D_Property

The majority of households across the UK, led by London, believe that the value of their home rose over the last month and they are confident about the outlook for 2017, according to new research.

The perceived rate of house price growth rose month on month with respondents in 10 of 11 regions covered by the Knight Frank and IHS Markit house price sentiment index (HPSI) saying price have gone up.

The future HPSI rose in February to a new post-referendum high as households in all regions expect the value of their home to increase over the next 12 months. It was the seventh consecutive month that the index has been in positive territory.

Overall some 19.9% of the 1,500 households surveyed across the UK said that the value of their home had risen over the last month, while 4.9% said that prices had fallen. This resulted in a HPSI reading of 57.5, up from 55.8 in January.

Any figure over 50 indicates that prices are rising, and the higher the figure, the stronger the increase. Any figure below 50 indicates that prices are falling. However, while February’s reading was at its highest level since the UK voted to leave the European Union it remains comfortably below its peak of 63.2 reached in May 2014 mirroring the moderation in price growth which has been seen since then.

But there are fairly large regional variations. Households in London at 65.2 and the East of England at 62 reported the biggest rise over the course of the month. They were followed by those in the South East at 60.3 and the West Midlands at 57.6. Households in Wales reported a slight fall in prices over the course of the month to 47.9.

The future HPSI, which measures what households think will happen to the value of their property over the next year, rose in February to 67.5, up from 65.5 in January and from 62.3 in December. February’s reading was the highest achieved by the index since the referendum last June.

It is also the first indication of household sentiment since the publication of the Government’s flagship Housing White Paper and remains firmly below its peak of 75.1 achieved in May 2014.

Whilst the headline index rose month on month, there remain quite large regional variations in terms of household expectations, with those in the South East at 76.4 the most confident that prices will continue to rise followed by those in the East of England at 74.5. Households in Wales are expecting the smallest gains at 58.2.

Meanwhile, mortgage borrowers at 73.6 were the most confident that prices would rise, followed by those who own their home outright at 69.7.

‘The rise in household sentiment on house prices comes as a less cloudy picture of the UK economy starts to emerge. Earlier this month the Bank of England revised up its forecasts for GDP growth, and although the country still has to negotiate a withdrawal from the EU, the immediate economic conditions remain positive,’ said Gráinne Gilmore, head of UK residential research at Knight Frank.

‘Home buyers and home owners are also benefitting from near record low mortgage rates, although affordability is an increasingly pressing issue in some areas. It is noticeable that sentiment on the future direction of house prices has particularly picked up in the Midlands and East of England, with the index reading for February close to or stronger than the average reading in the three months before the EU vote,’ she pointed out.

‘This reflects the relative strength of price growth in these markets which are benefitting from the strong performances of urban areas and the relative price differential to properties in the South East and London,’ she added.

According to Tim Moore, senior economist at IHS Markit, the improved economic backdrop, resilient labour market and low mortgage rates are behind households gaining confidence about the outlook for their property values over the course of 2017.

‘The upward direction of travel for housing market sentiment in February has seen property price expectations recover to levels seen just ahead of the EU referendum, with this pattern apparent among households in all UK regions,’ he said.

‘Brexit related anxieties appear to have receded among buyers, but there remains a sizeable list of factors likely to keep a brake on price momentum during the year ahead. These include localised affordability constraints for first time buyers, generally subdued pay growth, and a renewed squeeze on household budgets from rising living costs,’ he added.

Source: www.propertywire.com

February 23, 2017
old-1596553_1920

Households in UK confident about housing market outlook, latest survey shows

The majority of households across the UK, led by London, believe that the value of their home rose over the last month and they are confident about the outlook for 2017, according to new research. The perceived rate of house price growth rose month on month with respondents in 10 of 11 regions covered by the Knight Frank and IHS Markit house price sentiment index (HPSI) saying price have gone up. The future HPSI rose in February to a new post-referendum high as households in all regions expect the value of their home to increase over the next 12 months. It was the seventh consecutive month that the index has been in positive territory. Overall some…
February 22, 2017
building-828961_1920

Property sales in UK up for fourth month in a row, latest official data shows

Residential property sales in the UK increased by almost 5% between the end of last year and January, according to the latest official figures to be published. Overall the number of property transactions increased by 4.9% between December 2016 and January 2017, according to the latest HMRC data. The seasonally adjusted figure for the month was 0.3% higher compared with the same month last year, the fourth month in a row of increasing sales, and up from the 0.2% rise recorded in November and December last year. The figures are an indication of buyer confidence, according to Stephen Wasserman, managing director of West One Loans. ‘The growth in property transactions is a promising start to the…
February 21, 2017
hammerton-college-1751689_1920

Residential property transactions up 4.9%

The latest HMRC data has revealed that between December 2016 and January 2017, residential property transactions increased by 4.9% – the fourth consecutive month of increases. The seasonally adjusted figure for the month is 0.3% higher compared with the same month last year. Jeremy Duncombe, Director at Legal & General Mortgage Club, commented: “These figures show that although the housing market continues to grow in value and the worth of UK housing stock is rising, transaction volumes are not following the growth curve. Seasonally adjusted, purchasing levels have remained relatively flat on an annual basis, however this shouldn’t be mistaken as being representative of a lack of demand but rather the cost of moving, particularly stamp…
February 21, 2017
cabin-1763512_1920

Lettings volumes in prime central London saw improvement at end of 2016

The final quarter of 2016 saw strong growth in lettings volumes in the prime central London market, with activity particularly strong at the highest and lowest price sectors, the latest research shows. The decline in annual rental value growth slowed marginally, down 5% in January and there was a 5% year on year increase in the number of super-prime deals in 2016, according to the prime central London rental index from Knight Frank. There was a 12% year on year increase in the supply of new lettings properties in the final quarter of 2016 but that was lower than the increase of 30% recorded over the first nine months of the year. A breakdown of the…
February 20, 2017
building-1841299_1920

Tax change could result in UK landlords putting up rents by 20% to 30%

Tenants in the UK private rented sector face potential rent increases of up to 30% as a result of tax changes, it is claimed in a new analysis report. Tax changes, including the 3% extra stamp duty on additional properties, that have affected landlords are having a negative effect on the supply of rental properties and are not the neutral, non-discriminatory system that had been suggested. Indeed, David Miles, professor of financial economics at Imperial College London, says that the planned changes to tax for buy to let landlords due to be introduced in April should be abandoned. ‘Stamp duty is now being levied at a higher rate on properties bought to be rented. Most properties…
February 20, 2017
castle-822815_1920

Why 2017 is the year of build-to-rent

Over the last decade, the Private Rental Sector (PRS) has grown by 82% and squeezed past social rent in 2012/13 to become the second biggest tenure in the UK. Over the same period, the way we build rental property, and the way we rent it, has changed, too. Last year, the report Housing Futures: Urban Renters, published by Strutt & Parker, Stanhope and Network Homes, was published. The report had a closer look at Britain’s emerging build-to-rent sector, as the recent developments within the sector are reminiscent of those in other rental countries, such as Hong Kong, Germany, Japan, Sweden and the US. The research found that 48% of respondents had been renting the same property…
Restricted Content
The contents of this website are intended only for investors from certain qualifying classes (“High Net Worth Individuals”, “Self-Certified Sophisticated Investors” and “Restricted Investors”). To access the full contents of the site you must first register in one of these categories.
Please confirm that you are a suitable investor before proceeding. If you are unsure whether you meet the specific criteria or not, you can check the definitions here.
Will be back soon