Posts with tag: house prices

City House Price Growth Proving Resilient, Claims Hometrack

Published On: July 21, 2017 at 9:54 am

Tags: cities,house price growth,house prices,property market

City house price growth is proving resilient, with average values up by 5% in the first half (H1) of this year, claims the latest report from Hometrack.

Birmingham has the fastest growing house prices of all UK cities, while four areas are registering declines in property values in real terms.

City house price growth is running at 5.1% per year, which is down from 8.8% on June last year. Nevertheless, house price inflation has picked up in recent months.

Growth for H1 2017 ranges from 0.2% in Aberdeen to 6.1% in Birmingham. This is consistent with an 11% rise in home purchase mortgages, which are also 5% higher than the five-year average.

City House Price Growth Proving Resilient, Claims Hometrack

13 cities have a lower annual growth rate than a year ago; London, Bristol and Oxford have recorded the greatest slowdown, as affordability and uncertainty are hitting demand. The rate of price falls in Aberdeen has slowed sharply.

House price growth is higher in seven cities, but the scale of these increases, compared to June 2016, are more modest. The exception is Edinburgh, where the rate of growth has bounced back from 1.8% last year, to 6.5%.

Despite a material slowdown in the rate of house price growth in southeastern England, house price inflation is holding up, although real incomes have been squeezed. The impact of Brexit was greatest over H2 2016 and house price growth has picked up over the past six months.

At the end of 2016, Hometrack predicted that city house price growth over 2017 would stand at 4%. On current trends, it expects this to be closer to 6-7%. There remains material upside for house prices outside southeastern England, it says.

Nominal house price growth in four cities is failing to keep pace with the rate of consumer price inflation, which is currently 2.6%; Cambridge (+1.9%), Oxford (+2.1%), Newcastle (+2.4%) and Aberdeen (-2.7%).

House price growth across the City of London has fallen to a five-year low of 2.6%, meaning that prices are flat in real terms. Inner London markets have the lowest rates of house price growth and are recording real price falls.

Sustained house price growth in large regional cities has pushed house prices ahead of their 2007 peak in 16 cities. At current growth rates, it will be another two years before Newcastle, Glasgow and Liverpool exceed their 2007 levels. Belfast will take much longer, with prices still 45% lower than in 2007.

Online estate agent eMoov has recently assessed what a similar market crash to that in 2007 would mean for house prices today: https://www.justlandlords.co.uk/news/house-prices-8-years-recover-crash/

The Founder and CEO of eMoov, Russell Quirk, comments on the Hometrack data: “City living will always drive the UK market and so it gives a good indicator of where is quickest out of the blocks, while the overall market is still wiping the post election sleep out of its eyes. The latest data from Hometrack suggests that the UK market has also almost broken free from the shackles of Brexit uncertainty, with the market performing notably better than last year.

“It is a mixed bag of sweets in terms of the current UK market and London seems to be the liquorice where buyer demand is concerned, a classic favourite, but an acquired taste and one that is waning in popularity – particularly inner London. Other areas, such as Bristol, Oxford and Cambridge, are also paying the price of their much higher price tags with slower growth, whilst Britain’s second city has come to the forefront in terms of the best property price performance, joined by the regionally varied ensemble of Edinburgh, Leeds, Manchester and Nottingham.”

Glasgow is Driving the Housing Market in Scotland, Reports Your Move

Published On: July 21, 2017 at 8:11 am

Author: Em Morley

Categories: Property News

Tags: Glasgow,house prices,property market,Scotland

Your Move has released its latest House Price Index for Scotland, which shows that Glasgow is driving the housing market north of the border.

Following a surge in April, house prices in the country slowed in May, but continued to grow above trend, at 0.6%. This takes the average house price in Scotland to £175,070, while annual growth stands at an average of 3%. This figure, however, trails behind the 4.3% recorded for England and Wales in May.

Glasgow is Driving the Housing Market in Scotland, Reports Your Move

Activity in the Scottish housing market continues to be fuelled by strong demand from first time buyers and weak supply. June’s survey from the Royal Institution of Chartered Surveyors (RICS) shows that surveyors reported an increase in enquiries in May, but stock stands at an all-time low. There was also a further decline in the number of new seller instructions.

Average house price rises are also heavily dependent on activity in Glasgow, reports the estate agent. The increase in prices in the city during May represented 60% of the total monthly rise of £1,014 seen across Scotland as a whole.

On an unsmoothed basis, house prices actually dropped in May, but the three-month average used to reduce monthly fluctuations shows a better fit with the trend recorded over the last two years, with prices rising gradually.

