Tag Archives: city
Monthly landlord survey reveals effect of general election on private rented sector
Three quarters of letting agents are concerned that proposals for the creation of three year tenancies in England and Wales put forward in the run up to this week’s UK general election, a new report reveals. Members of the Association of Residential Letting Agents (ARLA) believe that the proposal put forward by the Labour party will see landlords exit the market and reduce supply. However, over a third of ARLA agents agree the Conservatives’ pledge to build 200,000 new starter homes will benefit the private rental sector the most. The report comes at a time when demand for rental accommodation was down in March, whilst supply rises. Some 72% of ARLA letting agents said three year tenancies, with a cap on rents will see landlords pull out the market, and lead to a decrease in the supply of rental property landlords in the North West and East Midlands most likely to pull out the market, with 84% of ARLA agents in these regions expressing concern. As well as seeing a reduction in landlords and therefore supply of rental housing, 74% believe the proposed three year tenancy agreements with rent controls and strict rules to make it more difficult to evict tenants will not actually benefit tenants at all, up from 69% in February. Meanwhile, 37% of ARLA agents agree that the Conservatives’ pledge to build 200,000 new starter homes offered at 20% discount to first time buyers would be best for the private rented sector. This will enable a segment of the current British renting population to get on the housing market, freeing up more properties for renting, helping to ease supply and demand. The March report also shows how the upcoming election is having an effect on the current levels of supply and demand for the private rented sector, as people hold out to see the outcome. Demand was down by 10% in March with just 36 house hunters recorded, down from 40 in February. Supply is heading in the other direction, with a rise in the number of properties managed per branch at 192 properties in March, up from 184 the previous month. Rents continue to increase for some, as 32% ARLA agents said that rents increased between February and March, the same increase as the previous month. ‘The vast majority of ARLA letting agents are worried that Labour’s proposed three year tenancies with strict caps on rents will only cause the gap between supply and demand to widen,’ said David Cox, managing director of ARLA. ‘Flexible tenancies are what makes the sector work, if this changes, some landlords will be forced to exit the market and tenants are likely to automatically incur rent hikes and feel driven to stay in agreements for longer before getting on the housing ladder; thus not freeing up rental properties for other tenants,’ he explained. ‘The proposals are aimed at reducing opportunities for landlords to raise rents and to create stability for tenants. However, Labour’s proposals aren’t… Continue reading
Property prices in Australian cities holding steady and up almost 8% year on year
Residential property values across Australia’s capital cities increased by 0.8% in April, down from the 1.4% increase recorded in March, the latest index data shows. Overall values increased over the past month across every capital city except Canberra where values showed a 1.5% drop over the month, according to the CoreLogic RP home value index. CoreLogic RP Data head of research, Tim Lawless, said that despite the slower month on month reading, the annual rate of growth has seen a slight rebound, with dwelling values now 7.9% higher over the past 12 months across the combined capital city index. ‘Annually, the rate of capital gain has slowed since April last year, however, since the February rate cut the Sydney and, to a lesser extent, Melbourne housing markets have caught a second wind which is reflected in the higher rate of capital gain as well as the very strong auction results and rapid rate of sale for properties sold via private treaty,’ he explained. ‘Despite the slight annual rate of growth upswing, capital gains remain lower than their annual peak recorded in April last year when dwelling values were rising at the rate of 11.5% per annum across the combined capitals index,’ he added. According to the April results, capital city dwelling values have been trending higher over the past 35 months, recording a cumulative increase of 25.3% between the end of May 2012 and April 2015. ‘While the combined capitals trend of dwelling value growth has been substantial, the rate of growth across the Sydney housing market stands head and shoulders above the other capital cities over the cycle to date,’ said Lawless. He pointed out that Sydney dwelling values are now 40.2% higher relative to the May 2012 trough. ‘If you factor in the previous 2009/2010 phase of growth, Sydney values are now up 65.4% after the global financial crisis,’ he added. A breakdown of the figures show that Melbourne is the only other capital city that comes close to this measure where dwelling values are 52.3% higher post GFC. The next highest rate of growth is Darwin where values have moved 26.5% higher, followed by Canberra at 19.8%, Perth at 15.2%, Adelaide at 12.2%, Brisbane at 8% and Hobart at 1.2%. ‘While the headline growth figures remain strong it is clear that some markets are winding down. The rate of growth in Perth and Darwin has slowed substantially in line with the wind down of major infrastructure projects associated with the resources sector and the housing market in Canberra has also softened post federal election,’ Lawless said. The performance of houses versus apartments has shown some interesting trends of late. Detached homes are continuing to outperform the multi-unit sector, with capital city house values up 8.3% over the past year while unit values have risen by a lower 5.6%. This trend is more noticeable in the key growth markets of Sydney and Melbourne. Sydney house values are up 15.5% over the past year while… Continue reading
Prime London market sees more first time buyers
More first time buyers are active in the prime London property market with fewer real estate investors in the sector in the first quarter of this year, new research shows. While investors continue to account for the majority of house purchases made across prime London, this margin has narrowed significantly, according to estate agent Marsh & Parsons’ latest London Property Monitor. Some 29% of prime London property purchases were made by an investor in the three months to March 2015, down from 37% at the end of 2014 but first time buyer sales increased from 21% of all purchases in the last quarter of 2014 to 28% in the first quarter of this year. The rise in first-time buyers has caused the number of prime transactions funded by mortgages to jump 17% in the past three months and over the past three months, demand for prime London homes has risen by 20%. As a result, heightened competition for available homes on the market has pushed the ratio of registered buyers per property up from 10 in December 2014 to 12 in March 2014, the data also shows. ‘First time buyers have been riding a wave of fortuitous circumstances recently with almost unheard of mortgage rates, reduced up-front stamp duty costs, and support schemes like the Help to Buy ISA inflating confidence,’ said Peter Rollings, chief executive officer of Marsh & Parsons. ‘Combined with a more accessible pace of property price growth so far in 2015, many more have been able to take the plunge into the property market. Prime London property has always been a bastion of investment, but it’s encouraging to see the drawbridge being lowered for everyday Londoners who live and work in this city,’ he explained. ‘However, there is, and has always been, some aspirational prime central areas that are out of grasp for new buyers, and will remain an investment stronghold. Addresses like Kensington and Chelsea resonate around the world, and will forever entice buyers looking for unparalleled capital returns,’ he added. The report reveals that as a result of this strong demand for starter homes, one bedroom properties in prime London have seen the biggest increase in value over the past 12 months with average values up 5%, compared to 1.7% annual growth across the market as a whole. This means the price of a typical one bedroom property in London has risen by £75 a day over the past year. Similarly, one bedroom properties are highly sought after as buy to let investments, with rents appreciating at the fastest rate of all property types across the capital. The average weekly rent for a one bedroom property has risen 5.8% year on year in more affordable outer prime areas of London, popular with young professional renters. ‘With more and more young professionals climbing onto the property ladder, one bedroom properties have outperformed the market across prime London…. Continue reading
