Posts with tag: house prices

Drop in Property Transactions Caused by Stamp Duty, Not Brexit, Says LSL

Published On: August 11, 2016 at 8:35 am

Tags: average house price,EU referendum,house prices,property transactions,Stamp Duty

Drop in Property Transactions Caused by Stamp Duty, Not Brexit, Says LSL

Property transactions dropped by 20% in the second quarter (Q2) of the year, caused by the rush to purchase ahead of the Stamp Duty deadline in April, rather than the Brexit vote, reports LSL/Acadata.

The report suggests that the annual decrease in house sales has more to do with the tumble recorded after the 3% Stamp Duty surcharge was introduced than uncertainty surrounding the EU referendum in June.

The study found that although annual house price growth slowed to 5.5% in July, transaction levels edged up over the past month. The average house price in the UK now stands at £293,318.

Although the huge spike in sales recorded in March caused a massive decline in April, sales in the first half of the year are still likely to be 4% higher than in the same period last year.

The report claims that the “exceptional” sales level seen in March has more than compensated for the decrease since.

It also points out that while property transactions rose in July, the Land Registry would have recorded these figures before the EU referendum took place.

The Director of Your Move and Reeds Rains, which are owned by LSL, Adrian Gill, comments: “Brexit may well have an impact on the housing market, but it’s not showing yet.

“Even when it does, there will be positive as well as negative influences on the market, which clearly has some strong long-term drivers for continued house price inflation.”

According to the research, house prices increased by an average of 0.2% in July, making it the fifth consecutive month that the annual rate of house price growth has dropped. Despite this, the 5.5% rise in house prices over the year has added an average of £15,422 to property values.

An Analyst at Acadata, Peter Williams, says: “The market was contracting pre-Brexit and the question remains, how will it perform post the Brexit vote and ultimately, on exit?”

Do you believe that the Stamp Duty surcharge has had more of an impact on property transactions than the Brexit vote? How have you been affected?

Property market shows referendum resilience

Published On: August 10, 2016 at 11:09 am

Author: Em Morley

Categories: Property News

Tags: Brexit,EU referendum,house prices,property market

An interesting new report from London based estate agent, Jackson-Stops & Staff has revealed there has been little change in the property market post-Brexit.

The investigation shows that despite a marginal weakening, reports of a crisis are wide of the mark.

Referendum resilience

The estate agent took data representing 90% of the entire UK property market on the 22^nd June, the day before the historic vote took place.

Results from this data showed there were 866,179 properties for sale. Of those, 352,301 were under an agreed offer, making up 40.7% of the market.

Jackson-Stops & Staff undertook the same investigation on Monday (8^th August.) Key results from this research show:

The total number of properties on the market, including those under offer, has risen by 1.7% to hit 872,953

The total number of properties under offer has dropped by 4.3% to 335,176. This is 38.4% of the market, showing a 2.3% since 22^nd June

Average asking prices for property in Britain have risen to £1,040-from £20,470 on 25^th July to £241,510 on 8^th August

Property market shows referendum resilience

Seasonal slowdown

Nick Leeming, Chairman at Jackson-Stops & Staff, notes, ‘whilst the market has weakened slightly followed the Brexit result, we usually see a slowdown in activity over the holiday months and these figures suggest we are yet to see a property crisis. Although agreed offers have marginally decreased, many thousands of buyers are still making offers to buy homes in the present economic environment. As a result, many sellers are feeling confident, demonstrated by the fact that asking prices themselves have not fallen-and have in fact seen a moderate increase.’[1]

Analysis of properties under agreed offer or sold subject to contract signing indicates that the average house price currently stands at £232,699. This is 3% lower than the average of all properties just two weeks ago.

The asking price of all properties on the market that are not under offer or sold is currently £247,026. This is 3% higher than the typical price recorded two weeks ago and suggests sellers with agreed offers were more realistic in pricing their property.

