual growth but month-on-month standstill

Published On: April 23, 2021 at 8:17 am

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Nation’s HMOs worth £26bn in current market conditions

The latest Government UK House Price Index has been released, showing an average annual increase of 8.6% for February 2021.

The index also shows a 0.0% month-on-month change from January, with the average price of a property in the UK sitting at £250,341.

Colby Short, founder and CEO of GetAgent.co.uk, comments: “The market remains in a very strong position despite monthly price growth sitting still and this was no doubt down to two factors. The first being the continued difficulties in securing a buyer caused by lockdown restrictions and the second being a drop in momentum on the run-up to what would have been the Stamp Duty holiday deadline. 

“While the latter will no doubt have an impact when it does arrive, it’s far more likely price growth will hit a bump in the road rather than a brick wall. The main reason for this is a severe shortage of housing stock available to satisfy demand and so even when buyer numbers reduce, we’re likely to see demand continue to outstrip supply which will keep the rate of house price growth stable.”

James Forrester, Managing Director of Barrows and Forrester, comments: “Many will be quick to panic at the sight of a month-on-month price growth stall but this simply doesn’t portray the overall health of the market, in the same way our efforts in combatting Covid can???t be assessed on such a short-term basis.

“The long-term picture shows a market in very good health, driven by strong regional performances across the board, from the South West, the East Midlands, Yorkshire and the Humber and the North West. As we enter what is often the busiest time of year, we can expect the market temperature to rise and house prices to follow suit for the remainder of the year, at the least.???

Marc von Grundherr, Director of Benham and Reeves, comments: “Although London continues to trail the rest in terms of the rate of house price growth, we’re certainly starting to see an early indication that the market is on the up. Tenant and homebuyer demand has started to lift during the first quarter of the year and this is only likely to grow stronger as lockdown restrictions are lifted and a return to professional and social normality continues.”

“While the market isn’t running as hot as other UK regions at present, this should work in the favour of the London market in the long run. A far more steady return to form is likely to be made and this will ensure that any crash landing as a result of the Stamp Duty holiday ending is going to minimised within the capital.”

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, comments: “The property market remains in a parallel universe at odds with the wider reality everyone has been living. It’s been a gloom-defying 12 months given that last March, when the first lockdown arrived, the market seized up, mortgage products were withdrawn and everyone held their breath.

“Fast forward a year and you no longer need to be a mystic or expert to predict what comes next and that’s precisely the point. Confidence is king and there’s plenty of it out there. That would have remained true even if the Stamp Duty holiday had ended. Now that it hasn’t, that’s just more fuel on the fire but its impact has been overstated all along.

“When it does finally end at the end of September, the market is likely to be cooling by then anyway after another bumper summer. Markets don’t move in straight lines but in the meantime the busy summer season and high demand, which is still growing faster than supply as the weather improves, is doing nothing to slow price rises.”

House prices increased by 8.5% over the year to December 2020

Published On: February 22, 2021 at 9:16 am

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Rightmove reports 'best ever spring sellers’ market' for the UK

The latest House Price Index published on GOV.UK by HM Land Registry looks at data for December 2020. The main highlights include:

  • UK average house prices increased by 8.5% over the year to December 2020
  • Average house prices increased over the year in England to £269,000 (8.5%), in Wales to £184,000 (10.7%), in Scotland to £163,000 (8.4%), and in Northern Ireland to £148,000 (5.3%)
  • The North West was the English region to see the highest annual growth in average house prices (11.2%), while London saw the lowest (3.5%)

You can read the full report on the Office for National Statistics website.

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, comments: “This confirms that 2020 was the year that fundamentals came home to roost. There was no escaping a lack of space for households who suddenly found they were living on top of each other with little respite. That has powered annual growth that reached a six-year high.

“Markets don’t move in straight lines and there’s no doubt there will be fresh challenges this year but there’s still too much pessimism around. One aspect being routinely ignored is the amount that Britons have saved during the past 12 months and the effect that will have in the real economy. 

“The Bank of England’s Andy Haldane revealed this month that he expects ‘accidental savings’ to have reached £250bn by June. This won’t just make itself felt on the high street and in our travel agents. It is set to be an instrumental supporting factor for house prices this year. 

“To put it in context, £250bn would fund the maximum stamp duty tax break of £15,000 on over 16.7million sales, which would be enough to cover every purchase in the UK for over 15 years. If the Chancellor does end the scheme as planned at the end of next month, it’s not necessarily all over for healthy house price growth even if some sales do fall through.” 

