UK properties rise by five percent in the last year and adds more value on average home

HM Land Registry New figures show a typical property sold for £225,956 in August, up from £215,143 in the same month in 2016.

Increases over the last 12 months have been largest in the north-west, where house prices have risen by 6.5 percent. This was followed by gains of 6.4 percent recorded in the East Midlands, East of England and the south-west.

“The strength and prosperous nature of the country’s property market has once again been shown in these new statistics.” Kevin Shaw, national sales director at Leaders, explained

“The fact every single region across the UK experienced an increase of at least 2.6 percent in house prices over the last year, shows the market’s resilience despite the uncertainty of Brexit and gives sellers and buyers great confidence to make their next move.

“A significant rise in house prices is good news not only for homeowners who now have more options open to them when it comes to either moving or releasing equity in their property but also for landlords whose rental return is topped up by substantial capital growth that is realised when selling.”

Yet he acknowledges the challenge this presents for first-time buyers.

“Rising house prices are not good news for everybody and can make getting on the ladder less affordable for some.

“This week’s Budget is the ideal opportunity for the government to show it is on the side of prospective first-time buyers by reducing or even abolishing stamp duty for this group,” Kevin said.

The data shows that while the average property is worth £225,956, first-time buyers actually pay an average of £190,792 while those who have previously owned a property typically spend £262,156.

Kevin adds: “Looking ahead to the next 12 months, the outlook for the property market remains extremely positive. With the exception of the prime central London sector, further rises in house prices are expected across the country.

“Demand for all types of homes remains high and supply in many areas is not great enough, so we anticipate a busy and booming market for some time to come.”

 

Delays in the Crossrail 2 route could possibly effect investments

The Crossrail 2 route was announced in early 2013, but could delay to the building of the line impact those who have already invested?

The “Crossrail effect” on property near the new Elizabeth Line has produced huge gains for homeowners and investors in the decade since the project was announced.

Prices around all 40 stations on the new 60-mile railway from Reading and Heathrow to Essex, which opens in December next year, have risen by more than 41pc in 10 years, according to the analysis by the crowdfunding platform Property Partner.

But news that the £31bn Crossrail 2 line, which would cut through prime Surrey commuter belt and central London to Hertfordshire, may be delayed by up to a decade because of a funding shortfall could impact those who have invested in these areas in anticipation of rising rents and imminent growth.

Since the Crossrail 2 route was announced in early 2013, tenant demand has spiked in the areas along the proposed line, pushing up rents in 13 of the 15 local authorities. The biggest rises have been in the northern and north-western stretches, notably Broxbourne, the northern terminus, where rents have increased by 21.5pc (according to the latest Rental Index by the property investment platform Landbay).

Before the 2013 announcement, rents were falling in seven of the authorities. And the recent admission that the project is likely to be delayed until the 2040s has coincided with rents falling again – including by 1.75pc in Broxbourne – as tenant demand dwindles.

John Goodall, chief executive of Landbay, says: “Planned infrastructure is a key driver of tenant demand, so rents and property prices along the planned line quickly followed suit. But news that the line may now be delayed by a decade is nothing short of a hammer blow to all those that have had the foresight to plan that far ahead.

“What’s needed by tenants, landlords, buyers, business and builders is a clear commitment from the Government that the project will be delivered in 2033 as expected – not only to help people and businesses plan their lives, but also to allow adequate time for local authorities to plug housing shortfalls before demand spirals out of control.”

In a political and economic climate where so much already feels in difficulty, some observers think the announced delays to Crossrail 2 send a further negative message about London’s future potential. Charles Holland, head of new homes at Marsh & Parsons estate agents, says: “Major infrastructure upgrades like Crossrail 2 improve the connectivity of areas ripe for regeneration that otherwise do not fulfill their potential.

“One of the major benefits of this will be vastly improved levels and quality of housing stock, including affordable housing. It is important for London and the UK to send a message that we are open for business and an attractive place to live and work, and that key infrastructure investments will be sanctioned as we look forward.”

But Chris Lloyd, associate director at the independent mortgage brokerage Enness, believes the changes to the timetable may be an opportunity for investors. He says: “The delay will, I’m sure, slow price growth along the route, so it’s worth buyers and investors considering these locations as they will probably start to creep up again as the end date gets closer.”

