POSTED BY: RESIDENT   23/03/2017

Property prices in England and Wales continue to rise with an annual year-on-year increase of 6.2 per cent in January according to the latest figures from the Office for National Statistics (ONS).

House values rose by 0.8 per cent month to month from December, to continue an upward path despite uncertainty surrounding Brexit.

England fared best with an annual rise of 6.5 per cent, taking the average property price to £234,794 according to the ONS research.

Wales also showed an annual rise of 4.2 per cent to reach £145,933 in January. Though property prices fell slightly month to month by 0.6 per cent from December.

The strongest rise was seen in the East of England with an increase of 9.4 per cent over the last twelve months.

London was slightly behind with an annual rise of 7.3 per cent. However, the capital showed strong signs of turning the corner from its recent slump, registering the largest month to month increase of 3 per cent from December.

Lowest annual growth was seen in the North East at just 2.2 per cent, and in Yorkshire and Humberside a large monthly decrease of 2.6 per cent was recorded.

Despite doom and gloom predictions in the run up to the EU referendum, Brexit uncertainty continues to be ignored by the property market as prices continue to rise regardless of the imminent start of the exit process.

CEO of haart estate agents, Paul Smith, commented: ‘With only a week to go until Article 50 is triggered – house prices remain indestructible as the average person is paying £13,000 more to own a home than the same time last year, reflecting the health and buoyancy of the UK economy seen in the last few months.’

Property price growth is slightly below the 7.4 per cent seen in 2016, and with inflation moving past the Bank of England target rate of 2 per cent this week, buyers may become more conservative. But the shortage of available property in the UK compared to demand should strongly underpin the market.

By Isabelle Fraser

24 MARCH 2017 • 12:01AM

House prices in Manchester have grown by 8.8pc in the last 12 months

Manchester has sped ahead of southern rivals, recording the fastest house price growth of any city in the UK.

Homes in the capital of the Northern Powerhouse increased in value by 8.8pc over the past 12 months, according to Hometrack.

Cities with higher-priced property have seen a slowdown in price growth: in London it slowed to an annual rate of  5.6pc, the lowest since May 2013. This is acting as a drag on the index’s overall level of growth.

By Richard Bradstock, Special to Gulf News

Overseas real estate picks are proving easy

Multiple UK cities figure prominently and Chicago’s got what it takes

Published: 14:01 March 22, 2017

By Richard Bradstock, Special to Gulf News

 

As part of a survey conducted last year, over 500 members of the public shared with us why they would invest in property and the response was typical. Themes of stability, reliability, diversification and low correlation with other major asset classes were raised.

Evidence shows that these attitudes are global. After a shaky 2016, marked by the fallout from Brexit and the US presidential election, we look at the trends that will likely dominate global this year.

The big picture: investors look above the fray of global political and economic risk

The knee-jerk reactions seen in 2016 now appear to be behind us. Major stock exchanges have long bounced back following the shocks and there seems to be a strong sense of business as usual. The recent IMF World Economic Outlook update showcased the broad consensus of forecasts suggesting that 2017 will be a year of “modest growth”.

Yet ongoing global economic and political uncertainty means these broad predictions come with a very clear health warning. Will Chinese rebalancing be managed successfully? Will consumer markets remain resilient?

Is the US about to start shredding its trade agreements? In light of these potential issues, it’s not difficult to imagine situations where investors are left exposed across multiple asset classes.

In our view, it is important to understand that balanced portfolios are fortified with assets that are above the fray. This explains why property, particularly residential property, is expected to remain a key investment theme in 2017. It also helps to understand why markets in the UK, US, Australia and Germany require special focus.

Brexit and beyond

After the UK voted to leave the EU, the British pound tumbled dramatically, causing residential property to become around 20 per cent cheaper for dollar-pegged foreign investors. Because of this, investors from the GCC and Asia are casting an eye over the UK market with renewed enthusiasm, recognising it as “the same old safe haven as ever — but cheaper”.

Investors are well placed to capitalise on this opportunity. Investors from the Middle East have been putting their money in the UK property market for a long time, and the appeal of British brick-and-mortar has become more pronounced after becoming far more affordable for dollar-pegged investors.

