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Auckland house market shows unmistakable signs of slowing
For the first time in five years the housing market in Auckland, New Zealand’s largest urban area, is showing signs that prices are stabilising, and may even be slowing. The average price in July was $867,681, a fall of 4.5% from the previous month and 2% below the average price for the previous three months, according to the latest data from Barfoot & Thompson. The trend is not as evident in the median price, which at $840,000 was the same as in June, and 2.1% higher than the median price for the previous three months. ‘There has been a definite change in the market in the last month. The winter months, school holidays and a slowing in the number of new listings all contributed to the slowdown in July, but buyer determination to pay whatever is necessary to achieve a property was tempered,’ said Wendy Alexander, chief executive officer of Barfoot & Thompson. ‘Buyers remain prepared to pay a fair price, and under the hammer sales at auctions of 70% were still high, but sales activity is slower than it was at the same time last year. In the three months May to July this year we sold 3,508 properties. In the same period last year we sold 3780, a 7.8% difference,’ she explained. She pointed out that the year on year increase in prices is still occurring, but at a much slower rate than in the past four years. The average price has increased by 5.3% over the past seven months compared to 2015’s full year average price increase of 14%. Meanwhile, the median price increase over the past seven months has been 6% compared to 17.4% for 2015. ‘Whether price increases will continue in the remaining months of the year is unclear. Normally, prices rise as we enter the spring/summer months, but the Reserve Bank’s new regulations affecting investors will start to have an impact from August,’ said Alexander. The data also shows that in July Barfoot & Thompson sold 1,034 properties, down 11.5% on the number in June and down 25.5% on those for the same month last year. New listings at 1,426 were down 19.4% on those in June and down 19.6% for those in July last year. At end of the month the firm had 3,012 properties on its books, some 2.6% higher than in June and 7.5% higher than in July last year. During July the firm sold 383 properties, or 37% of all sales, for more than $1 million and sold 94 properties, or 9.1% of sales, for under $500,000. Continue reading
First time buyer property valuation activity increased after Brexit vote
Housing market activity in the UK has shifted in favour of first time buyers and remortgagors, in the first full month after the vote to leave the European Union, according to the latest research. Overall, July has seen the number of all property valuations fall 2% compared to the same month last year, says the latest monthly analysis from Connells Survey and Valuation, which reflects a slight cooling compared to June. ‘Judging the Brexit effect might take years but in the meantime the first full month after the vote already looks encouraging as change has mainly been confined to the mixture of activity, rather than the overall volume of valuations,’ said John Bagshaw, corporate services director of Connells Survey & Valuation,. The data shows that activity in the first time buyer and remortgaging sectors have driven July’s valuation market. There were 12% more first time buyer valuations in July 2016 than in July 2015. Meanwhile remortgaging activity also saw the same 12% annual rate of growth. ‘July was particularly good for those making their first step on the property ladder. Despite some widespread fears about Brexit, any negative impact on wages, employment or inflation has not materialised and first time are continuing to make the most of government schemes and are now boosted by even lower mortgage rates this summer. This is the same development that is proving a boost for remortgagors, also benefitting from a new wave of even better mortgage deals,’ Bagshaw explained. Those already on the property ladder looking to move home appear to have been slightly more cautious in July than those making their first step. Compared to the same month in 2015, home mover valuations have fallen in number by 8%. Similarly, buy to let activity has been relatively cooler in July than at the same point a year ago. The total number of valuations for buy to let purchases has now fallen by 41% since July 2015. ‘Buy to let activity is steady post-Brexit vote, even if at a level lower than last year. In fact this correction is not new, and mainly not as a result of referendum uncertainty. Since April, held back by the Government’s 3% Stamp Duty surcharge, some landlords are pausing for thought,’ Bagshaw explained. ‘Looking ahead, tax changes are increasingly factored in to landlords’ investment plans which forms a strong core of buy to let activity focused on the long term and a solid basis of future growth in demand for valuations from landlords,’ he added. Continue reading
Demand for retirement homes in UK slows
The uptake of retirement housing in the UK softened in the second quarter of this year as many downsizers paused plans ahead of the European Union referendum vote, according to the latest quarterly review. Overall new buyer registrations for retirement properties slipped by over 20% from the first quarter to 4,744, a 30% fall on the same period last year, as uncertainty before the referendum slowed the market. However, the data from retirement property specialist Retirement Homesearch, also shows that the number of property viewings at 2,974 and instructions at 513 remained steady on first quarter numbers, showing that registered buyers are still actively looking to downsize. ‘Uncertainty around the referendum may have caused many downsizers to sit on their hands until after 24 June, but the outcome could mean a further delay in decisions, as markets fluctuate and affect pensions, which will have a knock-on effect on Britons’ retirement plans,’ said Nick Freeth, managing director of Retirement Homesearch. ‘However, with six million older Britons now living in houses with two or more excess bedrooms, downsizing could help retirees free up capital, reduce the cost of running large properties and move to homes better suited to their needs,’ he added. A recent report on the state of the UK’s housing, published by the International Longevity Centre (ILC-UK) and supported by Retirement Homesearch parent company, FirstPort, shows that under occupancy amongst the older generation is now a widespread issue with six million people living in houses with two or more excess bedrooms. Since 2005 there has been a significant increase in the number of 65 to 74 year olds living alone to 300,000. ‘As experts in retirement housing, we know that having access to specialist advice is especially important in the post-Brexit landscape where it is essential to minimise uncertainty. By ensuring downsizers get the guidance they need, they can begin to look forward to a new home, as well as a new lifestyle,’ Freeth concluded. Continue reading
