Tag Archives: investments
Equity release value in Britain up, but in London hit by Brexit uncertainty
The potential wealth available to over 55s in England, Scotland and Wales through equity release increased to £381 billion in the second quarter of 2016, a 0.7% quarterly increase, the latest research shows. However, values failed to increase across Greater London for the first time in almost four years due to uncertainty surrounding the European Union referendum while equity release potential elsewhere in the country continues to grow apace, according to the Equity Release Property Value Tracker report from Retirement Advantage. The report says that house prices are rising fastest in regions outside of Greater London, with the capital suffering its first quarterly drop in property values since the fourth quarter of 2012. The North of England with growth of 7.2% saw the greatest quarterly increase in wealth available, followed by Yorkshire and the Humber up 6.6% and the West Midlands up 5.6%. Meanwhile in Greater London growth stagnated with a drop of 0.04% and was also comparatively slow across the South East, up 2.8%. The two regions top the table for annual growth, however, up 14.6% and 13.9% respectively, with East Anglia next with growth of 8.2%. According to Alice Watson, product and communications manager at Retirement Advantage Equity Release, it is too early to tell what impact the Brexit vote will have on housing wealth but she pointed out that if mortgage lending conditions tighten as the result of a post-referendum economic slowdown, it could enhance the appeal of equity release. ‘A substantial proportion of this demographic is now accessing the wealth stored in their homes to facilitate a more enjoyable and fulfilling retirement. They are increasingly using equity release for home improvements, gifting to family members and holidays,’ she said. ‘Over the past three months we’ve seen new entrants to the market, innovative partnerships and welcome changes to the Financial Conduct Authority’s affordability assessments. These developments are great news for the consumer and have no doubt helped to further boost equity release’s already surging popularity,’ she added. However, she pointed out that despite rapid growth in its popularity, less than 1% of equity release’s potential is being realised. ‘Over the coming years, this popularity will increase further as over 55s take an increasingly holistic approach to retirement finance which places equity release alongside pensions and investments,’ she concluded. Continue reading
Billions to be invested in homes for sale and rent in Ireland
Some €200 million it to be put into an Infrastructure Housing Activation Fund in Ireland aimed at opening up large sites in areas where people need homes. This is to relieve critical infrastructural blockages to allow for the delivery of homes on key sites and to improve the economic viability and purchaser affordability of new housing projects and deliver 20,000 new homes by 2020. The Irish Government has also announced under its Housing Action Plan that €5.35 billion will be allocated to the development of social housing with the aim of building 47,000 more social housing units by 2021. There will also be changes to planning to allow large scale residential development planning applications to be fast tracked. The Government said it will legislate to allow for larger housing development applications of 100 plus units to be made directly to An Bord Pleanala, the country’s independent planning body. An Bord Pleanala is also set to prioritise the determination of all planning appeals for large scale developments. This is to be done within an 18 to 20 week period and the roll-out of e-planning is also being looked at. The action plan also includes increasing the supply of home to rent and support for a stable rental sector. A national policy for appropriate on and off-campus accommodation for students will also be developed. The Housing Agency will be allocated €70 million to acquire suitable portfolios of vacant properties to be let under a national vacant housing reuse strategy. A register of vacant properties across the country will be drawn up and the planning rules for change of use of vacant commercial units to a residential units will be reviewed. However, according to the Society of Chartered Surveyors Ireland (SCSI) critical skills shortages across all sectors of the housing market in Ireland will urgently need to be addressed to deliver the scale of housing delivery needed. Claire Solon, SCSI president, said that a National body with real authority and mandate is needed not just for housing, but also for national infrastructural planning. ‘It’s clear from the Action Plan that in several areas, it’s the need for projects like road completions, or water and drainage schemes that are actually preventing the delivery of housing,’ she pointed out. ‘The industry has shown itself be to resourceful following many difficult years, but there needs to be significant investment now to address the skills shortage in all sectors, professional, technical and trades,’ she explained. ‘We will be asking the Minister of Finance to specifically resource our sector in the upcoming Budget for training of apprentices, graduates and to help encourage workers from other sectors to transfer to construction and property roles. The industry plays a vital role in our economy and after many years of underinvestment, negative reporting and poor output, it needs radical intervention to upscale and deliver what could be one of the most important development stages in the history of our country,’ she added. The SCSI also believes… Continue reading
Affordability for home buyers in Australia eases in second quarter of 2016
Affordability for home buyers in Australia eased back in second quarter of 2016 as price growth returned to the residential real estate market. Overall affordability fell by 3.7% and was 2.1% less than the same quarter of 2015, according to the latest report from the Housing Industry Association, the voice of Australia’s residential building industry. The capital city housing affordability index fell by 4.3% during the quarter, while the regional market index experienced a 1.9% improvement. ‘Home price growth moderated in the early part of the year and the index showed an improvement in affordability during the March 2016 quarter. However, in the June quarter dwelling price growth returned and the index reverted to the level we saw at the end of 2015,’ said Geordan Murray, HIA economist. ‘While there was a decline in the headline index tracking the national picture, there was substantial variation around the country with substantial differences between states, and also differences between capital city markets and regional markets,’ he pointed out. He explained that the geographic variation in affordability is most evident in the comparison between Melbourne and Perth. Over the last year, the median dwelling price in Perth has fallen by 4.7% while Melbourne’s has grown by 11.5%. This has seen the affordability index for Perth increase by 6.2% over the last year, while the index for Melbourne has fallen by 6.2%. ‘These differences in affordability align with the relative economic performance of these two states. The Western Australian economy is navigating the tail end of the mining boom which has seen conditions in the local labour market deteriorate and consequently the rate of population growth has fallen quite sharply,’ Murray said. ‘In contrast, Victoria has experienced a healthy level of growth in the labour force and continues to record the strongest rate of population growth in the country,’ he added. A breakdown of the figures show that during the June 2016 quarter, improvements in affordability were observed in three capital cities with the largest improvement in Perth with growth of 3.2%, Darwin up 2.9% and Hobart up 2.2%. Affordability worsened in the remaining five capital cities with the largest decline recorded in Melbourne with a decline of 7.4%, followed by Canberra down 5.7%, Sydney down 1.6%, Adelaide down 1.3% and Brisbane down 1%. Continue reading
