Tag Archives: consumer
Scottish property prices bounce back after dip due to referendum vote
After a cooling in the market due to the referendum vote on independence, house prices in Scotland have now recovered, according to the latest index figures. Scottish property prices increased by 0.7% in October, taking the average house price to £164,798, just £717 below the pre-recession peak in May 2008. The LSL Property Services/Acadata house price index also shows that on an annual basis prices are up 5.7% and sales of million pound properties in particular have increased since the referendum. The biggest annual rise was in East Renfrewshire with price growth of 13.4%. But growth is not universal with annual price growth down 9.4% in the Scottish Borders and down 6.7% in South Ayrshire. On a month on month basis prices increased by 5.8% in East Dunbartonshire and by 3.4% in Fife but fell by 1.7% in East Lothian and by 1.8% in South Ayrshire. Even in Aberdeen, which has seen some of the highest price growth in Scotland, prices dipped by 0.5% in October. ‘After a run of monthly house price stumbles on the way to the landmark referendum, the Scottish property market has recuperated. Growth regained ground during October, and property values bounced back,’ said Christine Campbell, regional managing director of Your Move. She pointed out that this has returned overall annual growth in Scottish house prices to 5.7%, typically amounting to £8,850, over the past year, and property values in Scotland are making faster progress than across the North of England and Wales. ‘Since the independence question evaporated, a new ray of confidence and certainty is radiating through the market, as normality is resumed. The feel good factor is especially pronounced at the highest tiers of the property market, where political uncertainty froze activity most acutely,’ she explained. Indeed, sales of properties worth £1 million or above have more than doubled from September to October as high end homes began to change hands again. In fact, October 2014 saw the biggest number of million pound properties sold in a single month since September 2008. Campbell also pointed out that only three quarters of the country has seen price growth in the past 12 months and in the remaining areas, property values are below 2013 levels. ‘In these places, activity is vital to keep price growth sailing along, but house sales have slipped back 1% since September,’ she said. While overall, Scottish property sales in 2014 up to October are 14% higher than the same 10 months in 2013, this still only represents 65% of the average volume reached in the pre-recession period of 2004 to 2007. ‘The Chancellor’s revamp of stamp duty should go some way to shore up demand in the short-term, and set off more movement at the lower end of the property chain. But first time buyers have been the guiding light of the Scottish housing recovery, accounting for 46% of current sales in the property market,’ said Campbell. ‘For the bulk of… Continue reading
UK buy to let sector confident going into 2015, new research suggests
Confidence in the buy to let market will encourage significant investment in the sector by UK property investors in 2015, according to new research. This is despite the fact that 52% of buy to let property investors believe interest rates will rise next year, the report from specialist buy to let business Platinum Property Partners also shows. While the majority expect an increase, overall 42% believe interest rates will rise by less than 2% and only 10% expect to see interest rates rise by 2% or more. However, 29% cited a rise in interest rates as their biggest concern for 2015. An interest rate rise of any size would make buy to let borrowing more expensive, this hasn’t slowed down landlords’ ambitions as 43% of existing landlords intend to grow their portfolio of rental properties next year. Some 23% intend to expand their portfolio by one and 14% say they will purchase two more rental properties in the next 12 months. Landlords owning Houses in Multiple Occupation (HMOs) for young professionals and key workers have some of the biggest ambitions for 2015 with 52% planning to add to their portfolio during 2015, 29% planning to add two properties and 14% will add three. The survey also found that landlords still feel confident about capital growth despite recent reports that the housing market is slowing. While the Council of Mortgage Lenders (CML) point to a dip in mortgage lending as evidence that there has been a ‘plateau’ in housing market activity, landlords are confident that house price growth will continue during the course of the next five years. Just under half, 49%, expect UK property values to climb by up to 10% over this period, while a further 28% of investors predict an increase of 10% or more. HMO landlords have an even more positive outlook for capital growth with 43% saying property prices will increase by 10% or more, some 15% more than the overall average. None of the HMO landlords surveyed expect house prices to decrease in the next five years. However, UK buy to let investors have some concerns about what 2015 may bring. When asked for their number one concern, an increase in interest rates topped the poll at 29%, closely followed by future changes in laws and legislations for landlords at 26%. A further 9% are most concerned about the impact of a change of government ahead of the general election and 20% have absolutely no current concerns. ‘A rise in interest rates is one of landlords’ main concerns for 2015, yet the majority don’t anticipate that these rises will be dramatic or unaffordable. As a result, our research reveals that the sector will continue to grow next year, with two in five planning to add to their portfolio despite a likely interest rate rise,’ said Steve Bolton, PPP chairman. ‘Investors in HMOs show the greatest intention to increase their portfolios, which reflects the fact that HMOs… Continue reading
UK house prices up 10.4% annually, but inflated considerably by growth in London
UK house prices increased by 10.4% in the year to October 2014, down from 12.1% in the year to September 2014, the latest index from the Office of National Statistics shows. England saw the steepest price rises with an annual increase of 10.8% in England, while in Wales it was 5.7% and Scotland and Northern Ireland both saw year on year gains of 4.9%. But a closer look at the figures show that annual house price increases in England were driven by an annual increase in London of 17.2% and to a lesser extent increases in the South East of 11.9% and the East at 9.6%. So, excluding London and the South East, UK house prices increased by 6.7% in the 12 months to October 2014. And on a seasonally adjusted basis, average house prices increased by 0.1% between September and October 2014. The ONS data also shows that in October 2014 prices paid by first time buyers were 12% higher on average than in October 2013. For existing owners, prices increased by 9.7% for the same period. David Newnes, director of Reeds Rains and Your Move estate agents, pointed out that it is good news that annual house price growth across England and Wales has more than doubled over the last 12. ‘The considerable uplift in values over the year to November 2014 has pushed the average price of a home in England and Wales above £280,000 for the first time. These figures are spurred on by London and the South East, where the housing recovery has been fast tracked,’ he said. ‘When these regions are removed from the calculations, a calmer annual rise in house prices materialises. After a temporary hiatus at the highest tiers of the property market, growth has rallied again in the capital with values in prime spots such as Kensington and Chelsea, and Hammersmith and Fulham surging 5.3% over the course of the month, hitting new price records along the way,’ he explained. ‘Yet after a solid advance in activity throughout 2014 to date, completed house sales withdrew last month, from a particularly busy October. This doesn’t undermine the strength and stability of the growth in activity experienced over the year as a whole in some locations,’ he added. He believes that the changes to the Stamp Duty system should also allow activity to build further at the bottom rungs of the ladder, facilitating hefty savings. ‘This should help erode the upfront barriers of purchasing a home for the significant majority of buyers and sellers may feel the benefit of weightier demand, as well as being able to price their homes more realistically, without having to tactically negotiate threshold barriers,’ said Newnes. ‘In the year to September 2014, 69% of completed house sales on properties worth £1,125,000 or more were in London, and a further 19% took place in the South East. These more expensive regions will bear the brunt of stronger Stamp Duty tax at the highest levels,’… Continue reading