Rob Bence, co-founder of The Property Hub, is similarly optimistic. He says: “The opportunities for landlords are huge, regardless of the delay.

“When it comes to property prices and major infrastructure, there are usually two spikes – one after the initial announcement and one on completion. The first is led by investors. Landlords who own properties along the Crossrail 2 route will reap the benefits long before the line is finished.”

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The property market in London has been hit harder than any other region in the country by the sharp slowdown since Brexit, official figures reveal today.

The average value of a home in the capital dropped 0.2 percent in September to £483,568, making London the only place in England where prices went into reverse.

Prices in six out of the 33 local authority areas in the capital.Brent, The City, Westminster, Enfield, Kensington & Chelsea, and Lambeth fell year on year. Across London, prices rose just 2.5 percent, less half the national rate of 5.7 percent.

Just outside London, in the South-East region, prices are going up at 5.5 percent a year, suggesting that growing numbers of buyers are giving up on London and looking at locations in the Home Counties instead. Today’s figures do not include the impact of the Bank of England’s interest rate rise this month, the first for a decade. When the benchmark cost of borrowing doubled from 0.25 percent to 0.5 percent.

Jonathan Hopper, managing director of home buying agency Garrington Property Finders, said: “Winter has come early to the London property market. What began as a freezing of prices in the capital’s most exclusive postcodes is turning into a harder frost on both activity and prices.

London is now not just the worst performing English region, it’s a serial laggard. In the 12 months to September, prices in the capital rose at barely a third of the pace of those in the fastest-growing region. This shift is being driven by a steady flight of equity from London — and other previously overheated regions — to areas with greater affordability.

“It’s far too early to talk of the market seizing up, as demand remains relatively robust. But falling real wages and the ongoing problems of affordability are starting to have a noticeable chilling effect.”

North London estate agent Jeremy Leaf said: “Although, of course, there is no average UK price and the UK market reflects all different areas working at various paces, the trend in London is quite different where an excess of supply and weak demand are combining to reduce prices consistently with no real prospect of an increase until early next year at the soonest.”

At the time of the Brexit referendum in June 2016, prices in London were rising at 11.6 percent a year, but they have slowed down dramatically as uncertainty over the withdrawal process from the EU has alarmed buyers. Agents have also blamed higher stamp duty rates for slowing down demand at the top end of the market.

Today’s figures also show that the number of home sales is still plummeting. There were just 6,639 transactions in London in July, down 24 percent on last year. In Tower Hamlets, they fell by two thirds, from 463 to just 160, in an area with a population of more than 300,000.

 

How to showcase your property in preparation of viewings

 

When selling or renting out your home one of the most important things to consider would be the presentation of your home, especially as it’s well appreciated when a homeowner has put time and effort into making a good first impression on their homes.

Preparing your home for viewings is definitely an important step in the current buyer’s market. Why is that? Well, it’s because your buyer audience will decide within just a few minutes of viewing whether or not your property is an ideal for them: an unkempt garden or peeling paintwork is often all it takes to secure a lousy review and send them house hunting somewhere else. Giving your house kerb appeal however, isn’t just about dressing for effect. Rather what you should be targetting is encouraging potential buyers to make an emotional connection to your property, to see how easy it will be to live there, rather than spend time imagining how the place might look and how hard it might be to whip it into shape. So how exactly do you go about showcasing your home to the best it can be?

Make an entrance

The exterior of your home is the very first thing potential buyers see and probably make the judgement on. So take note of the property across the road – and make sure your front garden frames the house with a design that gives it good character, but which also complements the street and also the uniqueness of your own home. Keep garden paths wide and weed-free to emphasise the feeling of arrival and separate any driveway with small trees and hedging plants or neat garden ornaments/decorations. Give your front door a fresh coat of paint and stick with quality door furniture that suits the age and style of the property.

Get snappy happy

It’s human nature to overlook what we see every day, but when you see things on the screen, you get a much-needed ‘other view’. So take photographs of your property and analyse them on the computer. This will allow you to critique each room in sequence and make improvements accordingly and also make sure the theme of your home coincides. 

Clean up the clutter

An excess amount of clutter makes it difficult to concentrate on what you’re actually viewing; the more we see in a room, the less we process naturally. Clutter also has the knack for making everything look smaller, so strip back rooms and detox them of unnecessary items. Put large items of furniture, knickknacks, and books into storage or get rid of them if they are currently in use. Prune furniture – people tend to line their walls with chairs and tables – floating furniture away from walls into cosy groups makes the traffic flow more obvious and the perimeters clear.

