Tag Archives: city
Two tier house prices growth continues in Australia led by Sydney and Melbourne
The two tiered growth evident across Australia’s housing markets continued in July with Sydney and Melbourne driving home values higher, the latest monthly index shows. The CoreLogic RP Data Home Value Index increased by 2.8% month on month and 11.1% year on year and the total aggregated value of Australian housing increased by just over half a trillion dollars over the past 12 months to $6 trillion. Melbourne has traded places with Sydney to record the highest rate of capital gain, with values in the city up 6.1% over the three months ending in July, the highest rolling quarterly rate of growth since the three months ending August last year when values grew 6.4%. Growth in Sydney wasn’t quite as strong over the rolling quarter, up 5.4% but still the highest rate of growth since the March quarter this year when it was 5.8%. ‘To date, the capital cities have seen remarkable differences over the growth cycle which broadly commenced at the end of May 2012 and since that time dwelling values across our combined capitals index have increased by 30.4%,’ said Tim Lawless, CoreLogic RP Data’s head of research. Sydney values are 47.9% higher over the current cycle and Melbourne values are 32.1% higher while every other capital city has seen growth of less than 13% over the same period. Lawless explained that this highlights the extent to which the Sydney and Melbourne markets have outperformed other markets over the past three years. He pointed out that over the last year several cities have seen price corrections. Darwin has seen values falling the most, down by 5.3% while in Perth values also drifted lower over the year, down 0.3%. At the same time, the annual rate of capital gain in Sydney reached a new cyclical high with home values moving 18.4% higher over the year to the highest annual rate of growth for Sydney since the 12 months ending in December 2002. The strongest growth conditions outside of Sydney and Melbourne have been in Brisbane where dwelling values were 3.9% higher over the year. Based on the median dwelling price, Sydney prices are now 72% higher than Brisbane’s and Melbourne’s are 24% higher. Detached housing continued to outperform the unit sector, with house values substantially outperforming unit values over the past year apart from Hobart and Darwin. Detached home values are up 11.6% compared with a 7.2% increase in unit values over the past year. The differential is most pronounced in Melbourne where house values have surged 12.3% higher over the year compared with a 4.8% rise in unit values. ‘The higher growth rates for houses compared with units is likely to be supply related, with the underlying land component driving detached housing values higher at a time when new apartment supply has seen a substantial boost from new construction,’ Lawless said. While dwelling values continue to rise across most cities, the pace of rental growth has slipped to a new record low, which has… Continue reading
Commuters an hour from London pay 60% less for a home, new research shows
Average house prices drop from £722,000 in central London to £272,000 in commuter towns an hour outside of London, new research has found. It means that people living up to an hour’s rail journey and commuting to London for work save on average £450,000, or 60%, when it comes to buying a home, according to the analysis from Lloyds Bank. Wellingborough tops the list of the most affordable commuter towns but people that work in Birmingham and Manchester can be better off living in the city centre, rather than commuting, the research also found. Towns that are an hour’s commute from central London include Crawley, Newbury, Colchester and Chatham have an average property price of £272,000 and although commuters face paying an average of £4,944 in travelling costs, a commuter would need to travel for 91 years for the total rail costs to wipe out the difference in average house prices. Buying a home closer to central London saves travel time but not money. Indeed, 20 minutes closer and house prices begin to rise. Commuters from towns approximately 40 minutes away from central London, including Reading, Stevenage, Sidcup and Billericay will have to pay an average house price of £349,000, still some £373,000 or 52% lower than in central London and with a less significant average annual rail travel cost at £3,499. Even at up to 20 minutes distance away from the heart of the capital, commuters from towns such as Ilford, St. Albans and East Croydon benefit from an average house price that is nearly £321,000 lower than in central London. Though examples are rare, some commuters to central London do live in areas that command higher average house prices. For example, commuters to London from Beaconsfield pay a higher average house price at £921,516 than central London while also having to cover the cost of an annual rail cost of £3,788. Nearby, Gerrards Cross also has an average house price that is £32,525 higher. ‘It's no surprise, for London at least, that the further you commute the larger the difference in house prices although, of course, the journey also gets longer and more expensive,’ said Andrew Mason, mortgages director at Lloyds Bank, ‘The decision to commute is not simply a trade-off between financial costs and journey times. Quality of life is an important consideration and in nearly all towns in this survey housing affordability is significantly better with a London salary compared to what can be earned locally,’ he pointed out. ‘For commuters with up to an hour's journey to central London, the reward is an annual salary that is, on average, 22%, or £8,500, higher than what they could earn in their place of residence which is close to £38,500. In the 10 most affordable commuter towns the uplift in annual earnings by working in London is nearly £13,000,’ he explained. One of the key factors for most commuters is the significantly higher annual salaries that can be earned from working in… Continue reading
French Riviera poised to benefit from demand from global wealthy buyers
Prime property prices in the world’s most expensive cities are cooling which means that wealthy property investors could look increasingly to other cities and leisure hotspots such as the French Riviera, new research suggests. While in France as a whole property prices and sales in the last three years have fallen the Riviera is still a magnet for wealthy buyers. Indeed, the area that stretches from St Tropez in the south west to the border of Italy is the third richest region in France. While prices in France overall were down 8.1% as of December 2014 compared their peak in the third quarter of 2011, the Provence-Alpes-Côte d'Azur (PACA) region consistently commands the country’s highest house prices and the second highest apartment prices behind the Paris region. The latest French Riviera residential market report from international real estate firm Savills also points out that it is an important global tourist market where some 17% of properties are second homes or occasional accommodation, compared to 11% nationally. The analysis points out that like the rest of France, prices have fallen in PACA and the market is a buyers’ one. Values in the region have tracked the national average closely, and are down 9.5% from a 2011 high. ‘The market did not see the same rally between 2009 and 2011 as that experienced in Paris, so values currently look better value than those in the French capital,’ the report says, adding that government rhetoric and negative media coverage around the taxation of wealth, coupled with a faltering domestic economy has slowed activity across the Riviera's prime markets. The number of €3 million plus deals fell by 44% across the region between 2007 and 2013. Cap Ferrat and St Tropez, home to the Riviera’s largest prime markets, saw the sharpest declines, down 69% and 54% respectively. ‘Although transaction numbers are down, purchasers of the region’s best properties tend to hold for long periods, with low gearing as these homes are viewed as a store of wealth, so forced sales are rare and, as a consequence, there is no mechanism for prices to fall substantially,’ the report explains. It also points out that property in the French Riviera for most is viewed as an asset with long term appeal and therefore a safe store of wealth and regional statistics disguise local market characteristics. ‘What sets the French Riviera apart is extremely limited supply in the most desirable spots. In Saint-Jean-Cap-Ferrat, a peninsula of land east of Nice, there are around 500 properties and only a handful come onto the market in any single year. Supply is kept low and prices high by wealthy buyers who hold for long periods and are not generally forced to sell,’ the report says. ‘Cap-d’Ail, Beausoleil, Roquebrune-Cap-Martin adjoin Monaco and have benefited from the surge in activity that the Principality’s residential markets have experienced. Significantly cheaper prime property is available here, albeit without the tax benefits. The area has proved popular with… Continue reading
