Posts with tag: housing demand

Housing Demand is Currently at a 12-Month Low

Published On: September 29, 2017 at 10:25 am

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Housing Demand is Currently at a 12-Month Low

Housing Demand is Currently at a 12-Month Low

Housing demand is currently at a 12-month low, according to the August Housing Report from NAEA Propertymark (the National Association of Estate Agents).

Housing demand 

As holidaymakers set off abroad last month, the average number of house hunters registered at estate agent branches dropped to a 12-month low, at 343. This was down from 347 in July, but up from 284 in June.

The level of housing demand hasn’t been this low since last August (2016), when estate agents had an average of 287 house hunters registered per branch.

Property supply

However, the average number of properties available to buy on estate agents’ books increased marginally in August, from 35 in July to 37.

Sales agreed

The proportion of sales agreed to first time buyers remained at 23% in August, having fallen from 30% in June.

As expected during the summer, the amount of sales agreed per estate agent branch also remained low in August, with eight on average per branch.

The Chief Executive of NAEA Propertymark, Mark Hayward, says: “House hunters tend to put their plans on hold over the summer months while they prioritise holidays and, as a result of this trend, stock is usually lower. However, while we saw the number of properties available increase very marginally last month, it wasn’t remotely enough to start to close the gap between supply and demand. We shouldn’t take August’s decline as a sign of things to come – we’ll see the market bounce back in September and ramp up towards the end of the year as house buyers desperately try to complete transactions before Christmas.”

NAEA Propertymark’s partner organisation, ARLA Propertymark (the Association of Residential Letting Agents), has recently revealed its latest report for the lettings sector, also for August. Read the figures and compare the two markets online here: https://www.justlandlords.co.uk/news/tenants-continue-face-rising-rents/

Demand for New Homes Slumps Following “Attack on Buy-to-Let Landlords”

Published On: December 5, 2016 at 9:37 am

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One of Britain’s largest housebuilders warns of a slump in demand for new homes following the Government’s “attack on buy-to-let landlords” and Brexit uncertainty.

Demand for New Homes Slumps Following "Attack on Buy-to-Let Landlords"

Demand for New Homes Slumps Following “Attack on Buy-to-Let Landlords”

Berkeley Group reports a decrease in reservations of 20% in the six months to the end of October. The firm’s Chief Executive, Rob Perrins, believes this is largely due to “heightened global macro-economic and political uncertainty”.

However, he claims the slump in demand is ultimately down to “higher Stamp Duty” and the “extraordinary attack on buy-to-let landlords”, who play a large part in sustaining the housing market, particularly in London, alongside increasing the supply of new homes.

So far this year, the attack on buy-to-let landlords has included stricter mortgage lending criteria, the 3% Stamp Duty surcharge for additional homes and the scrapping of the 10% Wear and Tear Allowance. What’s more, landlords will face a reduction in mortgage interest tax relief from April next year.

Shares in Berkeley Group fell by more than a fifth since the introduction of the higher Stamp Duty rate in April, along with the EU referendum in June, as housebuilding stocks were hit by uncertainty.

However, despite the slump in demand, Berkeley has recorded a 34% increase in pre-tax profits to £393m for the first half of the year. The firm says it is well positioned to withstand the uncertainty.

The company sold 2,076 homes in the first six months of 2016 – little changed on the same period last year – at an average selling price of £655,000 – up by 29%.

Last week, Bank of England data suggested that the UK housing market is recovering from a post-referendum slowdown, as mortgage approvals rose to the highest level since March.

A separate report from Nationwide shows that house prices are continuing to slow.

Do you believe that the Government’s attack on buy-to-let landlords is having a widespread effect on the housing market?

Private rental sector thriving…for now

Published On: November 11, 2016 at 9:44 am

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The ongoing political and economic uncertainty is doing little to halt the private rental market, according to a new report.