Your Move has yet to see the impact of the General Election result on the Scottish housing market, as activity in May will have begun well before – in many cases, prior to the election even being called.

Despite the slowdown across Scotland, just over half (17) of 32 local authority areas still saw price growth over the month, compared with 21 in March.

East Lothian recorded the greatest increase in May, at 5.4%, boosted by the sale of the second most expensive property in Scotland. East Ayrshire showed the strongest annual performance, with average growth of 13.2%. Again, this reflects the sale of a high-priced property – a home sold in Kilmarnock for £746,000, which is much higher than the area’s average price of just £125,550.

But it’s Glasgow that’s driving the market. It was one of only three areas to set a new peak average price during the month (£151,622), while prices have risen by 10.9% on May 2016.

Flats – the most popular property type in the city – have seen average prices increase from £124,000 to £127,000 in just three months. By contrast, Aberdeenshire, which is also contributing significantly, is dominated by the sale of detached homes.

The Managing Director of Your Move Scotland, Christine Campbell, comments on the latest index: “After a surge in April, Scotland has returned to its long-term pattern of modest, but fairly steady, price rises. That hides wildly different fortunes in its various areas, though, and price increases are heavily dependent on a few key areas.

“With suggestions of possible reforms to LBTT [Land and Buildings Transaction Tax] rates, it will be interesting to see how this impacts the Scottish market in coming months.”

Alan Penman, a Business Development Manager for Walker Fraser Steele – one of Scotland’s oldest firms of chartered surveyors – adds: “The strength of the market in Scotland’s biggest city is supporting continued house price growth in Scotland, but there also remains a fundamental imbalance in supply and demand. The demand from first time buyers is encouraging; we need to make sure we have the property to meet it.”

One in Four Young Londoners Plan to Move out of the Capital

Published On: July 19, 2017 at 8:11 am

Author: Em Morley

Categories: Property News

Tags: first time buyers,house prices,London,property market

One in four young Londoners are planning to buy their first home outside of the capital, according to a new survey into the sentiment of the region’s young residents.

The cost of living was the main reason cited by 27% of respondents, who believe that it would be too expensive to purchase their first home in the capital.

A further 6% of 25-34-year-old Londoners said they would put down roots elsewhere to give themselves and their future families a better quality of life. Another 8% of the 2,007 young Londoners questioned plan to move out of the capital for “other reasons”.

Excluding the 42% of respondents who answered, “I haven’t thought about this yet”, the results were even stronger. A total of 74% said they will buy their first home outside of London for one of the above reasons.

One in Four Young Londoners Plan to Move out of the Capital

However, one in ten young Londoners said their love for the city would keep them there, while 4% cited “other reasons” as the main factor for staying in the Big Smoke.

The Director of Online Mortgage Advisor, which commissioned the survey, David Bird, says: “The stats from this survey evidence the sentiment that we’ve recognised in our own customers over the past couple of years. The number of first time buyers coming to us with enquiries about mortgages on properties outside the capital is on the rise, and we expect to see this continue as more and more people consider themselves to be priced out of London.

“In light of these results, we’ve created a tool called Is The Grass Greener?, which compares every single UK city, as well as London boroughs, to help first time buyers discover where they can get the most for their money and a quality of life that suits them. We’ve analysed both Government data and national statistics on a number of factors, including house price, crime rate, schooling standards and even the price of a pint!”

Using the tool, prospective first time buyers can see that Liverpool beats Wandsworth – a London borough with a population that is predominantly in its 30s – on statistics such as house prices, average first time buyer house price and cost of living. Manchester also has an average house price that is £429,201 cheaper than Wandsworth’s and has a higher capital growth rate.

The London Borough of Lambeth, which has a similar age demographic to Wandsworth, loses out to other cities, including Bristol, which has a much better crime and safety rate, along with lower petrol prices. According to UKCrimeStats, Bristol has a crime rate of 7.28, while Lambeth’s score is 15.16. This is based on crimes per 1,000 resident individuals.

Mark Homer, the Co-Founder of property education firm Progressive Property, comments: “Many younger Londoners want to live outside the capital as house prices become more detached from incomes, meaning that monthly payments and the deposit required to obtain a mortgage makes living in the capital unaffordable. This, coupled with the fact that many areas around London are still playing catch up with property prices, which have not risen as much since the credit crunch in areas around London as they have within, making these areas more affordable.

“Train services are also becoming quicker, with the East Coast Main Line, Crossrail and HS2 reducing journey times to the city, making commuting a viable option even from locations which were previously discounted as commuter locations. As the population of London grows, this trend is likely to continue, meaning areas surrounding London are likely to experience higher than average house price growth.”

