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Edinburgh property market at its hottest since credit crunch

THE Edinburgh’s property market is at its hottest since the credit crunch, a new report claims.

More homes in the city are being put up for sale and more people are looking to buy.

Warners Solicitors & Estate Agents said activity among both buyers and sellers was at record levels and showing few signs of slowing down despite Brexit.

Between January and March, the firm said it recorded over 250 property sales – an increase of over 40 per cent compared to the same period in 2018 – and brought almost 300 properties to the market.

David Marshall, operations director with Warners, said: “There had been a feeling that activity in the local property market would be subdued in the early part of 2019 as people were expected to wait and see the outcome of Brexit negotiations before deciding to buy or sell. This has not been borne out in reality.

“The rise in the number of homes coming onto the market that we have seen has been the greatest improvement in the market over the last two years.

“In 2016 and 2017 many people were having to delay selling their own home because they couldn’t find a property that they wanted to buy.

“As more homes have become available it has made this problem far less common. 
Buyers are more often able to find a home that they want, while most sellers are still able to sell their properties quickly.”

He said throughout 2016 and 2017, a significant shortage of homes for sale across Edinburgh and the Lothians had led to multiple buyers competing to secure properties, which meant that buyers found themselves having to bid well in excess of the Home Report valuation in order to be successful.

The market began to see a steady improvement last year, with Warners observing an 11 per cent rise in the number of new property listings compared to 2017.

Supply improved further in the first quarter of this year with more sellers willing to take the plunge and get their home onto the market.

Mr Marshall said as a result, the premiums buyers were now having to pay were lower than in recent years, with the average premium paid over the Home Report valuation now 3.4 per cent, down from 6.9 per cent in the first three months of 2018.

He said: “With the pressure on buyers having eased, house price inflation has also come back down to more manageable levels.”

Latest figures from ESPC show the average house price in Edinburgh rose by 1.8 per cent during the first quarter, though one and two bedroom flats in popular parts of the Capital have seen prices soar.

Mr Marshall said: “The levels of inflation we are now seeing are much more sustainable over the longer term so this is good news for the health of the market and, as we move forward, we would expect to see inflation continue in the region of one to three per cent for much of 2019.”

By IAN SWANSON

Source: Edinburgh News

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UK construction buoyed by house-building: surveys

UK construction industry is being shielded from the uncertainty about Brexit by modest growth in house-building, industry surveys showed on Thursday.

Builders registered 37,672 new homes for warranties and insurance from the National House-Building Council (NHBC) between January and March, up 3 percent compared with a year earlier.

NHBC’s figures, which cover 80 percent of the new homes market, are viewed as a lead indicator for the housing sector.

Separately, the Royal Institution of Chartered Surveyors (RICS) said private house-building supported the otherwise subdued construction industry, with overall confidence at an almost six-year low.

While the commercial construction sector has been hurt by falling business investment ahead of Brexit, efforts to narrow a shortfall in the number of residential homes on the market has helped the house-building sector.

Construction represents about 6 percent of British economic output.

“We are pleased to report good numbers for the start of the year, although we do need to bear in mind the situation 12 months ago when freezing conditions caused major hold-ups in registrations as well as build-rates across the bulk of the UK,” NHBC chief executive Steve Wood said.

Uncertainty around Brexit had caused “some dampening” of the housing market for new homes in early 2019, he said.

Prime Minister Theresa May has failed to get her European Union divorce deal through parliament, forcing her to delay the original Brexit date of March 29. A new deadline has been set for Oct. 31, more than three years since the 2016 referendum.

House-building was the only source of growth for Britain’s construction industry during the first three months of 2019, according to the most recent purchasing managers index from IHS Markit/CIPS. The survey for April is due at 0830 GMT.

Reporting by Andy Bruce; Editing by William Schomberg

Source: UK Reuters

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UK house prices gather a bit more speed in April – Nationwide

Growth in UK house prices picked up slightly in April, data from mortgage lender Nationwide showed on Wednesday, adding to other signs that a slowdown in the housing market ahead of Brexit might have bottomed out.

