Property News

Thursday, March 29, 2007

Nationwide: house prices will cool

According to the Nationwide Building Society, the UK housing market is set to cool further even if interest rates have peaked.

The prediction came as the mortgage lender's monthly survey showed a 0.4% increase in prices this month, bringing the annual rate of growth down below 10%.

The Bank of England has left interest rates at 5.25% since delivering a shock increase in January. While Governor Mervyn King is still expected to push rates up once more, the financial markets' certainty of another move diminshed after it was revealed that one of the central bank's policy makers voted to cut rates this month.

Fionnuala Earley, chief economist at the Nationwide, said: "The underlying trend is clearly softening as interest rate rises take effect." Pointing to declines in mortgage approvals and buyer enquiries, Ms Earley added that "leading indicators of house price inflation also suggest that the underlying trend will continue to slow this year."

Friday, March 23, 2007

Glasgow forecasts 10% rise in property prices

Leading property consultants Knight Frank predicts that house prices in Glasgow and west Scotland will continue to rise this year by about 10%.

They say a 9-10% rise is on the cards and last month's Bank of England decision not to increase the base interest rate above 5.25% will help the ever-expanding market. The average house price in Glasgow is just under £140,000, but some homes in the city's most desirable districts can sell for more than £500,000.

John Coleman, Knight Frank's head of residential sales in Scotland, said: "We anticipate the market will remain strong through the rest of the first half of 2007, with buying activity at or above the 10-year average." Although he went on to say: "It is increasingly difficult for first-time buyers to access the market and price growth higher than one or two percentage points above wage inflation is unlikely."

Thursday, March 22, 2007

Highland council looks to Finland to solve housing shortage

A touch of Finland is to help to tackle a remote Scottish community's affordable homes shortage.
In a new idea by The Highland Council to try and combat some of the areas housing problems they are to set a competition for 'Finnish' style home designs.

Allan Maguire, from Highland Council, said the council had set up a design and house build competition of the type used in Finland. The homes are built and then the Highland Housing Alliance and Highland Housing Fair will showcase them. The homes are on public display during a month-long exhibition before people start moving into them.

The Highland Council deliver 90% of all affordable housing in the region, which contains 200,000 residents in an area the size of Belgium. The largest settlement is Inverness city with 60,000 people, while average house prices in the Highlands are £135,000 compared to the average rural income of £16,000. And in some rural areas, 50% of the properties are holiday homes, while the communities have high rates of homelessness.

It is hoped that the competition will help locals with lower incomes get on the property ladder.

Tuesday, March 20, 2007

Robust house price growth

According to the latest survey from property website Rightmove, prices for homes in England and Wales rose an annual 12.2% in March, a sign the housing market has remained robust in the face of rising interest rates.

Rightmove said March's rate compared with a 11.5% increase in February and took the average asking price for a home to £228,183. Prices rose 1.5% on the month, Rightmove reported in its survey conducted between February 11th and March 10th. The figures are not adjusted for seasonal factors.

They went on to say that they believed a shortage of supply was driving prices higher in spite of higher borrowing costs. "As we have seen recently, raising interest rates can be used to influence the direction of prices in the short term but do very little to address the underlying cause of house price inflation. Crucially they cannot address the increasing demand for housing driven by the needs of a growing population." said Rightmove Commercial Director Miles Shipside.

Asking prices in the upmarket London areas of Kensington and Chelsea were more than 80% higher on the year, rising to more than 1.2 million pounds on average.

Friday, March 16, 2007

Affluent London booming

According to Knight Frank's latest house price index for prime central London, annual house price growth reached 31% in February.

Inflation was strong over the previous six months with a 16.3% increase in prices. February saw a monthly price rise of 2.6%.

Conditions in London's most affluent neighbourhoods remain tight thanks to ever-rising levels of demand and decreasing levels of new property coming onto the market. While city bonuses provided a major cash injection into the market, Knight Frank believes growing overseas interest has had a significant role to play in levels of demand. In particular, they attribute the massive house price growth in the exclusive SW postcodes of Belgravia, South Kensington and Chelsea to increasing demand from international buyers.

Wednesday, March 14, 2007

House prices still soaring in Scottish Capital

New figures from the Edinburgh Solicitors Property Centre (ESPC) show house prices are continuing to soar in the Scottish Capital despite recent rises in interest rates.

Sales in the first two months of the year show the average property price in Edinburgh has risen by almost 14% - to £194,979 - compared to the same period last year.

The high number of relatively affordable flats has helped turn Leith into the city's property hot-spot, with price rises of 25%. The top end of the market is also up with sales of homes costing more than £500,000, particularly in areas such as Murrayfield and Newington, up by just over 40%.

It is thought that a shortage in the number of properties being put up for sale is continuing to push prices up.

Tuesday, March 13, 2007

RICS: house price inflation eases

The Royal Institution of Chartered Surveyors have today said that house price growth eased in February to its weakest pace in nine months.

It is believed that the impact of three interest rate increases since August has continued to wear down demand. House price balance fell to 24.0 in the three months to February from 28.0 in the three months to January. February's reading is the slowest rate of house price inflation since May 2006 and below analysts' forecasts for a balance of 27.0, although it remains just above the long-run average of 21.6.

Many economists expect the Bank of England to raise borrowing costs to 5.5% from 5.25% in the coming months as policymakers attempt to bring down above-target inflation. The RICS price figures contradict surveys from the Halifax and Nationwide building societies which showed strong price growth last month in spite of rising interest rates.

Monday, March 12, 2007

Jan house price rise fastest in 2 years

Latest data from The Department for Communities and Local Government shows that house prices in Britain rose at their fastest annual rate in nearly two years in January, boosted again by London's booming property market.