Lose the ‘me, myself, I’

Your home is no longer yours once that “for sale” or “for rent” sign goes up, but you still need to prepare it so potential new owners pick up on the positive undercurrents of your efforts. Start by depersonalising and neutralising spaces – remove photos, clothing, and personal items and replace them with more generic alternatives and items that are only fit for yourself/your family. You can still give your home personality with carefully chosen items such as decorative mirrors or scatter cushions; just keep the family heirlooms and kiddie art to a minimum, or store them away.

Light the way

The atmosphere is best created by having a variety of light levels according to your mood and the time of day, so install dimmers if you want to especially showcase this feature of your home. Remedy bad lighting by increasing the wattage of your lamps and fittings. Aim for a combination of floor, table and overhead lighting in key rooms to create contrast and highlight eye-catching objects. 

New research suggests : Despite doomsday predictions for house price growth in the capital, prices in Hackney will continue to keep growth strongly over the next three years.

Westminster and Lewisham which will both experience growth of prices of more than four percent. With Hackney are expected to grow more than five percent in the years to 2020.

With Richmond Upon Thames will experience the lowest growth, with prices rising around 1.5 percent. That’s followed by Harrow and Hounslow, where prices will rise around two percent.

The forecast, by KPMG, follows figures published by Savills yesterday which suggested having fallen this year, London house prices will not begin to rise until 2020. The figures suggested prices will fall two percent next year and remain flat in 2019, before rising five percent in 2020.

KPMG said it expected the UK’s economy to remain relatively lackluster, weighing on local demand in London in the medium term.

“On the whole, our projections for the London housing market see a continued cooling in the short term, followed by a gradual rebound in the medium term, which will allow the cumulative price growth to remain positive over the forecast horizon overall.

“However, annual growth rates are not expected to revert to the above-five percent figures seen before 2017 in most boroughs during the period.”

Borough House price growth up to 2020
Hackney 5.31%
Westminster 4.27%
Lewisham 4.11%
Waltham Forest 4.03%
Newham 3.99%
Southwark 3.90%
Haringey 3.75%
Wandsworth 3.73%
Lambeth 3.63%
Islington 3.41%
City of London 3.36%
Barking and Dagenham 3.23%
Camden 3.18%
Tower Hamlets 3.17%
Brent 3.15%
Greenwich 2.90%
Hammersmith and Fulham 2.84%
Kensington & Chelsea 2.79%
Merton 2.63%
Barnet 2.60%
Redbridge 2.60%
Hillingdon 2.50%
Kingston upon Thames 2.46%
Enfield 2.46%
Bexley 2.43%
Croydon 2.43%
Havering 2.40%
Ealing 2.29%
Sutton 2.18%
Bromley 2.12%
Hounslow 2.00%
Harrow 1.93%
Richmond upon Thames 1.65%

Aviva Investors to float its first property investment trust with plans to raise £200m

Amid increasing demand from investors, Aviva Investors is to float a new real estate investment vehicle and raise £200m.

The fund is the first of its kind for Aviva Investors, which is the UK’s largest real estate manager with around £24bn of properties under management.

It is expected to announce its intention to float on the London Stock Exchange on Tuesday, and will then list later this month.

The fund, which will be called Aviva Investors Secure Income REIT, will invest in buildings across the UK that are let to well-known tenants such as blue-chip companies in order to reduce the risk of the income being cut off if tenants default on.

These could include offices, shopping centers, and hotels and would typically be let on leases of 10 years or more, said Renos Booth, head of real estate long income at Aviva Investors.

He added: “With the FTSE at record highs and gilt rates at record lows, there is a search for yield and income. The aim is to provide that secure income through a diversified portfolio.”

Andrew Cunningham, the former chief executive of housebuilder Grainger, will chair the fund, which is targeting an annual yield of 5pc.

Aviva Investors has previously offered a similar investment package to institutions such as pension funds through its £1.9bn Lime Property Fund, which has been running since 2004.

But the move to list a new fund on the London Stock Exchange means it will be open to a wider pool of investors.

Proceeds from the IPO will be spent in the first nine months of the fund’s life, Aviva Investors said, adding that it was already in the process of buying £85m of property. It could also look for fund developments that are not yet built.

