Posts with tag: house prices

Only Way is Up for House Prices

Published On: November 12, 2015 at 1:11 pm

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

House prices are continuing to soar and are expected to grow further.

Only Way is Up for House Prices

The Royal Institution of Chartered Surveyors (RICS) and LSL Property Services/Acadata have reported on the property market. LSL found that the average house price is edging closer to £300,000 after the most recent increase.

Another firm, Home, says that the number of homes for sale has dropped to a new record low. There are now 45% fewer homes on the market than in November 2007.

However, while demand is surpassing supply and driving up prices, the prime central London market is experiencing a slowdown in sales, as Stamp Duty is now considerably more expensive on homes costing £1m or more.

Estate agent Winkworth reports that its profits will be “slightly below”¹ market expectations this year, due to slow sales in the capital.

It blames Stamp Duty reform for “undermining demand for more expensive properties”, but adds that “this will still be the second best ever year for Winkworth, despite transactions still being 26% off their historic peak”¹.

Simon Rubinsohn, Chief Economist at the RICS, comments: “Property is set to become even more unaffordable going forward, making the Government’s focus of boosting the delivery of new homes absolutely critical.”

He says it is “hard to get away from the issue of supply when it comes to the current state of the housing market”¹.

The RICS reports that house prices have increased across all parts of the UK. Meanwhile, new listings have fallen since the start of the year.

The LSL/Acadata study found that house prices grew by an average of £2,500 in October, equivalent to £80 per day, reaching a tenth record high this year.

It believes that prices continue to be fuelled by London, where price rises averaged £24,636 in the past year, equivalent to 75% of the typical Londoner’s salary.

It also reports that last month was the strongest October for sales since 2007.

The LSL/Acadata index says that the average house price in England is Wales is now £288,421, up 0.9% on the previous month and 5.2% on October last year.

When London and the South East are excluded, the average house price rise in the rest of England and Wales was 3.9% over the past year.

¹http://www.propertyindustryeye.com/only-one-way-for-house-prices-to-go-and-thats-inexorably-up/

Which Two London Boroughs will See Highest Growth Over Next Five Years?

Published On: November 10, 2015 at 3:37 pm

Author: Em Morley

Categories: Property News

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

Despite recent warnings of a housing bubble, a new forecast by a leading estate agent states that house prices are set to increase even further across London over the next five years.

According to Savills, two London boroughs – Waltham Forest and Lewisham – are expected to experience the highest growth by 2020, up to 20%.

East London’s Waltham Forest has witnessed some of the greatest price rises in the capital, due to an increase in demand from buyers priced out of more central spots.

Which Two London Boroughs will See Highest Growth Over Next Five Years?

House prices in Lewisham, south of the river, are set to rise at a similar rate, caused by strong interest in popular parts such as Blackheath, Brockley and New Cross. Further investment from the council and plans for new build property developments are contributing to growth predictions.

If you have an investment property in either of these boroughs, or are considering buying there, your investment could see a surge in value over the next five years.

However, Head of Residential Research at Savills, Lucian Cook, claims that these predictions are largely dependent on the rate of interest rate rises in the next five years.

He says: “If rates rise too quickly, mainstream house price growth will be quickly curtailed. On the flipside, if rates remain low for too long, there is a risk that prices will rise too far, creating affordability issues further down the line when they do eventually rise.

“That risk has been mitigated by recent mortgage regulation, which, by stress testing affordability, caps the amount people can borrow relative to incomes. That is likely to cap price rises, particularly in London, where house price to household income ratios are highest, thanks to growth seen over the past ten years.”¹

In the outer suburbs of London, house prices are set to increase by an average of 17% by 2020.

This includes the cheapest borough, Barking and Dagenham, where the average home is valued at £318,000. It also encompasses Greenwich and Newham, which have both experienced some of the highest rises over the last year.

Even house prices in the most expensive boroughs, Kensington and Chelsea and Westminster, are forecast to grow by 15%, despite recently recording price declines.

Savills expects this slowdown to be short-lived, as buyers get used to higher Stamp Duty and international buyers are likely to return to the market soon.

Growth is expected to be slowest in Islington and Richmond, where the average property price is already over £500,000. However, price rises of 10% are still predicted.

In Hackney, now one of the capital’s most expensive boroughs, prices have spiralled recently. However, Savills still expects growth of 15% in Hackney and Southwark, where prices are catching up with prime central London and the City of London, which border both boroughs.

If you’re a landlord in London, make sure you keep up to date with the property market, to determine the growth in value of your asset.

¹http://www.savills.com/_news/article/105347/196636-0/11/2015/the-pace-of-interest-rate-rises-will-dictate-the-pace-of-house-price-growth

Annual house price growth rises in October

Published On: November 5, 2015 at 12:28 pm

Author: Em Morley

Categories: Property News

Tags: Homes,house prices,property market,uk property price growth

Annual house price growth rose during October, according to new research conducted by the Halifax.

The UK’s largest mortgage lender cited, ‘improving economic conditions,’ for the rise.

Increases

Data from the report shows that prices rose at an annual pace of 9.7% last month, up from the 8.6% recorded in September. In October, house prices increased by 1.1%, following a decline of 0.9% during the previous month.

This increase lifted the average price of a flat or house across the country up to £205,240, which is a new record high.