Prices rose by 0.9 percent in annual terms, speeding up from a rise of 0.7 percent in March.

That was the biggest increase since November although it was still weak compared with recent trends in the often surging UK housing market – prices were rising by about 5 percent a year at the time of the Brexit referendum in 2016, according to Nationwide.

In monthly terms, prices rose by 0.4 percent after rising by 0.2 percent in March, also the biggest increase since November.

Economists polled by Reuters had expected prices to increase by 0.7 percent in annual terms and to rise by 0.2 percent compared with March.

Robert Gardner, an economist with Nationwide, said first-time buyers appeared to be defying the jitters around Britain’s still uncertain departure from the European Union, helped by low interest rates and the lowest unemployment rate in more than 40 years.

“While the ongoing economic uncertainties have clearly been weighing on consumer sentiment, this hasn’t prevented further steady gains in the number of first time buyers entering the housing market in recent quarters,” he said.

The number of mortgages taken out by first-time buyers was approaching pre-financial crisis levels, the data showed.

While prices have been rising across the country as a whole, prices in London have fallen according to various measures of the market, hit by a combination of unaffordable prices for many buyers, tax changes affecting the buy-to-let market and the Brexit uncertainty which has weighed heavily on the capital’s financial services industry.

British Prime Minister Theresa May last month secured an extension to the Brexit deadline until Oct. 31, avoiding the potential shock of a no-deal Brexit for now but leaving the world’s fifth-biggest economy still deep in uncertainty about how it will leave the EU.

Writing by William Schomberg; Editing by Andrew MacAskill

Source: UK Reuters

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Mortgage Approvals Reach 9-Month High

Homebuyers and lenders appear to have brushed Brexit uncertainty in March, as mortgage approvals reached their highest level since June of last year.

Industry data from UK Finance, a lobby group for the financial services industry, revealed that high street banks approved 39,980 mortgages in March, up 6% from a year ago and up 2% from February. That’s the highest number of mortgages approved in a single month since June 2018.

The numbers were greeted as a sign that the housing market is rebounding following a slowdown in 2018 as Brexit negotiations stalled.

The figures confirmed the optimistic prognosis from the Royal Institute of Chartered Surveyors (Rics), which found that house prices had risen last month for the first time since July 2018. However, Rics warned that worries about Brexit would continue to put a damper on price growth.

Jeremy Leaf, north London estate agent and a former Rics residential chairman, told the Financial Times: “Mortgage approvals for home purchase are always a useful lead indicator of future market activity and these are no exception.

“They confirm what we have been seeing on the ground and in other surveys — that transactions are holding up reasonably well despite political and economic distraction,” he added.

However, he noted that sales are taking longer to complete and that buyers and sellers are having a hard time finding middle grounds on prices. He attributed some of the market turbulence to the withdrawal of buy-to-let investors from the market, following the introduction of a stamp duty surcharge on second homes and cuts to the mortgage interest tax relief. Those buyers haven’t yet been replaced by fist-time buyers.

The market varied regionally as well, he noted.

“The picture is very patchy and can vary considerably between areas which are quite close together and between London and elsewhere.”

The United Kingdom was due to leave the European Union on 29 March, but was granted an extension until 31 October, after Prime Minister Theresa May failed to gain parliamentary approval for her withdrawal agreement.

With the new deadline looming, other analysts cautioned that the recovery in the housing market would be limited.

Capital Economics property economist Hansen Lu said: “Looking ahead, the delay to Brexit suggest that demand and sentiment in the housing market will stay subdued for at least the next few months. As a result, we don’t expect to see a further recovery in mortgage approvals this year. At the same time, a no-deal Brexit looks less likely than before.”

However, recovery in the housing market was matched by and related to other good economic indicators.