Rose Jinks, of Landlord News and Just Landlords, explains how the change is affecting the private rental sector: “It’s not only first time buyers that are leaving the capital; landlords too are looking to other parts of the UK for high tenant demand and better rental yields.

“This should mean that those moving from London to other thriving cities should find an abundance of suitable rental properties before they can get onto the housing ladder themselves. Investing in large cities outside of the capital can therefore provide a win-win situation for all involved in the property market.”

However, she urges: “As ever, we encourage all landlords that provide rental housing to consider their tenants when setting rent prices, keeping the property safe and complying with rules and regulations governing the private rental sector. This will drastically improve the lives of those unable to buy their own homes.”

House Prices still Rising by over 25% in Parts of the Country, Show Official Figures

Published On: July 18, 2017 at 9:13 am

Author: Em Morley

Categories: Property News

Tags: average house price,house price growth,house prices,property market

The Land Registry and Office for National Statistics (ONS) have released their latest House Price Index, for May 2017, showing that property values are still rising by over 25% in some parts of the country.

On an annual basis, the Orkney Islands recorded the largest growth of all areas, at a whopping 25.16%, followed by 17.09% in Kensington and Chelsea, and 15.64% in Maldon.

Month-on-month, the greatest increase in house prices was recorded in Scarborough, where values were up by 6.63% between April and May. East Ayrshire (6.44%) and Kensington and Chelsea (6.02%) were close behind.

However, some areas are recording notable decreases in property values, with average house prices in the Western Isles down by 17.96% on May 2016, while the Shetland Islands (14.68%) and the City of Aberdeen (7.77%) also saw significant declines.

On a monthly basis, the Shetland Islands again recorded substantial drops, at an average of 6.79%, followed by Pendle (5.52%) and the Isle of Anglesey (5.38%).

House Prices still Rising by over 25% in Parts of the Country, Show Official Figures

Thanks to another month of strong growth, Kensington and Chelsea remains the most expensive place in the country to buy a property, at an average price of £1,501,966.

Outside of London, South Buckinghamshire takes the crown, with an average property value of £617,252.

Unsurprisingly, Burnley is the cheapest place to purchase a home in the country, at just £77,525.

Russell Quirk, the Founder and CEO of online estate agent eMoov.co.uk, has commented on the figures: “The latest Government figures show that where actual property sale completions are concerned, the market maintained a slight upward trend in May, up 0.5%, ahead of June’s election, whereas mortgage approval data from the likes of Nationwide and Halifax showed a slow in pace in the same time period.

“Although this provides two slightly contrasting views of the UK market, it makes sense that those in the middle of the sale would move quickly to push it through before any detrimental election impact on their property value occurs, whilst those looking to buy a property would put their mortgage application on ice until the political storm clouds had passed.”

He looks ahead: “The UK property market at present is as unpredictable as the economic and political landscapes that are influencing its buyer and seller demand.

“But whilst these top line figures paint a picture of a marginally declining market, it is important to note that annual growth is still up and there are still areas of the nation performing very well where property price growth is concerned.

“In the current UK property raffle, homeowners in the Shetland Islands, Pendle and the Isle of Anglesey will be going home rather annoyed that their property has seen the largest monthly fall in value. However, those in Scarborough, East Ayrshire, and Kensington and Chelsea will be delighted that their purchase has materialised into first place property price growth.”

The Senior Economist at PwC, Richard Snook, also responds to the data: “Today’s housing market data from the ONS and Land Registry shows a gradual slowdown of house price growth, in line with our expectations that growth in 2017 will be around half that of 2016.

“House price inflation fell back to 4.7% in the year to May, from a downwardly revised 5.3% in April (initially reported as 5.6%), taking May’s average UK price to £220,700.”

He continues: “Today’s figures are the first to be released since we published our latest housing market projections in the UK Economic Outlook. Our main scenario anticipates a softening of the market over the year, with house price inflation falling from 7% in 2016 to 3.7% in 2017. We expect London to be one of the UK’s worst performing regions, achieving price growth of just 2.8% in 2017. The key drivers of this slowdown are uncertainty related to Brexit and a softening in the economic outlook.

“The latest regional data is showing the strongest performance in East Anglia and the East Midlands, which registered annual growth of 7.5% and 7.2% in May respectively.”

