Tag Archives: european
Median sales prices hit record high in five regions in New Zealand
Five regions in New Zealand saw median sales prices hit a new record high but overall the median price nationals fell by 1% in June, the latest real estate index shows. The median sales price now stands at $500,000 with the Waikato/Bay of Plenty region recorded its fifth record median sale price for 2016, reaching $438,000, while the median price in Auckland reaching $821,000. The data from the Real Estate Institute of New Zealand (REINZ) also shows that Northland recorded a new record median of $360,000, while Otago reached $295,000 and Central Otago Lakes hit $730,050. The index figures reveal that sales fell 13% month on month which is in line with the general trend at this time of the year although an increase of 6% was recorded in June 2015. ‘Although the onset of winter means that June is generally a quieter month for the real estate market, there has been no let-up in the rate of price increases across the country, with five regions recording new record median prices,’ said REINZ spokesperson Bryan Thomson. ‘Although there is much discussion about the housing market and increasing new build supply, the fact remains that the vast majority of the supply comes from the sale of existing properties,’ he added. The data also reveals a rapid declines in the volume of properties available for sale right across the country, with a number of regions, such as Wellington and Hawke’s Bay, recording very low levels of properties for sale. Thomson pointed out that while Auckland continues to be the largest single region, its influence on the national picture is waning due to its own weaker sales and strong growth in sales in other regions, particularly Waikato/Bay of Plenty and Northland. Auckland’s peak share of national sales was 39.7% in January 2014, however, its share is now just over 33.8%. Over the same period Waikato/Bay of Plenty’s share of national sales has increased from 14.3% to 19.0%. A breakdown of the figures shows that Central Otago Lakes recorded the largest percentage increase in median price compared to June 2015, at 42%, followed by Waikato/Bay of Plenty at 26% and Otago at 19%. The number of properties available for sale across all regions in New Zealand has continued to fall between June 2015 and June 2016. Wellington has the fewest properties for sale with just over seven weeks of supply, closely followed by Hawke’s Bay with nine weeks supply and Auckland with just under 10 weeks of supply. The number of days to sell has only improved by three days at the national level over the past 12 months, although the regions have seen some significant improvements with nine regions seeing a decrease of 20% or more in the number of days to sell. Auckland was the only region to see a lengthening of the number of days to sell over the past 12 months. Between June 2015 and June 2016, the number… Continue reading
Caution due to Brexit likely to affect UK housing market in short term
Caution is likely to affect sales in the mainstream housing market in the UK as a result of the decision to leave the European Union but low interest rates will underpin prices, according to a new analysis. The market is seeing initial caution, particularly among discretionary buyers, and this likely to curtail housing market activity as buyers’ willingness to commit to a major purchase weakens. Over the medium term, the analysis from real estate firm Savills, suggests that sentiment will improve but also fluctuate as negotiations to leave the EU proceed. It also suggests that buyer sentiment is likely to lead to lower sales volumes in the short term. Also, the possibility of tighter lending could pull transactions numbers further down from recent UK highs of 1.3 million a year. ‘However, at this stage, we do not expect sales volumes to decline to post credit crunch lows,’ said Lucian Cook, director of residential research as Savills. The report points out that so far it has been business as usual for lending. ‘Should downside risks persist, there is a possibility that lenders tighten lending criteria. If stricter borrowing rules come into play, first time buyers and second steppers will be the most affected,’ Cook explained. He believes that low interest rates will underpin house prices with the prospect of a cut in base rates and this may present opportunities for those on low loan to value mortgages. Overall, house price growth is likely to slacken as a result of weaker demand in the short to medium term but looking ahead, Cook said that the possibility of a slower economy could have an impact on price growth. ‘We do not rule out the possibility of price falls in weaker markets. Low levels of house building has resulted in a market that is fundamentally undersupplied. This has not changed,’ he added. The analysis report also points out that the short term impact on sentiment is also likely to vary geographically and between different buyer groups, in part dependent on the level of opposition to or support for Brexit. That would potentially indicate more caution in the domestic markets of London and among first-time buyers and second steppers but less among mature home owners. ‘While this short term sentiment effect is likely to take longer to feed into the house price indices, we would expect the first indications of this impact to come from consumer confidence surveys and mortgage approvals,’ Cook pointed out. ‘At this stage, it appears that the downside risks to the housing market are milder than the events that led to the 2008 financial crisis. However, political and economic uncertainty is likely to curtail housing market activity initially as discretionary buyers exercise caution,’ he said. ‘The potential for lenders to tighten lending criteria presents a longer term risk to market activity, especially among first time buyers and second steppers. This could mean that UK housing transactions, which reached a post credit crunch high… Continue reading
Pace of rental growth in UK slowing
Rents across the UK continued to rise during June, but the first half of 2016 has been characterised by a slowing in the pace of rental increases, the latest rental index shows. Rents agreed on new tenancies across the UK, excluding London, increased by 3.5% in the second quarter to £773 per month compared to a year ago and by 3.9% to £1,575 in London over the same period. However, this is down compared to the UK wide figure for May which was 4.4% and 6.2% for London, according to the data from the June HomeLet rental index. Rents continue to rise in almost every area of the country, with 10 out of the 12 regions surveyed seeing an increase over the three months to the end of May. The index report says that the more modest rental increases seen in June are a continuation of a trend that has developed throughout the first half of the year, with rents rising across much of the UK each month, but at a slower pace than was the case throughout most of 2015. Last June rents were rising at an annual rate of 7.8% and 10.1% in London. The data suggests the private rental sector has responded to the needs and concerns of landlords and tenants alike during the first half of the year. Landlords were hit by higher stamp duty charges on purchases of new property in April, which led to a rush to complete transactions before then and a spike in the supply of rental property thereafter. Meanwhile, tenant demand for property has remained strong, particularly given rising house prices and squeezed mortgage availability, and projected growth in the UK’s population suggests this will continue, the report points out. It explains that official projections suggesting this growth will come from both the British born population and net migration. Nevertheless, the slowing in the pace of rental increases may reflect landlords’ recognition that an affordability ceiling is approaching. The outlook for the sector will depend in part on the fall-out from the UK’s decision to leave the European Union in June’s referendum. Some economists expect the referendum result to act as a brake on construction in the housing sector, which could exacerbate the current imbalance between demand and supply in the rental market. It is also possible that demand may increase as would be house buyers opt to wait and see how house prices are affected over the next 12 months and beyond. HomeLet’s data also suggests that the average length of a tenancy, as measured by how long tenants had occupied their previous rental property, has begun to come down over the past three months. The figures underline the important role that the private rental sector plays in providing a wide range of housing options to those who have not purchased a property. According to Martin Totty, chief executive… Continue reading
