Property Solutions

Variety of properties on sale in England and Wales reaches new low

Posted on January 30, 2014 at 1:41 pm

Image The complete variety of properties on the market in England and Wales has hit a brand new post economic crisis low with new data showing supply is down 55% in comparison to November 2007.

Meanwhile, asking prices in England and Wales have risen an additional 0.4% since last month, taking the yearly rise to five.7%, the newest figures from Home.co.uk, taking the common price to £247,137, an all time high.

The report says that home price inflation is principally driven by prices in London and surrounding regions. Prices inside the capital rose 1.8% last month alone and now stand 13.5% higher than three hundred and sixty five days ago.

Weaker regional housing markets corresponding to the North East, the West Midlands, Yorkshire and Scotland all recorded price deflation since last month, down a standard of 0.4%. Other areas of the united kingdom recorded stagnant prices or marginal gains at best.

But it’s the imbalance of supply and insist that may cause concern. Surging demand, chiefly in London and its surrounding regions, has pushed the combination adjusted average price for England and Wales to a brand new all time high although the weaker housing markets all witnessed a seasonal dip in prices.

Price growth in London’s housing market continues to soar at an alarming rate, the firm suggests, adding that that is only one of the hallmarks of an asset price bubble.

Things could decelerate inside the run as much as the festive season. The average time on market normally begins to rise at the moment of year. The median figure for England and Wales now stands at 120 days, four days lower than in November 2012. However, the common time on marketplace for Greater London actually fell someday to 74 days.

The total stock of the sales market has fallen by 7.9% since last month to face at 518,556, some 55 % less than in November 2007. Whilst a small drop in on-market stock might be expected as vendors await the brand new year, the magnitude of the autumn implies that we’re currently witnessing the bottom level of choice for potential buyers for the reason that housing crisis of 2007/2008.

With demand outstripping supply, sensibly priced properties are being snapped up by desperate buyers but they don’t seem to be being replaced with sufficient new stock. The availability of clean property stock fell around the UK last month however the demand supply imbalance remains most prevalent in London, the East and the South East of britain where supply, in comparison to October 2012, is down 30.5%, 20.7% and 19.5% respectively.

The corollary of accelerating demand within the face of dwindling supply is a cost spiral. The combo-adjusted average for England and Wales, at £247,137, has now eclipsed the former record set in 2007 and the annualised rate of increase, currently 5.7%, is accelerating.

The report points out that during the last five years, the cost of homes has fallen by a standard 0.4% between October and November. However, this month it’s the opposite with an increase of 0.4%.
 
In most regions, the market is already showing signs of the seasonal slowdown although the real picture is concealed by the astronomical performance of the London market. If we take London and the South East out of the equation then this month’s 0.4% rise across England and Wales will be effectively muted.

However, more of the regions are showing annual price growth because the recovery spreads further afield. Only Scotland and the North East are currently recording a year on year fall in prices at 1.4% and nil.8% respectively. Of the expansion areas, only the North West and Yorkshire have experienced price rises under 1% whilst four of the English regions are recording annual price growth of four% or greater.

In London the common price of a home within the region now stands at £407,354. Prices inside the capital have risen over 8.3% within the last six months alone and are actually 18.9% higher than five years ago. Dwindling supply of latest stock is a key price driver. The flow of latest sales stock into London’s market last month was down 30.5% compared with the identical period last year, inevitably placing further upward pressure on prices.

‘Potential buyers, especially those in London and the South East, are set for more frustration for the remainder of 2013 and into 2014. Their collection of properties to think about is the bottom it’s been since 2007 and there are not any signs of possible improvement,’ said Doug Shephard, director at Home.co.uk.

‘The flip side for vendors is, for sure, more positive. The low volumes of property that do make it to the market are in higher demand, and the common time on market is four days shorter than this time last year,’ he explained.

He said that the location is compounded because the seasonal slowdown takes hold and, commonly, a cooling of costs. ‘These fluctuations are somewhat hidden by the indisputable fact that the London market appears playing by a distinct algorithm,’ he added.

