Posts with tag: house prices

House Prices still Falling in 63% of London Local Authorities

Published On: October 31, 2018 at 10:27 am

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House prices in almost two-thirds (63%) of London local authorities have dropped on an annual basis, but the proportion of markets recording price declines is expected to slow over the remainder of the year, according to Hometrack’s latest UK Cities House Price Index.

Property values fell in 29 London local authorities and the commuter belt over the past 12 months. The prosperous borough of Kensington and Chelsea suffered the greatest year-on-year decrease, at an average of 4.9%, taking the typical house price to £1.17m.

It was followed by other wealthy boroughs, such as Camden and Hammersmith & Fulham, where prices dropped by an average of 4.3% and 3.1% to £737,000 and £707,000 respectively.

House Prices still Falling in 63% of London Local Authorities

House Prices still Falling in 63% of London Local Authorities

However, Hometrack’s latest analysis also reveals that the number of London postcodes recording monthly price declines has dropped to 44%, from a peak of 70% in December 2017.

This means that 56% of postcodes are now recording month-on-month price rises, implying that the proportion of markets experiencing annual price falls will slow further over the rest of 2018.

Although the London City Index as a whole has recorded a 0.4% average decrease year-on-year, lower value markets in outer and surrounding London have witnessed modest price growth over the past year, as affordability has been less stretched than in central areas.

For instance, house prices in Barking and Dagenham increased by an average of 2.3% over the past year, to £296,400. Havering, Spelthorne and Bexley experienced the next highest growth, all at an average of 1.4%.

Nationally, house prices in UK cities increased by an average of 3.2% in September, driven by strong growth in regional areas outside of the South East.

Property values are rising fastest on an annual basis in Liverpool (6.9%), followed by Birmingham (6.5%), Leicester (6.4%), Manchester (6.2%) and Glasgow (6.2%). With growth of over 6%, house price inflation in these five cities remains more than twice the rate of earnings growth (2.7%), as prices continue to rise off a low base and affordability remains attractive.

Richard Donnell, the Insight Director at Hometrack, comments on the report: “London’s housing market has registered a major slowdown in price growth over the last two years, as stretched affordability levels, multiple tax changes and weaker market sentiment have all impacted the demand for housing. Turnover has fallen much more than prices, which tend to be stickier on the way down, with few households being forced sellers.

“Our latest analysis reveals price falls are concentrated in inner London, while values continue to rise slowly in the most affordable parts of outer London and the main commuter areas. Price growth has firmed over the last six months, but the annual rate of growth remains negative, and we expect the current re-pricing process to run into 2019.”

He adds: “City level house price growth remains well above average in the most affordable cities. While the rate of growth has moderated slightly, prices in five cities are still rising twice as fast as the growth in earnings. We expect continued price growth in the most affordable markets over the remainder of the year.”

Latest UK House Price Index from the ONS has been released

Published On: October 18, 2018 at 8:03 am

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The main findings from the latest House Price Index (HPI) from the Office for National Statistics (ONS) were:

  • Average house prices in the UK have increased by 3.2% in the year to August 2018 (down from 3.4% in July 2018)
  • As of August 2018, the average house price is £233,000 – this is £7,000 higher than August 2017
  • Prices have broadly remained stable at a national level since April 2018

Commentary on the latest HPI

Steve Seal, Director of Sales & Marketing at Bluestone Mortgages, comments on the latest ONS HPI statistics: “It will be a relief for many borrowers that house price growth continues to slow down. However, this does not avoid the fact that many would-be homeowners remain in Generation Rent.

“With the cost of living expenses increasing month-on-month, aspiring borrowers may find their savings squeezed – particularly when it comes to an unexpected life event like an accident, divorce or illness. Leading to some going into the red, certain lenders may use these events as the reason not to progress with an application. It’s therefore vital that specialist lenders continue to provide support for these borrowers who require extra attention, without making a judgement solely based on a number.”

Craig McKinlay, New Business Director, Kensington Mortgages comments: “Albeit at a slower rate, house prices are still creeping up – in large part due to our lack of supply. As a result, all rungs of the ladder struggle to find appropriate property, which in turn slows down housing activity.

“With the Autumn Budget only a few weeks away, it would be great to see the government introduce incentives for older homeowners to downsize. An exemption from Stamp Duty, for example, would encourage movement. Understandably, there has been a lot of attention on first-time buyers, but maybe it’s time to start thinking about those further up the ladder too.”

Chrysanthy Pispinis, of Post Office Money, comments: “Despite the continued overall slowdown in house price growth, there are areas in the UK that are still seeing strong growth year-on-year. Cities such as Manchester and Leicester have seen 9% growth in the last year, though this shouldn’t deter first-time buyers (FTBs) as properties in these areas still remain affordable for new buyers.

