Housing Market
News covering issues affecting the UK residential property market, house prices, interest rates and buying and selling trends.
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Residential transactions fall 4.4% – HMRC
The number of residential property transactions fell in July, the latest figures from HM Revenue and Customs (HMRC) has revealed, with 100,720 transactions recorded last month, up 0.2 per cent compared to the corresponding month in 2014. But HMRC’s seasonally adjusted estimate shows that the number of home transactions actually fell by 4.4 per cent between June and July. There were also 10.100 non-residential transactions, down from 10,460 from the previous month. The volume of non-adjusted residential transactions was 2.4 per cent higher than in June and 8 per cent higher than in July last year. The number of seasonally adjusted transactions has steady increased over the past seven years, according to the HMRC report, with the volume of seasonally adjusted transactions remaining broadly stable at around 100,000 per month. The latest figures reflect a “shift-change of late”, with property sales over the past couple of months “stepping up to the mark of last summer”, Peter Rollings (left), CEO of Marsh & Parsons noted. He said, “In July, sales may have slipped back slightly month-on-month, but we need to remember that the market was working overtime in June to regain lost ground lost before the election.” Doug Crawford (right), Chief…
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Average rents in England and Wales reach record high
Average residential rents in England and Wales rose above £800 for the first time in July following the fastest monthly increase since records began six years ago. The figures from the latest buy-to-let index from Your Move and Reeds Rains reveal that rents increased by an average of 1.9 per cent across England and Wales to £804 per calendar month in July, up from £789 the previous month and a rise of 6.8 per cent year-on-year. Rental price increases in July were led by London, where rents rose by an average of 12.1 per cent year-on-year, followed by the East of England, up 12 per cent to stand at £838pcm. A breakdown of the figures reveal that all 10 regions saw rents increase on an annual basis last month, with London, Yorkshire and the Humber (£582 on average), and the East (£584) and West Midlands (£583) all seeing record rent peaks. Two regions saw rents decline on a monthly basis, with a 0.1 per cent month-on -month fall in Wales and the East of England. Higher rents are unsurprisingly being fuelled primarily by the widening supply-demand imbalance in the rental market, according to Adrian Gill (left), Director of Reeds Rains…
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Housing completions soar in England
House building in England is now at its highest level since 2008 following a significant rise in the volume of new homes being developed, new Government figures show. In the year to June, 131,060 residential properties were completed, a rise of 15 per cent on the same period a year ago. The latest quarterly house building statistics from the Department for Communities and Local Government (DCLG) show that between April and June, the number of completions rose by 22 per cent year-on-year. The Housing Minister, Brandon Lewis (right), welcomed the figures, but admitted there was more to do, vowing that the Government would “deliver 275,000 affordable homes by the end of this Parliament”. However, the number of new homes being started dropped by 1 per cent over the year, to 136,320, and by 6 per cent on a quarterly basis. The data was described as “encouraging” by Henry Gregg (left), the National Housing Federation’s(NHF) Assistant Director of Campaigns. But he also said that it was crucial that we as a nation continue to increase our efforts “to build the homes that are desperately needed”. He commented, “Last year alone we built less than half of the homes needed, pushing house…
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Mortgage approvals surge
There was a significant rise in the volume of mortgage deals secured in the first half of August, with early indications suggesting that this could be a record month for mortgage approvals. With property buyers and existing homeowners not wanting to miss out on record low mortgage borrowing rates, conveyancing firm QCAS has suggested that we could see record transactions this month following a sharp increase in the number of mortgage deals for August so far – already the highest since 2010. Victoria Mortimer, Head of QCAS, the conveyancing division of corporate law firm Shulmans LLP, said, “Normally transactions are low in August due to holidays, but we’ve got more work on than ever compared with the same time in previous years. As a national, large scale conveyancer we are well placed to spot emerging trends and there’s no doubt about this one. People are getting their finances sorted before the end of the year.” Mortimer described activity levels over the past 12 months as “incredible”, with her firm having handled more than £3 billion worth of property transactions during that time. “We believe this is due to a combination of factors; there are some great deals out there at…
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The growing supply-demand imbalance is pushing up residential property prices
Residential property prices look set to increase further this year, as demand from buyers continues to heavily outstrip the supply of homes coming on to the market, the latest residential market survey from the Royal Institution of Chartered Surveyors (RICS) has revealed. The report shows that while 44 per cent more chartered surveyors saw prices rise in July, the supply of homes coming onto the market continued the drop with 22 per cent more surveyors reporting a decline in fresh instructions. Furthermore, the shortage of housing inventory worsened further during July, with the average volume of homes for sale per surveyor falling to an all-time low. As a result, all areas of the UK are now expected to witness property price growth over the next 12 months, with the greatest level of confidence currently being seen in East Anglia and Northern Ireland. RICS expect home prices to be pushed higher on the back of the growing supply-demand imbalance, with 41 per cent of members expecting prices to continue to appreciate over the next three months. Increasing prices does not appear to have deterred buyer interest, with new purchaser enquiries growing for the fourth consecutive month, with 25 per cent of…