No decline

Leeming concluded by saying, ‘while sellers may have to drop their asking price a little to get an agreed offer, there is no evidence of sharp house price decline nationally. Indeed, sellers accepting an offer 3% to 5% below asking price is normal in a healthy housing market.’[1]

‘Despite the scaremongering being issued by a number of gloomy commentators, these figures show that the housing market continues to remain remarkably resilient. There is life after Brexit-the housing market is driven by need and these needs continue to motivate thousands of buyers.’[1]

[1] http://www.propertyreporter.co.uk/property/there-is-life-after-brexit-and-its-the-same-as-before.html

London Olympics’ Legacy Lives on Through Housing

Published On: August 10, 2016 at 8:34 am

Author: Em Morley

Categories: Property News

Tags: house prices,housing crisis,London,London property market,Olympics,Stratford

The London Olympics’ legacy continues to live on through the housing market, according to the latest research by hybrid estate agent eMoov.co.uk.

The firm found that since the London Olympics in 2012, property values in Stratford’s Olympic Village have shown greater strength than prices across the capital as a whole.

London Olympics’ Legacy Lives on Through Housing

Having been originally built to accommodate those competing in the Games, the Olympic Village has since been designated its own postcode (E20) and utilised as a residential complex, helping to tackle the capital’s housing shortage.

Although many cities have seen their Olympic legacies fade, it was widely believed that London would continue to benefit from the extensive regeneration it experienced ahead of the 2012 event. But what benefit, if any, has this regeneration brought to the London housing market?

The average property price in Stratford’s Olympic Village is now £459,199. Although this is significantly lower than the London average of £550,000, prices have soared by a huge 43% in the E20 postcode since the complex’s construction.

Over the same period, the London market as a whole has seen an average increase of 38%, despite widespread inflation as a result of high demand and a chronic lack of housing stock.

In England, the average house price rise was even lower, at 24%, taking the typical property value to £257,567.

Those that purchased property in the Olympic Village certainly seem to have won gold when it comes to housing; not only has house price growth outpaced the rest of the capital, property values are much more affordable than in London as a whole.

The founder and CEO of eMoov, Russell Quirk, says: “It goes to show that regardless of whether you thought the London Olympics was money well spent or not, the regeneration of what was essentially an east London wasteland has helped to breathe new life into the area where property is concerned.

“Yes, the area may have benefitted more so because of the Games, but we’re now four years on and the Olympic Park has seen a larger property value increase than the capital as a whole. That’s no coincidence. What has been done with Stratford should be an example that we should look to replicate right across London.”

With such potential for substantial capital growth and affordable house prices, could Stratford be your next investment spot?

Has the Property Market Lost Steam?

Published On: August 5, 2016 at 9:51 am

Author: Em Morley

Categories: Property News

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

The latest Halifax House Price Index reports that the average UK house price has dropped by 1% over the past month, following the Brexit vote. But does this mean that the property market has lost steam?

Between June and July, the average house price in the UK fell from £216,726 to £214,678 – a slight decline of 1%. However, prices in the three months to July are still 8.4% higher than in the same period of 2015.

Additionally, prices in the past three months were 1.6% higher than in the preceding three months. This is above June’s 1.1% increase, and similar to the rates of growth recorded in April and May (both 1.5%), but significantly lower than in February and March.

Has the Property Market Lost Steam?

However, the annual rate of growth, 8.4% in the three months to July, is unchanged from June, and is the lowest level since July 2015.

While house prices fell between June and July, following a 1.2% increase in June, Halifax claims that monthly changes can be erratic and falls often occur within an upward trend. Although this was the third monthly decline seen this year, it was lower than February’s 1.5% decrease.

The Housing Economist at Halifax, Martin Ellis, comments on the data: “House prices in the three months to July were 1.6% higher than in the previous quarter, up from 1.1% in June, but comfortably lower than earlier in the year. The annual rate of growth was unchanged at 8.4%; the lowest since July 2015.

“There are signs that house price growth is slowing, with a deceleration in both the annual and quarterly rates of increase in the past few months. Nonetheless, the current rates remain robust.”

He adds: “July’s monthly decline largely offsets June’s increase. The month-on-month changes, however, can be erratic and falls often occur within an upward trend. Overall, it remains too early to determine if there has been any impact on the housing market as a result of June’s EU referendum result.”

Halifax has also recently released its First Time Buyer Review. The report found that the number of first time buyers increased by around 10% in the first half of the year, compared with the same period in 2015.

