Tag Archives: homes
Prices of most expensive properties in London plummeting, new data suggests
House prices in London's most expensive areas are plummeting, sparking fears of a domino effect of house price falls across the UK, it is claimed. The latest data from Home.co.uk shows falls in six out of 10 of the UK's most expensive areas, all of which are in central London. Average sales prices fell by 8% in Belgravia over the 12 months to September 2014. Over the same period, prices fell in Westminster by 6.3%, in Soho by 5.7%, in South Kensington by 4%, in Chelsea by 3.5% and in Charing Cross by 2.7%. Tightening mortgage credit in the wake of the Mortgage Market Review as well as an increase in supply are among key factors in this price drop in the capital's most expensive, and arguably most overheated, property markets, according to the firm. House price inflation is now cooling across all of greater London. Across the capital region, the average asking price fell by 0.1% between August and September whilst average prices rose by just 0.2% across England and Wales. Thus far only the most expensive parts of London are suffering serious price deflation, but it may well spread. This latest trend in London's property market follows a period of dramatic increases in house prices in the capital, fuelled by low interest rates and foreign property investment. Prime property was the first segment to recover following the credit crunch in 2007. A wave of soaring prices then moved out from prime central London as buyers refocused on less expensive areas. The average asking price in London has risen by 9.8% in the last six months. Over the last year, some parts of the capital saw price rises far above the average of 19% for Greater London. In Stratford, the average sales price of a two bedroom property soared by 44.9% in the 12 months to September 2014 while in West Norwood, the same property type saw a price rise of 44.2% over the same period. Outside of the M25, only Slough showed comparable price appreciation. In the 12 months to September 2014, the average price of a two bedroom property in the Berkshire town rose by 44.3%. ‘Overall, it's been a simply staggering year for property prices in London. Some areas have far exceeded the 19% rise overall for Greater London, whilst others have underperformed relative to this figure,’ said Doug Shepherd, director of Home.co.uk. ‘The list of the top five locations reveals some jaw dropping gains. Moreover, it is highly likely that many owner occupiers in these locations earned less than their homes did over the course of the last year,’ he explained. ‘However, when prices rise at an unsustainable rate, boom can quickly turn to bust. Prime London prices are falling and the middle income areas that have seen the biggest price hikes this year are likely to suffer the same fate,’ he added. Continue reading
Latest data from UK estate agents shows younger buyers priced out of market
People aged in their thirties are dominating the first time buyer market in the UK with those who are younger prices out of the market, according to a new report from the National Association of Real Estate Agents (NAEA). Overall the number of first time buyers is up from previous month sales, from 20% in July 2014 to 28% in August, the highest percentage of FTBs recorded since April 2014 but the number of buyers aged 18 to 30 remains at an all-time low at just 3% of recorded sales for August NAEA agents agree prospective interest rate rises will affect demand in the property market which will not help younger buyers who are already out of the housing market. While the number of sales made to those aged between 18 to 30 remained low, sales to those aged 31 to 40 were the highest recorded for the month, with almost half, 45%, of homes sold being bought by those in this age bracket. The figures suggest that the majority of first time buyers fall into the latter group, as high house prices price the younger generation out of the market. The report also found that most buyers, some 90%, bought as couples, with just 7% buying alone. Although the overall rise in the first time market is a positive, nearly 90% of NAEA agents believe the foreseen rise in interest rates will affect the demand for property in some way, with another 39% of members already claiming to see signs of demand dropping off. ‘Reports from our members suggest that the high house prices of the current housing market are still proving a barrier for the younger generation. It is evident that first time buyers are indeed getting older,’ said Mark Hayward, NAEA managing director. ‘With the majority of home buyers this month aged 31 to 40, this suggests some correlation between the increase in the first time buyer market and this age group. It is concerning at the lack of young people unable to buy their first home before the age of thirty, having to rent or stay at home for longer in order to save,’ he pointed out. ‘While the increase in first time buyers is a positive, what could be a worry for home buyers is the prospective interest rate rise that’s on the horizon. If interest rates do rise, the majority of NAEA members agreed that this will affect the demand for property, as prospective buyers are discouraged by the cost of borrowing,’ he explained. ‘In addition first time buyers need to be careful they can afford their mortgage, as interest rates could significantly push-up repayments, putting pressure on household budgets,’ he added. The report also shows that in terms of housing stock for August, this month saw a decrease in the average number of properties available per NAEA member branch. Available properties decreased to an average of 49 per NAEA member branch, compared to 51 in July 2014. At the same time, the average… Continue reading
Low cost rental property programme launched in the UK
A new pioneering £400 million programme has been launched in the UK to boost the building of new affordable rental homes available at below market rates. Current schemes like Help to Buy have boosted house building and allowed 53,000 households buy a home with a fraction of the deposit they would normally require and now the government wants to do the same for the rental market. Communities Secretary Eric Pickles said that the new Rent to Buy provides more flexibility for people who want to rent affordably now, save for a deposit, and then either buy the new home or a different home later. Under the scheme, housing associations and other providers can bid for a share of £400 million in low cost loans to build up to 10,000 new homes across the country from 2015 to 2018. They will mainly consist of one and two bedroom apartments. Landlords must make the homes available for rent at below market rates for a minimum of seven years. Pickles said that this fixed period will give tenants the opportunity to save up for a deposit and get ready to buy their own home. At the end of the period, the tenant will have first refusal to buy the property or alternatively they may choose to move out and buy a different property, or rent another property either privately or with the housing association. If the home is sold, the housing association will then have the option to use any returns on their investment to build even more affordable homes in the area. Alternatively, they will still have a home, which they can look to rent at an affordable rate to another tenant who needs help to buy. This programme is part of a broader £23 billion affordable homes programme for 2015 to 2018, as well as other schemes like Help to Buy providing low deposit mortgages and Right to Buy which provides home ownership for council tenants. Pickles pointed out that these schemes are being arranged now, so construction works starts from 2015. ‘This government is standing by people who work hard and do the right thing, and helping them move on and up in life,’ he said. ‘Both house building and the number of first time buyers are now at their highest rate since 2007. But there is more to do. As part of our wider housing programme, this new scheme will help increase the provision of low cost rented accommodation and provide a springboard for young people to upgrade to home ownership down the line,’ he added. Under the deal housing associations will have up to 16 years to pay back the low cost loans. Until the loans are repaid, the homes must be made available for affordable rent. Only once the loans are paid can the housing association sell or rent it out at a market rate. Of the £400 million of government loan funding for this scheme, half of this will be available in London. London based housing associations… Continue reading