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Repossessions fall to historic low
Repossessions in the UK dropped to the lowest level since records began in 2008 during the second quarter of 2015, the latest data shows. The figures from the Council of Mortgage Lenders (CML) reveals that the repossession rate in the last quarter was just 0.02 per cent, which is equivalent to just one in 5,000 mortgages and the data from the CML revealed that arrears also continued to drop. Record low interest rates were a major factor in helping homeowners stay on top of their mortgage payments in the second quarter of the year, along with falling unemployment and a strengthening domestic economy. In total, there were 2,500 properties taken into possession in the second quarter, down from 3,000 the previous quarter and 5,400 in the second quarter of 2014. Of these, 1,800 were in the owner-occupier market and 700 in the buy-to-let market. In terms of arrears, the total number of mortgages with arrears equivalent to 2.5 per cent or more of the mortgage balance was 106,400, or 0.96 per cent of all mortgages, which again, was the lowest rate since quarterly records began seven years ago. Of all loans with arrears of over 2.5 per cent of balance,…
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Stimulating institutional investment is key to success of PRS
London property consultancy Daniel Watney LLP is calling on the Government to encourage further institutional investment as a means of improving the private rented sector, rather than relying on extra regulations for landlords and agents. It is well documented that significantly more new build homes are needed to help solve the UK’s housing shortage, and Daniel Watney believe that new funding from institutional investment can play an important role in contributing to the rise in housing supply, as well as addressing pricing issues in the housing sector. The comments come ahead of the Department for Communities and Local Government launching a new consultation on how to best tackle to rogue landlords and drive up standards in the private rental market. Julian Goddard, head of residential at Daniel Watney, said, “As the consultation paper itself acknowledges, rogue landlords are very much the minority, with the overwhelming majority of tenants satisfied with the accommodation and service they receive from their landlord. “The best way to improve the private rental market is not to burden landlords with excessive regulation, as the proposed immigration checks will do, and to encourage further institutional investment, which will allow for more purpose-built rental accommodation to be built,…
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Number of home movers fall in H1 2015
The volume of home movers in the UK in the first six months of 2015 fell by 9 per cent compared to the corresponding period in 2014, new data has revealed. The latest Lloyds Bank home movers review estimates that 155,000 people moved home in the first half of this year, which although down year-on-year, does actually represent a 32 per cent rise compared to the first six months of 2009 when the market was at its lowest point. The sharp rise in home moving activity witnessed since the trough of the market in March has contributed towards the hike in property values seen across many parts of the country during the same period, and while the number of home movers did fall, many experts believe that this is largely owed to general uncertainty in the run-up to May’s General Election. “There was a modest decline in the number of home movers in the first half of the year compared with 2014, which was in line with the general softening in housing market activity,” said Andrew Mason, Lloyds Bank Mortgages Director. He added, “Whilst the number of home movers has risen significantly since 2009, it remains well below previous…
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Homeowners urged to factor in interest rate rise
People thinking of buying a home or remortgaging their existing property should budget for a potential interest rate increase in the coming months after the Bank of England signified that it expects to see interest rates rise sooner rather than later. UK interest rates have remained at a record low of 0.5 per cent since March 2009, and although any hike to the rate would be dictated by economic data, including wage growth and productivity, over the next few months, the Governor of the Bank of England, Mark Carney (left), did last week admit that the time for an increase is ‘drawing closer’. It is not clear when the rate rise may occur, but Nicholas Leeming (right), Chairman of agents Jackson-Stops & Staff, is urging homeowners not to take any chances. He said, “Mark Carney has been careful to flag that interest rates will edge higher in the longer term as the economy continues to grow and inflationary pressure on wages increase. “Property buyers should recognise that rates will move towards more sustainable, long term levels and so budget for higher mortgage costs accordingly. Vendors should be aware that any such increases will create resistance to overly high guide prices.”…
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MPs to tackle the housing crisis
The All-Party Parliamentary Group (APPG), which is being chaired by Conservative MP James Cartlidge, has four vice-chairs: Helen Hayes, Lord Best, Stephen Pound and former Housing Minister, Mark Prisk. The group intends to produce an initial set of recommendations to Government on how to boost house building in the UK later this year. Cartlidge said, “Housing is increasingly becoming one of the most critical policy challenges facing local and national Government, and with a Housing Bill pending, it is likely to become more political and controversial. “In this context, a cross-party Parliamentary group focused objectively on the national policy challenge of housing offers a vehicle for taking the debate forward in a way that is both positive and constructive. Having spent my working life in the shared ownership housing sector, I am acutely aware of the challenges facing first time buyers, particularly in London. Equally, as a rural MP, I recognise the need for development to be sustainable. Ultimately, there are a whole raft of complex issues in housing and planning today but I hope that our APPG can make a real contribution to the debate.” Issues relating to housing were one of the hottest topics of the recent General…
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