Tag Archives: outlook
Average property prices in Canada set to rise by 2% in 2015, says latest forecast
The national average property price in Canada is forecast to increase by 2% to $442,400 in 2016, according to the latest forecast from the Canadian Real Estate Association. But there is likely to be regional variation. For example, increases are forecast to be slightly larger but less than 3% in British Columbia, Saskatchewan, Manitoba, Ontario, New Brunswick, and Prince Edward Island, with gains in some provinces reflecting an expected rebound from levels in 2015. Price growth in 2016 is forecast to be strongest in Ontario with growth of 2.8% due to an ongoing supply shortage of listings for low rise homes in and around the Greater Toronto Area, the CREA forecast report says. ‘Alberta and Quebec are forecast to see average home price growth of about 1.7% and 0.8% respectively in 2016, while Nova Scotia and Newfoundland and Labrador are forecast to edge slightly lower. The report explains that the national average price has run higher than expected since CREA’s last forecast, in part reflecting a jump in the proportion of higher priced home sales this spring and early summer in B.C.’s Lower Mainland, in and around the Greater Toronto Area (GTA) and Calgary. This trend now appears to be receding, causing the national average price to follow suit. However, recent trends in the Home Price Index, which is not affected by changes in the mix of sales activity the way that average price is, suggest that prices are still accelerating across much of B.C., in and around the GTA and Montreal. B.C. continues to see some of the strongest economic growth in the country, coupled with strong demographics. Home sales there have been drawing down inventories and boosting prices across the province. In Alberta, home sales have gone from setting records in 2014 to running at or below their 10 year average, as uncertainty surrounding the outlook for oil prices and employment continues to side line potential home buyers. In Ontario, the ongoing shortage of single family homes for sale in and around the GTA continues to drive very strong price gains. Record levels of activity in the province would likely be higher were it not for a shortage of low rise homes coming onto the market. In Saskatchewan, Manitoba, Quebec, and most of Eastern Canada, supply remains elevated. Home prices outside of B.C. and Ontario are forecast to keep pace with or lag inflation, as elevated supplies are drawn down by sales and return to better balance. The forecast for national sales in 2015 has been revised slightly higher, reflecting stronger than anticipated activity in B.C. and Ontario. National sales are now projected to rise by 3.3% to 495,800 units in 2015, marking the second strongest year on record for home sales in Canada. Across the country, British Columbia is projected to post the largest annual increase in activity in 2015 with growth of 18.1. Alberta, Saskatchewan, and Nova Scotia are expected to post the largest annual sales declines 21.6%, 12% and 12.1%… Continue reading
Report reveals skills shortage and planning are holding back UK house building
A severe shortage of skilled workers in the house building industry and the current planning system are combing to hinder efforts to tackle the UK’s housing crisis, according to new research. The report, which surveyed those within the housing supply chain, from SME contractors to major national developers, found real concern among these businesses on the effect of the sector’s skills shortage not only on individual firms, but also on national house building rates and the UK economy as a whole. However the research from Lloyds Bank Commercial Banking did find some approval for measures announced in the Summer Budget designed to tackle the current housing shortage, for example, plans to grant automatic planning permission for building projects on disused industrial sites. While the pace of house building is generally acknowledged to be improving, there remains much discussion about how it can be accelerated to match demand. According to the report, there are a number of key issues preventing the effective tackling of the housing shortage, including slow planning decisions, public opposition to development and lack of skilled workers. Some 24% of respondents said that the skills shortage is the biggest broader challenge currently facing their business while 35% believe there is a lack of suitable candidates to fill existing and new jobs. House builders said the skills shortage is most acute among electricians and site managers with project managers, quantity surveyors and architects following closely behind, reflecting the supply chain wide nature of the problem. But house builders appear to be taking steps to redress the balance with 31% prioritising investment in recruiting apprentices in an effort to increase the pipeline of talent coming into the industry. When asked what one change house builders would advocate for the alleviation of the housing shortage some 23% said greater local authority support to promote and fund building projects, while the same figure sought additional government support. Existing government schemes such as Stamp Duty reform and the Help to Buy equity scheme were flagged by 73% and 63% respectively as having a positive impact on the housing crisis. And despite the challenges cited in the report, house builders seem to be optimistic about the future, with respondents giving an average score of seven out of 10 when asked to rate their confidence in the success of the UK house building industry in the future. The research also found that 87% of respondents want to create new jobs in the next 12 months, and if replicated across the industry, this could mean the creation of more than 100,000 new house building roles. As an indication of future house pricing the first index to be based exclusively on house builder feedback predicted house prices will reach £232,826 by 2020, up 17% from £198,883 today. Some 84% said that rising house price increases were not affecting demand for new homes, and… Continue reading
Rents in England and Wales fall for first time since March
Residential rents across England and Wales have fallen on a monthly basis for the first time since March, despite fresh records in three regions, according to the latest index. Average rents fell by 0.1% on a monthly basis, down from £804 in July to stand at an average of £803 in August, the data from the Your Move and Reeds Rains index shows. However, on an annual basis rents are now 5.5% higher than in August 2014, representing a slowdown since July when annual rent rises stood at an all-time record of 6.8%. ‘August has witnessed a break in a series of blistering rent rises. Yet this mild correction comes on the back of a whole year of acceleration. Rents are rising rapidly on an annual basis, underpinned by an improving economic picture for many potential tenants and the peak lettings season is only just about to start this autumn,’ said Adrian Gill, director of estate agents Reeds Rains and Your Move. ‘There is also no major change to the fundamentals of supply and demand. This means that in the longer term, faster rent rises may become a semi-permanent feature of the British property market. Alongside purchase prices, rents will continue to rise rapidly until something happens to address a drastic shortage of homes in the UK,’ he added. A regional breakdown show that despite a slower picture across the board, three individual regions of England and Wales saw rents hit fresh records in August. In the West Midlands average rents of £586 per month represent the highest levels on record, while rents in the East Midlands have set their own record at £596. As the third region to see record rents, the East of England has also overtaken London to see the fastest annual growth of 11.5%, ahead of 10.2% annual increases in the capital. This takes average rents in the East of England to £843 per month. Meanwhile, while relegated to second place in terms of annual rent rises, London’s tenants still pay by far the most in absolute terms, with average rents of £1,278 in August. Annual rent rises in the West and East Midlands were also particularly strong, standing at 4.6% and 5.9% respectively. At the other end of the spectrum, Welsh rents are 3.1% lower than a year ago and the only region to see an annual fall. This comes as Wales has also seen the most negative trend on a monthly basis, with rents in the principality dropping 4% since July. In total five out of 10 regions have seen rents fall on a monthly basis. After Wales this is led by the South East, with rents 1.4% lower than in July, and the North East with a 1.1% monthly decrease. In London rents have seen a rapid reversal with a 0.3% fall following a 3.3% increase over the previous month. Leading the field on a monthly basis, South Western rents rose 3.2% between July and August,… Continue reading