Adnan Shah, founder of ethical real estate investment manager Buraq London, comments: “Festive celebrations had been put on hold in December, but it seems no one told the housing market, which saw prices soar higher than New Year’s Eve fireworks. 

“In hindsight, there were hints of an overheating market, with the monthly mortgage approvals cooling 103,400 in December, down slightly from 105,300 in November.

“Much of the slowdown in January had been due to buyers’ fears over the stamp duty holiday ending, but the growing optimism about an extension should see house prices blossom through the spring.”

Halifax House Price Index shows house prices beginning to drop in January

Published On: February 9, 2021 at 9:44 am

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Average UK house price rises again, Halifax House Price Index reports

The latest House Price Index from Halifax shows a slight decrease in house prices during January 2021.

The highlights from Halifax’s report include:

  • House prices in January were 0.3% lower than in December
  • House prices were 1.6% higher in the quarter of November to January than in the previous quarter of August to October
  • House prices were 5.4% higher than in January 2020

Russell Galley, Managing Director, Halifax, comments within the report: “The average UK house price slipped by -0.3% in January, the biggest monthly fall since April last year. Whilst this pushed the typical property value down to its lowest level since October, at just under £252,000, prices are around £13,000 higher than a year ago. 

“There are some early signs that the upturn in the housing market could be running out of steam, with the annual rate of house price inflation cooling to its lowest level since August. Industry figures for agreed sales remain well above pre-pandemic levels but new instructions to sell have decreased noticeably, and total stock held by estate agents has risen to its highest level since before the EU referendum in 2016. 

“The Stamp Duty holiday has undoubtedly helped to fuel growing demand amongst households for larger properties. However, given the current time to completion across the market, transactions in the early part of 2021 probably don’t include many borrowers who expect to benefit from the stamp duty reprieve. 

“How far and how deep any slowdown proves to be is a challenge to predict given the prevailing uncertainty created by the pandemic. With swathes of the economy still shuttered, and joblessness continuing to edge higher, on the surface this points to slower market activity and downward price pressures in the near-term. 

“That said, we saw the power of homeowners to drive the market in the second half of last year as many people looked to find new properties with greater space, spurred on by increased time spent at home. Such structural demand changes, coupled with any further policy interventions by government, could yet sustain underlying market activity for some time to come.” 

Read the full Halifax House Price Index report here: https://www.halifax.co.uk/assets/pdf/january-2021-house-price-index.pdf

Halifax House Price Index
Halifax House Price Index shows house prices beginning to drop in January

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, comments: “The lockdown is playing its part in keeping prices as high as they are because it has reduced supply, fuelling greater competition among buyers for what is available. 

“The Budget is only around the corner now and, while it remains to be seen whether the Chancellor will extend the stamp duty tax break, he has a big deficit and many other levers to pull that could affect the market in much more significant ways.

“Politicians are used to hearing people cry foul when handouts end. Treasury minister Jesse Norman told a Parliamentary debate earlier this week that the stamp duty holiday has done its job. Therefore the focus could quite quickly shift to other issues, such as capital gains tax. 

“The stamp duty holiday has now faded as a force behind agreed sale prices, though some buyers with smaller chains are still hoping to complete before the deadline.” 

Lucy Pendleton, property expert at independent estate agents James Pendleton, comments: “This is as muted a response to the faded hopes of a stamp duty tax break that sellers could hope to see. 

“We were being led to believe we’d have to put our heads in our hands in January and brace for impact because of the end of the stamp duty relief but the market’s mechanics pointed to a different result all along. 

“Rents have fallen, putting negative pressure on prices and first-time buyers won’t pay stamp duty on purchases up to £300,000 once the scheme ends anyway, just as they did before. For almost everyone else, apart from those at the top of the chain, the lost relief can be clawed back by renegotiating if necessary. 

“It is sellers, not buyers, who are a little quieter at the moment. A lot of people with children have decided against listing their property for sale while they’re homeschooling and their home looks like a bomb has hit it. There are still plenty of first-time buyers looking and we’re just five weeks away from when people’s gardens start to look better and we always see a rush of activity after spring has sprung, 

“The fact the Chancellor hasn’t ruled an extension to the stamp duty holiday either in or out is helping to create another wait-and-see period for both vendors and buyers. However, properties are still getting a very high level of engagement online. This is always good news and will manifest itself when we have a bit more clarity after the Budget. People are still dreaming of moving to larger properties, and one home we listed recently at nearly £4m received 8,000 views in 14 days. Most of these buyers would not be able to stretch that far but it tells us that the appetite is still there and will be reflected in activity over the summer.

