Greek
Central London prices set for growth of 18% over five years
House prices in central London set to rise 18% in next five years and rents by 19.5% as market moves forward after the UK’s general election, it is claimed. The latest analysis says that unprecedented uncertainty surrounding last month's election saw a stifling of house price growth across London, with the rate of house price growth at less than 4%, compared to the 9.6% increase seen in 2014. The emergence of the capital as a political scapegoat, with potential rent caps and a mansion tax being discussed, contributed to the sense that London households would bear the brunt of any tax changes, it points out. However both issues have now subsided, following the surprise majority win by the Conservatives, according to international real estate consultants Cluttons. Despite this, the damage done to domestic and international buyers' confidence was reflected in a sharp tailing off in demand during the first quarter of 2015, with both vendors withdrawing properties and buyers adopting a wait and see approach. ‘There is no doubt that the results of the general election have helped to re-inject confidence into the market that had receded early on this year,’ said Cluttons' international research and business development manager, Faisal Durrani. ‘The outlook for the London housing market has stabilised, while buyers and vendors have returned to the market following a conspicuous absence of activity. Our outlook for the rest of the year is for increased stability in the market and a return to a more normal state of activity,’ he added. The report also says that despite the Mortgage Market Review (MMR) contributing to a 16% year on year dip in home purchase loans in greater London to March 2015, affordability appears to be improving slightly, with the average loan size dipping to 3.86 times annual income in the first quarter of 2015. Risks still remain on the international front however. ‘International risks such as the threat of another Scottish referendum, a disorderly Greek exit from the European Union and a potential Brexit mean that the market has moved from a situation of having several unknown unknowns to being left with a handful of known unknowns. A Brexit remains the biggest threat as the impact on the economy is the biggest unknown at this stage,’ Durrani explained. Cluttons forecasts modest central London house price growth in 2015 of between 2% and 3%, before accelerating to nearly 5% in 2016 and stabilising at around 4% per annum between 2017 and 2019. Cluttons expect this level of growth to deliver cumulative capital value appreciation of almost 18% over the next five years. The prospects for the prime central London rental market are stable, with average growth of 4% per annum forecast for the next five years. Cluttons explains that affordability and the desire to purchase remain key challenges for the capital's rental market and while supply levels are rising, the strong rate of job creation in London will help in absorption rates. ‘The more subdued growth forecast… Continue reading
Prime central London rental values up for third month in a row
Rental values in the prime central London rose by 0.2% for the third consecutive month in March, pushing annual growth to 4%, the highest rate in more than three years. The rental value index is now at the same level it was during the summer of 2012, when London hosted the Olympic Games, according to the latest report from real estate firm Knight Frank. Rental values subsequently dipped as the sales market strengthened but growth returned at the start of 2014 but the lettings market benefited as the UK economic recovery took hold and companies began hiring more staff. Annual growth was 4%, the highest rate in more than three years but the report says that some landlords are hesitant to agree deals because they believe the sales market could strengthen. The number of tenancies, viewings and new prospective tenants are up markedly on 2014 rental yields at 2.92%, an increase on March 2014, the report also points out. The report points out that jobs in London’s financial services sector rose 17% in February compared to 2014 and according to recruiters this is due to oil price stability and subsiding concerns over a Greek exit from the euro zone. However, it is not a clear cut picture, the report says, and activity and stock levels have been dampened by the kind of indecision that has affected the sales market. ‘While some vendors have become landlords in order to wait out the general election to obtain more clarity around the future political landscape, the overwhelming mood of uncertainty has led to hesitancy as the election draws closer and campaigning steps up,’ said Tom Bill, head of London residential research at Knight Frank. He pointed out that some property owners who had considered the rental option have been reluctant to sign two year tenancy agreements while there is a possibility the sales market could strengthen in the second half of the year, depending on the outcome of the election. ‘Either way, demand in the lettings market remains strong. In the year to February 2015, the number of tenancies increased by 37% compared with the preceding 12 month period,’ Bill said. Meanwhile, the number of viewings rose 16%, property inspections increased 14% and the total number of new prospective tenants registering grew by 18%. A stronger lettings market and slower price growth in the sales market resulted in rental yields of 2.92% in March, higher than a figure of 2.83% recorded in the same month last year. Continue reading
Greek Real Estate Market Review By Taylor Scott International
Greek Real Estate Market Review : A frozen sector of the Greek Economy . The Greek property market has been facing a strong recession for five years, national real estate prices have hit the lowest levels of the last decade. … Continue reading