And finally, the CEO and Co-Founder of buy-to-let specialist lender Landbay, John Goodall, concludes: “Against a backdrop of increased political and economic uncertainty, house prices have slowed in their march upwards, suggesting that buyers are starting to feel the pressure of falling real wages and entering the market in fewer numbers. But demand is only half of the story; insufficient housebuilding continues to restrict the number of available homes for sale, which may not be creating house price pressure at the moment, but will when demand begins to pick up again.

“While the pace of house price growth may have slowed, house prices still continue to rise, ultimately meaning that fewer people can afford to buy, which can only place greater pressure on the UK’s rental sector. For that reason, it’s essential that new construction is planned across all tenures, so that rents don’t escalate to the point where they’re inhibiting aspiring homeowners’ ability to save for a deposit. Quite simply, we need to build more purpose-built rental homes to support those hoping to take their first steps onto the property ladder.”

Brexit Uncertainty is Biting UK GDP and Housing Growth, Reports PwC

Published On: July 18, 2017 at 8:14 am

Author: Em Morley

Categories: Finance News

Tags: Brexit,economy,GDP,house prices,housing market,London

In its latest UK Economic Outlook, PwC forecasts that Brexit uncertainty is starting to bite UK GDP and housing growth.

UK GDP growth will slow from 1.8% in 2016 to around 1.5% in 2017 and 1.4% in 2018, according to the firm’s latest projections.

This is due to slower consumer spending growth and the drag on business investment, due to ongoing political and economic uncertainty relating to the outcome of the Brexit negotiations.

While UK economic growth held up better than expected in the six months following the Brexit vote, growth slowed in the first half of this year, as inflation rose sharply, which squeezed household spending power.

PwC expects consumer spending growth to continue to moderate during 2017-18, as inflation eats into real spending power and wage growth remains subdued, despite record employment rates. So far, consumers have offset this in part through higher borrowing, but there are limits to how much further this can go, as household savings ratios have already dropped to very low levels. On the other hand, the weak pound should also have some offsetting benefits for net exports, as will a stronger global economy.

Brexit Uncertainty is Biting UK GDP and Housing Growth, Reports PwC

The Chief Economist at PwC, John Hawksworth, explains: “Brexit-related uncertainty may hold back business investment, but this should be partly offset by planned rises in public investment. Fiscal policy could also be further relaxed in the 2017 Autumn Budget to offset the ongoing real squeeze on household spending power.

“There are still downside risks relating to Brexit, but there are also upside possibilities if negotiations go smoothly and the recent eurozone economic recovery continues. We expect the UK to suffer a moderate slowdown, not a recession, but businesses should be monitoring this and making contingency plans.”

Housing growth loses momentum

In the property market, PwC projects a slowdown in growth, with house price inflation at 3.7% in 2017 – down from 7% in 2016. The average house price could be worth around £220,000 this year – £8,000 higher than last year – and could rise to more than £300,000 by 2025, the firm warns.

Property sales, which tend to be more volatile than prices, are where Brexit uncertainty has manifested itself most strongly. Year-on-year, the number of transactions has been down for 12 consecutive months.

The London property market has been most severely affected by economic and political uncertainty, in addition to the recent change to Stamp Duty. Price growth in the capital for the first four months of 2017 was around 4%, compared with about 13% for the same period in 2016. PwC expects London’s housing market to continue to slow, with just 2.8% and 3.8% growth on average for 2017 and 2018 respectively.

Elsewhere in the UK, the East of England and southern regions will continue to grow above the UK average, the firm believes, while Northern Ireland and the North East will continue to lag behind. While the average house price across the UK has risen by 17% since mid-2007, over a quarter of all local authorities are still below their 2007 peaks.

Richard Snook, a Senior Economist at PwC, comments: “There is a huge disparity in how sub-regional housing markets have performed since the recession. The local authorities that have experienced the greatest falls in house prices since 2007 are all based in Northern Ireland, while London dominates biggest risers, with all boroughs experiencing price growth of over 50%.”

PwC’s analysis has also found that London’s property market has seen a structural shift recently, as house price growth has moved outward from the capital. Growing unaffordability within London, coupled with policy reform, has seen house prices in prime central boroughs slow, while values in outer boroughs and the commuter belt have risen.

Over the last two years, house prices in the outer boroughs have increased nine percentage points faster than in inner boroughs, while growth in the fastest growing cities within the commuter belt (including Basildon, Luton and Slough) exceeded those in London by four percentage points.

Snook concludes: “The affordability crisis within London has seen first time buyers in particular struggling to buy in the capital. In 2016, house prices in London were 13 times median earnings, while the 15 commuter belt towns offer a lower – albeit still high – ratio of nine times earnings.

