Tag Archives: property
UK house prices set to slow in 2016 and fall slightly in 2017 then recover in 2018
House price growth in the UK is forecast to slow to 2.5% by the end of 2016 due to economic risks and uncertainty as Brexit unsettles the economy, according to new research. With growth slowing in 2016 next year prices could fall by 1% but the market will recover in 2018 and see growth of 2%, says the analysis from Countrywide. It predicts that while growth will slow across all regions, London is likely to see price growth slow to 3.5% in 2016 before a fall of 1.25% in 2017 and a recovery to 2% in 2018. The prime central London market is expected to be the hardest hit with prices forecast to fall by 6% in 2016, rising to 0% in 2017 and 4% in 2018 while the South and East of England is also expected to slow in 2016 followed by small price falls in 2017 before returning to positive price growth in 2018. Prices in the South East are expected to ease to 3.5% in 2016 from 9.6% in 2015 and fall by 1% in 2017 and a similar outlook is forecast for house prices in the East and South West as prices adjust to weaker economic conditions and previous strong growth. Weaker economic conditions are also expected to hit prices in the North, the Midlands and Wales. The North East is expected to see price growth fall to 0.5% in 2016 and a decline of 0.25% in 2017. Price growth in the North West, Yorkshire and Humberside, Wales and the Midlands is also expected to slow in 2016. Next year is likely to see small falls too as uncertainty about life outside the European Union impacts investment and labour markets despite the support of a weaker currency. The report points out that the vote to leave the EU has unsettled the UK economy as uncertainty surrounding the arrangements for decoupling from the EU and the effect this will have on trade and future economic growth. The firm expects a weaker economy and for this to affect house prices and transactions through consumer confidence, household incomes and the labour market. This is not the only factor affecting the path of house prices. It also points out that higher stamp duty continues to take its toll on the top end markets and after several years of double digit price growth, expectations of future capital gain have weakened in many areas leading to reduced demand. However the continuing lack of supply of property and very low borrowing rates will remain a supportive factor for house prices. The predicted price falls in 2017 will mean prices returning to levels similar to the first quarter of 2016. And the report explains that there are higher than usual risks to these forecasts given the extraordinary nature of the challenges ahead. These are mainly to the downside, although the UK housing market always has the capacity to surprise to the upside and… Continue reading
Rents down in all Australian cities apart from Melbourne and Hobart
Residential rents in Australia fell in all cities except for Melbourne and Hobart in July taking the combined capital city median weekly rent to $483 a week, the lowest since December 2015. Combined capital city rental rates are $485 a week for houses and $467 a week for units, according to the latest rent index from real estate firm CoreLogic. Overall the index fell by 0.3% over the month and is 0.6% lower than it was in July 2015 and it is anticipated that the rental market weakness will persist and that on an annual basis rents will continue to fall over the coming months. A breakdown of the figures shows that over the past 12 months rental rates have increased in Sydney by 0.4%, in Melbourne by 2%, in Hobart by 6.2% and in Canberra by 1.9%. Rents fell by 1% in Brisbane, by 0.5% in Adelaide, by 9.2% in Perth and by 15.7% in Darwin. CoreLogic research analyst Cameron Kusher pointed out that Hobart and Canberra are the only capital cities to have recorded stronger rental growth over the past year compared to the previous year. He explained that the market is currently seeing the softest wages growth on record and the declines are being cause by relatively high levels of housing investment following record highs recently and well as historically high levels of new dwelling construction as most of them are units which are more than twice as likely to be rented. He also pointed out that slowing population growth creates less overall demand for housing at a time when home commencements and the number of dwellings under construction were at historic high levels in March 2016. ‘The combination of all these factors means that landlords have little scope to increase rental rates in this current market. Potentially, the changing rental market conditions will have a flow on effect for older stock, particularly units given we’re seeing so much new unit supply being added to the rental market, much of which is located in inner city locations,’ he explained. He also said that while rental rates are falling and values continue to rise, gross rental yields remain at record low levels. ‘As a result of record low rental yields and the weakest rental market on record, those investors currently active are clearly focusing on capital growth potential,’ he added. Continue reading
Research suggests UK tenants worried about deposit protection
The majority of private sector tenants in the UK are worried that the deposits they pay for their rented home are not protected. Under the law a deposit, the money held as a fund for any damage caused during the tenancy, should be put into a deposit scheme and not held by a landlord or a lettings agency. But some 70% of tenants are concerned that their deposit has not been placed in a protection scheme and believe their landlord or letting agent has kept the deposit, according to new research. The study, conducted by online letting agent PropertyLetByUs, also shows that just 50% of tenants have ever received confirmation that their deposit is in a protection scheme and three quarters of tenants believe their landlord, or agent, will try and keep the deposit at the end of the tenancy. It is estimated that £3.2 billion deposits are being held in the deposit schemes, or by letting agents and landlords. The government intends to reform rental deposits and is looking at what it can do to make sure that people who rent have ‘proper consumer protection, including protection from landlords who withhold deposits unreasonably’. Tenant Deposit Protection was introduced in April 2007, as part of the Housing Act 2004 for all assured shorthold tenancies in England and Wales where a deposit was taken. It was identified as a way to raise standards in the lettings industry and ensure tenants are treated fairly at the end of the tenancy. ‘Tenants are right to be concerned. While deposit protection schemes protect tenants, there is little or no policing to ensure landlords and agents are compliant,’ said Jane Morris, managing director of PropertyLetByUs. ‘Our research shows that tenants simply don’t trust landlords and agents with their deposits, which is disappointing in light of the fact that the schemes have been around for many years. Agents and landlords have a legal obligation to put deposits in one of the three approved schemes within 30 days of receiving it,’ she explained. ‘There definitely needs to be reform and hopefully the Government will introduce new measures that will ensure that tenant deposits are fully protected,’ she added. Continue reading