 Given the capital’s recent price performance we expected another rise in prices, albeit a more subdued one. However, a leap of one.8% in a month is exceptional and elevates our concerns that London property is becoming a potentially catastrophic asset price bubble inflated by both government backed lending and foreign investment,’ he concluded.

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Outlook for brand new home building in Australia positive for 2014

Posted on January 26, 2014 at 4:37 pm

Image New house building in Australia is predicted to continue growing in 2014 however it would be concentrated in large states like New South Wales, Queensland and Western Australia, in accordance with the Housing Industry Association.

In its latest outlook report says recent months have seen higher levels of recent homes being built and a gradual recovery in renovation investments from a ten year low.

‘The improving level of dwelling commencements achieved in 2012/2013 would be consolidated this year before moving up yet another leg in 2014/2015,’ said HIA senior economist, Shane Garrett.

‘Meanwhile, renovations investment is predicted to grow in a majority of states and territories after falling to a 10 year low during 2012/2013,’ explained Shane Garrett, adding that renovations growth would be even more broad based, with increases occurring across most states.

Looking further ahead, the HIA predicts that dwelling commencements will lift above the 170,000 per year mark by 2016/2017 and renovations activity could also be prone to increase steadily, reaching $30.3 billion by 2017/2018.

‘Record low rates of interest and robust population growth is driving increased demand for housing. On this context, it’s absolutely crucial that planning reforms and infrastructure delivery facilitate the requisite supply of latest housing,’ said Garrett.

‘There currently exist many bottlenecks around land supply, infrastructure and the time taken to accomplish planning popularity of new dwellings. It’s vital that both federal and state governments address these obstacles and work with the housing industry in delivering a sufficient supply of affordable housing,’ he added.

Meanwhile, the newest data from the Australian Bureau of Statistics shows that new home lending during September increased marginally. Through the month the selection of loans advanced for the acquisition and construction of recent homes edged up by 0.4% to eight,366 on a seasonally adjusted basis. This represents the seventh consecutive month where lending was stuck at round the 8,300 level.

‘Despite encouraging signs of increased activity within the housing market, these figures continue to illustrate how restrictive lending is likely one of the factors holding back activity,’ said Garrett.

‘However, activity is considerably stronger than this time last year. The once a year increase in lending for home construction was up 6.3% in the course of the September 2013 quarter. Lending activity for brand spanking new home purchases was 27.5% higher than a year earlier. Other housing market indicators like prices, approvals and sales confirm that the industry is moving into a robust recovery,’ he talked about.

During the September quarter, the collection of loans to owner occupiers for the development and buy of recent homes rose by 0.5%, including a zero.8% increase within the collection of loans for the development of a brand new dwelling and a zero.1% rise in loans for the acquisition of recent homes. Excluding refinancing, the variety of loans to owner occupiers for home purchase rose by 1.5% within the September 2013 quarter.

Loans for brand new homes increased strongest in Tasmania, up 29.6% and South Australia which was up 10%. In Queensland there has been a rise of three.8%, Victoria was up 1.3% and New South Wales up 0.7. The selection of loans declined by 8.1% in Western Australia.

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UK govt frees up more sites for self build properties

Posted on January 24, 2014 at 6:17 pm

Image The united kingdom government has released four new sites for self as portion of its way to get more people building their very own homes and support the expansion of the custom build housing sector.

The sites are Urban Pioneers in Middlehaven, Oxley Park in Milton Keynes, Pound Lane South in Basildon, and Lightmoor Village in Telford. They’re along with eight sites that are already being brought forward by the houses and Communities Agency.

Housing minister Kris Hopkins said that these new sites will form around 70 plots for brand new homes. It will add to the 130 plots that are being made available under a central authority commitment to liberate land for those trying to build their very own homes.

The custom build sector currently builds about one in 10 new homes inside the UK, much fewer than many other European countries and there’s substantial growth potential available in the market with more people eager to build their very own home than ever before.