There were an estimated 154,200 first time buyers in the first six months of 2016, compared with just 140,500 in the first half of last year. This was more than double the market low recorded in the first half of 2009 (72,700), but is almost a fifth lower than ten years ago, in 2006.

In response to the latest figures, the founder and CEO of eMoov.co.uk, Russell Quirk, comments: “This is the first full damage assessment of the UK property market by Halifax since Britain hit the Brexit iceberg back in June.

“Although it would seem the UK property market has lost steam since the vote, with prices dropping 1% since last month, the summer period is always a traditionally slower time of year for residential property transactions.”

He continues: “With prices still up 8.4% year-on-year, there’s no real evidence that UK homeowners need to jump ship just yet, and so I would urge them to remain calm and avoid any rash decisions.

“Once the market picks back up in a couple of months’ time and the Brexit uncertainty starts to subside, I’m confident the previous upward trend in value enjoyed by UK homeowners will continue.

“In the meantime, this slight slowdown in price growth, coupled with yesterday’s rate cut by the Bank of England, make it an ideal time for those considering a property purchase to strike while the iron is hot. Or slightly cooled in this case.”

House Price Growth Steady in July, but Future Uncertain

Published On: July 28, 2016 at 10:51 am

Author: Em Morley

Categories: Property News

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

House price growth remained at a steady 0.5% in July, according to the latest House Price Index from Nationwide. However, the data suggests that the future of the property market is uncertain following the Brexit.

In the first month’s data following June’s EU referendum, Nationwide reveals that monthly house price growth stands at 0.5%, compared to 0.2% in June, while annual inflation is virtually unchanged, at 5.2% from 5.1%.

The average house price in the UK is now £205,715, up from £204,968 in June.

House Price Growth Steady in July, but Future Uncertain

Although the figures could be used to determine the effects of the Brexit vote on the property market, the Chief Economist at Nationwide, Robert Gardner, explains that the data used in this report is from the mortgage offer stage. This means that any impact from the vote may not be fully evident yet, as there is a short lag between a buyer’s decision to purchase a property and applying for a mortgage.

In addition, the index states that a slowdown in activity was expected over the summer months, following a surge in property sales ahead of the 1^st April Stamp Duty deadline for buy-to-let landlords and second homebuyers. It adds that it will be difficult to determine how much of the fall back in activity is the result of these tax changes and how much is due to the referendum.

Gardner also points out that the future of the property market looks unusually uncertain at this time.

“In the near term, increased economic uncertainty may lead to weaker demand for homes. Leading indicators are consistent with softening ahead. Household confidence fell sharply in the wake of the referendum result, especially attitudes towards making major purchases, which in the past has correlated with mortgage activity, though less closely in recent years. In the run up to the vote, the Royal Institution of Chartered Surveyors (RICS) reported declines in new buyer enquiries and expectations of weaker price growth amongst surveyors, though these trends pre-date the vote and are likely to have been impacted by the recent tax changes, as well as the referendum.”

He continues: “How the labour market evolves will be crucial in determining the demand for homes in the quarters ahead. It is encouraging that conditions were robust in the run up to the vote, with the unemployment rate falling to a ten-year low in the three months to May. The decline in long-term interest rates to new all-time lows in recent weeks should also help to keep borrowing costs low and provide some support for demand.

“Even if there is a fall back in demand as a result of economic uncertainty, the impact on house prices is not certain, as potential sellers may also hold off from placing their properties on the market. The stock of homes on estate agents’ books is already close to its lowest levels for 30 years, and surveyors have reported a decline in new instructions to sell alongside a fall in buyer enquiries. Moreover, housebuilders may react to the uncertainty by delaying construction, even though home building is already failing to keep up with the natural increase in the population.”

Gardner concludes: “The outlook for the housing market remains unusually uncertain and it may take several months for the underlying trends in the market to become evident.”

The founder and CEO of eMoov.co.uk, Russell Quirk, also comments on the new data: “The first evidence of the post-apocalyptic Brexit property market and on the face of it, not a lot to worry about, with prices up 0.5% monthly and 5.2% annually.

