Tag Archives: real-estate
Property prices and rental values expected to continue rising in Ireland in 2016
Property values increased across all regions in Ireland in 2015 and that trend is likely to continue in 2016 according to the annual residential property review and outlook report from the Society of Chartered Surveyors Ireland (SCSI). SCSI members expect the price of an average three bedroom semi-detached property to increase by between 4% and 8% in 2016 depending on location. According to the national survey of over 700 estate agents and chartered, property values are estimated to have risen by approximately 8.8% nationally in 2015 but to have moderated to 4.8% in Dublin. In 2014 Dublin property values rose by 19.5%. In Leinster values are estimated to have increased by 9.4% while in Munster and Connacht/Ulster they rose by 10.4% and 8.8% respectively. John O’Sullivan, chairman of the SCSI Residential Agency Professional Group said that the Central Bank’s lending rules had dampened price growth in Dublin and displaced it to neighbouring counties which have experienced an uplift in values over the past 12 months. ‘This happened because potential buyers were unable to justify the cost of buying in Dublin or were unable to access the necessary finance. According to our survey, 47% of Dublin based respondents believe that, in the absence of the Central Bank rules, values in Dublin would have grown by between 9.8% and 14.8%. That’s 5% to 10% more than the actual increase,’ he pointed out. ‘Most of the growth in values nationally accrued from the regions. The ongoing economic recovery is starting to spread across the country and further increases in property values in the regions can be expected in 2016 as incomes and expectations for the future continue to improve. The outlook remains fragile however and is dependent largely on the employment opportunities and investment for regional towns,’ he added. The report also shows that the private rental market experienced another year of continued growth with average rental values increasing by 12% nationally. The growth in rental prices is now outperforming the growth in property values across each of the regions. Respondents to the survey have attributed this trend to the shortage of supply in the sales market which is putting disproportionate pressure on the rental market. According to the survey SCSI members predict further increases in rental values in 2016, with the average rental value for a three bed semi-detached property expected to increase by a further 5% to 7% depending on location and two out of three said they believed that the new rent freeze legislation had increased the cost of renting for tenants. O’Sullivan noted that the rental increases have come about not just as a result of the broad undersupply of housing nationally, but also because of the difficulties that potential buyers are having accessing finance to purchase a house. ‘Allied to this, the collapse in construction output has resulted in virtually zero supply of social housing units to accommodate the growing social housing lists. Consequently, this cohort of tenants has had to seek accommodation… Continue reading
Severe shortage of properties for sale pushing up asking price, says latest index
The supply of property coming onto the market in England and Wales has fallen by 8% year on year and as a result prices are set to keep rising. The latest index shows that in the East England asking prices have already risen 2.1% this year as supply is overwhelmed by demand while overall the average asking price for England and Wales is up 0.7% month on month. The date from Home.co.uk also shows that asking prices have increased in all regions except the North West and North East during the last month. And year on year asking prices are up 8.1% overall. In the East of England the supply divide is the most acute and in this region asking prices are up 12.2% year on year, meaning it has overtaken both Greater London and the South East which saw annual rises of 12% and 10.3%. The index report says that across England and Wales, prices remain on a strong rising trend and this looks set to continue as interest rates are currently on hold until at least 2017. It also points out that the total stock of property for sale remains very low, and scarcity will continue to be one of the key drivers of the 2016 property market in the UK. The second key driver is ultra-low interest rates. The number of properties entering the market is down 8% compared to a year ago. The hardest hit is the West Midlands where 17% less new stock arrived on estate agents' books this January compared to January 2015. The East of England is also in the midst of a property drought and 14% less stock was registered on agent portfolios last month. Looking to the North and Wales, the picture is very different. Only small drops in numbers of properties entering the marketplace have been observed in the North East, North West, Wales and Yorkshire. Supply in these regions remains relatively buoyant and, consequently, prices show little if any upward progress. ‘With interest rates on hold at super low levels for the foreseeable future, we are likely to witness price growth continuing to ripple out from London across the rest of the country. Lack of supply will be the key driver and, as buy to let investment continues to soak up many of the available properties, so supply will continue to dwindle,’ said Doug Shephard, Home.co.uk director. ‘The London market is now maturing and is slower and with more moderate price rises. Investment capital is now making its presence felt further afield in the East and South East where prices are leaping ahead and supply of stock for sale is crashing,’ he explained. ‘We may expect the same or a similar market dynamic to become manifest in the West Midlands, the South West and the East Midlands towards the end of the year, together with significant price growth,’ he added. ‘What is clear is that this property boom is not going away while borrowing… Continue reading
Home prices set to rise 5.4% in the United States in 2016
Home prices across the United States, including distressed sales, increased year on year by 6.3% in December 2015 and increased month on month by 0.8%, the latest index shows. And forecast data from the CoreLogic House Price Index also indicates that home prices are set to rise by 5.4% this year. ‘Nationally, home prices have been rising at a 5% to 6% annual rate for more than a year,’ said Frank Nothaft, chief economist for CoreLogic. However, he added that local market growth can vary substantially from that. For example, some metropolitan areas have had double digit appreciation, such as Denver and Naples, Florida, while others have had price declines, like New Orleans and Rochester, New York. ‘Higher property valuations appear to be driving up single-family construction as we head into the spring. Additional housing stock, especially in urban centres on the coasts such as San Francisco, could help to temper home price growth in the longer term,’ said Anand Nallathambi, president and chief executive officer of CoreLogic. ‘In the short and medium term, local markets with strong employment growth are likely to experience a continued rise in home sales and price growth well above the US average,’ he added. Meanwhile, research from real estate firm Zillow shows that buyers in Boston, New York, and Washington, D.C. have to stay in a home for at least three years to break even on a home purchase, and buyers in the Bay Area would have to stay nearly that long to make buying financially advantageous. In general, Americans can break even on a home purchase in less than two years in 70% of US metros and the firm says that this is thanks to low interest rates, healthy home value forecasts, and the relatively fast pace of rents in recent years. The Breakeven Horizon index shows that on average you don't need to plan on living in a home for even two years to make purchasing the home more financially advantageous than renting it over the same time period. Among large housing markets, the Breakeven Horizon is longest in Washington, D.C. at 4.5 years and shortest in Dallas at 1.3 years. Around the country over the last year, the Breakeven Horizon quickened in most of the Midwest and Southeast as well as in the Northeast corridor from New York to Boston. The Horizon stretched longer in Florida, Northern California, and in the Northeast from Virginia Beach to Philadelphia, but it remained clear that financially, it's still a better deal to buy a home than rent it, assuming you're planning to stay in the home for at least a couple years. ‘Even with record high rents in places like San Jose, Boston and Washington, D.C., putting off a home purchase might be the best financial decision for a young person who has saved enough for a down payment, depending on how long they intend to stay in their jobs and homes,’ said Zillow chief economist Svenja… Continue reading