Research from letting agency Belvoir however suggests that this situation could change, unless the Government changes plans to alter mortgage interest tax relief. In addition, the agency wants to see new measures that will help boost supply of rental homes on the market.

Policy reversal

Dorian Gonsalves, chief operating officer at Belvoir, stated: ‘If there is no reversal in Government policy with regards to mortgage relief taxation and no measures are introduced to increase the supply of rental properties then landlords are likely to come under increasing pressure to raise rents.’[1]

‘If they subsequently start selling off properties, this will clearly have a negative effect on the availability of good quality accommodation. We await the chancellor’s Autumn Statement on 23rd November with great interest,’ Gonsalves continued.[1]

Data from the Belvoir report reveals that rents rose slightly in the third quarter of 2016. 88% of Belvoir offices reported a rise in demand for house, while 63.5% saw an increase in demand for flats.

In terms of rental price movement, Belvoir agents do not foresee a big change in the lead up to the festive season.

Private rental sector thriving...for now

Private rental sector thriving…for now

Vacant

Continuing, Gonsalves said: ‘Historically Q2 and Q3 tend to show an increase and Q4 tends to be when there might be a decrease, as landlords don’t want properties to be left vacant at this time of year and so it is an opportunity for tenants to pick up a bargain.’[1]

‘Two to three bedroom houses remain top of the list for stock shortages, with 81% of offices reporting a shortage of three-bed semi-terraced houses, 68% reporting a shortage of three-bed detached homes and 66.5% of offices reporting a shortage of two-bed houses.’[1]

Concluding, Gonsalves observed: ‘’Our analysis of rental periods in Q3 versus Q2 showed that almost half of franchise owners (46.3%) reported that the average time for tenants to rent was 13-18 months and over a quarter (27.78%) reported the average time in a rental property was over two years.’[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2016/11/buy-to-let-market-continues-to-thrive

 

Are Government housing schemes driving prices up?

Published On: September 2, 2016 at 10:04 am

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In excess of two-thirds of Government spending on incentives designed to encourage buyers, such as Help to Buy, have failed to increase housing stock, according to new claims.

Despite increasing demand for property, these sort of schemes have only served to add to the supply-demand imbalance, putting upward pressure on prices, according to Shelter.

Failed focus

The charity organisation has slammed the Government for spending most of its property funding on house-buying incentive programmes. This money, according to Shelter, could have been better being put towards increasing the supply of housing stock, including affordable housing.

Shelter argues that the Government’s housing strategy has only increased demand to buy property and has moved property prices up, while failing to front up to the shortage of homes in Britain.

Latest figures from Nationwide indicate that residential property prices continued to rise in August. Values rose by 0.6% month-on-month to hit an average of £206,145, largely due to a fall in the number of properties for sale.

Are Government housing schemes driving prices up?

Are Government housing schemes driving prices up?

Stable

Chief economist at the Nationwide, Robert Gardner, noted, ‘surveyors report that instruction to sell have declined and the stock of properties on the market remains close to 30 year lows. This helps to explain why the pace of house price growth has remained broadly stable.’[1]

Early this week, Peter Jeffreys, a senior policy analyst at Shelter, told the Daily Telegraph that new prime minister Theresa May has a chance to increase supply of homes. However, he warns that this can only be done if there is a substantial reform of the house-building sector, including local authority planning sections.

In 2015, there were approximately 120,000 new homes built in Britain. This is less than half of the 250,000 per year the Government feels is needed to solve the crisis.

[1] https://www.propertyinvestortoday.co.uk/breaking-news/2016/8/government-housing-schemes-are-pushing-up-house-prices

 

 

Rental market stays stable post Brexit

Published On: July 26, 2016 at 8:46 am

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The latest report from the Association of Residential Letting Agents has suggested that the rental market has stayed relatively stable following last month’s Brexit vote.

Referendum reality

In the aftermath of the decision to leave the European Union, there has been very little movement in terms of rental costs.