“Other cities which are continuing to see growth and provide affordable options for FTBs include Portsmouth and Southampton, both with 8% growth over the last year. Three in five (63%) recent FTBs compromised on location to get their foot on the ladder, proving that buyers can find their first home and make their money go further by doing their research.”

House Prices in Salisbury Plummet Following Nerve Agent Attack

Published On: October 17, 2018 at 9:45 am

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The nerve agent attack in Salisbury has caused house prices to plummet in the Wiltshire city, according to analysis by cashbackremortgages.co.uk.

Using Land Registry and Home.co.uk data, the study found that the average house price has dropped by almost 9% since Salisbury became the centre of an international scandal, when a former Russian spy and his daughter were poisoned with the novichok nerve agent in March.

The research revealed that the average price of a sold property in the Wiltshire city averaged £328,243 between February and April, but fell by 8.8% to £299,207 between May and July.

Comparatively, across the whole of Wiltshire, the average house price increased by 1.7% over both three-month periods.

It also seems that more Salisbury homeowners are now trying to sell their properties since the poisoning that claimed two more victims, one of whom died.

The percentage of new property listings by estate agents in the city rose by almost a fifth (19%) between May and July, compared to the period between February and April.

Suchit Sethi, the Founder of cashbackremortgages.co.uk, comments on the findings: “Over the past seven months, Salisbury has been at the centre of an international scandal. The research we’ve carried out suggests the scandal may have fed its way through to the local property market, too.

“Prices have fallen disproportionately in Salisbury, and the events this year may well be what has driven that decline. It’s possible that the relentless media attention focused on the city has stirred up doubts in the minds of some prospective buyers and contributed to a drop-off in demand. Equally, the scandal may have caused a surge in people putting their homes on the market.”

He believes: “Over time, things will almost certainly recalibrate to the norm, but, for now, the Salisbury property appears anything but normal.”

Do you live in Salisbury? Give us your thoughts on the property market since the attack.

Liverpool is Setting an Example for other UK Cities

Published On: October 11, 2018 at 9:34 am

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Liverpool has just hit the headlines for leading the UK’s cities in terms of its house price growth. The Hometrack UK Cities House Price Index reported 7.5% inflation in Liverpool during the year to August 2018. For those working in the Liverpool property sector, the news comes as no surprise.

Jonathan Stephens, MD, Surrenden Invest, commented:”Liverpool has exceptionally strong credentials as a property investment destination. It has a booming city centre population, a thriving business community and a superb cultural offering. This combines to produce a high and sustained level of demand for decent, well-located rental homes, which in turn means that property investors can earn healthy yields, as well as enjoying the potential for impressive capital growth.”

“Liverpool is one of those rare cities that has it all. It’s a delightful blend of economic opportunities, cultural pursuits, a superb gastronomic scene, a lively sporting offering and a thriving property market. The city also enjoys property prices that are well below the average for the UK, which is another reason that it is such an exciting prospect for property investors.”

“This is definitely an exciting phase in Liverpool’s history. The city is one of the most investable destinations not just in the UK, but in the world. The resulting boom in population is generating a long-term, positive impact on the property market. I wouldn’t be surprised to see Liverpool leading the UK again in terms of its property price increases over the coming months.”

As part of the Liverpool-Manchester metropolitan area, the city was recently flagged up by IBM’s annual Global Location Trends report as being among the top ten cities in the world for foreign direct investment (FDI). The area pulled in the tenth highest number of FDI projects in 2017, according to the report, resulting in the creation of some 7,000 jobs.

Earlier this year, TripAdvisor also highlighted Liverpool as one of the best places in the world to visit. The city’s cultural offering was key to that decision. This year, it is offering a year-long programme of events, exhibitions, seasons and performances to mark the ten-year anniversary of Liverpool being crowned European Capital of Culture. One of the most impressive offerings is the Terracotta Warriors exhibition, which is drawing in visitors from around the UK and beyond.

 

 

Quarterly House Price Growth Remained Steady in September, Reports Halifax

Published On: October 8, 2018 at 10:03 am

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House prices in the latest quarter (July to September) were, on average, 1.8% higher than in the preceding three months, according to the latest House Price Index from Halifax. This is the third consecutive quarterly increase.

Annually, house prices were up by an average of 2.5% in September, taking the typical property value to £225,995. However, this rate of growth is down from 3.7% in August.

Month-on-month, house prices dropped by an average of 1.4% in September, marking the second consecutive decline on this measure.

Housing activity

Bank of England (BoE) data shows that the number of mortgages approved for home purchases – a leading indicator of completed sales – rose to 66,440 in August (for which the latest figures are available), from 65,156 in July.

