Tag Archives: middle-east
Cost of getting on the rental property ladder in UK set to soar, research suggests
With many private rental sector landlords in the UK requiring a deposit of four weeks’ rent getting on the rental ladder could present similar challenges in terms of cost as buying a home, new research suggests. It says that the cost of the average rental deposit is estimated to grow by 40% by 2026 to £1,111, more than the growth of the average monthly rent which is estimated to increase by 28% over the same period. This will mean that the average monthly rental deposit will be 70% of the average monthly salary, however there will be considerable regional variations, according to the research carried out on behalf of financial comparison website money.co.uk by the Cebr (Centre for Economics and Business Research). In London for example, the average rental deposit is predicted to rise to £2,733 by 2026, amounting to 120% of the average monthly salary, up from 99% in 2015. Deposits are predicted to rise sharply across the whole of the South of England. In the South East the average deposit is estimated to hit £1,469 in 2026, representing 83% of the average monthly salary at £1,761, up from 72% in 2015. In the South West the average deposit is estimated to represent 80% of median monthly earnings at £1,437 by 2026, up 14% from 66% of the average salary in the region in 2015. The research also suggests that based on recent trends, by 2026 an estimated 68% of all deposits requested will be at least six weeks’ rent. This means landlords will be demanding a lot more money from tenants before they sign a tenancy agreement. Average monthly rent is due to increase by 28% by 2026, some 8% higher than the increase in average salaries over the same period which are set to grow by 20% by 2026. The largest increase in rents between 2015 and 2026 is estimated to occur in London with close to 39% growth. Other regions with high estimated growth are the South West and South East where rents are predicted to grow by 32% and 34% respectively over the same period. The lowest increase in average rent is estimated to be in Yorkshire and the Humber with a 17% price rise between 2015 and 2026 and overall monthly salary growth is not expected to keep pace with the rental market Between 2015 and 2026, the average monthly salary is predicted to rise by an average of 20% or £267 to £1,576. This increase is lower than the estimated increase in both monthly rental costs and rental deposits which could mean many individuals will find the cost of renting just as unaffordable as buying. This is despite the fact the financial outlay required to rent is significantly lower than getting on the property ladder. ‘The rapid rise in deposits as well as rents is a double blow for everyone on the rental ladder. With the forthcoming changes to tax legislation and crackdown on… Continue reading
Property sales in Scotland reach highest annual figure since 2008
Residential property sales in Scotland exceeded £16.5 billion in 2015, according to the latest statistics published by Registers of Scotland (RoS). A total of 97,701 sales took place across the country last year, the highest annual figure since 2008, and an increase of 4.5% compared to the previous year. Edinburgh had the largest volume of sales at 11,991 in 2015, up 8.3% on 2014 followed by Glasgow, up 12.2% to 11,616. East Renfrewshire experienced the largest annual growth in the volume of sales, with a 13.1% increase to 1,861. Aberdeenshire saw the largest decrease in volumes, down 11.8% to 5,108. The average price of a residential property rose in 2015 by 3.6% to £169,402 and the local authority area with the highest average price was Edinburgh, where the average price for the year was £238,036, an increase of 4.9% on 2014. The highest annual change in average price was in West Lothian, up 9.1% to £161,014 in 2015. The only local authority area to show a slight decrease in average price was East Renfrewshire, down 0.6% to £227,369. While the average price for all property types increased in 2015, semi-detached houses showed the largest rise in price, up 3.4% to £157,995. Detached properties had the highest average price at £249,921. Flats have the highest volume share, claiming 36.2% of the total market. The lowest share of the market was semi-detached houses, with 17,974 transactions accounting for 18.4% of the market. These statistics cover all residential sales between £20,000 and £1 million, including those that did not involve a mortgage. ‘The total value of the residential property market continues to make a significant contribution to the Scottish economy,’ said Registers of Scotland's director of commercial services, Kenny Crawford. ‘In 2015, the market totalled £16.5 billion, an increase of 8.2 per cent on the previous year. The Edinburgh property market represented over 17.2% of this figure, bringing in over £2.8 billion to the Scottish economy. This is significantly larger than the next biggest property market, Glasgow, with 9.8% of the market at £1.6 billion,’ he added. Continue reading
Negative equity rate falls to 13.1% in the US in fourth quarter of 2015
Fewer home owners in the United States were underwater as the negative equity rate fell to 13.1% in the fourth quarter of 2015, according to the latest data to be published. But more than 820,000 underwater home owners still owe over twice as much on their mortgages as their homes are worth, a reminder that some owners may not see positive equity in their homes in the foreseeable future. The data from the Zillow Negative Equity Report also shows that six million home owners were still in negative equity, which means they owe the bank more than their homes are worth. A year ago eight million home owners were upside down on their mortgages. The report explains that over time, negative equity can act as an anchor on a housing market, preventing underwater homeowners from listing their homes and re-entering the market. It is more prevalent in less expensive areas that are affordable to first time buyers. Without these homes available, many potential buyers are side lined and unable to take advantage of mortgage rates that remain near historic lows. It also points out that in the past year, millions of underwater home owners resurfaced as the total amount of negative equity declined by $75 billion, but some owners are so far underwater that positive equity may be several years away, leaving them stuck in their homes unable to sell. ‘Even though the number of underwater homeowners has fallen significantly since the peak of the housing crisis, negative equity persists in many markets as it fell at its slowest pace in a year,’ said Zillow chief economist Svenja Gudell. ‘Things are moving in the right direction, but some owners are still deeply underwater. As we move into the home shopping season, inventory is already low, and negative equity is keeping potential additional stock from becoming available,’ she added. Las Vegas still had the highest rate of negative equity at 20.9% followed closely by Chicago, where 20.5% of home owners were upside down on their mortgages. At the other end of the spectrum, in San Jose only 2.8% of mortgaged home owners were underwater. Continue reading