12% of letting agents reported a fall in rent, while 77% saw no change.

Prior to the vote, 19% of agents suggested that rents would increase, with 20% expecting them to drop. 61% thought that they would stay the same.

Supply of available properties and housing demand has also stayed fairly constant since the referendum. 67% of ARLA members have reported no change to supply, with 64% saying that there has been no change in the number of tenants looking to secure a rental property.

This said, 45% of letting agents have seen uncertainty from landlords looking to let, which could cause problems in the coming months.

Calm

David Cox, managing director of the Association of Residential Letting Agents, noted, ‘the rental market has responded to Brexit in a calm fashion, with no immediate fallout amid extreme political and economic uncertainty. What we need is some certainty from the new Government that housing remains a priority with the rental market playing a central role. For example, we want to avoid a situation where institutional investors start pulling away from the market, because ultimately this will impact tenants by squeezing supply further and pushing up rents.’[1]

‘Although we’ve seen some hesitation from landlords this is relatively mild and it’s importantly they do not act in haste. Any inevitable longer-term changes will then be taken on board with greater ease,’ he continued.[1]

Rental market stays stable post Brexit

Rental market stays stable post Brexit

Monthly rises

On a month on month basis, demand for rental accommodation was up during June. In addition, the supply of properties managed on agents’ books also rose. There were 37 would-be tenants on average registered per ARLA branch in June, up from the 33 recorded on average in May.

The supply of rental properties increased by 3% in June, from 171 in May to 176.

Cox concluded by stating, ‘if one thing is clear following Brexit, it’s that supply and demand remains a real issue in the rental market. If supply continues to dwindle against growing demand, no matter what the eventual implications of Brexit are, renting will become more difficult and expensive for tenants.’[1]

[1] http://www.propertyreporter.co.uk/landlords/rental-market-survives-storm-brexit.html

Demand for UK property at lowest for 3 years

Published On: June 30, 2016 at 10:57 am

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The uncertainty surrounding the EU referendum result caused demand for new property to slip to the lowest levels seen for over three years.

Research from the National Association of Estate Agents shows that the number of property sales agreed in the last month fell sharply.

Demand falls

There were an average of 304 house hunters registered per member branch during May, down 6% from April and the lowest levels seen since November 2013.

In addition, the statistics show that in comparison to May 2015, demand has fallen by 21% year-on-year.

Similarly to demand, the supply of properties available to buyers rose marginally from 35 properties to buy per branch in April to 37 in May.

During the last month, 41% of agents suggested that house prices would fall. 30% said that demand would decrease as a result of the referendum result.

Uncertainty

Despite the number of house hunters per branch falling in the last month, the number of sales to first-time buyers increased, albeit marginally.

Mark Hayward, director of the National Association of Estate Agents, said, ‘the EU referendum, without doubt meant that May was a month of uncertainty for potential house buyers and demand dropped significantly and is currently at the lowest level we have seen in the last three years.’[1]

‘As a result of the vote for a Brexit, we expect international investors to look a lot harder at the UK as a potential market to buy in and this will have a knock-on effect on the house building sector, as investments may be delayed or put off completely,’ he continued.[1]

Demand for UK property at lowest for 3 years

Demand for UK property at lowest for 3 years

Short term stability

Hayward appreciates, ‘in the short term, we believe that house prices will remain stable, we cannot be certain about the next quarter as political uncertainty and market unrest could affect the housing market.’[1]

However, he continued by saying, ‘as we continue to say, there are simply not a sufficient number of houses available in this country to cater for everyone’s needs and a Brexit could impact the skills required to drive property developments in the UK. This means that in the longer term, something will need to give which regrettably could mean a surge in house prices or buyers struggling to find a suitable property in order to move or get that first foot on the ladder.’[1]

[1] http://www.propertywire.com/news/europe/uk-residential-property-demand-2016062912085.html