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UK housing demand reaches 11 year high
Housing demand in the UK continues to growth, reaching an eleven year high in August, according to the latest monthly report from the National Association of Estate Agents. The number of house hunters registered per branch continued to grow this month, up 5%, to an average of 462 per branch compared to 439 in July. This is the highest recorded since August 2004, when an average 582 house hunters were recorded per NAEA branch. Available housing also increased in July, jumping 25% from an average of 44 properties available per NAEA member branch in June, to 55 in July. These levels have not been seen in almost two years, when 57 houses on average per branch were recorded in September 2013. However, the number of sales made in July remained static from May and June, with just nine per branch, indicating that although housing stock is starting to increase, it remains a struggle to complete a purchase. The July Housing Market Report also reveals that the number of sales made to first time buyers continued to fall in July, with the group now accounting for just 23% sales. This has fallen from 24% in June and 29% in May. However, it is an increase on last year, when only 20% of sales were made to first time buyers in July 2014. ‘Typically, we’d expect to see sales taking longer to complete during the summer months, as buyers and sellers are on holiday. It is alarming however, that the number of sales being made to first time buyers is steadily falling,’ said Mark Hayward, NAEA managing director. ‘Having said that, the fact that there is more housing coming on to the market means that hopefully over the next few months we’ll see activity in the market increasing and more sales completing, to respond to the growing army of house hunters we’ve seen emerging over the last few months,’ he pointed out. ‘The truth of the matter is though, there simply aren’t enough houses to meet growing demand, and until we see more physical bricks and mortar, there may be no hope in solving the housing crisis,’ he explained. ‘It’s also alarming that the number of sales being made to first time buyers is steadily falling; with reports of house prices increasing and expectations of rising in the future, first time buyers will continue to be pushed out of the market,’ he added. Continue reading
First ever rural plan in England will boost homes in villages
Villages and towns in England’s rural communities will be allowed to build starter homes for local residents as part of new plans set out by the government. Under the country’s first ever Rural Productivity Plan the law will be amended to allow Starter Homes to be built on Rural Exception Sites for the first time. This will allow local areas to allocate more sites for Starter Homes specifically for people who already live in the area, or have an existing family or employment connection to the area. It is part of a wide ranging plant to boost productivity and ensure the countryside becomes an even more attractive place for people to live, work, start a business and bring up a family. The plan points out that while a lack of housing is currently a national challenge, in rural areas it is a particular constraint to labour and entrepreneurial mobility, adding that the stock of housing is limited in rural areas relative to demand and house prices are on average 6.7% higher in rural areas than in urban areas. Under the plan the government will increase the availability of housing in rural areas, whilst protecting the Green Belt and countryside. This will include a significant contribution to the 200,000 Starter Homes already announced to be offered at a 20% discount for first time buyers under the age of 40. ‘Through the right combination of measures, the government wants to ensure that any village in England has the freedom to expand in an incremental way, subject to local agreement,’ the report says. Alongside the review of planning the aim is to ensure local authorities put local plans in place for housing according to agreed deadlines and require them to plan proactively for the delivery of Starter Homes. The government will also bring forward proposals to speed up the process of implementing or amending a plan and make it easier for them to establish a neighbourhood plan and allocate land for new homes, including through the use of rural exception sites to deliver Starter Homes. There will be a review the current threshold for agricultural buildings to convert to residential buildings and the introduction of a dispute resolution mechanism for section 106 agreements, to speed up negotiations and allow housing starts to proceed more quickly. Chancellor of the Exchequer George Osborne said that the aim is to create the right conditions for rural communities and businesses to thrive and this means investing in education and skills, improving rural infrastructure, and allowing rural villages to thrive and grow. ‘We’re connecting the countryside to make it just as simple to run a business from Cornwall as it is in Camden. But it’s not just about transport and technology. Our plan will help us create thriving towns and villages where generations of families can open and expand their businesses, buy a home and educate their children at first class schools,’ said Environment Secretary Elizabeth Truss. Communities Secretary Greg Clark that… Continue reading
Property sales fell back in UK in July, latest transaction data shows
Property sales in the UK fell back between June and July by 4.4%, according to the latest seasonally adjusted estimate from HMRC. There were a total of 100,720 residential transactions and 10,100 others in July, the data shows, some 0.2% higher compared with the same month last year. Peter Rollings, chief executive officer of agents Marsh & Parsons, pointed out that it is the first rise on an annual basis for this measure for seven successive months. ‘In July, sales may have slipped back slightly month on month, but we need to remember that the market was working overtime in June to regain ground lost before the election,’ he said. He explained that ever since the changes to stamp duty at the end of 2014 property taxation has become more of a sticking point in London, and here buyer demand has slowed somewhat at the top-end. ‘It will take a while for these changes to fully bed in, and in the meantime house price rises and property sales in the capital may be outshone by other UK regions for the months to come,’ he said. ‘But that’s not to say they’ve fallen out of line and with an average 12 buyers chasing every available property on the market, the strength of the demand for homes in London will continue to push growth up a gear,’ he added. Doug Crawford, chief executive officer of conveyancing services provider myhomemove, also believes that the general election has been a factor affecting the property market in recent months. ‘The general election’s outcome assured buyers and sellers that the housing market was likely to remain stable, leading to a spike in the number of property transactions in June. Today’s HMRC figures show that the number of transactions has barely changed over the last year and this begs the question about why a year’s steady improvement in the economy hasn’t led to an increase in home purchases, particularly when mortgage availability and rates have been so favourable,’ he said. ‘The main impediment has been a serious shortage in supply. There is a lot of appetite from buyers but not enough homes for sale to meet demand. This mismatch is stoking price rises. In some areas we have even seen instances of gazumping, as sellers look to make the most of competition between buyers by accepting higher offers,’ he explained. He believes that the big question looming in the background is the timing of an interest rate rise from the Bank of England. Many would be buyers are keen to purchase while mortgage rates are so low. Increased anticipation of rate rises is putting greater pressure on buyers and competition for homes for sale could drive up prices further in the short term,’ he added. Continue reading