Hopkins said that the growth of this sector presents an important business opportunity for smaller house builders and gives jobs and work for local architects, builders and native suppliers.

Speaking to the Federation of Master Builders at a summit jointly organised with the National Self Build Association (NaSBA), he urged smaller developers to grab the business opportunity presented by this untapped market, and offer custom build opportunities to the thousands of self builders waiting to get their projects off the floor.

‘We are determined to assist aspiring self builders up and down the rustic who wish to build the house in their dreams but can’t discover a plot to start. That’s why we’ve committed to steer the style by making our formerly used public sector land available for self builders, and why today we’re making four further sites available, taking the full to twelve,’ Hopkins explained.

‘We are seeing a brand new type of house building model emerging on this country and i’m pleased to work out how positively the construction industry and lots of councils are responding. With the self-build industry contributing some £4 billion annually to the united kingdom economy, i need to encourage more builders to cash in on this business opportunity and offer custom build options on their sites,’ he added.

Brian Berry, chief executive of the Federation of Master Builders (FMB), said that there needs to be renewed confidence that there are genuine opportunities to construct more new houses. ‘FMB members are well placed to deliver the standard products this new generation of custom build clients demands, that’s innovative, affordable and financially viable properties with a view to ensure diversity available in the market and go a way to tackling Britain’s alarming housing deficit,’ he told the meeting.

‘This is why the FMB is taking the lead in working with NaSBA to advertise the expansion of the custom build sector, including working to develop a web based platform which may better link up FMB members experienced in delivering self build and custom build projects with clients who desire a home built,’ he added.

Ted Stevens, chair of the NaSBA, said that a up to date NaSBA progress report back to the govt. suggested that as much as 4,000 additional self or custom build opportunities are currently within the pipeline, due to a number of initiatives now being undertaken by the houses and Communities Agency, and around 50 local councils.

‘This growth will provide opportunities to a number of small builders. Nearly all of self builders already rely upon a neighborhood building contractor to construct their new homes. There’s also a possibility for some house builders to set themselves up as custom build developers, taking existing tracts of land and carving these up into individual serviced building plots,’ he added.

According to Claire O’Shaughnessy, head of Land and Regeneration on the Homes and Communities Agency (HCA), told the meeting that unlocking a supply of land is usually a major barrier to getting schemes off the floor. ‘So the sites we’ve identified will play a small yet significant part in helping aspiring self builders just do that,’ she added.

Hopkins also said that the govt. is calling to run a pilot project on a different public land site that allows you to test the workability and benefits of disposing serviced building plots on a bigger scale. Details of the pilot should be made available shortly.

Custom build or self build homes are homes built or commissioned by individuals or groups of people for his or her own use, either by building the house on their lonesome or working with builders. Custom home building typically involves individuals commissioning the development of a brand new house from a builder, contractor or package company or, in a modest variety of cases, physically building a home for themselves.

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Posted in Property Solutions

Economists and real estate experts confident about way forward for US property price growth

Posted on January 22, 2014 at 1:39 pm

Image A survey of economists, real estate experts and investment strategists within the Usa has found that many expect property prices to have grown by a median of 6.7% year on year by the top of 2013.

The Zillow Home Price Expectations Survey, which consulted 108 leading forecasters, also reveals that they then expect price growth to slow over the following five years. Many said they want to peer the government maintain a substantial role inside the mortgage market.

While appreciation is predicted to stay strong during the rest of this year, the pace of home value growth is expected to slow considerably through to 2018. Panelists said they expect appreciation rates to slow to roughly 4.3% next year, on average, eventually falling to three.4% by 2018.

Based on current expectations for home value appreciation over the following five years, panellists predicted that overall US home values could exceed their May 2007 peak by the primary quarter of 2018, and should cross the $200,000 threshold by the tip of 2018.

‘The housing market has seen a period of unsustainable, breakneck appreciation, and a few cooling off is both welcome and expected. Rising mortgage rates, diminished investor demand and slowly rising inventory will all contribute to the slowdown of appreciation,’ said Zillow chief Economist Stan Humphries.