 

Kent’s Property Gems

A disused lift shaft has been sold off at auction today for £350,000. The beachfront plot on Viking Bay in Broadstairs originally had an asking price of between £40,000 and £50,000. The lot was in the Clive Emson auction, which was held this morning in Maidstone.

Also on the list was a block of public toilets in Longport, Canterbury, which went for £120,000.It was listed as having ‘potential’ in its location opposite Canterbury College and close by to a pay and display car park.

Even a bunker dating back to the Second World War on the Isle of Sheppey couldn’t escape the gavel after it went for £85,000.It was sold as a “rare opportunity” to buy the freehold which was once an air raid post.

Finally, an office building also went under the hammer at the auction, at The Clive Emson Conference Centre. There is a catch though; it’s right next to Sittingbourne’s fire station. It fetched £210,000 after having a guide price of between £210,000 and £220,000.

Find your hidden gem in Kent on www.propertypropertyproperty.co.uk.

This is set to be positive year for Aberdeen’s commercial market

The political landscape and predictions are widespread over how the snap general election could affect the markets. With Scotland dealing with the negative impact on property investment and market confidence amongst some investors and developers because of the prospect of a second independence referendum.

However, in Aberdeen, the atmosphere has largely driven by the fortunes of the oil and gas industry for the past two years, with the sector now showing largely positive signs. But not to say the wider political backdrop is of no concern, the UK’s vote to leave the EU immediately benefited Aberdeen’s oil and gas economy. The North Sea producers have profited from production costs being incurred in a depreciated sterling relative to a product sold in US dollars, as have local service companies pitching for business around the world conducted in a largely dollar-denominated market. With a growing confidence in the local air which is now impacting itself in our property market.

The office sector was a most impacted sector by the energy industries. The fortunes between 2013 and 2015 fluctuating and with the best quality space have maintained headline rents and interest from occupiers despite carrying a record level of voids. However, it must be said that much of the remaining stock has seen its day, being functionally or economically challenged or located on peripheral estates which have long been a unique feature of Aberdeen’s property supply.  

In comparison, Aberdeen’s industrial market has held up reasonably well. During 2016, take-up was in line with the 10-year average with rents generally remaining stable although the supply of second-hand stock has increased.

Investor appetite for Aberdeen is beginning to show signs of increasing. A North American investor, for example, acquired the Lloyd’s Register building in Prime Four Business Park for £41 million in February, pushing Q1 office investment levels to £49 million, more than the total volume recorded during 2016. Investors are seeking a ‘flight to quality’, looking for well let assets in the city, which may offer more attractive yields than elsewhere in the UK.

The good news is that office lettings in Q1 2017 were 181,000 sq ft (16,815 sq m), the highest quarterly take-up since Q3 2013. This clearly indicates that the local mood has moved up a gear, in part reflected by oil companies Total and Marathon committing to new leases and a number of large requirements circulating.

The further positive news comes with Hurricane Energy announcing a new find west of Shetland with estimated recoverable reserves of a billion barrels and small local independent Chrysoar announcing a $3 billion acquisition from Shell comprising 10 separate assets in the UK continental shelf with funding from US private equity firm EIG Partners.

The smart money is clearly backing a more positive future for Aberdeen and the property market is starting to reflect this.

 

Abbeywood where house prices are way below the London average and price growth is strong at the Crossrail hotspot!

Abbey Wood SE2 postcode has grown by an impressive 76 per cent in the last five years, but the average remains a relatively modest £309,560.

Buyers have been pouring into Abbey Wood in anticipation of next year’s launch of Crossrail — the Elizabeth line — which will cut journey times to central London by almost half an hour.

While the area is not a thing of beauty and boasts few amenities, it has streets of good-value period terraces where a three-bedroom house would cost £375,000 to £425,000. You could get a slightly dated purpose-built two-bedroom flat in Abbey Wood for about £250,000.

The research by Bairstow Eves, using Countrywide data, evaluated average prices in every postcode in London. Then, concentrating on the cheapest 25 per cent of postcodes, it analysed their one-, two-, and five-year price growth to establish the areas where prices are on the strongest upswing.

Bellingham and Catford (SE6), an area well-placed to link to Crossrail services via neighbouring Forest Hill, has performed almost as strongly, with prices up 71 per cent in the same period, to an average £380,641.