‘Improving economic conditions and household finances, together with sustained low mortgage rates, have boosted housing demand during 2015,’ noted Martin Ellis, Halifax housing economist. [1]

‘Strengthening demand is filtering through into higher sales levels, although the ongoing shortage of supply is acting as a significant constraint on activity,’ he added. In addition, Ellis believes that demand is likely to continue to outstrip supply over the next few months, ‘maintaining upward pressure on house prices,’ as a result.[1]

Annual house price growth rises in October

Shortage

This chronic lack of supply has presented real problems for estate agent group Countrywide, who announced last night that its full-year profits were expected to drop as a result of fewer properties coming onto the market.

The company noted that, ‘the anticipated post-election recovery in residential transactions failed to materialise in any significant way.’[1]

Just last week, rival mortgage lender Nationwide said that house prices increased by 3.9% in October, in comparison to the same period twelve months ago.

In addition, property values were up by 0.6% compared to September

[1] http://www.bbc.co.uk/news/business-34730542

London House Prices Increase by £10,000 in a Month

Published On: October 24, 2015 at 11:50 am

Author: Em Morley

Categories: Property News

Tags: house prices,London property market,property supply

London House Prices Increase by £10,000 in a Month

Prospective homebuyers in London are still being faced with a lack of properties coming onto the market, as supply continues to decrease, pushing prices even higher.

The average asking price of a home in the capital has risen to a record high of £630,050, increasing by 1.6%, or £10,047, in just one month, according to Rightmove’s latest House Price Index.

In the east London borough of Tower Hamlets and southern district of Merton, sharp growth has driven average asking prices up by over £50,000 in a month.

Although demand from buyers is still rising, the latest price growth reflects a decline in the amount of homes being put up for sale, with 16.2% fewer properties coming onto the market this month compared with October last year.

The study also found that just four out of 32 boroughs – Richmond, Hillingdon, Hackney and Newham – saw an increase in property supply this year.

Director and Housing Market Analyst at Rightmove, Miles Shipside, says that the latest data “highlights London property owners’ financial resilience and determination to be able to choose when to sell, being acutely sensitive to time their moves and to make the most of their very valuable property asset”¹.

As the capital is experiencing more hopeful buyers and fewer properties, homes that are put up for sale at a good price are selling very quickly.

Jo-Anne Neighbour, of estate agent Savills, comments: “Buyers are very clued up on what represents value and can easily spot an asking price that is out-of-line.”¹

Are you searching for a home or property investment in the capital? If so, what kind of market are you witnessing?

¹http://www.homesandproperty.co.uk/property-news/news/london-house-prices-shortage-homes-market-pushes-prices-ps10k-month

Property price confidence rises

Published On: October 23, 2015 at 12:57 pm

Author: Em Morley

Categories: Property News

Tags: homeowners,house prices,property market

Data taken from a new report by Zoopla indicates that 9 out of 10 homeowners are confident that house prices will rise in their area during 2016. This figure, taken from the Zoopla Housing Market Sentiment Survey, marks a 4% year-on-year rise in confidence amongst English homeowners.

Confidence

The survey of nearly 5,000 homeowners found that 92% are expecting property prices in their region to rise within the next six months. This was an increase from 88% twelve months ago.

In addition, the research found that 41% of homeowners were planning to improve their existing home. 9% said they planned to refinance their house, a 3% increase from the back end of 2014, with mortgage rates remaining at record lows.[1]

What’s more, the proportion of people looking to sell property has risen to 19%, having reached 15% last year.[1]

Eastern Optimism

Homeowners in the East of England were found to be most optimistic, with 97% expecting the price of their home to increase over the next six months. Property owners in London and in the South East are nearly as confident, with 96% of respondents across this pair of regions suggesting a price rise is likely.[1]

However, price sentiment around the accessibility of funding is more volatile. The proportion of those that think it is harder to get a mortgage now than three months ago has dropped from 49% to 26% since the Mortgage Market Review was introduced in April 2014.

Speculation continues to mount around when the Bank of England will raise interest rates. With lenders keeping an eye on developments, it may be becoming noticeable that borrowers are not seeing as many competitive products.

Property price confidence rises

Positive outlook

‘As the end of the year approaches, homeowners are the most optimistic they have been in some time,’ noted Lawrence Hall of Zoopla. ‘While the brightening national economic outlook-with real-terms wages rising and consumer confidence almost back-up to pre-recession levels-this bodes well for the property market in 2016.’[1]

‘While traditionally the estate agency market tends to take a break over Christmas in terms of completions and viewings, homeowner confidence shows no sign of slowing down and many individuals use the end of the year as a landmark to evaluate how much their property has appreciated over the calendar year,’ Hall continued.[1]

Concluding, Hall observed, ‘the only slight chink in the armour is the fact that a sizeable number of people still feel securing a mortgage is becoming more difficult, despite the fact that the MMR was implemented with consumers’ best interests at heart.’ He said that, ‘it could also be an indication that the supply of low mortgage rates that have flooded the market of late could be about to reduce as lenders try to pre-empt the Bank of England’s movements regarding the Base Rate.’[1]

[1] http://www.propertyreporter.co.uk/property/house-price-confidence-for-92.html

Manchester property prices to boom in next decade

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

Author: Em Morley

Categories: Property News

Tags: house prices,Manchester,property market

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

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

Predictions

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

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

The top ten locations were:

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

Unsurprising

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

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

Manchester property prices to boom in next decade

Affordable

Mr Armistead said that an, ‘average residential property in Manchester is just £155,000, while a flat in a good area costs as little as £120,000. It’s not surprising that many investors, especially from the South, are targeting Manchester as a great place to invest. A property in Manchester can provide a 5% minimum cash rental yield and a typical 12% total cash yield, including 7% capital appreciation. Demand for rental accommodation is strong and by comparison with other regions, housing is cheaper.’[1]

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

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