While consumers were still wary of big-ticket purchases, “it may well be that housing market activity has gained some support from recent improved consumer purchasing power and robust employment growth,” Howard Archer, from economic forecasting group EY ITEM, fold the Evening Standard.

Annual wage growth is at nearly a 10-year high and unemployment has fallen to 3.9%, a 44-year low.

Soruce: Money Expert

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London Buy To Let Investment In Recovery

The London buy to let property market is showing signs of recovery according to the latest data released from buy to let finance broker Commercial Trust.

London buy to let took a bit of a battering over the last year, largely due to the uncertainty caused by the Brexit fiasco. However, positive signs have been seen in the first quarter figures for 2019 from Commercial Trust.

According to the latest figures, the number of submitted purchase mortgage applications for the capital rose by 4 per cent on the previous quarter, propelling London back to its position as the leading region for buy to let business applications – 15.8 per cent of overall business, closely followed by the South East at 14.5 per cent.

This followed the last quarter of 2018 which had seen the South East overtake the capital for the first time, with London buy to let in second place.

Strong results were also shown for the East of England and the North West, enjoying an increase in the proportion of buy to let applications submitted during the first quarter. The same two regions shared top billing for buy to let completions over the quarter, with each contributing 13 per cent of overall completions.

Remortgaging continued to dominate buy to let applications, with 60 per cent of business coming from landlords looking to refinance.

Chief executive at Commercial Trust, Andrew Turner, commented: ‘The effects of Brexit have been keenly felt in London and perhaps the stalling of house price growth has to some extent created a buyers’ market for buy to let.

Our latest figures underline the importance of London and the South East within the buy to let market. For the first quarter of 2019, these two regions contributed over 30 per cent of our buy to let purchase applications, an increase from the 26 per cent recorded in Q4 of 2018.

Whilst it is good news to see increased activity in London, movement is not restricted to that area and both the North West and East Anglia have also increased their proportion of overall purchase business during the quarter.

With Brexit now pushed back to later in the year, the combination of low interest rates, a wide variety of mortgage product choice, stalling house prices and soaring tenant demand, many investors are of a mind to invest in the private rental sector.’

Source: Residential Landlord

Edinburgh
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Edinburgh housing market activity ‘highest since credit crunch’ and resisting Brexit pressure

Property market activity in Edinburgh is at its highest level since the credit crunch and shows no sign of slowing down because of Brexit, according to Warners Solicitors & Estate Agents.

Between January and March, Warners recorded over 250 property sales – an annual increase of over 40 per cent compared to the same period in 2018 – and brought almost 300 properties to the market.

David Marshall, operations director with Warners, said: “There had been a feeling that activity in the local property market would be subdued in the early part of 2019 as people were expected to wait and see the outcome of Brexit negotiations before deciding to buy or sell. This has not been borne out in reality.

“The rise in the number of homes coming onto the market that we have seen has been the greatest improvement in the market over the last two years.

“In 2016 and 2017 many people were having to delay selling their own home because they couldn’t find a property that they wanted to buy.

“As more homes have become available it has made this problem far less common. Buyers are more often able to find a home that they want, while most sellers are still able to sell their properties quickly.”

Mr Marshall added: “With the pressure on buyers having eased, house price inflation has also come back down to more manageable levels.

“The latest figures from ESPC show that the average house price in Edinburgh rose by 1.8 per cent annually during the first quarter, well below the rate of inflation observed during 2017 and 2018.

“The levels of inflation that we are now seeing are much more sustainable over the longer term so this is good news for the health of the market and, as we move forward, we would expect to see inflation continue in the region of one to three per cent for much of 2019.”

Source: Scottish Legal

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1,000 homes a week purchased through Help to Buy last year

Just over 52,000 homes were purchased through the Help to Buy: Equity Loan scheme in England in 2018 – a 12% increase on the previous year, the latest government figures showed.

Across what’s being hailed as a very successful year for Help to Buy by mortgage industry figures, an average of around 1000 households per week bought property through the scheme.

