House prices in London:asking prices see growth for first time in two years

https://www.telegraph.co.uk/property/house-prices/asking-prices-london-fall-29pc-dragging-average-uk-property/

Homeowners across London are showing cautious signs of shaking off the Brexit blues, with a renewed confidence in the market pushing up asking prices for the first time in two years.

The average price of a property in the capital stands at £617,94 — or  1.3 per cent more than in August last year — according to the latest Rightmove house price index, published today.

The number of London homes sold during the past month is also up compared to last year, by a significant 5.2 per cent, representing the biggest increase since July 2017.

The research contradicts last week’s UK House Price Index from the Land Registry, which showed sales prices down by 2.7 per cent in the year to June. However, these figures relate to deals being struck back in the new year and therefore do not necessarily present an up-to-date picture of the health of London’s market.

William Drey, a director of estate agent Jackson's in Tooting believes a lack of supply is driving price rises. “We are seeing a large number of first-time buyers in the market, particularly those who have been renting locally for many years,” he said. “This is causing a wave of second-time buyers who are selling their first properties, and they tend to be upsizing within the Tooting, Balham or Clapham area.”

Seasonal slowdown

Asking prices are down marginally (0.1 per cent) month-on-month but a drop is to be expected now that the summer holidays are in full swing. Last year prices dropped 3.1 per cent between July and August.

“Some potential buyers have sat back and watched the price of property coming to the market in the capital falling year on year for the last couple of years, giving many of them little incentive to do anything but sit on the sidelines,” said Miles Shipside, director and housing market analyst at Rightmove, who described the increase as a “strong reason to be cheerful”.

“It’s always hard to spot the bottom of a market, especially in a massive place like London with its myriad local markets,” he added. “However … [if asking prices continue to rise] … buyers might decide to stop sitting it out before prices rise further. That could happen if we have more certainty on our Brexit outcome, and this annual price rise may be an indicator of more market activity to come.”
Marc von Grundherr, a director of London estate agents Benham & Reeves, believes the recent Tory Party shake-up that saw Boris Johnson replace Theresa May as Prime Minister might have helped both buyers and sellers feel more confident. “Having May sat there, almost paralysed, certainly did not help,” he said.

“Having a change in Government, and the feeling that, deal or not, we are coming out of Europe might have made people feel that there is no point in waiting and they have waited so long already they are sick of it.

“I think vendors are definitely more confident than they were a year ago and since there are few people who are really under pressure to sell, there is no reason for price cutting. Prices are certainly not flying, but I don’t see them falling either. We have seen a significant uptick in buyer numbers, and even investors are creeping back.”

Across London, homes in Zone 3 have seen the strongest asking price growth, up 2.8 per cent to an average of £576,709. There is also positive news in central London with prices up by 1.6 per cent in Zone 1 to almost £1.4million, and up 1.8 per cent in Zone 2 to almost £728,000. Growth was more muted in the suburbs, while Zone 6 prices are still falling — down 1.7 per cent year-on-year.


The best-performing boroughs were Southwark (up two per cent), Newham (up 1.6 per cent), and Bromley and Kingston upon Thames, both up 1.3 per cent.

https://www.homesandproperty.co.uk/property-news/house-prices-in-london-asking-prices-see-growth-for-first-time-in-two-years-a132806.html

UK housing market at its weakest point in a decade, says Savills

https://www.onthemarket.com/for-sale/flats-apartments/brighton-and-hove/

The UK housing market is at the weakest point since the global financial crisis a decade ago as Brexit uncertainty puts off buyers, according to a leading estate agent.

Savills, which sells and manages commercial and residential property around the world, said fewer houses were sold in the UK in the first half of 2019 than at any point since the first half of 2009.

The declines have been led by London, where prices have fallen after years of rapid inflation. The average price of London homes sold by Savills fell by 32%, to £2.1m, in the first half of 2019 compared with the previous year, as the company shifted towards less expensive homes to make up for a weakness in “prime properties” – those worth more than about £3m.

Weakness in the UK was mirrored in international markets amid “political instability and slowing global economic growth”, Savills said. In Hong Kong, which has faced weeks of political protests, office investment volumes fell by 34% year-on-year in the period, while the broader Asia-Pacific region remained under the shadow of the trade war between the US and China.

