Tag Archives: real-estate
Prime seaside properties in UK can cost up to 71% more
It’s well documented that that living by the sea in the UK comes at a cost with the latest research showing prime properties on the coast can cost as much as 71% more. The prime waterfront index from international real estate firm Knight Frank points to a number of towns and cities along the Devon, Dorset and Cornwall coast which have surpassed the wider property market over the last two decades in terms of price growth. Using data from the Land Registry, based on actual sales volumes going back to 1995, the index has calculated the annual price performance of individual coastal markets relative to the average price increase across the three counties. Croyde in North Devon has been the best performing coastal market over this time, with annual outperformance of 4.1% on average. While this may seem relatively muted over the course of a year, over 20 years this equates to cumulative price growth of around 122% above the wider Cornwall, Devon and Dorset area. Over the past two decades, Croyde has seen prices more than quadruple, by 432%, compared to 310% combined across the three local authorities. A number of other long established prime markets including Rock, Salcombe, Padstow and Falmouth feature in the hotspots identified in the research, and have all experienced outperformance of at least 2% annually since 1995 according to the analysis. The index report points out that price growth and outperformance can be very location specific. For example, the average annual price outperformance for the top 15 best performing small coastal towns and villages has been 2.8%, compared with 2.6% for medium sized coastal towns such as Christchurch, Topsham and Lyme Regis and 2.5% for the top five large coastal towns or cities including Bournemouth and Exeter. It also explains that higher outperformance in smaller settlements since 1995 is likely to be related to the scarcity of available stock relative to demand. Demand for prime coastal property comes from a variety of sources. Such markets benefit from their appeal to upsizers and downsizers often moving within the local area or looking for a lifestyle change, as well as second and holiday-home buyers. The research also points out that many homes bought in top seaside locations are second homes and the announcement in the Chancellor’s 2015 Autumn Statement that a higher rate of stamp duty would be introduced for additional properties, including second homes, from April 2016 prompted a number of purchasers to bring forward deals ahead of its introduction. ‘In the short term, it may take time for the tax to be absorbed, especially in a market where there are notable levels of discretionary purchases. In turn, this may have an impact on pricing, potentially providing opportunities for committed buyers,’ the report says. ‘Over the longer term we believe transaction volumes will rise once the additional stamp duty is fully priced into the market,’ it adds. Continue reading
Edinburgh named as top city to invest in student accommodation in UK
Edinburgh, Bristol and Brighton are the best university cities to invest in student property in the UK, with Oxford further down the list in fifth place and Cambridge seventh. The research from real estate agent Chestertons takes into account a range of factors including average cost, rent charges and growth in house prices and rates each city out of 10 with the top scoring 8.3, 7.9 and 7.8 respectively. Reading was not far behind with 7.7, then Oxford with 7.5, York with 7.1, Cambridge and St Andrews both on seven, and Southampton and Warwick, both on 6.6 making up the rest of the top 10. Aberystwyth in west Wales, Liverpool and Lancaster came out as the least beneficial investments among the 24 cities covered by the research, owing to more affordable rents and slower house price growth. Aberystwyth came last with a score of just 4.3 due to the lowest graduate income of just £16,000 and housing market growth in the region of -6%. Liverpool and Lancaster, both in the North West, followed closely behind, each scoring 5.3. ‘Student lets are generally seen as a great investment. There will always be a reliable level of demand and universities can often be really helpful in pointing students your way,’ said Daniel Killick, from Chestertons. ‘Some locations, however, offer a better return than others. We were keen to get some deeper insights into the UK’s student property market and understand where the most attractive prospects are and the ones that are less likely to pay off,’ he added. Continue reading
High end home prices keep rising in mainland China despite cooling measures
Luxury home prices in major mainland cities in China continued to rise in the second quarter of 2016 despite government cooling measures, according to the latest real estate market report. In Shanghai, where non-residents are restricted from buying homes, sales decreased 20% quarter on quarter but as a key safe haven asset class, luxury homes were still sought after, says the report from international real estate firm Knight Frank. In Beijing some 257 new luxury homes were sold, up 38% quarter on quarter, driven by booming supply and demand in the traditional peak season. In Guangzhou, where market recovery became slower, sales fell over 20% and inventory level fell 11.7% due to a lack of new supply. The report says that the Hong Kong market remained polarised, with super luxury homes popular with billionaires, but other homes recording price drops because of an anticipated increase in supply and a potential interest rate rise. In Taipei, the new administration did not emphasize curbing measures, which encouraged developers to launch new projects. Enquiry levels for luxury homes surged, but buyers were deterred by the high property tax, which dragged down sales to only 30% of the volume a year ago. Overall prices and rents remained stable amid the low interest rate environment. ‘In the short term, curbing measures are expected to remain in first tier mainland cities but luxury home prices are set to rise, propelled by high premiums in recent residential land sales,’ the report explains. It predicts that luxury home prices could fall 5% to 10% in Hong Kong and stay steady in Taipei for the rest of the year. Meanwhile, in the commercial sector mainland Grade-A office markets remained active. In Shanghai, rents rose and the vacancy rate fell, driven by strong demand, with core business districts seeing satisfactory leasing performance. In Beijing, rents continued to climb, although the vacancy rate edged up slightly with six new projects completed. Guangzhou was relatively quiet, with minor increases in both rents and prices. The sales market saw transaction volume drop over 40% quarter on quarter and in Hong Kong, leasing activity was slow on Hong Kong Island due to the low availability of space and weaker demand from the mainland, while Kowloon East remained active, boosted by strong relocation demand from tenants on Hong Kong Island. In Taipei, the letting market performed well with a good absorption rate, most notably in Xinyi District. Overall rents and prices remained steady. Looking ahead, a huge amount of new supply is likely to impose upward pressure on vacancy rates in Shanghai, Beijing, Guangzhou and Taipei, the report suggests. But it explains that the shift from Business Tax to Value-added Tax on the mainland is likely to reduce the tax burden and benefit the absorption of office space. Continue reading
