Tag Archives: sales
British rental prices up 2.5% year on year
Rents in Britain increased by 2.5% in the 12 months to May, down slightly from the 2.6% annual rise recorded in the previous month, the latest index figures show. Rental prices grew by 2.6% in England, 0.4 % in Scotland and were unchanged in Wales, the data from the Index of Private Housing Rental index published by the Office of National Statistics also shows. It means that a property that was rented for £500 a month in May 2015, which saw its rent increase by the Great Britain average rate, would be rented for £512.50 in May 2016. Rental prices for Great Britain excluding London grew by 2% in the same period and rental prices increased in all the English regions over the year to May 2016, with rental prices increasing the most in the South East at 3.4%, up from 3.1% in April 2016. This was followed by London at 3.3 but this was down from 3.7% in April 2016 and the East of England at 3.2%, up from 3.0%. Annual price increases had previously been stronger in London than the rest of England since November 2010. I The lowest annual rental price increases were in the North East at 0.8%, unchanged when compared to April 2016, the North West at 1.2%, up from 1.1% and Yorkshire and the Humber at 1.2%, down from 1.3% over the same period. The zero annual rate of change in Wales continues to be below that of England and the Great Britain average. Rental growth in Scotland has gradually slowed to 0.4% from a high of 2.1% in the year to June 2015. The IPHRP series for England starts in 2005. Private rental prices in England show three distinct periods: rental price increases from January 2005 until February 2009, rental price decreases from July 2009 to February 2010, and increasing rental prices from May 2010 onwards. When London is excluded, England shows a similar pattern but with slower rental price increases from around the end of 2010. Since January 2011 England rental prices have increased more than those of Wales and Scotland and since the beginning of 2012, English rental prices have shown annual increases ranging between 1.4% and 3% year on year, with May 2016 rental prices being 2.6% higher than May 2015 rental prices. Excluding London, England showed an increase of 2.3% for the same period. Looking at data from the UK House Price Index over a longer period shows residential house price growth has typically been stronger than rental price growth for a number of years, with an average 12 month rate of house price inflation of 5.7% between January 2013 and April 2016, compared with 2.1% for rental prices. Inflation in the rental market is likely to have been caused by demand in the market outpacing supply. Demand in the lettings market continues to strengthen, with RICS’ Residential Market Survey noting that tenant demand continued to grow robustly in May 2016. The strength… Continue reading
Landlords in UK urged to stay calm in face of EU exit vote
Residential landlords in the UK are being urged not to read too much into the decision by the country to leave the European Union, having gone through a turbulent period recently. Buy to let landlords are now paying a 3% surcharge in stamp duty on each additional property they buy to add to their portfolios and are also facing further tax changes. Now there are concerns that Brexit could affect their businesses. However, according to Richard Lambert, chief executive officer of the National Landlords Association (NLA), while leaving the EU is completely unknown territory, jumping to conclusions isn’t going to help anyone. ‘We welcome governor Mark Carney’s steadying words and his reassurance that the Bank of England and the Treasury have extensive contingency plans in place to ensure the country’s financial stability,’ said Lambert. ‘Any knee-jerk reaction will have a real impact on our members’ mortgages, tenants’ rents and overall confidence in the market. So we would urge the policy as regards to interest rates should be, to continue the Prime Minister’s analogy, one of steady as she goes,’ he added. In a joint statement, David Cox, managing director of Association of Residential Letting Agents (ARLA) and Mark Hayward, managing director of National Association of Estate Agents (NAEA), said that in the short term the market can weather the uncertainty. ‘The outcome of the EU referendum will create a period of uncertainty among home owners, buyers, investors, landlords and developers. We can expect international investors to look a lot harder at the UK as a market and this will have a consequential impact upon the house building sector as investment may be stalled,’ the statement said. ‘In the short term we believe that both prices, and rents, will remain stable, but we cannot be certain about the next quarter as political instability, and market unrest, could lead through into prices in the housing market,’ it pointed out. ‘We believe that the UK housing market is resilient, as is the supply chain that drives it. But as we indicated in our Brexit report last month, the bigger impact may well be in the skills necessary to drive UK housing development, and this is now a major concern for UK buyers and renters,’ it added. Anne Wilson, senior tax manager of the tax department at Pierce Chartered Accountants, pointed out that tougher buy to let mortgage lending criteria has been announced. The rules will require lenders to carry out stricter stress tests on prospective borrowers or those wishing to re-mortgage to ensure that they have sufficient capital to cover repayments if interest rates increase to 5.5%. In the future, there will also be changes to the way that tax relief for interest payments on the purchase of residential lettings will be given in the tax computation. This will affect individuals, partnerships and limited liability partnerships which let out residential properties. At present there are no proposals for this restriction to… Continue reading
Sales in US reach highest level for a decade and prices reach all time high
Existing home sales in the United States increased in May to their highest pace in almost a decade and median sales prices reached an all-time high. While the uptick in demand this spring amidst lagging supply levels pushed the median sales price to an all-time high, according to the National Association of Realtors®. All major regions except for the Midwest saw strong sales increases last month. Total existing home sales, which are completed transactions that include single family homes, town homes, condominiums and co-ops, were up by 1.8% to a seasonally adjusted annual rate of 5.53 million in May from a downwardly revised 5.43 million in April. The data from the National Association of Realtors (NAR) shows that with last month's gain, sales are now up 4.5% from May 2015 and are at their highest annual pace since February 2007. ‘This spring's sustained period of ultra-low mortgage rates has certainly been a worthy incentive to buy a home, but the primary driver in the increase in sales is more home owners realizing the equity they've accumulated in recent years and finally deciding to trade-up or downsize,’ said Lawrence Yun, NAR chief economist. ‘With first time buyers still struggling to enter the market, repeat buyers using the proceeds from the sale of their previous home as their down payment are making up the bulk of home purchases right now,’ he pointed out. ‘Barring further deceleration in job growth that could ultimately temper demand from these repeat buyers, sales have the potential to mostly maintain their current pace through the summer,’ he added. Surpassing the peak median sales price set last June of $236,300) the median existing home price for all housing types in May was $239,700, up 4.7% from May 2015 and the 51st consecutive month of year on year gains. The data also shows that total housing inventory at the end of May rose 1.4% to 2.15 million existing homes available for sale, but is still 5.7% lower than a year ago while unsold inventory is at a 4.7 month supply at the current sales pace, which is unchanged from April. ‘Existing inventory remains subdued throughout much of the country and continues to lag even last year's deficient amount. While new home construction has thankfully crept higher so far this year, there's still a glaring need for even more, to help alleviate the supply pressures that are severely limiting choices and pushing prices out of reach for plenty of prospective first time buyers,’ said Yun. The share of first time buyers was 30% in May, down from 32% both in April and a year ago. First time buyers in all of 2015 also represented an average of 30%. Properties typically stayed on the market for 32 days in May compared to 39 days in April, which is below a year ago when it was 40 days and the shortest time since NAR began tracking in May 2011. Short sales were on the market the longest… Continue reading
