Reeds Rains Property Blog

Property News from Reeds Rains

Scotland House Price Index

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Scottish housing recovery stronger than in North of England 

  • Scottish house prices only 2.4% below April 2008 peak, compared to 8.1% in North of England
  • Average prices in Scotland up £6,435 in a year – highest annual rise since October 2010
  • House prices set a new record in Aberdeen City, up 17.1% over the last 12 months
  • Q1 2014 sales up 25% compared to Q1 2013 fuelled by home movers and increased supply

Donald MacLellan, Chairman of Walker Fraser Steele Chartered Surveyors, part of LSL Property Services, comments: “For households all across Scotland, there is light at the end of the tunnel. The average price in Scotland is now only 2.4% (£3,900) below its pre-recession April 2008 peak. The recovery in Scotland has now taken a stronger grip than in the northern most regions of England. Just south of the border lies a reminder of the challenging road back from the depths of the recession, with the average price in the North of England still lingering 8.1% below its 2007/2008 pre-crisis peak. As the independence vote looms on the near horizon and the debates become more ferocious, it will be interesting to note if this has any impact on current trends.

“The Help to Buy scheme and buoyant demand from first-time buyers have been the catalysts spurring the Scottish market on. Sustained growth is bedding down across the country, and on an annual basis average property prices have risen in 66% of all areas of Scotland. The flagship success story is Aberdeen City, where average house prices reached a new record of £219,117 in March 2014, after 17.1% annual growth. The revived confidence at the bottom of the property ladder is rising through the rungs, emboldening home movers to take the plunge after years of hesitation. The highest increase in sales has been in classic family semi-detached homes, increasing by 28%. As activity levels strengthen throughout the price ranges, overall sales in Scotland are up 25% in the first three months of 2014 compared to the same period last year.

“Housebuilding initiatives and replenished supply are also greasing the wheels on the highway of recovery. New waterside developments and a fresh wave of housing stock in Inverclyde have helped raise average house prices in the area by 19.6% over the past year, the highest annual growth experienced in Scotland.

“However, there remains a note of caution and the recovery still requires nurturing. There are corners of the country where the ‘feel-good’ factor has yet to be seen. In Midlothian, average house prices have dropped 10.8% annually and two of Scotland’s seven cities suffered monthly house price falls in March 2014. By keeping interest rates at a historic low, the Bank of England is maintaining the steady cost of borrowing and supporting housing market growth. But whether the uncertain fiscal impact of an independent Scotland will have ramifications for the wider recovery remains to be seen.” 

Read the full Scottish House Price Index - 2014 here

House Price Index - April 2014

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Average house prices climb £1,200 in April - setting new record 

  • Average prices now at £263,113 peak – £54,000 above recession low point in April 2009
  • House sales up 40% year-on-year, with 72,000 transactions in April
  • Sales activity fuelled by increases in first-time buyers and buy-to-let landlords
  • East Anglia joins ranks of London and South East with prices exceeding pre-recession highs

David Newnes, director of Reeds Rains and Your Move estate agents, owned by LSL Property Services plc, comments: “Average prices across England and Wales have risen £1,200 during April, setting a new record. Prices have now climbed over £54,000 (26%) above the recession rock-bottom of April 2009, when the nation was gripped in the gloomy depths of the financial crisis. 

“As the floods and bad weather at the start of the year become a distant memory, sales in April have returned to more normal levels. Total house sales stand 40% higher than at the same point last year, totalling 72,000 in April. Activity is largely being fuelled by increasing numbers of purchases by first-time buyers and buy-to-let landlords, as consumer confidence sweeps the country. Low inflation and healthy wage growth are energizing household finances, and infusing aspiring buyers with greater optimism. 

“Considering the regional picture, while London may be forging the way with 13.2% annual house price growth, the rest of the country is definitely following the trail. Growth is emanating out from the capital, and prices and activity are progressing steadily across all regions. There are success stories from Reeds Rains branches all across England and Wales – with Lincolnshire, Northamptonshire and Nottingham all witnessing house price inflation above the national average. East Anglia has become the third region following London and the South East where house prices have reached record highs, and have exceeded their pre-recession peak. In a key indicator of the vigour of the recovery, over the last twelve months prices have risen in 89% of the unitary authorities across the country. 

“But supply levels need to keep pace, thus allowing the wheels of the housing market to continue turning. Constrained supply in the capital has already moderated total London sales over the past twelve months. Demand shows no sign of slowing: more house building is imperative to keep the momentum going, and to ensure that price rises are sustainable, in particular for first-time buyers – who remain the key ingredient at the lower end of the market, oiling the cogs of growth. 

