Tag Archives: property
Property prices in Scotland down slightly in run up to Brexit, but up 4% year on year
Residential property prices in Scotland increased by 4% year on year in June but fell by 0.4% month on month, according to the latest data to be published. Overall prices flattened slightly in the run up to the European Union referendum with the first monthly decline since February but it was still the largest annual growth rate since May 2015, says the Your Move Acadata index. While monthly house prices were down compared to May, the average price of property was £170,404 in June, still 0.97% higher compared to the start of the year. A breakdown of the figures shows that a number of areas did not see prices fall in June, most notable Aberdeen where a fall in oil prices have hit the city hard in recent months, but it saw prices rise by 1.6% month on month. Prices increased month on month by 3.8% in Glasgow, by 2.8% in East Dunbartonshire, by 2.5% in Stirling, by 2% in Shetland, by 1% in Moray, by 1.3% in South Lanarkshire, by 1.2% in North Lanarkshire, by 0.5% in Argyll and Bute, by 0.4% in West Dunbartonshire, by 0.2% in Renfrewshire, the Borders and East Ayrshire, by 0.1% in South Ayrshire and North Ayrshire and were unchanged in Edinburgh. Prices fell by 6.4% in Inverclyde, by 5.9% in Fife, by 5% in Perth and Kinross, by 3.9% in East Lothian, by 3.5% in Dumfries and Galloway, by 3.3% in Orkney, by 3% in West Lothian, by 2.4% in Dundee, by 2.4% in Clackmannanshire, by 2.3% in East Renfrewshire, by 1.8% in Midlothian, by 1.3% in Aberdeenshire and by 0.1% in Falkirk. Christine Campbell, Your Move managing director in Scotland, pointed out that the data covers the period up to the end of June, so any impact from Brexit is not yet reflected in the figures. ‘What we can see is that the underlying fundamentals of the market remain strong. We’re benefitting from record low mortgage rates, high employment levels, and high demand for property. Following April’s introduction of the 3% tax increase on second homes, house prices and transaction figures remain arguably skewed in the second quarter of this year, as buyers pushed to complete before the surcharge came into effect,’ she said. She also explained that June was the first month that the spike in house prices as a result of the 2015 LBTT changes dropped out of the annual figures. ‘This previous distortion in property prices goes some way to explaining the seemingly significant annual price increase we saw this June,’ she commented. ‘Whilst market sentiment remains strong, with continued demand from both buyers and sellers, it will be interesting to watch how potential Brexit implications play into transaction and price figures over the coming months,’ she added. ‘Long term, the outlook for the housing market looks favourable. However, with housing demand continuing to vastly outstrip supply, it is important that we see a concerted focus on building new property to ensure there are… Continue reading
Brexit uncertainty created pause in UK home borrowing in July
The UK’s mortgage sector was hit in July as a result of the European Union referendum with both the number and value of house purchase approvals falling month on month and year on year. The BBA figures show that house purchase approval numbers were 19% lower than in July 2015, though in the first seven months of 2016 they were some 2% higher than in the same period of 2015. The data also shows that remortgaging approvals were 6% higher than in July 2015 and in the first seven months of 2016 were 21% higher than in the equivalent period of 2015. Overall gross mortgage borrowing of £12.6 billion in the month was 6% higher than in July 2015 while net mortgage borrowing is 3% higher than a year ago. As the first lending figures since the decision to leave the EU not much can be taken from them, according to Rebecca Harding, BBA chief economist. ‘The data does not currently suggest borrowing patterns have been significantly affected by the Brexit vote, but it is still early days. Many borrowing decisions will also have been taken before the referendum vote,’ she pointed out. Andy Knee, chief executive of LMS, said that the figures suggest home buyers took stock in July. He pointed out that the value of loans for house purchases fell to its lowest level since March 2015 following a buoyant first six months of 2016, ‘What remains to be seen is whether this will become the norm or if August activity will be bounce back following the immediate shock. On the other hand, despite a small fall remortgaging is up as existing home owners capitalise on the record low mortgages available,’ he explained. ‘Following the vote for Brexit, swap rates fell leading to lower mortgage rates across the board. At the same time, intense speculation about a decrease in the Bank of England interest base rate to 0.25% and other monetary policy interventions have also contributed to lower rates, encouraged lending and driven home owners to take advantage of this,’ he said. ‘Anecdotally, there is little to suggest a lull in the demand for house purchase and remortgaging. We therefore expect activity to bounce back in the autumn months once the dust settles and some sense of normality returns,’ he added. According to Tanya Jackson, head of corporate affairs at Yorkshire Building Society, believes that people’s desire to own a property largely outweighed any uncertainty caused by the EU referendum in July. ‘That said, the full effects of the vote are unlikely to be seen until a few months after the outcome of the vote was announced, as those buying a home in July are likely to have begun the house buying process before the EU referendum,’ she said. ‘We do expect the outcome of the EU vote to limit market activity to an extent in the short-term as prospective buyers take a wait and see approach on how it affects their finances…. Continue reading
Negative equity rates down in the US but still affecting one in 10 owners
Negative equity is still affecting more than one in 10 home owners in the United States five years after the nation’s housing market recovery began, new research shows. Home owners who owe more than their homes are worth are nearly equally dispersed among urban and suburban communities in most metros across the country, says the latest report from real estate firm Zillow. But the numbers are falling. Nationally, some 12.1% of mortgaged home owners were underwater in the second quarter of 2016, down from 12.7% in the first three months of the year and below the 14.4% recorded a year ago. A breakdown of the figures show that 13.7% of owners in urban regions are underwater and 11.2% of those in suburban regions while Cleveland and Detroit have the greatest difference between urban and suburban negative equity rates. After the housing bubble burst, nearly a third of home owners in the United States were underwater on their mortgages. As the market recovered, many home owners have gained back the lost value on their homes, freeing them to sell or refinance. In most areas of the country, negative equity is nearly equally spread across urban and suburban areas. In 13 of the nation's largest metros, the share of urban and suburban homeowners who are underwater is within two percentage points. But some metros are seeing notable gaps in the share of underwater homeowners between urban and suburban areas. Cleveland and Detroit have the biggest difference between negative equity rates in urban and suburban neighbourhoods at 13.6% and 10.8% respectively. In these metros, home values in the main urban centres are trailing behind the overall region's recovery, and are still well off from their peak levels. By contrast, negative equity is equally common among urban and suburban areas in the Seattle area, where a more balanced recovery and strong economic growth have led to home values near or exceeding their bubble peak levels in urban and suburban areas alike. ‘At its worst, negative equity touched all kinds of home owners in all kinds of markets. The type of community a given home was in, urban or suburban, mattered little. Fast forward a few years, and the relative vibrancy of a given community and how it has performed over the past few years, and not necessarily its location in the city or suburbs, matters a great deal,’ said Zillow chief economist Svenja Gudell. For the first time, all of the largest markets in the country now have negative equity rates below 20% and the data shows that Western metros with strong job and housing markets have the lowest rates of negative equity. Less than 5% of mortgaged home owners in San Jose, San Francisco, Portland, Denver, and Dallas are underwater. Continue reading
