Tag Archives: housing
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
UK house prices down by 1% month on month, too early to judge Brexit effect
House prices in the UK fell by 1% between June and July, taking the average price to £214,678, according to the latest index which also shows that overall growth is slowing. In the three months to July prices were 1.6% higher than in the preceding three months, above June’s 1.1% increase and similar to the rates recorded in April and May of 1.5% but it significantly lower than in February and March. The data from leading lender the Halifax, also shows that prices in the three months to July were 8.4% higher than in the same three months a year earlier, unchanged from June but the lowest since July 2015 when it was 7.8%. The month on month decline largely offset the 1.2% increase in June, but Martin Ellis, Halifax housing economist pointed out that month on month changes can be erratic and monthly falls often occur within an upward trend. He explained that it was the third monthly fall so far this year and was smaller than February’s decline of 1.5% and the quarter on quarter change is a more reliable indicator of the underlying trend. The number of first time buyers increased by an estimated 10% in the first six months of 2016 compared with the same period in 2015, according to the Halifax First Time Buyer Review. There were an estimated 154,200 first time buyers in the first half of 2016 compared with 140,500 in the same period last year. This was more than double the market low in the first half of 2009 when it was 72,700. Nonetheless, the number of first time buyers in the first half of 2016 was nearly a fifth lower than in 2006. ‘There are signs that house price growth is slowing with a deceleration in both the annual and quarterly rates of increase in the past few months. Nonetheless, the current rates remain robust. Overall, it remains too early to determine if there has been any impact on the housing market as a result of June’s EU referendum result,’ Ellis added. Alex Gosling, chief executive officer of online estate agents HouseSimple, also believes that too much should not be taken from the monthly figure. ‘There are so many factors at play right now, we're probably going to have to wait until September to get a clearer picture of how the housing market is coping with this headwind of political and economic uncertainty,’ he said. ‘Property transaction levels traditionally drop off during the summer months,’; he explained, adding that there have been a number of other factors impacting the housing market in recent months such as April stamp duty changes, the EU Referendum, and the cut in interest rates. ‘The Bank of England's decision to cut interest rates yesterday should definitely provide a stabilising effect on the economy. Whether that will be enough to inject the necessary confidence into the property market only time will tell. It will certainly provide a level of confidence… Continue reading
UK only key country in EU likely to see property prices fall in next 18 months
House prices will rise in nearly all European markets this year on the back of historically low lending rates but in the UK prices will fall over the next 18 months due to the decision to leave the European Union, says a new analysis report. The German housing market is set to see the strongest growth due to high demand and tight supply of homes for sale but Italy is likely to see prices remain static due to a poor economic outlook, according to the report from S&P Global Ratings. ‘While uncertainties caused by the UK's June 23 referendum decision to leave the EU could dent eurozone growth and, by extension, the housing market recovery over the next few years, we don't expect that it will derail it,’ said Jean-Michel Six, chief economist for Europe, the Middle East, and Africa at S&P Global Ratings. The report forecasts that eurozone real GDP will expand 1.7% this year, and it expects that the European Central Bank's (ECB's) accommodative monetary stance, leading to historically low sovereign bond yields and mortgage interest rates, will spur improvements in Europe's housing markets. The UK is the only housing market for which house price declines are forecast as a result of the Brexit vote, although it points out that strong market gains in the first half of this year should keep full year house price rises at 5%, with the market only likely declining in 2017 by 2%. Although Ireland's economy has tight economic ties with the UK its housing market will continue its robust recovery, with prices growing by 6% this year, aided by the ongoing improvement in the labour market and a housing supply shortage. The forecast says that the Netherlands, also exposed to the UK economy, should also continue to see nominal prices rise by 5% this year on the back of economic improvements and favourable policy measures. Even the French housing market, which has been falling in recent years, is showing some resilience and looks set to grow by 2% in 2016 and in 2017 against a backdrop of low lending rates and modest economic growth. The strongest residential housing market gains this year will be in Germany, where robust economic fundamentals, a shortage of housing that is being further squeezed by the surge of migrants, and historically low lending rates should lead to prices inflating by 7% on last year. Spain and Belgium will each see house price rises of 4% this year. In Spain, economic growth, declining unemployment, and interest from foreign buyers should underpin a continued recovery of house prices the report says. In Belgium, forthcoming changes to fiscal rules and very favourable loan rates are still underpinning demand this year. While economic recovery and price incentives are also continuing to lift house prices in Portugal, a large stock of nonperforming domestic loans is… Continue reading