“With the more stringent Mortgage Market Review (MMR) lending conditions now in place, and tighter regulation and stress tests on banks, the borrowing process is slowing, but this isn’t a setback for the market so long as the government encourages a healthy flow of available housing stock.”

Read the full house price index - 2014 here

Shakespeare's Birthday

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Today would have been William Shakespeare's 450th birthday!  

Shakespeare is synonomous with Stratford-Upon-Avon, but he made reference to many locations throughout England, and for a bit of fun we've found some properties that make reference to Shakespeare.

1.  For those on a tight budget, or who want to invest, how about this 1 bedroom flat on Shakespeare Street, Wallsend  Offers in the region of £50,000.

 2. Another investment opportunity on Shakespeare Street, Burnley.  £46,500 for a 3 bedroom house.

 

3. A 3/4 bedroom bungalow in Shakespeare Avenue, Chester  £300,000.

4. An extended 4 bedroom semi on Stratford Road, Birmingham for £315,000.

e.surv Repossessions Release - April 2014

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Home Repossessions 44% Higher In The North 

But signs North-South divide is starting to close 

  •  North East and the North West are the repossession hotspots 
  •  Eight in ten (78%) Northern towns have more repossessions than average 
  •  Oldham has highest repossessions rate and East-Central London the least 
  •  But the North-South divide may be beginning to close: 4 of the 5 biggest improvers are in the North: Carlisle (-26%); Harrogate (-23%); Telford (-22%) and Hull (-21%) 

The rate of home repossessions was 44% higher in the North than in the South in 2013, according to detailed research released this morning by e.surv chartered surveyors. 

e.surv’s analysis of court-ordered repossessions in England and Wales in 2013, broken down by post code, found there were 5.6 repossessions per 1,000 households in the North, 44% higher than the 3.9 repossessions per 1,000 households in the South.This compares to 6.3 repossessions per 1,000 households in the North and 4.4 in the South in 2012. 

Eight in ten Northern towns (78%) were home to more repossessions than average in 2013. The North West, North East and Wales were repossession hubs in 2013, with 6.0, 5.9 and 5.8 repossessions per 1,000 households respectively. The South West – the area with the lowest number of repossessions per year – experienced the biggest improvement, with repossessions falling 15% over the past year.   

Richard Sexton, director of e.surv chartered surveyors, explains: “The North is still home to the largest wedge of repossessions, despite improvements in household finances across the country. Both the North West and the North East are still paying the price of recession-driven public sector job cuts – which stimulated a glut of local repossessions. The whole country is now in recovery, but the North has the furthest to go to catch up, and is comparatively lagging behind.”

Buy-To-Let Index – March 2014

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Buy-to-Let Lending Takes Rent Rises To Four Year Low

  • Rents rise at slowest annual pace since January 2010 – up just 0.9% in twelve months to March
  • Average rent across England and Wales now stands at £741 per month, after 0.2% monthly fall
  • Proportion of all tenants behind on rent stands at 7.8%, down from 8.5% in March last year
  • Rising house prices increase landlords’ annual returns to 12% – or almost £20,000 per year

Rent rises across England and Wales have slowed to their lowest annual rate in over four years, according to the latest Buy-to-Let Index from LSL Property Services plc, which owns the UK’s largest lettings agent network, including national chains Your Move and Reeds Rains.As of March, rents across England and Wales are now just 0.9% higher than twelve months ago.

Rents have not increased as slowly since they grew by 0.4% in the twelve months ending January 2010, making the latest annual rent rises the slowest for over four years.

In absolute terms this means the average rent in England and Wales is only £6 higher than a year ago, currently standing at £741 per month compared to £735 in March 2013.

On a monthly basis, rents fell by 0.2% between February and March. This leaves rents in England and Wales approximately £1 lower than in February.

David Newnes, director of estate agents Reeds Rains and Your Move, part of LSL Property Services, comments: “Mortgage lending is recovering steadily – and the impact is becoming clear.  This year is seeing access improve across all areas of the property market, and that now includes private renting.

“A flow of investment from landlords has increased supply of homes to let, supported by historic low mortgage rates and significant growth in the number of buy-to-let loans.  At the same time more first time buyers are starting to balance the many thousands of new tenants entering the rental market.  And this is slowing demand a little.  The result is a private rented sector where supply and demand are more aligned than for many years.  More mortgage lending is good for tenants too.”

Read the full LSL Buy-to-let index - March 2014 here

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