“In Asia Pacific, the imposition of Sino/US trade tariffs has affected investment confidence,” Savills said in a statement to the stock market.

Savills had previously warned it expected profits to decline in 2019, before either the Brexit extension or the Hong Kong protests, disruptions to business in two of its key markets.

Mark Ridley, the chief executive of Savills, said: “In many markets, particularly the UK and Hong Kong, political and economic uncertainty has considerably reduced the volume of real estate trading activity in recent months, although occupier demand remains robust.

“Underlying demand for the secure income qualities of real estate remains high, but these macro uncertainties weigh on investor sentiment and make predictions in respect of near-term market activity difficult to determine with accuracy.”

The company’s total revenues grew 16% year-on-year in the first half to £847m, in part because of growth in non-transactional operations such as facilities management and consultancy.

In the UK, both residential and commercial property sales volumes have been reduced by Brexit uncertainty since June 2016. While prices are still rising on average across the UK, the pace of growth has slowed. Average house prices in the UK increased by 1.2% in the year to May 2019, down from 1.5% in April 2019, the latest ONS figures show.

The uncertainty continued in the first half of the year after the government delayed the scheduled date of Brexit to 31 October, dampening the prospects of a short-term increase in demand for property.

The British commercial market, including retail properties, office space and warehousing, also declined. Savills’ transaction fee income fell by 7% year-on-year in the first half, “reflecting continued Brexit-related uncertainty”, Savills said. It comes at a time when the retail sector faces significant changes to its business model. The move to online purchases has diverted shoppers away from local high streets, resulting in a stream of store closures.

Savills saidits figures indicated commercial property investment activity in greater London was down by 31% year-on-year, while investment in markets outside London fell 33%.

Andrew Allen, the head of global investment research for real estate at Aberdeen Standard Investments, said the range of possible outcomes for investment in British property was “higher than people can remember”, mainly because of Brexit.

He said UK property remained attractive to investors from abroad, particularly as returns from financial assets such as bonds were declining. Financing costs have also fallen as major central banks cut interest rates.


“Despite all the challenges that we see, there is plenty of global capital that wants income,” Allen said.

https://www.theguardian.com/business/2019/aug/08/uk-housing-market-at-its-weakest-point-in-a-decade-brexit-says-savills?

Flipping property:drastic fall in number of Londoners buying and selling on homes for a quick profit

https://hmlandregistry.blog.gov.uk/2018/01/26/how-old-is-my-house/

Current market conditions of stagnating prices, slower sales and higher taxes have made it far harder to make money out of a quick buy and sale.

The number of London homes being bought and sold in a year to make a quick profit has collapsed by more than 80 per cent since the “flipping” boom peaked before the financial crash, according to new research.

Across the capital just 1,240 houses or flats were sold on within 12 months of being purchased last year, a fall of 86 per cent since the 8,380 flipped in 2002.

In some boroughs flipping has virtually disappeared altogether with just six such transactions recorded in Islington and 10 in Camden and Kensington & Chelsea in 2018.

The phenomenon, which contributed to the rapid gentrification of many areas of London, was at its most popular in the early and mid Noughties.

Soaring prices, easy access to mortgage debt, and gazumping made it easy for “amateur developers” to make vast profits from hurried refurbishments of “fixer uppers”.

The craze was fuelled by property shows such as Sarah Beeny’s Property Ladder, showing how buyers could makes tens of thousands of pounds through flipping.

The biggest gains came as prices peaked in 2014 when a flipped property was sold for an average of £115,440 more than was paid for it.

But in the current market conditions of stagnating prices, slower sales and higher taxes have made it far harder to make money out of a quick buy and sale.

Aneisha Beveridge, head of research at agents Hamptons International, which compiled the figures, said: “Between 2000 and 2007 house prices were rising at an average annual rate of 13 per cent, so there were plenty of opportunities for flippers to make profits.

!But following the financial crash price growth has slowed, and this combined with tax changes has meant that generally it’s harder for flippers to make as much of a return as before.”

In Kensington & Chelsea the number of flipped homes dropped more than 90 per cent from 108 in 2004 to just 10 last year.


It was a similar story in Redbridge where numbers fell from 285 to 28 over the same period

https://www.homesandproperty.co.uk/property-news/flipping-property-drastic-fall-in-number-of-londoners-buying-and-selling-on-homes-for-a-quick-profit-a132496.html