“The bellwether London market has peaked for now and the shift in behaviour of landlords last month is evidence of that. Many landlords decided they would cash in on record prices late last year but were asking too much for homes that weren’t in great condition. Since mid-January, a significant number of them have now given up trying to sell and, having got tenants out, are now trying to let them again. Their gamble hasn’t paid off and this is weighing on supply even further.”

Adnan Shah, founder of ethical real estate investment manager Buraq London, comments: “The modest falls in prices we’re seeing can be blamed on the impending end of the stamp duty holiday, and the chances of an extension are dwindling by the day.

“There have been two significant jumps in residential prices since the general election. First the Boris bounce, and then a post-COVID rally caused by pent-up demand and people rethinking their living situations. 

“This isn’t a market that needs puffing up any more. The threat of valuations becoming detached from reality should concern buyers, landlords and investors alike. 

“However, the vaccine rollout is proceeding better than expected, and if the engines of the economy are firing on all cylinders by the summer, the benefits could keep the housing market purring in the coming months.”

Nationwide’s January House Price Index also reports a slowdown in house price growth.

House price growth slows slightly as end to Stamp Duty holiday approaches

Published On: February 4, 2021 at 9:51 am

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end to Stamp Duty holiday

The January 2021 Nationwide House Price Index shows that annual house price growth has slowed for the first time in six months. This slowdown has occurred just as the end of the Stamp Duty holiday approaches.

The highlights of Nationwide’s report include:

  • Annual house price growth has slowed to 6.4% from 7.3% in December
  • Prices are down 0.3% month-on-month, after taking account of seasonal factors
  • Homeownership has increased for the third year running

Within the report, Robert Gardner, Nationwide’s Chief Economist, said: “To a large extent, the slowdown probably reflects a tapering of demand ahead of the end of the Stamp Duty holiday, which prompted many people considering a house move to bring forward their purchase. While the Stamp Duty Holiday is not due to expire until the end of March, activity would be expected to weaken well before that, given that the purchase process typically takes several months (note that our house price index is based on data at the mortgage approval stage).”

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, has commented on the index results: “A predicted collapse in house price growth has failed to materialise. This was supposed to be the month that legions of buyers effectively threw in the towel and moderated their offers having been forced to remove the Stamp Duty tax break from the equation.

“Yet, despite everything, this market is still clinging firmly to strong annual price increases and this is further evidence that, while the Stamp Duty tax break was a catalyst for the mini-boom, it’s not the main motivator pouring fuel on this fire. 

“This isn’t really that surprising. By the end of last year, the market’s gains had already eroded the tax benefit of the Chancellor’s scheme, which already suggested there was more going on. Those who benefit least are also those more likely to be older, with families and most in need of more space. These households are also more likely to have the money to make that move happen. They are responsible for the narrative that has characterised the past nine months. 

“Continued talk of negative interest rates isn’t doing anything to cool demand for mortgages either and the housing market could still have a few more surprises up its sleeve this year.”

Lucy Pendleton, property expert at independent estate agents James Pendleton, comments: “Forget the mild monthly price decline, this is hardly the performance of a market in peril. The fact that most buyers agreeing purchases now will almost certainly miss out on Stamp Duty relief has barely moved the needle so there are wider factors at work here and chances are they’ve been cooking up a storm all along.

“Just look at what this market has weathered. After a year in which it has faced a stubborn pandemic, associated economic chaos and tightening borrowing criteria for first-time buyers, it has still surged beyond anyone’s expectations. Even in London, which can swing earlier and further than other regions, the pendulum is showing a reluctance to swing to the other extreme. Achieved sales prices have softened but it hasn’t been enough to send badly squeezed first-time buyers stampeding back to estate agents’ windows. 

“Expect low-interest rates and vaccine optimism to continue to play a commanding role in what happens over the next few months, as all eyes turn to unemployment and the end of the furlough scheme. Those buyers who are confident in their income, however, will continue to make that felt and there are still plenty of them around.”

Adnan Shah, founder of ethical real estate investment manager Buraq London, comments: “A slight nudge southwards is a positive start to a year that had a lacklustre future written for it. January was arguably the sternest test of the residential market since the pandemic began. 

“The initial shutdown last year stemmed a lot of panic, whereas last month’s statistics demonstrate that the residential market is actually much more willing to shrug off the sort of temporary economics that reach our ears daily than people give it credit for.”

