Posts with tag: London housing market

Index of Private Housing Rental Prices for Great Britain: February 2018

Published On: March 21, 2018 at 10:09 am

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The Index of Private Housing Rental Prices (IPHRP) is an experimental price index tracking the prices paid for renting property from private landlords in Great Britain.

The report shows that private rental prices paid by tenants in Great Britain rose by 1.1% from January to February 2018, the rate of growth here being unchanged in those 12 months.

In England, private rental prices grew by 1.1%, Wales grew slightly more at 1.4%, and Scotland 0.4%.

In the capital, London has seen an increase of 0.1%, coming in at 1% below the average for Great Britain as a whole.

The IPHRP covers Great Britain as a series of price indices, and doesn’t measure newly advertised rental prices. Instead, it reflects overall price changes for privately rented properties. Whilst Northern Ireland is not currently included, the Office for National Statistics (ONS) is working to secure private rental data for the entire UK.

The 12 month growth rate of private rental prices paid by tenants in Great Britain has seen signs of a slow down since 2015. It has however  increased by 1.1% in the last 12 months, leading up to February 2018. This has largely been driven by a slowdown in London over the same period; its growth rate (0.1%) is currently at its slowest since 2010, when in September it was at -0.4%.

From January 2011 to February 2018, private rental prices increased by 15.6%. However, London has a great impact on this, and if you exclude the capital, private rental prices increased by 12.6%.

What does this mean for the private rented sector? Kate Davies comments

The Executive Director of Intermediary Mortgage Lenders Association (IMLA), Kate Davies, commented on the ONS’ Index of private housing rental prices (IPHRP) in Great Britain in February:

“These figures reaffirm how subdued private housing rental statistics have been in the last few months. Whilst that may be giving tenants some temporary respite from higher rents, the flip-side is that landlords will be facing downward pressure on their cash-flows and profitability. This comes at a time when successive policy changes in the buy-to-let (BTL) sector have proved detrimental, with net BTL investment falling by 80% since 2015.

“We are already concerned that availability of private rental homes is unlikely to keep up with household numbers. We therefore ask the Government to recognise the benefits that a strong Private Rented Sector (PRS) brings for the UK, and the importance of maintaining a good supply of rental properties for the periods when home ownership is not suitable or achievable for households.”

It seems that all countries in Great Britain have experienced a rise in rental prices, however in England they have increased more than in Scotland and Wales. See below for the index values for Great Britain compared to its constituent countries.

In London, it looks to be the case that growth in private rental prices is continuing to slow. The largest annual rental price increase was found to be in the East Midlands at 2.5% (down from 2.6% in January 2018). This is followed by the South West at 2.1% (unchanged) and the East of England at 2.1% (up from 1.9% in January 2018). The percentage change of private housing rental prices is shown below.

 

Number of Homes Under £250,000 in London Dwindles

Published On: June 2, 2015 at 12:48 pm

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The amount of homes worth £250,000 or less in London has decreased by 14% in a year, according to research by Experian.

Most of these properties are in Newham, Enfield, Croydon, and Barking and Dagenham.

Director of Residential Research at Savills estate agents, Lucian Cook, says just 75 of 627 council wards in the capital have an average house price of £250,000 or less. He says this is a reflection of how increasing prices affect the whole of London.

He adds: “The shrinking market under £250,000 reflects the extent to which prices in London have risen over the past five years and been dislocated from the rest of the UK.”1

Chief Executive of Haart estate agents, Paul Smith, comments: “Not only are homes under £250,000 gold dust to first time buyers in the capital, but investors are also on the hunt for them.

“The strongest yields can be achieved on properties of this value and London is still viewed as the global hotspot for property investment.”

He says that this shortage is forcing first time buyers out of London in search of a family home, as the average age of this type of buyer is 32-years-old.

He continues: “We are now starting to see more first time buyer activity outside the capital than inside. You can get a three-bedroom semi-detached house in Chelmsford for £250,000, but in London, even somewhere outside the centre like Wembley, you’d be lucky to get a two-bedroom flat.