The Ministry of Housing, Communities and Local Government (MHCLG) introduced Help to Buy in 2014 as a way of assisting first time buyers trying to get on the property ladder, and the total number of homes bought with its help since its inception is now above 210,000.

More than 42,000 (81%) of homes bought in England in 2018 through Help to Buy were purchased by first-time buyers – a 14% increase on 2017 – which means one in seven purchases by first-timers was through Help to Buy.

Recent research showed first-time buyers needed to find a deposit of more than £30,000 in order to purchase a home in 2018 – an increase on the previous year.

Very successful year
Kate Davies, executive of Intermediary Mortgage Lenders Association (IMLA), said: “The statistics for 2018 highlight a very successful year for Help to Buy. The government’s programme has continued to stimulate the bottom of the housing ladder and indirectly support the whole of the UK property sector throughout 2018.

“With as many as one in every seven first-time buyers using Help to Buy in England in 2018, it is likely that the programme will remain invaluable in supporting home buyers over the remaining years of the scheme.

“While we are yet to see if the programme is continuing to grow in 2019, strong HMRC transaction statistics for Q1 2019 possibly indicate that Help to Buy-fuelled sales are still running at a healthy pace, continuing the trend we have been witnessing for more than a year.”

Beyond 2023
The government has indicated that Help to Buy will come to an end in 2023 and, while welcoming the figures for 2018, Craig Hall, head of broker relationships and propositions at Legal & General Mortgage Club, warned that first time buyers need further help.

He said: “Looking beyond the scheme’s end, it’s vital that government and industry works together to ensure these buyers remain supported. It’s likely that we may see private schemes coming to market to help fill the void.”

He added that higher LTV lending from mortgage providers and family assist mortgages are also helping first-time buyers, who should always seek out the expertise of a mortgage broker before taking any course of action.

Written by: Max Liu

Source: Your Money

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Region’s business confidence remains above UK average

Business confidence in the region slid three points in April but remains above the UK average, a new report released today reveals.

The latest Business Barometer from Lloyds Bank Commercial Banking shows that companies in Yorkshire reported higher confidence in their business prospects, up four points to 20 per cent, but lower economic optimism, which has fallen eight points to 17 per cent. Together, this gives an overall confidence of 18 per cent, compared with a UK average of 14 per cent.

Businesses’ hiring intentions show a net balance of eight per cent of businesses in the region expect to hire more staff during the next year, down seven points on last month.

Across the UK, overall confidence climbed four points as both firms’ optimism about the economy and their confidence in their own prospects continued to climb from lows recorded earlier this year.

Companies’ economic optimism rose to four per cent, while their confidence in their own business prospects climbed three points to 23 per cent.

The Business Barometer questions 1,200 businesses monthly and provides early signals about UK economic trends both regionally and nationwide.

Kelly Green, regional director for Yorkshire at Lloyds Bank Commercial Banking, said: “It’s very positive to see Yorkshire firms increasingly confident about their trading prospects, but perhaps surprising to see this isn’t reflected in their hiring intentions.

“By carefully managing working capital, firms can build their financial flexibility to increase staffing and take advantage of growth opportunities without harming day-to-day spending.

“We’ve pledged to lend up to £1.4bn to Yorkshire firms in 2019, including through working capital tools, to help firms make the most of the opportunities that come their way.”

Across the region, a net balance of two per cent of businesses said they felt the UK’s exit from the European Union is having a negative impact on their expectations for business activity.

By Rachel Covill

Source: The Business Desk

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Brexit wobbles spread across the UK as annual price growth hits a six year low

New-build sales plummeted by almost a quarter in the first three months of 2019, rendering the Government’s housing incentives “impotent,” research claims.

Analysis by property adviser London Central Portfolio (LCP) found that the number of new-build transactions in England and Wales dropped 24.3% between the fourth quarter of 2018 and the first three months of the year to 95,935.

Naomi Heaton, chief executive of LCP, said: “Despite the Government’s various schemes created to incentivise the purchase of new homes, the calamitous state of UK politics is rendering them impotent.