Latest government House Price Index released: Prices continue to rise

Published On: January 22, 2021 at 9:01 am

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The commuter belt rental markets where tenants can reduce their rent by as much as half

The Government has published its latest UK House Price Index, revealing statistics for November 2020. The highlights include:

  • The average price of a property in the UK was £249,633
  • Average UK house prices increased by 7.6% in the year to November 2020
  • Average house prices in the UK increased by 1.2% between October and November 2020

Read the full report here: https://www.gov.uk/government/publications/uk-house-price-index-summary-november-2020/uk-house-price-index-summary-november-2020

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, comments: “The COVID mini-boom was still in full swing in November, and it’s a measure of how strong the market was last year that a huge monthly leap in the annual growth rate doesn’t even surprise us anymore. 

“This was also a month that saw a second national lockdown, which buyers are expected to have taken in their stride, but that won’t necessarily show in these figures for a couple of months.

“Fast forward to January and confidence seems to be taking some punches. There’s been a negativity soup served up this week, with the stamp duty deadline now too close for comfort, but let’s not forget that when the pandemic erupted some were predicting massive house price falls in 2020. They never materialised and that wasn’t just down to the stamp duty holiday, which many now think was either unnecessary or rolled out too early, but rather a dramatic shift in the type of property people wanted to live in and its location. 

“The hunger to move because of repeated lockdowns is being underpriced and levels of agreed sales reported since November do still point to a resilient market. We will only have to wait a couple of weeks to see if this has continued through January, which is when most buyers could no longer really hope to transact in time. 

“It remains to be seen how many buyers really will pull out of purchases if they can’t claim the relief. Widespread renegotiations up and down chains are probably a more realistic outcome. When you’ve found the perfect house, it’s easy to say you’ll walk away but it’s much harder to do. Remember that most first-time buyers already benefited from a significant stamp duty discount even before the scheme began.  

“One headwind for the market that has been largely ignored concerns a huge drop in the UK’s population. In the past week, the Economic Statistics Centre of Excellence said official statistics had missed the fact that the population hadn’t grown last year but had actually fallen 1.3m since the pandemic began, aided by an exodus of over half a million foreign-born residents. It said that this represented the largest fall in the UK resident population since World War 2. This could have a dramatic impact on demand, even if that loss first makes itself felt in the rental market, with better value rentals reducing overall purchase demand.”

End of 2020 saw house prices at record high, Halifax House Price Index shows

Published On: January 12, 2021 at 9:34 am

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Nation’s HMOs worth £26bn in current market conditions

The latest Halifax House Price Index has been released, showing data from December. The key findings of the report highlight:

  • On a monthly basis, house prices in December were 0.2% higher than in November
  • In the latest quarter (October to December) house prices were 2.6% higher than in the preceding three months (July to September)
  • House prices in December were 6.0% higher than in the same month a year earlier

Read the full report here: www.halifax.co.uk/assets/pdf/december-2020-house-price-index.pdf.

Lucy Pendleton, property expert at independent estate agent James Pendleton, comments: “This market seems to be able to hurdle anything and, though the annual growth rate has cooled slightly, it still continues to plough a low-Earth orbit.

“It must be beginning to dawn on the Chancellor that the stamp duty tax break was completely unnecessary. Any sensible estate agent is hoping the market puts on the brakes before we end up in bubble territory. A housing market has to take the economy with it ultimately, and the threat to the labour market in the second quarter of this year is a major concern.

“The simple truth is that extra space has become non-negotiable for legions of homeowners with families, and the usual winter slowdown has met the immovable force that is hundreds of thousands of people all trying to jump to larger properties at the same time.

“It’s right about now that vendors begin to think of their homes as piggy banks once again, even if agents on the ground are seeing more homes fall short of asking prices. This only leads to tears later on when the chasing pack forces valuations back to a more sensible level, and there are indications in London that this is already beginning to happen.”

Nicky Stevenson, Managing Director at national estate agent group Fine & Country, comments: “Buyers forced to re-evaluate their living arrangements have delivered a market with endless momentum that now threatens to course right through to the spring. It’s very unusual to reach a record high in December, when buyers usually use the winter to pause their house hunting.

“This time around, buyers have remained steadfast and this underlines the fact that the race for more space is no passing fashion. It looks set to be a seismic shift in priorities that could last a generation and a third national lockdown is only going to solidify that trend.

“People have long memories when it comes to the traumas inflicted in situations like this. Room to spread out is now putting other so-called essentials in the shade and forcing compromises over things that would once have been deemed priorities like en-suites and out-buildings.

“This is forcing buyers to focus on a much longer time horizon that allows them to mentally set aside headaches like Brexit, the pandemic, and the end of government support measures.

“The more time passes, the more apparent it becomes that the desire for a larger home is trumping the stamp duty tax break in buyers’ eyes, as it becomes increasingly unlikely that transactions will complete in time to benefit.”