Tag Archives: investments
Home prices and rents in the US up for over 45 months in a row
National home values in the United States increased to an average of $187,300 in July, the 48th month in row of appreciating values, the latest index data shows. Home values have risen by 5% over the past year and have been consistently climbing since August 2012, but still remain 4.7% below the peak of April 2007 when the median home value was $196,600. The index report from real estate firm Zillow shows that Portland, Dallas and Denver reported the highest year on year home value appreciation among the 35 largest metros across the country. In Portland, home values rose almost 15% to a median value of $334,900 while in Dallas and Denver prices were up 11.9% and 11.3% respectively. In notoriously expensive San Francisco, however, home values have been slowing down since the beginning of the year. In January, home values were up almost 12% year on year and are now appreciating at about half that pace, up 6.6% over the last 12 months. ‘The consistent rise in home values that we've been seeing for the past four years masks a number of region specific trends that have taken place over the past few months,’ said Zillow chief economist Svenja Gudell. ‘In most areas, the market is being driven mainly by a strong labour market and tight supply, especially among entry level homes that first time buyers are after. But some markets, especially the red-hot Pacific Northwest, are adding more jobs and attracting more residents, putting the pressure on home values and rents,’ she explained. ‘The Bay Area and Southern California are still growing at a faster pace than the nation as a whole, but growth rates have come back to earth a bit after several years of rapid growth. And markets in other regions, like the Northeast, keep steadily chugging along. All housing is local, and as the local economies in individual metros ebb and flow, housing will follow suit,’ she added. She also pointed out that more than at any time since the boom and bust, the US housing market is being driven by local fundamentals, and not by national trends. Zillow’s latest figures also shows that rents across the country have increased by 2% over the past year to $1,408 per month and have now increased for 47 months in a row. Of the 35 largest US metros, Seattle, Portland and San Francisco reported the highest year on year rent appreciation. In Seattle rents rose almost 10% to a median of $2,052 per month, while rents in Portland rose just over 8%. In San Francisco, the median rent price rose to $3,407 per month, the second highest of all metros, right after San Jose in California while rents in San Francisco appreciated 6% over the past year. Continue reading
UK rents up 2.4% in 12 months to July 2016, latest index shows
Rents in the UK’s private rental sector increased by 2.4% in the 12 months to July 2016, unchanged compared with the year to June 2016, according to the latest index data. The figures from the Office of National Statistics (ONS) shows that rental prices grew by 2.6% in England, 0.2% in Scotland and were unchanged in Wales. Rental prices increased in all the English regions over the year to July 2016, with rental prices increasing the most in the South East at 3.5%, up from 3.4% in June 2016, followed by the East of England at 3.1% and London at 3%, both unchanged from June 2016. Annual rental growth in the South East has surpassed that of London since May 2016. Since the beginning of 2012, English rental prices have shown annual increases ranging between 1.4% and 3% year on year, with July 2016 rental prices being 2.6% higher than July 2015 rental prices. Excluding London, England showed an increase of 2.3% for the same period. The lowest annual rental price increases were in the North East, up 0.9% and up from 0.8% in June 2016, the North West up 1.2% and Yorkshire and The Humber up 1.3%, both unchanged when compared with June 2016. But the lack of movement in Wales meant that rents continue to be well below that of England and the average for the country as a whole while rental growth in Scotland has gradually slowed to 0.2% in the year to July 2016, from a high of 2.1% in the year to June 2015. Looking at data from the UK House Price Index over a longer period shows residential house price growth has typically been stronger than rental price growth for a number of years, with an average 12 month rate of house price inflation between January 2013 and June 2016 of 6%, compared with 2.1% for rental prices. Inflation in the rental market is likely to have been caused by demand in the market outpacing supply, says the ONS report which points out that the Royal Institute of Chartered Surveyors (RICS) Residential Market Survey reported an increase in demand in the three months to July, while tenant demand increased in June according to the Association of Residential Letting Agents (ARLA). On the supply side, RICS reported that new landlord instructions were flat in July and ARLA reported that the supply of rental stock bounced back in June 2016, following a sharp drop in May. It points out that rental prices have been growing at a slightly faster rate than real wages in recent months. Regular pay also grew by 2.3% in the three months to June 2016 compared with the same period last year, continuing a revival of real earnings growth. The annual jump in private rental prices is a stark reminder of the struggles that many people living in private rented homes are facing in saving a deposit to buy their first home, according to Richard Connolly,… Continue reading
Improved rail links to London boost prime property prices in commuter towns
Prime property prices in key UK locations where train services make them commuter zones for London have seen prices rise in the second quarter of 2016, according to the latest index data. In Bristol, where commuters are within reach of London’s Paddington station, prime property prices have increased by 7.4% in the year to June 2016 with the second quarter of the year seeing a 17% rise in new buyer registration and a 19% rise in viewings. In nearby Cheltenham prime property prices increased by 8.6% year on year and 2% quarter on quarter, according to the index data from real estate firm Knight Frank, and this compared with annual growth of 1.3% in the UK wide prime property market. But in Oxford, another popular commuter city, prime prices increases by just 0.3% between April and June, taking annual price growth to 0.7% but the data report says that demand remains strong. In Oxford the slow down in price growth is attributed to uncertainty in the run up to June’s historic referendum and the decision to leave the European Union. ‘After several years of strong price increases, during which the city has comfortably outperformed the wider UK, the latest figures suggest that price growth at the top end of the market in Oxford has started to ease,’ said Oliver Knight, research associate at Knight Frank. ‘While the fundamentals underpinning the market remain unchanged, the reasons for the easing are twofold. Firstly, there was a softening in demand for prime property in the immediate run up to the EU referendum, with potential purchasers adopting a wait and see approach,’ he explained. ‘Secondly, and arguably more importantly, recent changes to stamp duty levied on the purchase price of the most valuable properties has made buyers increasingly price sensitive,’ he added. He pointed out that prime homes in Oxford worth more than £2 million rose in value by just 0.1% in the year to June as buyers and vendors factored higher purchase costs into pricing and offers. In comparison, properties worth up to £750,000, where the stamp duty burden is lower, rose by 1.7%. According to William Kirkland, Knight Frank Partner in the firm’s Oxford City Department, demand remains consistent and new high speed rail link at Oxford Parkway, which opened in October 2015, has helped stimulate demand in property markets to the north of the city as commuters using the line can now be in London Marylebone in under an hour. ‘As a result, there has been an increase in the number of Londoners looking to buy property in Oxford so far this year. Some 25% of all prospective buyers registering with Knight Frank's Oxford office in 2016 were based in the capital, up from 19% in 2015,’ he added. A growing imbalance between supply and demand continues to drive strong price growth in the prime Cheltenham market. There were 19% fewer prime properties available for sale across Cheltenham at the end of June year on year… Continue reading