“Yes, this isn’t a huge rate of growth, but prices are still continuing the upward trend enjoyed since 2012. That’s not to say there won’t be any impact, as the likes of Nationwide and Halifax usually report on somewhat of a lag, due to the use of mortgage offers data, not cold hard completions.

“This said, the UK property market is one of the strongest in the world and historically, house prices are higher than July 2014 and July 2015, so it’s looking pretty healthy across the board.”

He notes: “It’s important UK home sellers take any Brexit doomsayers and their forecasts with a pinch of salt and avoid acting irrationally where the sale of their home is concerned.

“We are entering a traditionally slower time for the property market, and so this cool in price rate growth is always likely to happen during the summer months. Once September rolls around again, we predict things will start to pick up and prices will continue their sharp ascent.”

The Best Locations for First Time Buyers Revealed

Published On: July 28, 2016 at 8:41 am

Author: Em Morley

Categories: Property News

Tags: average house price,first time buyers,house prices,London,property ladder,property market

In its latest analysis of the UK property market, hybrid estate agent eMoov.co.uk has highlighted the best locations for first time buyers in England, and where they should avoid.

Using Land Registry figures, eMoov has mapped the average first time buyer house price across each English county and each of London’s boroughs, as well as calculating the average increase in value since 2012.

The study found that first time buyers are now paying an average of just over £196,000 for their home. However, in the last four years, the average price paid across England by those getting onto the property ladder has risen by £42,451.

This substantial 28% increase beats the average rate of growth for England as a whole, where the typical house price has risen by 26% over the same period, highlighting the ever-growing obstacle facing first time buyers.

But it’s worse news for those hoping to get onto the ladder in London, where the average first time buyer house price is a whopping £462,602, up by 54% on 2012.

So where should first time buyers look to buy, where should they avoid, and which location has seen the greatest increase in house prices in the past four years?

England

Average first time buyer prices across England

At just £86,116, County Durham is home to the lowest house price for first time buyers. Although low demand has caused price drops in the area, this has benefitted those trying to buy their first home.

However, those thinking of buying in County Durham should be aware that its poor performance is notable – prices have risen by just 3% (£2,600) since 2012, the lowest rate across England and a far cry from the national average.

Naturally, the City of London and Greater London are the most expensive counties for first time buyers. However, the capital’s commuter zone also proves out of reach for many buyers. Surrey (£323,973), Hertfordshire (£305,043), Berkshire (£292,227), Oxfordshire (£286,962) and Buckinghamshire (£286,511) make up the top five most expensive counties for first time buyers outside of London, with each location seeing house price growth of between £80,000-£96,000 since 2012 – the greatest increases outside of the M25.

London

London’s first time buyer house prices

Living in London comes at a high price, even in the most affordable boroughs. First time buyers looking for a home in the capital will find that the average price across even the cheapest boroughs is still much higher than the UK average.

At £254,600, Barking and Dagenham is the most affordable borough for first time buyers. Havering comes in second place (£281,836), followed by Bexley (£285,464), Croydon (£301,001) and Sutton (£312,978). In 2012, the average first time buyer house price for these boroughs came in at under £200,000, but each location has experienced an increase of between £95,000-£118,000 in the last four years.

Unsurprisingly, Kensington and Chelsea (£1.1m) is the most expensive spot in the capital for first time buyers. Westminster (£906,882), the City of London (£711,009), Camden (£669,020) and Hammersmith & Fulham (£690,296) complete the top five.

The founder and CEO of eMoov, Russell Quirk, comments on the findings: “First time buyers are paying almost as much as second and third steppers in actual price terms, yet the percentage increase in first time buyer properties is tracking at even greater than regular house prices. It really does highlight the issue facing the nation’s next generation of aspirational homeowners.

“How the Government expects anyone to get on in life when the first hurdle they face is all but unobtainable, to begin with, is beyond me, especially in London. Over 90% of the capital’s boroughs have seen the price paid by first time buyers increase by more than £100,000 in just four or so short years.”

He urges: “We must address this issue and find a way to bring homeownership back in reach of the average homebuyers, not just in London, or the surrounding commuter counties, but to the whole of England.”

Landlords, remember that many young people in the UK are stuck in rental properties. Ensure that you offer a safe and suitable home to hopeful first time buyers, and set a reasonable rent price.