In recent years, Manchester and Liverpool have become some of the best cities in the UK for property investment. Manchester is one of the strongest buy-to-let cities in the UK. Not only are 63 per cent of households renting (24 per cent above the UK average), but in the extended city centre four out of five apartments are rented.

Reflecting the strong demand for rental properties- rental growth of 20.5 per cent is expected between 2017-21.

In Liverpool, property demand remains strong, with a 6 per cent price growth seen during June to September 2016. Demand is likely to rise further as the population of Liverpool is predicted to grow from 83,000 to 1.6 million by 2040.

As the UK begins the process of formal departure from the EU, a process likely to take around two years, the fundamentals that have long made UK property investment popular with GCC investors remain firmly in place, providing an attractive opportunity for long term investors to ride out any short term volatility.

Key markets to invest in 2017

Well-known for its striking architecture, Chicago is also one of the largest US cities. A hidden gem in the real estate world, the windy city is expected to be a key US property investment market through 2017. The city has the sixth highest GDP among world cities and is diversified across a variety of markets that include finance, technology, telecommunications and transportation.

Since July 2013, average condo prices have risen 16.2 per cent, while average prices at IP Global’s most recent Chicago project have risen 5-6 per cent since February 2015. These figures are extremely encouraging for potential investors.

Germany is also on our list of top investment destinations for 2017. A joint report from PwC and Urban Land Institute ranked Berlin as the No. 1 city in Europe for investment and development prospects. Strong economic growth and increasing population continue to underpin the German capital’s reputation as one of Europe’s prime destinations for residential property investment.

With a 40 per cent housing supply deficit, 400,000 new residents expected by 2030 and the opening of the Berlin Brandenburg Airport scheduled for 2018, the near term outlook for Berlin’s property market looks extremely promising

20 MAR 2017

Brexit described as “first world problem”, as Chinese buyers and institutions continue to pour money into Britain’s real estate sector.

ummary:

• Chinese property investors are forecast to continue spending heavily in the UK, attracted by its status as a safe-haven location
• 44% of the value of property deals announced between 2012 and the end of the first half of 2016 were made by Chinese buyers
• The strength of UK property has not been dented following last year’s EU referendum, with the chief executive of a Chinese equity firm describing Brexit as a “first-world problem”

British real estate remains one of the strongest safe-haven assets available to the global investor community.

And its most vested international buyers are set to continue moving money to the UK.

For Chinese private and institutional investors, UK property is the most bought, and most highly sought, overseas investment. According to the Financial Times, 44% of the value of property deals announced between 2012 and the end of the first half of 2016 came from Chinese buyers.

Investors in the Far East are attracted by UK real estate’s renowned ability to grow returns, and its low correlation to equity and gilt performance.

Chinese buyers regard Britain as a safe destination for their money. Analysis from accountancy firm Grant Thornton found that in just 12 months in 2015, the top 20 Chinese-owned businesses that operate in the UK saw revenues soar by 174%.

While 2016’s Brexit vote has caused a degree of uncertainty for the country’s economy, the appeal of acquiring British assets has not diminished in the eyes of China’s biggest investors.

Private equity fund PGC CapitalChinese plans to invest £600m in property and business parks in the UK over the next five years. The institution’s Chief Executive, Denise Li, told the Financial Times that while some economists in the UK and Europe see the vote to leave the EU as “huge”, she said “back home in China, we see this as a ‘first-world problem’”.

Brexit has, though, made UK real estate more affordable for investors from China and around the world, after the pound fell to a 31-year low against the dollar. But many buyers are aware of sterling’s reputation as one of the strongest global currencies, which could prompt a renewed surge in investment before the pound regains its losses over the next few years.

10 MAR, 2017 by Rupert Smith

Private Landlords have already been feeling like they have had ten rounds in the ring with Mike Tyson or being current…Tony Bellew for that matter!

The referee thankfully did not score against the investor yesterday and thankfully the budget did not include any further measures to make the life of the investor more harrowing.

Investors must be aware of the change in legislation coming into force next month with the abolishment of mortgage interest rate relief.