“Young professionals are increasingly doing a balancing act, weighing up their commute against the quality and size of their home – and home is increasingly coming out the winner.”1

Research analyst at Countrywide, David Fell, thinks that the Government’s Stamp Duty reform last year could be behind the shortage of homes under £250,000: “We are now seeing homes that would have come onto the market at £250,000 before the change, marketed at £260,000 or £270,000.”

Similarly to Smith, he is witnessing first time buyers moving further away from central London: “A decade ago, the focus of first time buyers was in places on the Zone 2/3 border, such as Hackney, Deptford and Crystal Palace.

“Today, stretched affordability means new buyers have to look further and further afield to get on the housing ladder. Places like Walthamstow, West Ealing and Croydon are now the starting point of many first time buyers’ home searches.”1

However, the other side of the market, properties priced at £500,000 or more, rose by over 22%.

Associate Director of John D Wood in Weybridge, Vincent Dennington, says: “We have been taking on a lot of property about £500,000 and it has been selling quickly to both owner-occupiers and investors.

“As mortgage rates are low, people are seizing the chance to move up the property ladder while they still can. Many people are concerned they might not be able to afford to upsize their home in the future if prices continue to go up, so they are making the move now.”1

In the South East, research reveals a similar story. The number of homes for sale at less than £250,000 has dropped by 10% and homes at over £500,000 has risen 25%.

1 http://www.homesandproperty.co.uk/property-news/news/hunt-londons-rare-property-gems-under-ps250000

 

South East London Property Guide

Published On: May 30, 2015 at 1:13 pm

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South East London is emerging as one of the best parts of the capital for first time buyers, as 15,000 starter homes have been bought in this area in the last year, revealed Hamptons International.

The highest levels of demand have been felt in areas furthest from central London, such as Beckenham, Crystal Palace and Bromley, where it is still possible to buy a house with two or more bedrooms for less than £300,000.

For first time buyers wanting to stay closer to the centre, one-bedroom flats in areas such as Brixton and Surrey Quays are the most popular.

Head of Research at Hamptons International, Johnny Morris, comments: “For some first time buyers, it’s simply a case of finding a home that they can afford. But an increasing number are choosing to skip a step in their housing journey, looking for a bigger home they can stay in for longer.”1

The following areas in South East London offer the best value and lots of potential for buyers:

Beckenham, Zones 4/5 

Beckenham has nice shops, cocktail bars, good schools and a village feel. Young professionals and families are moving to the area, not too far from the City.

Average price of a flat*: £313,790

* Property prices from Zoopla

Brixton, Zone 2

Brixton Village, featuring cool bars and restaurants, has made the area one of the trendiest spots in London.

Average price of a flat: £375,954

Bromley, Zone 5 

This town is 12 miles from central London and has been promised huge investments, marking a bright future.

Average price of a flat: £277,709

Camberwell, Zone 2

Beautiful architecture with an urban lifestyle makes Camberwell appealing to young professionals and families.

Average price of a flat: £340,182

Catford, Zone 3

Eight miles from central London, Catford has a strong community, popular schools and well-priced homes.

Average price of a flat: £235,012

Dulwich Village, Zone 2

There aren’t many parts of London that feel rural, but Dulwich Village has that vibe, with Georgian houses, cottages, good schools and independent shops.

Average price of a flat: £387,274

Greenwich, Zone 2

Historic Greenwich will soon see a new 24-hour community and 15,000 new homes.

Average price of a flat: £424,676

Kennington, Zones 1/2

Kennington has been redeveloped, bringing in an eclectic group of residents. The new Damien Hirst gallery adds culture.

Average price of a flat: £429,701

Lee, Zone 3

House hunters have previously overlooked Lee, but the area has a good community spirit, fascinating history, good schools and good value Victorian properties.

Average price of a flat: £251,356

Lewisham, Zone 2 

For commuters, fast trains are attractive, while families look for homes in the conservation areas. If buyers are quick, they can get in on London’s next big Tube project.