“The uncertainty rolls on.”

The new homes transaction figure doesn’t include greater London, where new-build sales were down 19% on a quarterly basis to 13,003.

It comes as LCP analysis of Land Registry data suggests there were 885,889 sales across England and Wales, including transactions in London and new-builds, during the 2018/2019 financial year.

This is below the 1.2m estimated by HMRC based on Stamp Duty receipts.

Heaton told EYE that the discrepancy could be due to HMRC’s statistics including the whole of the UK, while the Land Registry doesn’t include transfers such as those under  power of sale repossessions or to companies.

Heaton added that HMRC and Land Registry data never corresponds and said LCP has not had an explanation despite raising this several times.

There is also plenty of gloom in the wider market when it comes to prices and sales.

LCP found that average property prices in England and Wales, excluding London, are now growing at their slowest rate since 2013 at 2.9% annually to £254,196 in March.

Sales volumes in England and Wales, excluding London, fell 0.8% in the 12 months to March to 798,521.

In prime central London, average prices were up 1.8% annually to £1.84m, while transactions fell 15.7% to 3,378 over the same period.

Average prices in greater London were up 1.4% annually to £624,343, while sales fell 3.4% to 87,368 in the year to March 2019 – 24.7% lower than at the EU referendum in June 2016.

Heaton added: “The Brexit wobbles that have been evident in the capital for some time are now impacting on England and Wales.

“Buyers’ faith in the market has waned and sellers are beginning to question whether now is the best time to make a move.

“In previous market cycles, London has often been an early indicator of what was to come for the rest of the UK. This may well presage more bad news to come for the domestic market.”

By MARC SHOFFMAN

Source: Property Industry Eye

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Buy To Let Property Investors Back As Prices Fall

Buy to let property investors are returning to the market as falling prices make property investments viable according to independent estate agent, haart.

The agent found that the number of landlords registering for buy to let property has risen by 7.9 per cent on the month but has fallen by 21.8 per cent on the year across England and Wales.

In London, the number has risen by 11.8 per cent on the month but fell by 28.1 per cent on the year. The number of buy to let property sales has dropped by 2.6 per cent on the year across England and Wales and fell by 71 per cent in London. Average buy to let property sale prices are down 11.9 per cent across England and Wales annually, and by 12.4 per cent in London.

According to haart’s figures, house prices across England and Wales fell by 0.6 per cent on the month and by 5 per cent on the year with the average house price now sitting at £218,556.

New buyer registrations rose by 23.2 per cent on the month and by 7.8 per cent annually. The number of properties coming onto the market this month rose by 12.3 per cent and has risen by 1.9er cent on the year. In March, there were 12 buyers chasing every property across England and Wales.

CEO of independent estate agent, haart, Paul Smith, commented: ‘Three years on from George Osborne introducing the 3 per cent hike in stamp duty surcharges on second homes, landlords are beginning to come to terms with the additional costs and are cautiously entering the market again. Our branches across England and Wales saw a monthly uptick of 7.9 per cent in the number of landlords registering to buy, a figure which has been continuing to grow since the start of 2019.

Interestingly, sale prices to landlords are down by nearly 12 per cent on the year which may be spurring on this activity, these price decreases could be causing the available stock to fall within lower stamp duty thresholds, making the stamp duty levy a little easier to stomach. Despite this, landlords are not back in their hundreds, the number of registrations is still down 22 per cent on the year. Whilst some brave souls are re-entering the market, the hammering buy to let property investors received in terms of various tax changes is still fresh in many of their minds.’

He concluded: ‘Clearly investors are recognising the value that can still be found in buy to let property, especially in comparison to the overvalued and faltering stock market. Although the property market hinges on confidence, the FTSE 100, gold and cash are far more volatile to socioeconomic impact, so investors are increasingly returning to property where they deem their money safest, and where the yields are highest.’

Source: Residential Landlord