For buyers on really slim budgets the bargain basement postcodes are Thamesmead, just north of Abbey Wood, where average prices stand at £252,747, up 60 per cent in five years, and Dagenham (RM10) where prices have grown 66 per cent to an average of £270,878. The once-desolate Thamesmead Estate is currently the focus of a £1.5 billion regeneration. Housing association Peabody was granted planning permission for the first phase of its transformation of the area late last year. There are also plans to link it to the London Overground.

Predictably, none of today’s leading areas are in Travel Zones 1, 2 or 3, where  nothing qualifies as affordable. More than one in three are perched on the outer fringes of London – MitchamDagenhamHarold WoodWellingSuttonNortholtWest Drayton, and Uxbridge. Their low prices combined with good transport links have been tempting an increasing flow of buyers priced out of more central locations, pushing their prices upward.

NORTH LONDON
Nowhere in fully priced west London makes the good-value grade, but representing north London are 
Tottenham (N17), where prices have mushroomed 67 per cent to an average £347,486 — and where billions of pounds worth of regeneration money is being spent on new homes and facilities — and its near neighbour Upper Edmonton (N18) where prices stand at £316,045, up 66 per cent.

The location of London’s cheapest neighbourhoods is a bellwether for change in the capital,” said David Fell, research analyst at Countrywide, who believes that as these regeneration schemes take root further growth is likely.

Over the last 20 years the most affordable neighbourhoods in London have been pushed steadily outwards and eastwards as swathes of the inner city reinvented themselves. Some of the cheapest corners of the capital in the Nineties turned into the boom towns of the Noughties, changing beyond recognition in the course of two decades.

It’s likely to be a similar story for some of today’s cheapest neighbourhoods in London. The arrival of Crossrail and the extension of the Overground will soon plug swathes of south and east London into the rest of the capital. The prospect of these new links is already bringing a wave of new development to some of the furthest-flung corners of the city. Within a decade it’s conceivable that the capital’s cheapest neighbourhood could pop up in west London for the first time.”

 

Property Market Trends and Portents: What Should Home-owners Expect?

Property Market Trends and Portents: What Should Home-owners Expect?

After more than six months of concerted growth at the beginning of 2014, the housing market has cooled somewhat in recent times. After concerns that a new bubble may be about to form in the market, property prices have stagnated and even started to fall in the third financial quarter. This trend is set to continue for the last three months of the year at least, with the latest survey from the Royal Institute of Chartered Surveyors (Rics) showing a -18% balance in respondents reporting a rising demand for housing in the UK.

Although this sudden dip in growth has caused consternation among home-owners and potential buyers, it is unlikely that it will continue indefinitely. Even with the UK economy expected to grow at a consistent rate during 2015 and beyond, however, it is still worth considering the trends that will impact on the property market going forward.

 3 Property Market Trends to Consider

 With this in mind, let’s take a look at some of the real estate trends that we are likely to encounter in the fourth financial quarter and 2015. These include: -

 1.1       A Rise in UK Construction Output

 There is a strong link between real estate growth and the construction sector, and both are considered as being key engines of economic expansion. Given the recent stagnation, it was therefore surprising that construction output rebounded in September, recording growth of 1.8% following a 3% contraction in August. Not only does this underline the value that public sector projects can add to the market, but also the fact that the property sector is built on solid foundations.

1.2      Growth in the Buy-to-let Marketplace

While the property market has shown excellent resilience in recent times, the slowdown in price hikes has also triggered growth in the lucrative buy-to-let market. As a growing number of individuals find themselves priced out of the UK market, many turn to rental properties as a way of sourcing accommodation. This has created rising demand and enabled landlords to raise their prices, with the cost of agreeing a new tenancy having soared by 3.7% during the last year alone. This trend is set to continue for the rest of the year at least, so aspiring landlords and realtors such as Featherstone Leigh may wish to capitalise on this.

 1.3.      London will Remain Decoupled from the UK Economy

 Throughout the course of the last property market boom, London prices and trends decoupled from the rest of the UK and this trend is likely to remain for the foreseeable future. One of the primary reasons for this is London’s emergence as a global icon in the real estate market, which means that it benefits from overseas investment in a way that other geographical regions do not. It is considered to be something of a safe-haven for international property investors, and while this is good news for the economy it means that the capital does not provide a true barometer for the real estate landscape as a whole.

 

From Vickie Harrison