Tag Archives: market
New property listings fall in UK with Brexit affecting the market
Some 68% of UK towns and cities saw new property listings fall in June, with supply down 13% in London alone, according to the latest property supply index which suggests Brexit is to blame for the decline. Lichfield and Winchester registered the biggest drop in supply in June, with new property listings down 37% and 36.5% respectively, the index from online estate agents HouseSimple shows. It also reveals that four of the top 10 biggest fallers in June were in the South of England and although the majority of areas saw supply levels fall in June, there were a few areas that bucked the trend. The biggest risers in June were the Scottish towns of Inverness and Stirling, where new property listings were up 30.5% and 18.5% respectively. Out of the top 10 risers, half the towns were in the South of England. In London new properties listed across the capital fell by 12.8%, following a fall of 2.4% in May. Wandsworth and Waltham Forest saw the biggest drop in supply, both down 34.9%. This follows a big rise in supply in both these boroughs in May, with new property listings up 9.5% in Wandsworth and 31% in Waltham Forest. Only five out of 32 London boroughs saw an increase in supply last month, with new property listings in Barnet up 11.4% in June and Barking and Dagenham up 8.8% leading the way. ‘Fear and uncertainty over the Brexit vote definitely had an impact on buyer and seller confidence in June, with many sellers holding off putting their properties on the market until the result was known,’ said Alex Gosling, chief executive officer of HouseSimple. ‘Now we know, and although the decision has come as a bit of a shock, at least a degree of uncertainty has been taken out of the equation. The property market can now roll up its sleeves and get on with it. Nothing has fundamentally changed overnight and people still need to buy and sell homes whatever the market conditions,’ he explained. ‘We still have a supply shortage, and this may well counter any fallout from Brexit. There were concerns about the London market faltering, but demand is still strong in the capital and the weak pound should attract foreign investors looking to pick up bargains, particularly at the top end of the market,’ he added. ‘For the rest of the year, we may see a small dip in prices as there are choppy seas ahead, but it’s certainly not the end of the world levels predicted by some doom-mongers. Supply should hopefully edge up, as fears around the impact of Brexit dissipate, and sellers feel more confident about market conditions and the wider global economy,’ he concluded. Continue reading
Home lending in the UK increased in May, latest CML data shows
Home owners in the UK borrowed £9.4 billion for house purchase, up 15% month on month and 8% year on year in May, according to the latest data. They took out 53,800 loans, up 13% on April and 5% on May 2015, according to the Council of Mortgage Lenders which said that some equilibrium is coming back into the home lending market. A breakdown of the figures show that first time buyers borrowed £4.3 billion, up 10% on April and 23% on May last year. This equated to 27,500 loans, up 9% month on month and 16% year on year. Home movers borrowed £5.1 billion, up 19% on April but down 2% compared to a year ago. This represented 26,300 loans, up 18% month on month but down 5% on May 2015. The data also shows that remortgage activity totalled £5.2 billion, down 15% on April but up 30% compared to a year ago. This came to 30,900 loans, down 12% month on month but up 25% compared to a year ago. Landlords borrowed £2.6 billion, up 4% month on month but down 4% year on year. This came to 16,600 loans in total, up 3% compared to April but down 8% compared to May 2015. ‘There was a sense of the market regaining some equilibrium in May, following the stamp duty driven spike in March and the subsequent dip in April,’ said Paul Smee, director general of the CML. ‘For the second month running, first time buyers borrowed more than home movers, the first time in 20 years that this has been the case. Buy to let continues at lower levels as expected, after the change to stamp duty,’ he pointed out. However, he also pointed out that Brexit, and its likely effect on the market, is a question to which the answer will not immediately be forthcoming. ‘Lenders will continue to be open for business as usual, but lending volumes may be affected by uncertain consumer sentiment,’ he added. The CML report also shows that affordability metrics for first time buyers have remained relatively stable. The typical loan size increased to £131,000 from £130,000 in April, while the household income of borrowers also increasing slightly from £39,700 in April to £40,000 in May, which meant the income multiple went up from 3.46 to 3.51. Home movers showed a similar trend with the average amount borrowed increasing to £166,000 from £163,000 in April, and the average household income of a home mover also increasing to £53,300 from £52,500. This meant the income multiple went down from 3.26 to 3.25 month on month. Remortgage lending saw a month on month decrease in May but a year on year increase by both volume and value, reaching levels similar to those in the first three months of the year. Gross buy to let lending continues to be lower than usual as expected after the surge in activity to beat the stamp duty changes on second properties ahead… Continue reading
Almost half of UK estate agents think Brexit is having a negative impact
Some 42% of estate agents in the UK believe that the decision to leave the European Union has already had a negative impact on their business, new research has found. One agency even found that following the vote on 23 June some 10% of its sales fell through and valuations were reduced by 40%, according to a survey by software supplier Dezrez. A third of those surveyed predict that there will be between 5% and 20% less properties being put on the market and suggested that home owners may see the value of their house drop by 5 to 15%. But less than believe that property values will fall considerably. The research also found that 52% of estate agents expect vendors or buyers to pull out of sales, or for vendors to take their houses off the market but 53% had seen no affect to date. Indeed, some 37% believe leaving the EU won’t have a long term impact on their business, the remainder are either unsure or anticipate a change in the market and their business model. Few have actually prepared for any kind of Brexit impact. The poll showed that 54% believe it is too early to either have a strategy or indeed need one, while 16% said they have a strategy and 13% are working on one. ‘As the economic landscape continues to shift following the UK’s vote to leave the European Union, the Bank of England Governor Mark Carney has warned prospective buyers to proceed carefully if planning to borrow money,’ said the firm’s chief executive officer Justin Morris. ‘This warning, and the ongoing analysis from property professionals, is unsurprising. However, until the market settles, we won’t know the exact extent the effect Brexit will have on the residential property market. What is clear is that in the short term uncertainty will lead to a dip in market confidence,’ he explained. He added that while opportunist buyers may jump at the chance to renegotiate on price, more prudent buyers will be looking at the affects the turbulent economy is having on their finances, making sure that they will still be able to afford their mortgage. He pointed out that many of the estate agents believe that there are still more buyers than sellers. So, whilst a base reduction in housing stock and value is likely, the market could very well even itself out and remain steady. ‘The role of the estate agent will be increasingly important to vendors and buyers a like. Negotiations may become trickier and sales progression more complex, consumers will rely heavily on traditional estate agents for their experience and advice. There is no doubt that there are challenges and opportunities ahead,’ he concluded. Continue reading
