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Scotland’s Property Prices Hit Record Levels

Scotland’s property prices are rising at the fastest for a decade, Savills has reported.

The estate agent puts the rises down to a COVID-19-led property boom that has produced double-digit rates of annual increase – with average Edinburgh house price topping £300,000 for the first time.

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‘The sales market, particularly for family homes, has been very active in the first half of the year’, said Savills director John Forsyth. ‘Nearly 80 per cent of the properties we have sold have attracted multiple bidders. Premiums of up to 20 per cent over valuations have been achieved by our Edinburgh city office.

The firm said that in June registered buyer inquiry levels were up 30 per cent on a year ago. As in England, it seems the pandemic has encouraged many families to move to larger properties that are more suitable for working from home.

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Savills’ comments were reported in Scottish Housing News which also quoted Rettie & Co head of research Dr John Boyle as saying the last time Scotland had seen similar house market growth was in the bubble of the early to mid-noughties leading up to the global financial crisis. ‘Increased demand has not been met by a rise in supply, which is broadly stagnant or below comparable 2019 levels, therefore prices will rise’, he said.

Registers of Scotland, which records all Scotland’s house transactions, said that the cost of the average house in the country had increased from just under £153,000 in May 2020 to £171,448 this year.

Source: Landlord Knowledge

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House prices up 10% annually, according to ONS

Average house prices increased by 10.0% over the year to May, up from 9.6% in April, according to the latest figures from the ONS.

On a monthly basis prices were up 0.9% in the month to May to an average £255,000, nearly returning to the record average house price seen in March of £256,000.

Average house prices increased over the year in England to £271,000 (9.7%), in Wales to £184,000 (13.3%), in Scotland to £171,000 (12.1%) and in Northern Ireland to £149,000 (6.0%).

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London continues to be the region with the lowest annual growth (5.2%) for the sixth consecutive month.

Tomer Aboody, director of property lender MT Finance, said: “Despite a dip in price growth in April, the housing market got back on track in May, continuing on its upwards trajectory.

“Buyer confidence certainly remains high, not only in terms of the desire to move but also in respect of getting the necessary finance approved, and this is helping push up prices.

“With so many mortgage products out there, buyers have the opportunity to get onto the property ladder, or move up it, at record low rates. If you have to stretch yourself to get a bigger mortgage to purchase the property you have set your heart on, low mortgage rates make this a much more palatable proposition.

“Stamp duty holiday or not, prime properties with good outdoor space, including room to work from home and not too far from the station or the office to make commuting possible where necessary, will always be in demand with multiple buyers willing, and able, to pay.”

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Mark Harris, chief executive of mortgage broker SPF Private Clients, added: “Continued strong demand for property, combined with a lack of stock, is pushing up prices further still. Low mortgage rates, combined with bigger deposits built up during lockdown, are giving buyers plenty of purchase power.

“Despite the tapering of the stamp duty holiday, there isn’t much sign of a significant slowdown in the market. Lenders remain keen to lend and interest rates look unlikely to rise anytime soon, resulting in some cheap mortgage deals, particularly for those with large deposits.”

Source: Mortgage Introducer

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Annual house price growth accelerated in June

Annual house price growth accelerated in June, and now stands at over 13 per cent, the Nationwide’s latest House Price Index suggests.

The 13.4 per cent annual rate of increase is the highest level recorded since November 2004. The month on month rate of increase was 0.7 per cent, meaning an average priced house went up by over £2k between May and June.

Strongest price growth was in Northern Ireland, weakest was in Scotland.

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While strong house price growth is partly due to ‘base effects’, with June last year unusually weak due to the first lockdown, the market continues to show significant momentum, said Nationwide chief economist Robert Gardner.

‘Indeed, June saw the third consecutive month-on-month rise, after taking account of seasonal effects. Prices in June were almost 5 per cent higher than in March.