Many fear that rents will soar over the long term and the government will be forced to backtrack over time.
Over 20 areas in the UK have already seen the average rent paid for a residential property grow in excess of 3% over the last year. These findings highlight the growing affordability crisis facing the 4.3m tenants in the UK, and follow the government commitments outlined in last week’s Housing White Paper to create a fair and better-served private rented sector……now that’s an article in its own right!

Statistics suggest that by 2025 more people in the UK will rent rather than own property much like the rest of Europe
The analysis suggests these 20 areas, where rental growth is reaching unsustainable levels, should now be the prioritised focus for government, developers and landlords. The current pace of growth means a tenant in Luton (the area with the fastest growing rents at 6.5%) is now paying an extra £528 over the year on rent, bringing total annual rent paid to £9,354.

With basic economics in mind… there are more “bottoms than there are seats” and the rental market is very very strong, demand outstrips supply etc etc surely property prices will remain strong? The debate continues…

Complete RPI Ltd, a UK specialist, have maintained a 98% occupancy across their portfolio for the past three years UK nationwide which makes interesting reading.

Post-Brexit, changes and new report reveal that currency shifts are driving a fresh wave of property buyers based in the Middle and Far East taking advantage of a significant “discount” in UK real estate, this combined with the uncertainty of new leadership and insecure financial markets make UK real estate still a very safe bet for the wary investor.

By Andrea Wong, 13 March 2017

The Chancellor’s Spring Budget was a rather low-key affair to say the least. It was a statement that was met by disappointment by people up and down the country, most notably property investors, due to lack of mention of the housing market. One thing that the Chancellor did announce though is that there would be a rise in income tax for self-employers despite a pledge not to raise taxes, causing concern for landlords today.

Last month, the government published the document known as a White Paper which strategised a Brexit plan with emphasis fixing the ‘housing crisis’ and building houses with more affordable rent. Many believed that this handed Chancellor of the Exchequer Philip Hammond with the perfect opportunity to expand on the housing plans issued by the government and address the issues that the market faced. Further to this, it was hoped that he would reverse George Osborne’s implementation of the 3% stamp duty levy for property investors in 2016, even though that additional tax has not slowed the market down or deterred investors.

With no mention of the housing market, investors can rest assured that no new taxes or charges will be levied on them, and that the market remains firmly open to investment. Furthermore, another factor which remains unchanged is that tenant demand in the UK is extremely high and, with more people than ever before entering the private rental market, high quality buy-to-let accommodation will continue to be a very popular and lucrative investment for a long time to come.

The Chancellor’s maiden Spring Budget did include additional plans to distribute economic growth across the country, particularly with regard to the development of the Northern Powerhouse. He is aiming to improve different areas with huge investments in infrastructure, healthcare and education to benefit people living in the Northern regions. According to recent JLL reports, the economic outlook for the Northern cities looks bright, with Manchester City Centre considered the number one market for capital value growth prospects over the next few years.

Whilst the Chancellor failed to discuss the housing market directly, the previously mentioned Government White Paper document shed light on the situation. There seems to be a real focus on fixing the issue, as well as an acceptance that homeownership is now less common due to high-rise prices. In response to the White paper, Green Party member, Sian Berry was full of optimism: “I’m pleased to see the Government is at last catching up with the real world on renting. We have suffered from years of obsession with homeownership and a long list of failed policies such as ‘Help to Buy’, shared ownership and starter homes”.

With the UK buy-to-let market going from strength to strength and rental accommodation demand high, especially within the regions of the Northern Powerhouse, investors should not be concerned by the relative lack of airtime given to housing in the Budget. Homeownership is out of reach for many ordinary UK families even with extra support from the help-to-buy scheme, paving the way for even more growth in the private rental market to come.

PUBLISHED: 14:26, Tue, Mar 14, 2017

HOUSE PRICES, will they rise or fall after Article 50 is triggered? Prime Minister Teresa May is clear to make the move and begin negotiations to leave the European Union (EU) – but what effect will this have on our housing market.

Express.co.uk spoke exclusively to Will Herrmann, Director of private property developer West Eleven, who explained that any effects will be insignificant – and the welfare of the property market relies on how any leaks throughout the process are received.

“It’s inevitable that Article 50 is going to be triggered and the timetable for it happening has been well documented,” he said.

