Housing Market
News covering issues affecting the UK residential property market, house prices, interest rates and buying and selling trends.
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Commons committee measures up property industry for Brexit risk
The effect Brexit is likely to have on the property industry has been revealed by a House of Commons committee. Its research, published today, shows that 3% of the UK’s 43,000-strong sales, lettings and property management related workforce are EU nationals and 1.5% are non-EU nationals – or nearly five percent of the workforce in total. Based on ONS figures, the committee therefore concludes that if many of these people were to leave the UK and return to their home countries, it would not pose a threat. “The work of UK-based estate agents is primarily domestic and is generally not highly dependent on EU labour,” the report by the House of Commons Committee on Exiting the European Union says. Brexit: EU renters More problematical is the high number of ‘other nationalities’ who rent properties in the UK, the Brexit report suggests. It quotes the most recent English Housing Survey, which points to nearly a quarter of all privately rented accommodation being inhabited by EU nationals or those from outside Europe. The ‘other nationalities’ highlighted in the report also own 3.4% of all owner-occupied properties, although this is much higher in central London’s prime districts, and 8.4% of local authority –…
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Chancellor’s promise to build 300,000 new homes a year is on shaky foundations
Figures just published by the Department of Communities and Local Government (DCLG) reveal that the number of new homes built in England between July and September dropped by 4%, and by 1% year-on-year. The number of new homes started totalled 40,070 during the quarter, and 166,100 year-on-year, although the figures for completions were marginally better, up 2% to 39,250 on a quarterly basis and by 5% on an annual one. But the figures, which include both local authority and private new builds, reveal that the most marked downturn took place in the private market where quarterly starts were down by 6% compared to the previous quarter, and completions down by 2%. The figures also reveal how much the UK is becoming a nation of house dwellers, despite many governments’ attempts to build more ‘high density’ housing. New homes Just after the Millennium flats made up 25% of all new builds and, despite rising to 50% during the mid-noughties, has slumped back to 25% again. Earlier this month Housing minister Alok Sharma (pictured, left) revealed a £25 million fund to help “ambitious local authorities and third sector organisations in areas of high housing plan for new homes and infrastructure”. “Locally-led developments…
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Vendor instructions continue to shrink, say very un-merry surveyors
The volume of vendor instructions dropped during November for the 22nd month in a row and half of all agents reported fewer instructions in November than October, the latest survey from the Royal Institution of Chartered Surveyors (RICS) reveals. Its monthly UK Residential Market Survey of members also reveals that house prices and buyer demand continued to weaken in London, the South East and East Anglia during November, although the trend has yet to spread. The property market is now clearly divided along geographic lines, too. Many agents in the South believe house prices are unlikely to rise soon and more than half in London have seen them drop. But surveyors everywhere else except the North East were more upbeat particularly in Wales, Northern Ireland and the North West. RICS also reveals that the decline of new buyer enquiries for properties is beginning to stabilise. Five percent of those canvassed said demand was lower than the previous month, down from 19% during October. Flat prices Surveyors don’t expect the market to pick up anytime soon either, the report says. Nationally prices will remain flat as gains in the north and Wales continue to be offset by losses in London and…
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Auctions are booming while rest of industry struggles, say leading property auctioneers
Property auctioneers are booming and taking market share off traditional high street property sales, it has been claimed by two leading auctioneers. Tony Limbrick, founder of Network Auctions, says his company has had a record year during 2017 while private treaty sales have dipped to an all-time low as the economic uncertainty created by Brexit and high house prices have kicked in. “We firmly believe our results confirm the confidence people continue to have in the sector,” he says. His comments reflect similar claims recently by James Emson (pictured, left) of auctioneer Clive Emson, who said auctions have been taking market share off high street agents this year. As the year comes to a close, Tony Limbrick says 2017 was his company’s most successful year to date generating sales revenues of £41m compared to £36m last year. Also, the number of property’s sold at its auctions has increased from 79% to 81% by the same measure. Toby, who started up Network Auctions in 2005 after a career as an estate agent with Bairstow Eves, says auctions are doing well despite the “collapse of buy-to-let and uncertainty since Brexit”. “Our record breaking results in such a difficult market are testament to…
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House sales have slumped this year – or have they?