The most optimistic quartile of panellists predicted an 8.3% annual increase in home values this year, on average, while probably the most pessimistic predicted a mean increase of five.6%. Expectations the various optimists fell from 9.3% within the last survey, but rose from 5.1% many of the pessimists.
 
The most optimistic panellists predicted home values would rise roughly 12.5% above their 2007 peaks by the tip of 2018, on average, while the foremost pessimistic said they expected home values to stay about 6.2% below 2007 peaks.

A variety of private and non-private plans for overhauling the nation’s mortgage finance system and reforming government sponsored entities Fannie Mae and Freddie Mac were proposed, all of which seek to attenuate and redefine the government’s role inside the mortgage market to some extent.

Panelists were asked how involved they suspect the government ought to be in any re-imagined mortgage system. Among those panellists expressing an opinion, the general public, some 58.4%, said the federal government’s involvement within the conforming mortgage market have to be somewhat significant, significant or very significant. Only 8% of respondents said the government must have a non-existent role inside the conforming market.

Panelists were also asked to define the perfect level of presidency backing for mortgage loans going forward. Among those panellists expressing an opinion about what maximum percentage of all new mortgages must be backed by the government, the median response was 35%, roughly the extent seen in 2006 on the height of the housing bubble.

‘Policy discussions centred on reforming the nation’s housing finance system have only just begun, and it’ll be very interesting to work out what comes out of those debates and the way the market will react to new proposals,’ said Humphries.

‘How much mortgages will become costing average consumers, and the ongoing availability of traditional mortgage products just like the 30 year fixed rate mortgage, are some of the critical issues currently at stake for consumers in these debates,’ he explained.

Currently, the government backs roughly 90% of all new mortgage originations within the US in some form. In 2000, previous to the valuables bubble, the federal government backed about 50% of latest mortgages.

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Fewer properties on the market inside the UK at a reduced price, research shows

Posted on January 20, 2014 at 11:02 am

Image The share of properties on the market around the UK which have seen their asking price reduced has fallen significantly as confidence builds within the property market, consistent with a brand new report.

Research released by property website Zoopla reveals that only 31% of properties for sale today have had their asking prices cut since first being listed, down significantly from 40% in November 2011.

Preston tops the list of places with the foremost discounted properties in the marketplace while London has the bottom proportion of price reduced properties and the largest average discounts are in Liverpool and the smallest in Plymouth and Edinburgh.

Overall the extent of the reduction in asking prices has also fallen over the past two years. Sellers who were discounting their properties to take a look at to succeed in a sale in November 2011 were doing so at a normal of seven.4% of the unique price. The typical reduction today stands at 6.4% of the unique price.

Preston has the top proportion of discounted properties currently with 43% of houses on the market having been reduced in price since coming onto the market. Yorkshire towns dominate the rest of the pinnacle five places with the most important proportion of reduced price properties that can be purchased with Rotherham at 42%, Wakefield & Barnsley at 41% and Doncaster at 40%.

London tops the list of places with the bottom proportion of price reduced properties available to buy at 20%, due to high demand and occasional stock within the capital. Bedford at 25% has the second one lowest proportion of discounted properties on the market with Milton Keynes home to the third lowest proportion at 28%.

The biggest average discounts on offer the unique asking prices are to be present in Liverpool, with a typical current asking price reduction of 8.6% or £14,149. The smallest discounts are being offered in Plymouth and Edinburgh, where sellers who’ve dropped prices have done so by only 5.5% on average.

‘Confidence within the property market is at its highest level because the start of the industrial downturn and it’s reinforced with fewer sellers feeling the pressure to lower their expectations and drop prices,’ said Lawrence Hall of Zoopla.

‘With the standard New Year rush of buyer demand prone to be made much more acute by the boost of the second one phase of the government’s Help to shop for scheme, sellers expectations could rise further inside the coming months. The one thing that might upset the fad is that if there’s a significant rise in level of stock coming to the market,’ he added.

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