Average price of a flat: £309,826

Nunhead, Zone 2 

Between East Dulwich and Peckham, Nunhead has a neat high street and prospering local festivals.

Average price of a flat: £316,943

Peckham, Zone 2

Peckham is young and exciting in parts, but also has a solid scene of good cafes, bars, shops and schools.

Average price of a flat: £316,943

Penge, Zone 4

Investors and young professionals are taking advantage of Penge’s low property prices, train links and fast commute.

Average price of a flat: £242,372

Vauxhall, Zone 1

For buyers with larger budgets, Vauxhall is having an artistic renovation, providing a creative place to live that’s close to the West End.

Average price of a flat: £1,484,560

Woolwich, Zones 3/4

Commuters and investors are looking to Thames-side town Woolwich for its new redevelopment opportunities.

Average price of a flat: £272,440

1 http://www.homesandproperty.co.uk/area-guides/greater-london/area-watch-property-guide-south-east-london#1

Homeless People are Criminals in London Borough

Published On: May 21, 2015 at 11:56 am

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Homeless people in East London could be criminalised after a ban on anti-social behaviour was introduced.

Homeless People are Criminals in London Borough

Homeless People are Criminals in London Borough

The new Public Space Protection Order in Hackney will see police and council officers demanding people stop any activities considered anti-social, including begging and sleeping rough.

The Order covers Hackney Downs, London Fields, Broadway Market, Mare Street and Regents Canal.

Those considered breaking the rules could be given a £100 fixed penalty notice or fined up to £1,000.

Chief Executive of homelessness charity Crisis, Jon Sparkes, says: “Any moves to ban and criminalise rough sleeping will be counter-productive and only make it harder for people to access the dedicated support they need to move away from the streets for good.”1

Councillor Sophie Linden, Deputy Mayor, defends the ban: “We introduced this Order after trying for months to deal with anti-social behaviour in the area, including offering support, housing and advice to those that are persistently sleeping rough.

“Enforcement action will always be the last resort. We will continue to make sure anyone who is sleeping rough is offered professional help and support.”1

This news arrives after research found that a third of Londoners do not earn enough to afford a decent standard of living. An individual would need an income of £27,000 per year to comfortably rent a flat in the capital.

1 http://www.independent.co.uk/news/uk/home-news/the-london-borough-that-has-turned-homeless-people-into-criminals-10265493.html

Wealthy London Homeowners Drop Asking Prices

Published On: May 11, 2015 at 10:01 am

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Homeowners in the luxury central London market cut asking prices, as they feared a Labour government.

Almost 40% of all property types in the prime central London sector sold below their marketed value in the first quarter (Q1) of this year, as vendors unwillingly lowered their asking prices.

Gazundering has not been seen so strongly in this market since 2012, when the country was emerging from the recession. Boroughs such as Belgravia, Kensington and Chelsea, Mayfair, and Knightsbridge experienced determined buyers looking for further price cuts at the point of sale.

Wealthy London Homeowners Drop Asking Prices

Wealthy London Homeowners Drop Asking Prices

New research from Lonres on the first three months of 2015 revealed that 64% of properties that had already been reduced in asking price, dropped the value again when the vendor was close to completion.

As the outcome of the general election has been more certain than anticipated, it is believed that this market will begin to pick up again.

The study also found that 72% of estate agents in central London witnessed a rise in price cuts in Q1 2015, and the average saving for buyers on homes worth over £1m was £240,000.

Managing Director of Douglas & Gordon estate agents, Ed Mead, says: “High-end central London has been dramatically affected [by uncertainty surrounding the election]. Volumes are down over 50%.”1

Savills estate agents also discovered that price reductions and a decline in demand caused a 5.2% drop in values over the six months to the end of Q1.

Managing Director of Rokstone, Becky Fatemi, says that price cuts indicated concerns over a Labour government, but that sellers accepted that values were too high.

