Tag Archives: taxes
Prime property market in Dubai sees sales fall
Dubai luxury home prices remain relatively resilient despite a drop-off in sales activity, according to the latest analysis of the Emirate’s residential real estate market. Sales in Dubai’s prime segment, comprising properties worth over AED10 million, hit the lowest level since the end of 2012 in the final three months of 2014, the research document from international real estate firm Knight Frank shows. Despite this however, Knight Frank’s prime residential price index saw a relatively modest fall in the three months to December of 1.2% quarter on quarter, the second consecutive quarterly fall. Indeed an examination of the data shows that these two declines nearly reversed the increases seen in the first half of last year, leaving values just 0.3% higher year on year in the fourth quarter of 2014. Despite the lower level of transactional activity however, the nationalities investing in real estate in Dubai remained diverse. Data from the Dubai Land Department (DLD) shows that, in 2014, more than 140 nationalities bought property in the Emirate. A breakdown of the figures shows that Indians remained the top foreign property investors, spending around AED18.1 billion, while the British and Pakistanis invested AED9.3 billion and AED7.6 billion, respectively. Overall though, the Emiratis spending AED 22.8 billion were the leading real estate investors, accounting for approximately 21% of the total spent last year. Between 2013 and 2014 Indians and Saudis increased their levels of real estate investment in Dubai while the British and Pakistanis, as well as the aggregate of the remaining GCC countries, spent 1% to 12% less. The total level of real estate investment from all other countries also fell in 2014, by almost 5% year on year. An assessment of web traffic to KnightFrank.ae’s website shows that around 44% of the total viewings in 2014 originated from the UAE. But the report points out that a significant proportion of these will have been expats. What’s more, another 18% of those clicking through to Knight Frank’s UAE website were doing so from the UK, while 7% were from India and 4% from the United States. As a proportion of the total, the level of web traffic from Russia also fell year on year in 2014 however, this did not come as a surprise since the rouble has nearly halved against the US dollar, to which the UAE dirham is pegged, since July, making it significantly more expensive for this nationality to buy property in Dubai. Finally, the strengthening of the US dollar and the weakness of the euro also means that demand from European buyers has also begun to wane, in turn adding further downward pressure on residential property prices in Dubai. Continue reading
New accreditation standard for London lettings hailed a success
More than 115,000 rented homes across London are now badged under the Mayor's Rental Standard accreditation system launched last year to improve the experience of landlords and tenants. Less than a year since its launch in May 2014, the London Rental Standard is going from strength to strength with 307 letting agent firms signed up and eight accrediting bodies licensed under the scheme. It has been adopted by 10 of the biggest names in the lettings industry, including Spicerhaart, Andrews, CBRE, Chestertons, Douglas and Gordon, Savills, Knight Frank, Leaders, Foxtons and Stirling Ackroyd. Londoners either letting or renting through every London branch of these firms are assured that they, and every landlord or agent displaying the London Rental Standard badge, have met the Mayor's set of core commitments and training levels to offer tenants a better, more professional service. These include transparent fees, better property conditions, better communications between landlords and tenants, improved response times and repairs, and protected deposits. Some 30% of London's households now live in rented homes, and by the middle of the 2020s the number of renters is predicted to overtake the number of home owners in the capital. In the last 10 years the number of families with children renting in London has risen 10% to almost a third yet 85% of landlords are not aware of core legislation that protects renters and 61% have no professional management training. The London Rental Standard is fast becoming an important feature of London's lettings industry, helping Londoners to pick between the huge array of landlords and agents on offer in the capital. It helps landlords and agents to understand their responsibilities to their tenants and to equip them with the knowledge they need to protect themselves from mistakes which can incur hefty costs and leave tenants disgruntled. The standard is one of a raft of measures the Mayor Boris Johnson has supported to improve the experience of London's two million private rented sector tenants. This includes successfully lobbying for legal changes to make it compulsory for letting agents to join an independent consumer complaints scheme to help protect tenants and landlords, and banning retaliatory evictions. He has also created a search engine where Londoners can compare average market rents, secured significant sums from the Government to help provide greater enforcement against criminal landlords including those who rent out beds in sheds, and pioneering thousands of new high quality, purpose built homes to rent with large scale schemes on public land in Elephant and Castle and the Stratford, supported by long term institutional investment. The Mayor is also helping renters who want to buy through his First Steps scheme, with more than 46,000 Londoners already supported to buy their home through shared ownership and other products. The Mayor is now calling on all remaining letting agents and landlords to sign up to the London Rental Standard, and help to stamp out rogue agents or landlords in every corner of… Continue reading
Higher taxes and election uncertainty put brakes on prime London house prices
Prices in the prime property market in London fell marginally in the first quarter of 2015, confirming concerns that higher taxes and pre-election qualms are affecting the sector. They were down 0.5% quarter on quarter and this follows an average 2.6% price adjustment in the final quarter of 2014, according to the latest research from international real estate adviser Savills. The firm says this was triggered by the stamp duty reform announced in December’s Autumn Statement and means that the 12 month rolling prime London average has slipped into negative territory. However, Savills research is forecasting that prices in the prime London market will rise by 23% over the next five years assuming no further taxation of high value property. The prime central London housing market has been most affected by increased stamp duty charges and values are down 1.1% on a quarterly basis and 4.3% year on year, a reflection of the fact that the more valuable markets have borne the brunt of increased stamp duty charges. By contrast, the markets of Islington, Wapping and Canary Wharf continue to show positive annual growth, despite an easing in values in the past six months. Year on year the north west prime market is up 1.8% but down 0.6% quarter on quarter. North London is up 6.2% year on year and down 0.8% quarter on quarter. The data also shows that the East of City prime market has seen prices rise 4% on an annual basis but down 1.5% quarter on quarter while in the south west prime market prices are down 2.6% year on year and down 0.2% quarter on quarter. But over the longer term prices in the prime sector have seen considerable growth. Over the last five years prices in central London are up 30.8%, in north west London up 30.7%, in south west London up 38.1%, in north London up 45.6% and in east of City up 41.6%. Overall the prime market has seen growth of 36.6% over five years. Since the peak of the market prices in price central London are up 33.6%, in north west London up 28.4%, in south west London up 33.7%, in north London up 42.3% and in east of City up 33.6%, taking the growth for the whole of London to 34.3%. ‘As we forecast in November, uncertainty regarding the general election and the potential for further taxation of high value property have contributed to a subdued market in the first part of 2015,’ said Lucian Cook, head of UK residential research at Savills. ‘The stamp duty changes came after five and a half years of sustained price growth for prime London property. This segment of the market is now looking fully taxed and sellers are having to factor in price adjustments equivalent to the stamp duty increase,’ he explained. The analysis also shows that by contrast, the softening in… Continue reading