This figure is very close to the five-year average approval rate, of 66,550, but is 2,000 above the monthly average for the previous 12-month period, of 64,638.

Mortgage approvals have remained relatively low, but stable, over the past five years. The monthly average from August 2013 to July 2018 was 66,550, and the maximum and minimum monthly variance from this average is 11%.

This recent five-year period has a notably lower number of mortgage approvals and less volatility than the average before 2008. From August 2002 to July 2007, the monthly average number of approvals was 110,550, but the highest monthly mortgage approval rate was 20% above this, and the lowest was 33% below.

Quarterly House Price Growth Remained Steady in September, Reports Halifax

Quarterly House Price Growth Remained Steady in September, Reports Halifax

The number of completed home sales in the UK remained near the monthly average for the past 12 months in August, rising to 99,120 month-on-month. In the three months to August, sales increased by 1.2% from the previous three months. The volume of residential transactions has been broadly flat over the past year and is likely to remain so in the coming months.

The number of homes for sale has continued on the trend of being low, with 2018 seeing the lowest recorded amount of homes for sale for any year in the past decade. Since June 2015, the average stock of homes for sale per chartered surveyor has been less than 50,000, which is below the lowest rate and trend for the previous five years.

Comments

The Managing Director of Halifax, Russell Galley, comments on the figures: “With the annual rate of house price growth easing to 2.5% in September, from 3.7% in August, and the quarterly rate of growth remaining at 1.8% for the second month, we are seeing a steadying in house price inflation across these more stable measures.

“This is set amongst mortgage approvals and completed house sales remaining broadly unchanged, although a gradual pick-up in wage growth has helped to support household finances.”

He continues: “The annual rate of growth is near the top of our forecast range of 0-3% for 2018, as a low supply of new homes and existing properties for sale, combined with historically low mortgage rates and a high employment rate, continue to support house prices.”

Lucy Pendleton, the Founder Director of independent estate agent James Pendleton, also gives her thoughts: “This bulletin is as clear as mud, but it’s the sharp monthly drop on August’s prices that sticks out because of its timing.

“September is a month that normally sees a burst of activity as people return from holiday and go back to work. So, a fall of this scale is quite a retreat at a time when increased competition among those racing to move by Christmas would normally give the market a bit of buoyancy.

“The concern is that legions of Brits didn’t get back from holiday and head straight out again to the estate agent like they normally do. The back to work bounce is nowhere to be seen.”

The Director of Sales and Marketing at Bluestone Mortgages, Steve Seal, analyses the findings: “Whilst the average growth of house prices remains steady, this doesn’t necessarily mean all doors are open for aspiring homeowners. If anything, there are still significant barriers when it comes to securing funding.

“Lifestyle and financial habits are changing – and it’s unfair that some potential buyers are turned away for not fitting an outdated computer scoring system. A missed phone or credit bill, or unforeseen costs for an accident shouldn’t mean you are barred from homeownership. These customers, instead, need a personalised underwriting experience that ensures the nature of their situation is fully understood. It’s vital that specialist lenders continue to find the best solutions for all of their clients, based on a rounded and fair view of their individual financial situation.”

Annual House Price Growth Steady in September and Q3

Published On: October 3, 2018 at 9:55 am

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Annual house price growth was steady in both the month of September and third quarter (Q3) of the year, according to the latest House Price Index from Nationwide.

The latest report covers the monthly data for September, as well as quarter-on-quarter figures for Q3, which cover the three months to September.

Monthly data 

The average house price increased by 0.3% in September, which is up from the decline of 0.5% recorded in the previous month. However, annual house price growth between August and September remained steady, at an average of 2.0% for both months.

The average house price across the UK now stands at £214,922.

Robert Gardner, the Chief Economist at Nationwide, comments: “Annual house price growth was stable in September, at 2%. Indeed, annual house price growth has been confined to a fairly narrow range of 2-3% over the past 12 months, suggesting little change in the balance between demand and supply in the market.

“Looking further ahead, much will depend on how broader economic conditions evolve, especially in the labour market, but also with respect to interest rates. Subdued economic activity and ongoing pressure on household budgets is likely to continue to exert a modest drag on housing market activity and house price growth this year, though borrowing costs are likely to remain low.”

Annual House Price Growth Steady in September and Q3

Annual House Price Growth Steady in September and Q3

He adds: “Overall, we continue to expect house prices to rise by around 1% over the course of 2018.”

Quarter-on-quarter figures

On a quarterly basis, the average house price increased by 2.1% in the year to Q3, which is down only slightly from the 2.2% rate of growth recorded in Q2.

Regional house price growth was slightly more varied in Q3, however, though Southern England continued to see more subdued rates of growth.