“Sentiment will change with the success (or not) of the negotiations and how well they presented to the public.”

The property expert believes upmarket areas such as Fulham, with a high French population, will flourish but that most other areas of the UK won’t prosper as a result of the Brexit news.

What will Brexit do for the British housing market? Will house prices be lower or higher?

House prices rise slightly post-Brexit according to Will.

He told Express.co.uk exclusively: “I think prices will stay flat with possibly some very modest increases but the breaking effect on price rises and the cause of the slowdown in transactions in the market is more caused by other factors such as Stamp Duty Land Tax (SDLT).”

“As far as London is concerned, I think that the effects of Brexit are largely priced into the market,” the expert claimed.

“There were large corrections in Chelsea and Fulham immediately after the referendum and these areas now appear to have turned a corner.”

Will many people continue to buy from overseas?

There will continue to be more overseas buyers in Britain, especially from China, Will said.

“The effect of the devaluation of the pound has led to an opportunity for overseas buyers.

“Globally, Chinese and other far Eastern buyers want to save their money protected by a strong democracy, judiciary and property laws.”

Thanks to the poor state of the Euro there will be more investment from buyers closer to home to – who will be looking for stability in a more reliable market.

“The Euro looks set for a continuing period of instability too. These factors continue to make UK property appealing,” Will explained.

Will it be cheaper or more expensive to rent?

Renting will also become yet more expensive after Brexit.

“This is a function of the general seizure in the property market – as transaction volume sales slow, more people are renting,” Will explained.

“This is combined with a lack of supply and increased costs to landlords.”

“The entire effect of Brexit is of course unknown, but the UK is a huge market place in its own right and a global trading nation. I would expect the effects in the housing market to be relatively insignificant compared the other headwinds it faces.”

The pound is falling since the Prime Minister was given the go ahead by Parliament to trigger Article 50.

9th March 2017

Modest growth is continuing in the UK property market but the outlook is less positive in London than the rest of the country, according to the latest report from chartered surveyors.

Some 24% have seen a rise rather than a fall in prices over the past three months and the North West was seen to have performed particularly well with a net balance of 64% reporting rising prices.

However, central London bucked the growth trend with 62% of respondents saying that prices had fallen rather than risen during the same period.

But it is in the private rented sector that the biggest change is likely with the report from the Royal Institution of Chartered Surveyors (RICS) saying that rents are predicted to rise by in excess of 20% over the next five years

Overall sales volumes were broadly unchanged for the third month in succession and new buyer enquiries were again flat and have now failed to see any meaningful growth since November 2016. The pace at which new instructions are dwindling appears to be particularly acute in the North West of England and the West Midlands.

Near term expectations remain positive but point to a relatively modest rise in activity in the months to come. The headline price balance came in at +24% in February, unchanged from a downwardly revised figure of +24% in January.

However, surveyors have now reported a fall rather than a rise in London prices for a full year with most of this activity concentrated in the inner boroughs. However, sales activity appears to have picked up in London after nearly a year of negative to flat growth.

Tight supply conditions across a majority of the regions coupled with stable sales activity has led to a further erosion of available stock for sale, with the average stock per surveyor just shy of a record low. Indeed, respondents across most parts of the UK continue to highlight in their comments the supply shortage to be very dominant feature of the market at present.

Wales and Northern Ireland reported the strongest expected improvements, followed by Scotland and the North West of England.

In the lettings market, tenant demand rose for the third consecutive month as 15% more respondents noted an increase rather than a fall on a non-seasonally adjusted basis. But growth in demand is more modest than a year ago when 29% more respondents reported an increase.

The flow of new landlord instructions, however, reportedly deteriorated, with a net balance of -10% the weakest reading in over two years. The report says that this negative trend is likely to persist over at least the next couple of months as changes to mortgage interest tax relief start to take effect in April.

As such, rent expectations remain in firmly positive territory with a net balance of +24% in February. Looking ahead over the next 12 months, survey respondents forecast rents to rise by a further 2.7% and to accelerate to an average 4.4% per annum over the next five years.

However, the London rental market continues to be an exception with surveyors reporting weak tenant demand along with negative near term rental expectations.