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Premium properties selling well in Scotland, but prices are down
Premium property sales in Edinburgh increased year on year in January, but the average sale prices was down, according to new research on the Scottish residential market. Across Scotland, 535 premium properties were sold in January, up from 494 a year ago. A total of 5,330 mainstream market properties under £300,000 were sold in January, up from 4,144 in January 2015. The average value of a house in Scotland in January was £163,610, down from £166,682 in January 2015. A total of 148 properties over £300,000 were registered as sold in the Scottish capital in the first month of the year, up from 131 in 2015, 136 in 2014 and 109 in 2013, the data from estate agency Strutt & Parker shows. Indeed the average sale price in January was £227,899, down from £236,696 in January 2015 and the premium market share, that is the percentage of all sales that were greater than £300,000, was 21.1%, down from 23.9% in January last year and the 40% recorded in March at the height of the sales rush before the introduction of Land and Buildings Transaction Tax. ‘It is very encouraging to note that registered sales are up year on year. The average price is down but by a relatively insignificant amount and it is not something I am worried about. In many respects the sales market is still adjusting to the unprecedented rush of premium sales before the introduction of LBTT last year, which saw record numbers of premium sales and the average price in Edinburgh spike at £320,257,’ said Blair Stewart, partner in Strutt & Parker's Edinburgh office. He pointed out that looking back at 2015, the value of Scottish property sales increased 8.2% on 2014 and the number of transactions was up by 4.5%. Edinburgh sales in particular were up 8.3% to 11,991, which was largely a reflection of the LBTT effect. ‘LBTT aside, however, the Edinburgh premium market has grown steadily in recent years from the lows seen in 2009. It has shown strength in the early months of 2016 and we have some very exciting new properties on our books so I am reasonably optimistic about where we are,’ added Stewart. In the market area covered by Highland Local Authority, premium sales in January numbered 18, down from 37 in December and 25 in November, but up from 12 in January 2015, 13 in January 2014. The premium market share stood at 7.9% in January, down from the 10.9% high recorded in March. In Aberdeenshire premium sales registered in January at 42 were down on the same month a year ago when 61 such sales took place. This cooling contrasted with a strong finish at the end of 2015 which saw 122 and 120 premium sales respectively in November and December. The data average property price in Aberdeenshire in January was £203,329, down from £229,476 at the start of 2015. According to David Strang-Steel, partner in Strutt & Parker's Banchory… Continue reading
Poll shows widespread support for UK build to rent sector in Parliament
There is cross party support among British Member of Parliament for the emerging build to rent sector and predictions for growth, according to a new poll. Some 81% of MPs say they support the build to rent sector and the contribution it makes to the UK housing supply while 62% think it will make a higher contribution to housing supply over the next five years compared to current levels. The survey commissioned from ComRes by the British Property Federation (BPF) also found that build to rent has cross-party support, with 71% of Labour MPs in support and 91% of Conservatives. Few MPs think buy to let property will make a higher contribution to housing supply over the next five years, with 27% expecting its contribution to be higher, compared to 41% who expect it to be lower. MPs were somewhat split on social housing and affordable rent, with 26% of MPs expecting to see a lower contribution of social housing and affordable renting, compared to 39% who expect to see a higher contribution over the next five years. The results showed that new MPs are more likely to see this sector as a growth area than long serving MPs at 46% compared to 37%. The BPF estimates that there is at least £30 billion investment ready to enter the build to rent sector, and that it has the potential to deliver significant amounts of additional housing across the UK. The most recent figures from the BPF’s Build to Rent Map show that there are over 37,500 build to rent units with planning permission, under construction or complete across the UK. Most development is concentrated in the capital, where there is more than 20,000 units. ‘The widespread recognition amongst MPs of the build to rent sector is a positive sign it is starting to enter the nation’s housing vocabulary,’ said Ian Fletcher, BPF director of policy for real estate. ]It is also heartening that whilst all political parties are pushing a home ownership agenda, there is recognition amongst MPs that housing supply will come in other welcome forms and our nation requires that if we to get anywhere close to meeting demand,’ he pointed out. ‘This is not a zero-sum game, where tenures are competing, but a quest to deliver far more homes, where it is imperative that other forms of tenures are also encouraged,’ he concluded. Continue reading
Many buy to let property investors not put off by UK tax changes
Most property investors in the UK are undeterred from buy to let despite 2016 tax changes and 56% are planning on purchasing within the next 12 months, new research shows. With changes in tax approaching some 40% plan to set up a limited company for their properties to counter the impact of tax changes, whilst 33% plan to raise rents, according to the latest client barometer survey from specialist lender Shawbrook. However, while the outlook for investors remains positive, new changes to tax relief and stamp duty have caused some investors to check their ambitions. Of the 44% who are not planning on purchasing a new buy to let property this year 37% said it was due to the 20% cap on tax relief for buy to let properties making the proposition unattractive and 16% said the 3% extra stamp duty levy on additional homes was putting them off. The latest figures also revealed that 49% of clients said they considered regulation to be the biggest challenge facing property investors over the next six months, a significant increase on last year’s barometer results, which found that regulation was something only 23% of investors considered to be the biggest challenge they faced. Despite these challenges 61% have a positive outlook for the upcoming 12 months, predicting either a large or small increase in property value. In total 43% of landlords saw an increase in tenant demand in 2015 and 61% saw an increase in their rental income. A further 44% are confident that their business will grow in 2016. ‘As a lender it is always great to see such positivity in the market, and as with our Broker Barometer conducted in late 2015, it seems that there is a lot of optimism amongst property professionals also,’ said Karen Bennett, the firm’s sales and marketing director of commercial mortgages. ‘Obviously the new changes will have an effect and may instil more caution across the market, however, Shawbrook is well placed to adapt to change, and we are expecting the market to remain buoyant,’ she added. Continue reading
