Tag Archives: conservative
Long term outlook for UK prime country market looking positive
The long term outlook for the UK’s prime country property market is positive, but the election result is unlikely to lead to significant price growth, according to a new analysis. The result of the General Election has marked an end to the uncertainty experienced in the UK prime markets in the run-up to polling day, when concerns about taxation and personal finances led to weaker demand at the start of 2015, the Knight Frank report points out. Indeed, it shows that annual price growth had slowed to 2.5% by March, down from 5.2% in the second quarter of 2014 but prices have risen by nearly 1% so far this year and by 2.5% annually. ‘We now expect there will be more positive trading conditions as buyers and vendors return to the market. Transactions, which had been put on hold pending the outcome of the vote or as a result of a wider sense of political uncertainty, will proceed,’ said Oliver Knight of the firm’s residential research unit. However, prices remain below peak levels, creating an opportunity for buyers and prime market activity has picked up over the last 12 months,’ the report also says. ‘With a Conservative Cabinet, the possibility of a mansion tax for properties valued at over £2 million has gone. Now, one of the key questions is what effect a more certain political environment will have on prices,’ explained Knight. ‘While the confidence engendered by political stability is expected to result in a rise in market activity, any expectations that prices will jump significantly as a direct result of the general election may be unrealistic. ‘Any market is based on supply and demand and the number of new properties coming to the market is expected to increase. This rise in supply, together with uncertainty as to the precise direction of fiscal policies of the new government is likely to mitigate significant price rises,’ he pointed out. ‘Additionally, higher purchase costs as a result of the increase in stamp duty announced in December need to be considered. As a result of that change, the up-front cost of buying a property valued at more than £937,500 has risen,’ he added. The report says that overall the long term outlook for the prime country market is positive as for now interest rates remain at record low levels, economic growth is steady and mortgage rates are competitive. ‘As the economy continues to improve the ripples of demand from London will strengthen. Popular commuter locations, within easy reach of the capital, are likely to be the biggest beneficiaries,’ said Knight. ‘There has already been an increase in the number of buyers looking to exploit the relative price gap that has opened up between London and regional prime markets and the expectation is that this will continue,’ he concluded. Continue reading
Number of sales to first time buyers in UK edges up
Just over a quarter, 26%, of house sales in the UK were made to first time buyers in April but estate agents are warning that with prices increasing it could be harder for them in the next few years. Sales to first time buyers are up from 22% in March, according to the National Association of Estate Agents (NAEA) April Housing Market Report. However when looking further ahead, 93% of NAEA agents do not see first time buyers having substantial cut through in the market over the next five years. Further, 55% of member agents think that house prices will increase over the next five years, continuing to push first time buyers out of the market. The report also found that in the build up to the General Election, demand in April remained similar to the previous month with 344 house hunters registered per branch compared to 343 in March, whilst supply decreased from last month, with just 43 houses available per member branch compared to 48 in March. In addition to this, 74% of NAEA member agents do not see supply and demand levelling out over the next five years, meaning that more buyers will be squeezed out of the market. ‘The market is notoriously tough for first time buyers. House prices continue to increase and lenders have tight and restrictive lending criteria,’ said Mark Hayward, NAEA managing director. ‘Whilst this month’s figures are positive and a step in the right direction, I’d like to think that with the help of 200,000 new starter homes and the Help to Buy ISA, first time buyers will be given even more help to get their foot on the ladder, however these things may take time to come to fruition,’ he explained. Following the result of the General Election, 92% of NAEA agents think the majority Conservative government is great news for the housing market and out of all the Conservatives’ pledges, 60% of agents believe their plan to build 200,000 new starter homes will benefit consumers the most. Also, some 41% of estate agents believe that the Help to Buy ISA will be the most beneficial, allowing first time buyers to save more successfully for their first home. Continue reading
Rents in UK set to rise in next five years, according to lettings agents
A third of lettings agents in the UK reported that rents increased in April, the latest data shows, and many believe they will continue rising over the next five years. The latest monthly private rental sector report from the Association of Residential Letting Agents (ARLA) shows that in the North West some 46% of landlords reported an increase in the region. Overall nine in 10 agents reported that they were happy with the general election result and with Labour’s rent cap proposals thrown out, 79% of ARLA agents predicted that rents will increase over the next five years. The report also shows that in the last month, the number of landlords selling their buy to let properties has increased, particularly in London. ARLA agents in London saw the number of landlords selling their buy-to-let properties double between March and April, rising from three to six properties on average per branch. Scottish agents saw an increase from four to seven buy to let properties going up for sale in the last month, whilst the national average increased from three to four buy to let properties up for sale on average per branch. ‘It is interesting that we have seen an increase in the amount of landlords selling their buy to let properties in the last month, which is likely to have been a result of political uncertainty,’ said David Cox, ARLA managing director. ‘We know that Labour’s plans were unpopular for many landlords and agents, so this increase in those selling their buy to let properties may have been a knee jerk reaction to the possibility of Labour’s proposals coming in to practice,’ he added. Following the general election result earlier this month 90% ARLA letting agents were happy with the outcome of a majority Conservative government with 95% believing the result is good news for the private rented sector. Some 13% of those agents said it was good news because the Conservatives will interfere less with the industry and 11% believe the result will provide certainty and stability to the market In April, supply and demand remained similar to last month. On average, ARLA member branches managed 193 properties, compared to 192 in March. In April, ARLA agents reported an average of 36 prospective tenants per branch, which remains exactly the same as March. ‘It is going to be interesting to see what happens in the market in the next few months following the election result and whether we see an increase in supply of rented accommodation as a result of the Conservative’s promise to build 200,000 new starter homes offered at 20% discount to first time buyers. This policy will help first time buyers make that leap onto the housing ladder and as a result this will hopefully free up rental property,’ Cox pointed out. ‘Hopefully, now the country is under less political… Continue reading
