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Average prices in England and Wales up over 6% year on year
Average property prices in England and Wales increased year on year by 6.4% in December, taking the average property value to £188,270, the latest index shows. Month on month house prices rose by 1.2% since November 2015, according to the monthly index report from the Land Registry. London recorded the greatest increase in its average property values with annual growth of 12.4% and the biggest month on month rise at 2.1%, taking the average price to £514,097. The North East saw the lowest annual price growth with an increase of 0.8%, taking the average price to £99,069, a considerable difference to the average price in London. Wales saw the most significant monthly price fall with a decrease of 0.8% to take the average price to £121,780. The most up to date figures available, show that the number of completed house sales in England and Wales fell by 8% to 79,960 compared with 86,452 in in October 2014 while the number of properties sold for more than £1 million fell by 2% to 1,231 from 1,258 a year earlier. Repossessions in England and Wales fell by 51% to 431 compared with 888 in October 2014 and the region with the greatest fall in the number of repossession sales was London with a fall of 71% from October 2014. Mark Posniak, managing director at Dragonfly Property Finance, pointed out that with demand strong and supply weak, prices in December defied the usual seasonal slowdown, adding that this is even more pronounced in London. He believes that the construction lag is having a significant impact on the market. ‘On a more positive note, we are seeing noticeably more construction activity at the moment, particularly by smaller developers. But this will take time to trickle through into the market,’ he said. ‘Looking into 2016, it's hard to see anything other than a continuation of the current trend of steadily rising prices, especially with interest rates unlikely to rise in the near future and a robust jobs market,’ he added. According to John Eastgate, sales and marketing director of OneSavings Bank, prolific buyer demand is fanning the house price growth. ‘A strengthening labour market, robust consumer sentiment and a supportive mortgage market all played their part, despite the obstacles provided by the festive period. This strength of demand has been compounded by the record low levels of property on the market at present,’ he said. ‘Uncertainty around economic growth in 2016 provides a reason for caution. The good news however, is that house building starts appear to be at their highest level since 2007. It is not yet strong enough to counterbalance demand. However if this trend of improvement is maintained, it should lead to a healthier property market for investors and buyers alike,’ he added. The lack of supply is also the explanation of what is currently happening with unseasonal growth in the market, said Jonathan Hopper, managing director of the buying agents Garrington Property Finders. ‘Even… Continue reading
Home renovations sector in Australia seeing a slow recovery, says new report
The home renovations sector in Australia is being held up and frustrated by the hesitant pace of the current real estate market, according to a new report. The comprehensive review of the country’s renovations market from the Housing Industry Association shows that the current recovery has been slow since the slump in activity between 2011 and 2013. Indeed, the hesitant pace of the current recovery is mainly due to patchy consumer sentiment and challenging labour market conditions in several states, according to HIA senior economist Shane Garrett. . ‘Dwelling price growth is also pretty unspectacular in a number of important markets,’ he said, adding that there is considerable geographic variation. The report says that demand for renovations in New South Wales has been greatly boosted by the strength of prices. Many Sydney households that had been planning on moving house find that it is now much more affordable to undertake a major renovations job instead. ‘Australia’s home renovations market is a major strand of consumer spending and will be worth just under $30 billion this year. Its labour intensive nature means that it has substantially positive knock-on effects for employment,’ said Garrett. ‘Over the coming years, the modest recovery will continue. This will be spurred on by very favourable interest rate settings as well as improvements in economic growth and the labour market over the medium term. However, the recent tightening of mortgage credit conditions casts an unwelcome shadow,’ he explained. The Spring 2015 edition of the HIA’s Renovations Roundup projects that renovations activity will increase by 3.9% this year with a slight 0.4% increase forecast for 2016. The HIA is forecasting that activity will grow by 0. Continue reading
House prices up 0.1% in the UK in November, latest growth index shows
House prices across the UK increased by 0.1% in November but softened slightly year on year with annual growth of 3.7%, down from 3.9% in October. The latest data from lender the Nationwide shows it was the weakest performance in monthly price growth since June 2015. The latest increase takes the average house price to £196,807. But Nationwide chief economist Robert Gardner pointed out that growth rates have fluctuated throughout the year. Annual growth has been in a fairly narrow range between 3% and 4% over the past six months, which he said is broadly consistent with earnings growth over the longer term. ‘While this bodes well for a sustainable increase in housing market activity in the period ahead, much will depend on whether building activity can keep pace with increasing demand. Surveyors have continued to report a dearth of properties on the market in recent months, with the number of available homes reportedly at the lowest level since the late 1970s,’ said Gardner. ‘Therefore it is positive that policymakers are focusing on the need to increase home building, with the Chancellor announcing a range of measures aimed at boosting housing supply in his Autumn Statement,’ he explained. ‘The current rate of construction activity is well below the projected rate of household formation. Only 135,000 new homes were built in England in the 12 months to September 2015, well below the 220,000 new households that are projected to form each year over the next decade,’ he added. Neal Hudson, associate director at Savills research, described the figures as showing a relatively strong end to the year. ‘Previous trends suggest that prices tend to weaken in December and so the 4.1% total growth seen in the year to date may be closer to 4% by the end of the year. These price rises are in a large part due to increased competition in the mortgage market which have led to record low mortgage rates and record high lending multiples,’ he added. According to Alex Gosling, chief executive officer of online estate agents HouseSimple, the main issue in today’s market is that demand continues to massively outstripping supply. ‘We have an immediate supply crisis in the UK and it's hard to see how home builders can build houses fast enough to free up the demand supply bottleneck,’ he said. ‘We need measures to stimulate the housing market and it can't be just about building more homes to meet demand in the future. Sellers need to be encouraged back to the market. But home owners are finding it harder to climb up the property ladder, which means people are renovating and extending rather than moving,’ he pointed out. ‘High prices remain a barrier for first time buyers but also second and third steppers and price growth is unlikely to cool in the coming months, especially with more investors expected to come to the market to buy before the new buy to let stamp duty rates come into… Continue reading