Yorkshire and Humberside was the top performing region of the quarter for the first time since 2005, with the annual rate of growth picking up to 5.8%.

Northern Ireland also saw annual price growth strengthen, to an average of 4.3%. Wales experienced a slight softening in growth, with prices up by 3.3% year-on-year. Price growth also slowed in Scotland, from a rate of 3.1% in Q2 to 2.1% in Q3.

The Outer Metropolitan, London and North all recorded small annual price declines, with the North being the weakest performing region, after prices fell by an average of 1.7%.

England witnessed a 0.6% quarter-on-quarter rise in Q3, with prices up by 1.4% compared to the same quarter last year.

For the sixth consecutive quarter, price growth in Northern England exceeded that in Southern England. While the North saw prices drop, other regions, such as Yorkshire and Humberside and the North West, experienced accelerated price growth, meaning that overall prices in Northern England were up by an average of 4.1% annually.

Meanwhile, in Southern England, both London and the Outer Metropolitan regions saw prices decline year-on-year, leading to overall price growth in the South slowing to just 0.3%. However, looking at price levels, there is still a significant gap, with the average price in Southern England standing around twice that in Northern England.

Gardner gives his thoughts on the quarterly statistics: “Overall, UK house price growth remained broadly stable, but regional house price developments were more varied.

“For the fifth quarter in a row, London prices fell in annual terms, though the decline remained modest, at just 0.7%. Indeed, prices in the capital are only 3% below the all-time high recorded in Q1 2017 and are still more than 50% above their 2007 levels.”

He continues: “The Outer Metropolitan region also saw a slight year-on-year fall, with prices down 0.3% in Q3. The weakest performing region was the North, where prices were down 1.7% year-on-year.

“Yorkshire and Humberside was the strongest performing region in England, and also the UK, with prices up 5.8% year-on-year. The East Midlands continued to see relatively strong growth, with prices up 4.8% year-on-year.”

Gardner explains further: “Northern Ireland saw a pick-up in annual price growth to 4.3% and was the best performing amongst the home nations. Wales saw a slight softening in growth, with prices up 3.3% year-on-year. Price growth also slowed in Scotland, from 3.1% in Q2 to 2.1%.

“England was again the weakest performing nation, with prices up 1.4% year-on-year.”

Industry Experts have Responded to the New Data

Industry Experts have Responded to the New Data

Comments 

James Newbery, the Investment Manager at property investment platform British Pearl, responds to the index: “What’s striking is that we are still a nation divided. Growth since the financial crisis has been incredibly uneven, with many regions still struggling to get back to where they began, whereas London has powered ahead. That means there are still opportunities out there, but they must be chosen carefully.

“What’s significant is that, even in the market that has cooled the most — London — prices are still very close to all-time highs. It has been a gentle softening over what is now a relatively long period, and you can partly credit Help to Buy and a weaker pound with warding off a convulsion in prices. A market that balloons then falls back hard is something all buyers fear, but the capital may well have dodged this eventuality against the odds.

“People’s confidence in the Government to deliver the Brexit result they want might be waning, but economic factors and buyer incentives still mean deals in the capital add up on paper.”

The Founder Director of independent estate agent James Pendleton, Lucy Pendleton, also comments: “London looks like the sick man of the UK on paper over five quarters, but the capital is in more a holding pattern than stuck in a rut. Prices in the capital have corrected, but sheer weight of numbers means price tags don’t have to sink far to pick up renewed interest.

“The market is playing pinball nationally between annual growth of 2% and 3%. It has the distinct look of a herd waiting to see what’s going to happen next before it decides which way to go. People are waiting to see whether the Brexit gods deliver us a very bad Brexit or just a tumultuous one.

“Politics has come to the kitchen table whether people like it or not and estate agents are already talking about Christmas coming early, but it’s next year they’re talking about.

“The festive season always delivers a slowdown and Brexit promises to deliver a second in March, with no mulled wine in sight. All eyes will be on how this affects buyer sentiment as we hit the usually busy post-Christmas period. We are expecting to be coasting into December, with annual growth still coming in at double the Nationwide’s prediction for the year, but wait-and-see could still be the order of the day come January, and that could severely dampen confidence.”

Steve Seal, the Director of Sales and Marketing at Bluestone Mortgages, gives his thoughts on the figures: “It is sadly the case that continued house price growth is limiting aspiring homeowners’ ability to take the first step onto the property ladder. This continued – albeit at a slower rate than previous quarters – is testing the affordability of many aspiring homeowners, who find themselves barred from affordable mortgage rates with high-street lenders because of circumstances beyond their control, such as a divorce or an illness.

“As an industry, we need to ensure that aspiring homeowners are made aware of the options available to them and that they have access to appropriate resources.”