London house prices: property market in the centre of the capital emerging from 'Brexit coma'

https://www.theguardian.com/money/2018/jul/18/uk-annual-house-prices-rising-at-slowest-rate-for-five-years-ons

The moribund central London property market is finally emerging from a three-year “Brexit coma” as impatient buyers decide they have put their decisions on hold long enough, according to two reports this week.

Estate agent Chestertons says its analysis shows the epidemic of price reductions is easing as confidence returns to the capital, despite the continuing political uncertainty during the Tory leadership contest.

Its data found that there were 35 per cent fewer price cuts in the first five months of the year compared with the same period in 2018.

At the same time the number of home buyer registrations across the capital as a whole rose 18 per cent.

The biggest rise in demand has come in prime central London areas such as Chelsea, Westminster, Mayfair and Knightsbridge, where there has been a 32 per cent increase in the number of buyers registering.

Chestertons’ managing director Guy Gittins said: “With confidence comes an acceleration in activity — and that’s what we’re seeing as buyers shrug off the current political uncertainty and the London housing market starts moving again. This has been the most encouraging start to the year we’ve witnessed since the EU referendum result, and the change in buyer appetite is palpable.

“The direction of travel is clear. The recent upswing in buyer demand means it’s much more likely that a property will sell for its asking price compared to a year ago, as competition for available homes ramps up. And this is only the start. We know there’s a huge amount of pent-up demand in the market, and once there is greater clarity over Brexit, more buyers are going to be getting off the fence and flooding into the marketplace.”

Separate analysis from property investment fund London Central Portfolio (LCP) has also uncovered a “notable change of sentiment” over recent months.

It has recorded a 37.9 per cent jump in transactions during the last quarter — the biggest rise in more than two years — and suggests that investors are shrugging off “Brexit fatigue.”

Prices are also up, surging 13 per cent on a quarterly basis and 8.2 per cent year on year, according to the LCP data.

LCP chief executive Naomi Heaton said: “The ‘wait and see’ attitude, endemic since the EU referendum in 2016, appeared to start turning ahead of the Brexit deadline of March 29, with investors wanting to capitalise on weak sterling and discounted prices.

“While the extension of the deadline appeared to have initially dampened investors’ enthusiasm, there has been a notable change in market sentiment and several estate agents are reporting improved trading conditions. It would appear investors are no longer prepared to sit on the sidelines while the UK makes up its mind.”


https://www.homesandproperty.co.uk/property-news/london-house-prices-property-market-in-the-centre-of-the-capital-emerging-from-brexit-coma-a131546.html

How the tenant fee ban is changing buy-to-let

https://www.telegraph.co.uk/property/house-prices/mapped-area-england-wales-average-house-prices-100000/

The tenant fee ban is new to most of the UK, but has been in place in Scotland since 2012. Advocates of extending the ban throughout the rest of the UK pointed to the fact that rents in Scotland have not risen significantly in the intervening years.

While this may be true (depending on your definition of significantly), there are many differences between the housing market in Scotland and the housing market in the rest of the UK, particularly England.

Because of this, it might actually be easier and more accurate to set aside the Scottish housing market when considering what the tenant fee ban could mean for other parts of the UK.


The practicalities of extending the tenant fee ban

Not only does England have a larger population than Scotland, but, in much of the country, it also has much greater population density. This leads to increased demand for housing, especially rental housing and thus buy-to-let property investors who do remain in the market could well have more flexibility to raise rents than their northern counterparts.

They may also have more motivation to do so because one of the major differences between the Scottish housing market and the English one is that Scotland is exempt from the Right to Rent legislation, hence landlords can be more relaxed about setting up tenancies themselves and then using lettings agents for day-to-day property management.

Landlords in England, however, still have to think much more seriously about the personal liability they face if they either take in a tenant who does not have the “Right to Rent” or breach the Equality Act when undertaking “Right to Rent” checks. This may provide a compelling argument for continuing to use lettings agents and passing the cost on to tenants.


Landlords in England are selling up - sometimes fast


It’s also worth noting that many former buy-to-let property investors have exited the market over recent years and it seems likely that more will do so in future. While this exodus may not have been entirely caused by the prospect of the ban, it does have the impact of reducing the supply of rental property and/or reducing competition amongst landlords.

New research from Sellhousefast.uk looked at 10 of the UK’s key buy-to-let markets, namely Birmingham, Canterbury, Colchester, Coventry, Enfield, Luton, Manchester, Peterborough, Stockport and Wolverhampton.

It found that the area in which properties sold most slowly was Wolverhampton, but even here, the average sales time was just 138 days.

The area in which properties sold most quickly was Stockport, where sales took an average of just 104 days and this was closely followed by Coventry where the average sale took 124 days.

This is hardly surprising given that popular buy-to-let locations, by definition, are places where there is strong demand for property. What is, however, currently unclear, is whether these properties have been bought by residential buyers or by committed buy-to-let investors looking to expand their portfolios as, one way or another, this could have a significant impact on the housing market.