The number of house sales in England has dropped by 12% compared to a year ago, according to latest figures from the government’s statisticians, the ONS. The figures are for August and are based in part on the latest set of sales results to be released by the Land Registry. The data also reveals that the number of homes sold dropped elsewhere too – by 15.8% in London and by 3.4% in Wales, both by the same measure. But the house sales report is entirely contradicted by figures from HMRC which reveal it believes that the number of homes sold in the UK increased by 9.2% during the year to October 2017, and by 1.7% over the past month. We spoke to the Land Registry, who were unable to explain the difference between the two house sales numbers and, we are told, neither is the ONS. So baffling is the difference between the HMRC data, which is based on Stamp Duty receipts, and the Land Registry data, that the Negotiator has been told analysts at Savills have spent a lot of time and energy on finding out why. “I would back the ONS figures every time because they are the…
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Agent stock down 6.75% compared to 2015, latest Rightmove index figures reveal
The average level of sales stock per estate agent branch has dropped by 6.75% compared to 2015, the latest Rightmove index reveals. This decrease in the number of homes available for sale is across the board; for every month so far this year the average figure is lower than the same month two years ago. During 2015, historical Rightmove data shows, agents had 61.8 properties on their books on average, which has now dropped by four properties to 57.6 properties. Rightmove says in its report that overall estate agents’ stock of property for sale remains “tight” particularly further north where demand is exceeding supply. Northern price rises This is also pushing up prices faster in the north than the south – Rightmove says the North East’s housing market is experiencing the fastest asking price growth at the moment, up 1.3% month-on-month and 4.7% year-on-year. Also, it’s the regions above London that are doing the best year-on-year as London, the SE and SW all experiencing weaker price growth than their northern counterparts. Rightmove is also pessimistic about next year, which it says will see asking price growth of 1% overall. “2018 will continue the 2017 trend by being a real mixed…
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Smaller landlords are disappearing – is this what the Government wanted all along?
Growth in the buy-to-let sector this year has dropped dramatically as more amateur, smaller portfolio landlords have stopped buying properties or decided to leave the market, a report has claimed. The Kent Reliance annual Buy To Let Britain survey, published in association with Legal & General, quizzed 865 landlords and shows that the recent mix of tax reform and tighter regulation has reduced growth in the number of privately rented houses to 2.2% this year, down from just over 8% in 2014. These recent reductions in tax allowances and extra Stamp Duty, coupled with a second round of stricter buy-to-let lending rules introduced by the Prudential Regulation Authority (PRA) this year, means the market now favours larger portfolio and institutional investors, the report claims. Limited companies And the landlords who have stuck with buy-to-let are now increasingly turning to limited company status to reduce their tax costs. Kent Reliance says 70% of all buy-to-let loans are now from companies rather than individuals. This, Kent Reliance Chief Executive Andy Golding (pictured, left) says, is having the effect many warned it would – to push up rents as tenant demand outstrips supply in some areas of the UK, in particular the East…
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Historic high: UK housing market now worth £6 trillion
The value of the nation’s homes passed the £6 trillion mark for the first time in its history, the Halifax has revealed. It says house price inflation of 5% over the past year has pushed up the total market value of homes in the UK by nearly £400m so far this year, raising the total to £6 trillion. It’s not all due to house price rises, agents may be happy to note. Since 2007 the number of private dwellings available to be sold has increased by 1.9 million, Halifax says. Although this sounds punchy, it only represents a rise of 190,000 homes being added to the stock every year – far less than the 300,000-yearly run rate that the government recently said it wanted to achieve. Housing market London has led the charge for both additional homes and house price rises, reflecting the huge demand for homes to buy in the capital. The number of homes added to the stock in the capital over the past decade totals 250,000, Halifax says, while London homes on average have increased by 71% to an average of £579,761. “The value of housing stock has grown by close to £2 trillion in the past…
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First time buyers counting on parents’ death to get on property ladder
Young first time buyers can seem like a desperate lot sometimes as they scrimp and save for a deposit, or beg deposits off their parents. But now a new kind of desperation has set in – those waiting for their parents to die. Research by online agency TheHouseShop.com to find out which options offer younger people the best chance of getting on the property ladder discovered that only 10% are taking the traditional route of saving up. Completed by YouGov, the research found that instead many first time buyers are instead hoping to take a rather morbid short cut. Just over a fifth hoped to become home owners when their parents passed away and left them the family home, while 17% were relying on using the money left to them by their parents. Property ladder Also, another fifth were expecting to borrow money off their parents before they die, meaning that nearly 60% of first time buyers are relying on their family or parents in one shape or another to get them on the property ladder. One surprising figure from the research is that the government’s Shared Ownership Scheme is obviously seen as a strategy of last resort – just…
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Property market slowdown worst at top of market, says Rightmove
The largest houses are taking the longest to find buyers as the property market slowdown continues, it has been revealed. Rightmove’s monthly house price index reveals that across the UK properties with five bedrooms and detached four-bedroom houses are taking 76 days to sell, while in London it’s 86 days. The average time to sell across the UK for all properties is 63 days, the portal says. Property market slowdown Rightmove believes the slowdown at the “top of the ladder” is helping soften the sales market overall. In London the number of sales agreed compared to same period a year ago is down by 9%, while southern counties have experienced a dip of 7.8%. The north has fared better, Rightmove says, with a dip of just 3%. But these are only year-on-year figures – better than expected sales across the UK earlier this year means sales so far this year are ahead of 2016. “Sales agreed numbers are holding up better in the north, whilst a common factor throughout the country is the lower and middle market sectors being the most active,” says Rightmove director Miles Shipside (pictured, left) “However, where property prices have far outstripped buyers’ wages, and consequently…
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