Tag Archives: finance
Asking prices down across England and Wales post Brexit vote
The price of property coming onto the market in England and Wales has fallen by 0.9% or £2,647 with momentum continuing due to a supply shortage, according to the latest asking price report. Activity is within usual expectations for the run-up to the summer holiday season and buyer demand in the two weeks since the European Union referendum result is consistent with 2014 although down on 2015. The monthly report from property portal Rightmove points out that the same period in 2015 benefitted substantially from a post general election boost so enquiries this year are down 16% compared to that period. It adds that as 2014 was not distorted by the election it is a better basis for comparison, and buyer enquiries are at the same level as the like for like two weeks in 2014. Since 2010 the month of July has recorded average price falls of 0.4%. The Rightmove data shows that new seller asking prices fell by 1.2% or £7,407 this month in Greater London while in inner London they fell by 2.3% or £19,051. The seven cheapest inner London boroughs all saw price of newly listed property falling while asking prices in outer London were unchanged. Asking prices fell by 0.7% month on month in the North East, taking the average to £147,251 but are still up 0.3% year on year. In the North West they fell by 0.5% month on month to £176,277 and are 3.6% higher than a year ago and in Yorkshire and Humber they were down 2.1% month on month to £172,412, and up 1.3% year on year. In the West Midlands month on month prices were down 1.6% to £200,129 and still up by 3.6% year on year while in the East Midlands they were down 0.2% month on month to £190,192 and are up 3.9% year on year. The East of England saw asking prices fall by 0.7% to £313,255 but they are 7.3% up compared to a year ago. In the South East they fell 0.6% to £386,988 and are up 6.7% year on year while in the South West they were down 0.4% to £286,155 and up 5.2% year on year. In Wales asking prices fell by 2.3% month on month, taking the average price of a newly listed home to £177,280 but prices are 2% up compared to July 2015. According to Rightmove, most agents report market momentum continuing due to shortage of suitable property for sale, buyers fearful of missing out on scarce choice, and affordability and availability of low mortgage rates. Sellers seem undeterred as compared to the same period last year, the two weeks pre-referendum saw the number of new properties coming to market down by 8%, and the two weeks post referendum saw them up by 6%. Overall the figures covering the last four weeks, two weeks before and two weeks after the referendum, give an early but reassuring view into the short term effect of the political turmoil… Continue reading
Hong Kong saw residential property prices stabilise in June
Residential property prices in Hong Kong stabilised in June with more activity mainly in the primary sector, as developers launched new projects with deep discounts and other enticements. According to the Land Registry, residential sales in June edged up 0.7% month on month, reaching 4,620 units. The gain was attributed mainly to robust activity in the new homes market. Meanwhile there have been more home buyers returning to the market looking for bargains, according to the latest monthly market review report from international real estate consultants Knight Frank. It points out that several new residential developments were oversubscribed in June. One example was Park Yoho Venezia in Yuen Long, which managed to sell over 90% of its available units within hours on the first day of the launch. This trend is expected to continue, with developers offering deep discounts and aggressive mortgage schemes to boost sales. Interest in the ultra-luxury residential market showed no signs of abating. For example, the top floor unit in Severn Villa on the Peak sold for HK$232 million or HK$170,463 per square foot, making it the most expensive apartment in Hong Kong. Knight Frank believes that high net worth individuals are expected to continue acquiring premium residential properties in Hong Kong given their scarcity and high status. The report also points out that the government of Hong Kong has announced that seven residential sites, capable of providing 4,800 flats, will be available for sale by application in the third quarter. As of the end of May, the number of homes pending pre-sale consent had risen 11% month on month to 14,526 units, the highest level in eight months, according to the Land Department. ‘Given the increase in supply and uncertainty brought about by Brexit, we maintain our forecast of a 5% to 10% drop in luxury home prices and up to a 10% decline in mass residential prices over the year,’ the report concludes. Meanwhile, in the commercial sector Grade-A office leasing on Hong Kong Island remained subdued in June. On the supply side, tight availability limited choices in the market, while on the demand side mainland companies slowed their expansion pace in Hong Kong after the previous leasing boom. The report points out that the Kowloon East office market remained very active, with the key driver being relocation demand from tenants across the harbour. One reported example involved Kingfisher, which moved from Cornwall House in Quarry Bay to KOHO in Kwun Tong. Over the past few months, a number of co-working space operators have been aggressively expanding in Hong Kong, becoming one of the major sources of demand for office space. For example, WeWork reportedly took up large office space of about 60,000 square feet in Asia Orient Tower in Wan Chai last month. A US co-working space operator reportedly took up four floors, spanning 29,000 square feet in Soundwill Plaza in Causeway Bay. ‘Looking ahead, we expect rents in core business areas to rise… Continue reading
European commercial real estate investment up 2.5% in second quarter of 2016
Commercial real estate investment remained strong across Europe in the second quarter of 2016 totalling €54.0 billion, up 2.5% on the previous quarter and 30.4% on the 10 year average, new research shows. However, overall activity fell short compared to the second quarter of 2015 with the office sector having the strongest quarter, seeing an 8.3% increase on the first three months of 2016, driven by a particularly strong performance in the Nordic region. The research from CBRE also points out that despite uncertainty in the UK caused by the European Union referendum, sentiment remained strong in other European markets and investment levels were stable year on year. Investment volumes in France and Sweden, Europe’s third and fourth largest markets, were particularly resilient. The data shows that over the last year investment in these markets has grown 32% and 20% respectively. Indeed, second quarter results in both France and Sweden were boosted by buoyant office sectors. Ireland also performed extremely strongly, transacting a record €2.3 billion of commercial property deals in the second quarter of 2016, more than double that of the same quarter last year, although the sale of the Blanchardstown Centre for close to €1 billion closed during this quarter. Poland followed suit, transacting €1.5 billion in the second quarter, over three times the level recorded in the same period last year. But Germany showed decreased levels of investment in the second quarter, which is likely connected to a lack of availability of stock in the core markets, which dampened the European total. Core property in Germany remains highly regarded as a safe haven and sentiment remains strong. The UK also performed less strongly than its continental European counterparts in the run up to the Brexit vote although strong fundamentals continue to underpin the UK market. The recent depreciation of sterling, coupled with low interest rates, has attracted the attention of overseas investors to the UK, and with the spread between bond yields and property being the widest on record, the fundamentals of UK and continental European real estate remain attractive. ‘Whilst investors have reacted cautiously to Brexit, the market fundamentals remain strong and investors still have significant capital to deploy. The uncertainty means that many investors will watch and see how the market develops before deciding how to act, said Jonathan Hull, managing director of Investment Properties EMEA at CBRE. ‘However, sentiment is already improving as the UK enters a more stable political environment and there are signs that the market is responding positively to this,’ he added. According to Miles Gibson, head of UK research at CBRE, the EU referendum risk was undoubtedly one factor affecting investment activity in the second quarter. ‘But instability in the financial markets earlier in the year was similarly important in causing investors to be more risk averse,’ he added. Continue reading