“Essex appears to be a key commuter hotspot, with lower historical house prices than commuter towns west of London.”

How have the Property Markets of Game of Thrones Filming Locations Fared since the Show Aired?

Published On: July 17, 2017 at 9:39 am

Author: Em Morley

Categories: Property News

Tags: Game of Thrones,house prices,property market,TV

As the seventh season of Game of Thrones is set to kick off, online estate agent eMoov.co.uk has looked at how the property markets of the show’s filming locations have fared since the programme aired?

Using property market data from each of the filming locations, eMoov has highlighted where the best destinations to buy property associated with Game of Thrones are…

King’s Landing – Mdina, Malta

Average house price – £294,622

Pros – Robust property market, nice weather

Cons – High murder level, use of wildfire

The property bubble in Mdina has slowed since its use as a filming location in series one. Despite the market slowdown, however, house prices have risen by 2.9%, although this growth has been turbulent. Properties here start at £180,000 and upwards, with the average value standing at £294,622.

Nevertheless, a brand new terraced house overlooking the city will set you back £780,000 or more and the high-end market boasts prices up to £5m.

Slaver’s Bay/Bay of Dragons – Split, Croatia

Average house price – £299,794

Pros – Warm, sunny climate, influx of buyer demand

Cons – Past negative reputation, regeneration yet to complete

How have the Property Markets of Game of Thrones Filming Locations Fared since the Show Aired?

Split has seen the largest increase in property prices since Daenerys Targaryen eradicated slavery in the region and set the residents free. There is typically a warmer and more arid climate than that found in the Seven Kingdoms, and property starts at around £70,000 for something more cosy, but can climb to as much as £123,000 for something more substantial.

The average house price across all property types now averages just below £300,000, following an influx of buyer demand and positive market sentiment.

Beyond the Wall – Iceland

Average house price – £266,000

Pros – Quiet and small population

Cons – Cold winter climate

Beyond the Wall, or Iceland, is home to some of the most affordable house prices in the land, with the cold climate reducing property appeal to potential buyers.

The market saw a brief spike earlier in the show, although buyer demand soon plummeted and stock levels increased. That being said, the region continues to be quaint for those looking to get on the property ladder; first time buyers that like the cold can snap up a home for just £225 per square foot.

Lordsport – North Antrim, Northern Ireland

Average house price – £127,920

Pros – Proud people

Cons – Dark and damp weather, uncertain political landscape

Property on the land of the “ironborn” boasts an average price of £127,920, but this could be on the rise due to the popularity of the show.

Although the average house price in the wider area is fairly affordable, a cottage in the immediate vicinity can go for as much as £350,000.

Winterfell – Newry, Mourne and Down, Northern Ireland

Average house price – £130,322

Pros – Affordable property and appreciating prices

Cons – Uncertainty in the market

The average house price in Newry, Mourne and Down is an affordable £130,322, which has risen by 4% since season one. However, a premium property is substantially more expensive. Entering the high-end of the market can cost you £2,250,000.

Castle Black/Wall – Magheramorne,Northern Ireland

Average house price – £114,932

Pros – Quiet

Cons – Always a cool climate, lots of snow

A property close to the Wall will cost you an average of £114,932. That said, a larger home, such as Castle Black, would still command between £800,000-£1m, based on the current market climate.

The tourist boards of a number of past Game of Thrones filming locations have recorded a surge in visits since their landscapes were screened, with Mdina in Malta, Split in Croatia, Iceland, Morocco, Spain and more benefitting from the huge popularity of the show.

It is possible that Northern Ireland could be the next up-and-coming hotspot for diehard Game of Thrones fans, as well as those looking for affordable price tags.

Belfast is home to the show’s Titanic Studios, where the majority of the inside scenes are filmed, from Winterfell to King’s Landing to Meereen.

The average home in Northern Ireland’s capital goes for £115,868, which is up by 8% on the £107,326 recorded in April 2011, when the show first aired.

This is a great option for property buyers who are keen to get close to the action, with homes costing £100,000 less than the UK average of £220,094.

Russell Quirk, the Founder and CEO of eMoov, says: “Although this is a bit of fun in terms of valuing fictional properties in the Game of Thrones, the success of the show has a very real impact on the areas in which it is filmed, which can boost the economy and in turn help to stimulate property prices.

“Northern Ireland provides an ideal property investment opportunity for diehard Game of Thrones fans, with much lower average house prices than the rest of the UK. Such a popular show being based there has certainly helped bring jobs and industry to the surrounding communities, and helps showcase the stunning scenery boosting tourism in the process.”