She comments: “The froth has come off the market.”1 

The homes experiencing price reductions sold for 88% of their original asking price, the Lonres report claimed, and properties were on the market for an average of 32 days.

Director of Lonres, Anthony Payne, explains: “The high-end property market is an emotional place. The sale price is not based on any logic but merely my house is nicer than the one down the street.

“However, we found that if you discounted your home you would sell quicker than someone who did not but would inevitably need to bring the value down to the sale level further down the line.

“Interestingly, it’s the captains of industry, who make very clear decisions in their business world, who become emotional when selling their home and take it personally.”1

1 http://www.telegraph.co.uk/finance/property/11589652/Panic-selling-and-gazundering-hits-the-luxury-homes-market-in-London.html

Sales of Properties Worth £1m Have Dropped by a Fifth

Published On: May 6, 2015 at 2:58 pm

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Sales of properties worth over £1m have fallen by almost a fifth year-on-year due to concerns over a possible mansion tax, revealed Land Registry.

Around England and Wales, 851 homes worth over £1m were sold in January, a 19% drop on January 2014, when 1,049 properties worth more than £1m were sold.1

The majority of properties in this price bracket were sold in London.

The uncertainty surrounding the election will be cleared soon when the results are announced, however, buyers are worried about potential mansion taxes and affordability pressure. Experts have found that London’s high-end property market has slowed as a result.

Stamp Duty changes in December 2014 also made this tax more expensive for buyers in the capital’s most expensive boroughs.

Sales of Properties Worth £1m Have Dropped by a Fifth

Sales of Properties Worth £1m Have Dropped by a Fifth

Land Registry research found that property prices in Kensington and Chelsea have had the slowest annual growth of all London boroughs in the past year, with just a 5.2% increase. The average home in this area is worth £1.29m.

Westminster was the only other London borough to record year-on-year price growth of less than 10%, with a 9.9% rise, making the average price £999,687.

In contrast, Newham experienced the highest growth of all London boroughs, with a 19.8% upsurge in prices, to £291,364.

Property Economist at Capital Economics, Matthew Pointon says: “Uncertainty regarding the mansion tax has taken its toll on prices in prime central London.”1 

In all price brackets, the amount of property sales in England and Wales was 53,168 in January, an 18% drop compared with January 2014, at 65,175.

House values rose in England and Wales by 5.3% in the year to March, reaching an average of £178,007. On a monthly basis, they dropped slightly by 0.8%.

The strongest price growth was recorded for semi-detached houses in the past year, with an increase of 6.1%. The average semi-detached home is now worth £169,194.

Regionally, London still has the strongest year-on-year price growth, with an 11.3% rise, making the average property in the capital worth £462,799 in March.

The only region to record lower house prices than a year ago was the North East, with a 2.9% drop to £97,444. In Wales, prices rose 2.7% to £117,828.

This data arrives as estate agents report a slowdown in the market as buyers await the outcome of the general election. The first time buyer sector in particular has experienced a downturn.

The National Association of Estate Agents (NAEA) found that first time buyers bought 22% of properties sold in March. This is down from 30% in February.

Overall, the NAEA found that demand for homes is the lowest in a year. An average of 343 house hunters registered per estate agent branch in March, a drop from 366 in February.

Almost two-thirds (63%) of estate agents noted a slowdown in the market, the NAEA revealed.1

The NAEA also said that the supply of homes on the market has risen slightly to an average of 48 per branch, compared to 43 in February.

Managing Director of the NAEA, Mark Hayward, says: “We may have seen a slight increase in supply this month, but it is not an ongoing trend or a big enough jump to fill the gap for demand.

“Although our agents have seen the market cooling off ahead of the general election, it will inevitably bounce back again at a rapid rate after May 7th, so it is more important than ever that the party elected focuses on increasing the supply of homes.”1 

1 http://www.dailymail.co.uk/news/article-3062946/Sales-homes-worth-1million-plunged-nearly-FIFTH-amid-fears-mansion-tax.html