House prices rose 10.9% year-on-year in January, the biggest annual gain since March 2005 and up from a rise of 9.9% in December. House prices in London rose 13.2% on the year in January after a rise of 11.8% in December. The DCLG said the average house price stood at £205,286 in January compared with £201,090 in December.

Northern Ireland saw the strongest year-on-year price growth., annual house price inflation is currently running at 42.5%. In Scotland annual house price inflation rose from 15.2% to 15.9%, in Wales the rate increased from 9.1% to 10.2%. Meanwhile, in England, buoyed by strong growth in the capital, annual house price inflation rose from 8.9% in December to 9.9% in January.

Friday, March 09, 2007

Terraced houses see largest price rise

New research from Halifax has today shown that terraced homes have seen the largest increase in property prices over the past decade.

The average terraced house price has surged by 239% in the past ten years. Flats and maisonettes rank second, with a 235% increase, followed by semi-detached homes at 211%. That compares to overall house price growth of 205%. Detached homes and bungalows experienced below-average price increases of 196%.

Terraced properties command an average price of £186,316, up from just £54,945 ten years ago. In County Durham, for example a two-bed redbrick terrace could have been picked up for for around only £9,000 eight years ago, now, the same property today would be on the market at nearly £90,000.

Thursday, March 08, 2007

House prices up 1.8% in February

Today HBOS's Halifax house price survey showed that house prices rose 1.8% in February.

House prices rose at their fastest rate in four months in February, the biggest monthly rise since October. The 3-month annual rate of house price inflation held steady at 9.9% for the third month running.

Analysts said a shortage of properties was helping to buoy prices but noted there had been some signs higher rates may be starting to weigh. Many economists expect house price inflation to slow in the course of this year. "The overall impression that emerges is that while house prices may be peaking, they currently remain pretty buoyant," said Howard Archer, economist at Global Insight.

According to Halifax, the cost of an average home stood at 192,233 pounds in February.

Wednesday, March 07, 2007

Spiral of decline for seaside towns

According to The Commons Communities and Local Government Committee, many of the country's seaside towns are now locked in a downward spiral of decline.

MPs warned that many coastal communities were characterised by a combination of physical isolation, high levels of deprivation and poor housing. Often they suffered from a "skewed demographic profile", with young people leaving to find jobs elsewhere, while the arrival of older people buying homes for their retirement put health and social services under pressure.

"Government has neglected the needs of coastal towns for too long. A greater understanding and appreciation is needed of the challenges faced in coastal towns," the committee said in its report. Housing was often poor, frequently characterised by redundant hotels, for example in Blackpool, which had been converted into care homes, or flats attracting a transient population, which in turn made local regeneration more difficult.

Tuesday, March 06, 2007

£5k flat for sale

It would appear it is still possible to bag yourself a property for under £100k - that is if you don't mind living in a not-so-desirable area of Glasgow and in a building with structural problems.

Yet househunters are scrambling to get their hands on Scotland's cheapest home. The flat in Port Glasgow, Inverclyde, has gone on the market for just £5000. It is even cheaper than a garage in Giffnock, Renfrewshire, which is on the market at offers over £5900.

The top floor flat is set in a red sandstone tenement and boasts a hall, lounge, kitchen, bedroom and bathroom. Competition for the Bruce Street property has been fierce, with the sale going to a closing date tomorrow. Property experts warn the apartment would need some work to bring it up to scratch, but said it will prove to be a sound investment.

Property prices across Scotland have soared, with the average house north of the border now costing £126,639. A spokeswoman for Allen and Harris estate agents in Bridge of Weir, said: "I have never heard of a property as cheap as this. "There are a lot of structural problems and it is in a bad area. It might attract a developer or landlord, but not a first-time buyer."

Monday, March 05, 2007

1 in 5 now paying 3% stamp duty

Latest research from the Halifax shows that nearly a fifth of all homebuyers are forced to pay stamp duty at the higher rates.

Halifax said the number of home sales in England and Wales above £250,000 has risen almost fourfold in the past five years. It means the number of residential property sales attracting at least 3% tax has increased from 73,403 in 2001 to 279,408 in 2006. According to Halifax research, the number of homebuyers on the higher rate of stamp duty rose to 19% in 2006, up from 6% in 2001.

Total revenue from the tax on property sales was roughly £4.6 in the 2005/06 tax year, up 114% from 2000/01 figures. Stamp duty kicks in on house sales above £125,000 at which it is levied at 1%. This rises to 3% for properties over £250,000 and 4% for properties over £500,000.

In the 2005/06 tax year, the higher rates accounted for 74% of total residential stamp duty revenue. Research from the lender estimates that 3.5 million English and Welsh properties are now valued above the £250,000 threshold, with 600,000 liable for the highest 4% rate.

Thursday, March 01, 2007

Farmland has trebled in value

According to the Royal Institution of Chartered Surveyors (RICS) rural land market survey, average UK farmland has trebled in price, the highest its ever been in the history of the RICS.

The farmland market strengthened rapidly in the second half of the year, with prices rising by 18% compared to 6% in the first half of the year. Competition between City fuelled "life-style" buyers and farmers, keen to expand production and exploit higher commodity prices, has resulted in demand rising at its fastest rate so far.

In the North East England, prices grew by around 15% in the second half of 2006, compared to the same period in 2005. RICS spokesman David Coulson, a rural chartered surveyor working in the region, said: "North-East farmland and farms have been slow to come to the market and demand still far exceeds supply. So the few farms and parcels of land to be sold have seen a steep rise in price." He said most land on the North-East market is priced at levels of £3,000 per acre (£7,413 per hectare) with small lots frequently achieving prices of £8,000 to £10,000 per acre.