Mark Burns is the managing director of property investment company Hopwood House.

https://www.landlordtoday.co.uk/breaking-news/2019/6/how-the-tenant-fee-ban-is-changing-buy-to-let

House prices in London:pace of price falls slow in the capital while buyer demand fuels growth in the North of England

https://www.countrylife.co.uk/property/london-property/london-property-of-the-week-period-townhouse-in-notting-hill-24641

Market commentators believe London has seen the bottom of its market cycle and credits novice buyers for the improvement

The collapse in London’s property market is showing tentative signs of slowing, according to new research by Rightmove.

Over the past year to June, asking prices across London fell by two per cent, which is the smallest decline measured since January and an improvement on the 3.8 per cent decrease recorded in March.

The slight upswing is thanks to higher numbers of first-time buyers taking advantage of low mortgage rates and the market slowdown.

However, despite continual falls, the average asking price for a home in the capital still currently stands at £618,880, almost double the average of the rest of the country.

Outside London, record price growth in the active regional markets of East Midlands, North West, Wales, Yorkshire & the Humber helped to push the national average to £309,348. This is just £91 away from the market peak seen a year ago, with high levels of buyer demand nudging up prices in these regions.

The London overview

In London's most central — and most expensive areas — the average cost rose to £763,000, while in suburban areas, homes hit an average asking price of £516,000.

Homes in travel Zone 3 were the star performers ⁠— relatively speaking ⁠— with average asking prices up by 0.5 per cent over the past year. All other travel zones showed annual price drops.

“With average prices nearly £130,000 cheaper than in neighbouring Zone 2, the price momentum we are currently seeing may be down to buyers being priced out of the more central zones and having to accept a slightly longer commute to work in order to afford to buy,” said Miles Shipside, Rightmove director and housing market analyst.

But over the past year, only four boroughs saw positive house price growth: Bexley, Brent, Barking and Dagenham, and Waltham Forest.

The first-time buyer effect

Marc von Grundherr, director of Benham and Reeves, thinks London has seen the bottom of its market cycle and credits novice buyers for the improvement.

“Market conditions are currently perfect for first-time buyers due to low mortgage rates and stuttering house price growth and as a result, it is this demographic leading the charge in a market blighted by Brexit angst,” he said.

However there remains a gulf between wages and prices.

“Affordability is arguably the biggest drag on the market as, despite sluggish price growth as a result of Brexit, many still struggle to raise the capital required for a mortgage deposit,” he said.
“Couple this with the additional costs of stamp duty and legal fees and that initial barrier will always be the hardest thing to overcome when looking to buy.”

At a local level, agents in certain popular areas are seeing a return of first-time buyers with decent budgets and pent-up desire to buy.

Charles Mitchell, head of sales at Winkworth in Tooting, south-west London, says first-time buyers with up to £500,000 to spend are kick-starting the market.

"Over the coming year we expect to see a steady rise in activity in the lower end of the market."

He also hopes that buyers of more expensive properties "will also start to come out of the woodwork, in the belief prices won’t sink any further."

https://www.homesandproperty.co.uk/property-news/house-prices-in-london-pace-of-price-falls-slow-in-the-capital-while-buyer-demand-fuels-growth-in-a131276.html

New listings increased strongly in May, latest index shows

https://www.chestertons.com/property-to-buy/search-results/properties-in-london-to-buy/b-t-llondon/

Sellers returned to the housing market in May with new property listings across the UK up 9.2%, from 57,710 in April to 63,001, the latest index data to be published shows.

New supply in London was also up 7.9% with activity in the capital back after a difficult few months, according to the property supply index from Housesimple which analyses the number of new properties listed each month by estate agents across more than 100 major UK towns and cities.
Overall, some 80% of those towns and cities saw a rise in new properties coming onto the market in May compared to April. Warwick, Falmouth and Canterbury all saw new property listings rise by at least 60% in May, while new sellers were up by a quarter in the London borough of Hammersmith and Fulham.

Warwick was top with a rise of 68.2%, followed by Falmouth up 64.1%, Canterbury up 63.8%, Slough up 54.3%, Rotherham up 53.9%, Southport up 52.1%, Weston Super Mare up 50.5% and Guildford up 50.4%.

In London new listings increased the most in the borough of Hammersmith and Fulham, up 25.1%, followed by Brent up 22%, Kingston upon Thames up 21.9%, Hackney up 20.4% and Camden up 19.9%.

‘May was a strong month for new listings. Sellers looked to make the most of relatively calm market conditions and buyers continued to cash in on competitive mortgage rates. Parents will also be thinking about the next school year and this may spur on families looking to move and changes school,’ said Sam Mitchell, Housesimple chief executive officer.

‘Although Brexit uncertainty will return later in the year, the housing market experienced a late spring bounce in May as the Brexit extension removed short term uncertainty. There is now a window of opportunity for buyers and sellers to make the most of more stable market conditions in the weeks to come,’ he added.

https://www.propertywire.com/news/uk/new-listings-increased-strongly-in-may-latest-index-shows/