‘Regional data for the three months to June indicates that all parts of the UK saw an acceleration in annual house price growth. Northern Ireland and Wales saw the largest gains, at 14 per cent and 13.4 per cent respectively. By contrast Scotland saw the weakest rate of annual growth, at 7.1 per cent closely followed by London at 7.3 per cent’.

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Meanwhile mortgage payments are still affordable, said Gardner, but deposits remain a major hurdle for most first time buyers

‘Despite the increase in house prices to new all-time highs, the typical mortgage payment is not high by historic standards compared to take home pay, largely because mortgage rates remain close to all-time lows. In fact, on this measure affordability remains broadly in line with its long run average,.

‘However, house prices are close to a record high relative to average incomes. This is important because it makes it even harder for prospective first time buyers to raise a deposit. For example, a 10 per cent deposit is over 50 per cent of typical first time buyer’s income’.

Underlying demand is likely to remain solid in the near term as the economy unlocks, said Gardner. ‘Consumer confidence has rebounded while borrowing costs remain low. This, combined with a lack of supply on the market, suggests further upward pressure on prices. But as we look toward the end of the year, the outlook is harder to foresee’.

Source: Landlord Knowledge

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House Price Begin to Dip, but Remain High Year-on-Year

The average price of a UK home dipped 0.5 per cent in June, according to the latest House Price Index from Halifax.

The statistics, released yesterday, showed that the average house price was now £260,358 across the UK, having risen 2.9 per cent in the last quarter. Annually, however, house prices have increased by 8.8 per cent.

Russell Galley, managing director of Halifax, said: “With the stamp duty holiday now being phased out, it’s was predicted the market might start to lose some steam entering the latter half of the year, and it’s unlikely that those with mortgages approved in the early months of summer expected to benefit from the maximum tax break, given the time needed to complete transactions.”

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He added: “That said, with the tapered approach, those purchasing at the current average price of £260,358 would still only pay about £500 in stamp duty at today’s rates, increasing to around £3,000 when things return to normal from the start of October. Government support measures over the last year have helped to boost demand, particularly amongst buyers searching for larger family homes at the upper end of the market. Indeed, the average price of a detached home has risen faster than any other property type over the past 12 months, up by more than 10 per cent or almost £47,000 in cash terms. At a cost of over half a million pounds, they are now £200,000 more expensive than the typical semi-detached house.”

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Reacing to the news, Martin Magnone, CEO and co-founder at Tymit, said: “Whilst house prices have dipped by 0.5 per cent this month, the frenzied housing market shows no signs of slowing down just yet. As a result, it’s not just property prices that have been surging – furnishing budgets are too, and it’s not out of choice. Our research revealed that a third of people rushed their property purchase to take advantage of the Stamp Duty holiday, and two-thirds faced unexpected expenses as a result, with the average furnishing budget blown by almost £15,000.”

He added: “As demand outstrips supply, the market is moving at a faster rate than ever before and caution, planning and budgeting are being thrown to the wind in order to secure a dream home. Whilst home buyers need to act fast, purchasing a property is a huge decision – 60 per cent of those we surveyed wished they’d taken more time. With this in mind, I’d urge people to plan, plan and plan again to ensure their new home doesn’t welcome them with loans and costly credit cards they hadn’t budgeted for.”

BY PETE CARVILL

Source: Property Wire

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Property prices hit record high as average UK home now costs staggering £336,000

Property sales prices have hit a record high for the third month in a row, pushing the typical price tag across Britain to £336,073.

The price of homes coming to the market increased by 0.8%, or £2,509, on average in June, according to Rightmove.

It said asking prices across all regions have risen – despite Office for National Statistics (ONS) figures last week showing the average UK house price fell by £5,000 in April after reaching a record high in March – the month when a stamp duty holiday was originally due to end.

The ONS house price index is less timely than Rightmove’s data as it is based on completed sales at the end of the conveyancing process, rather than the prices that sellers are looking to achieve.

Tim Bannister, Rightmove’s director of property data, said: “Record low interest rates and stamp duty tax reliefs have helped many to afford higher prices, satisfying their pent-up desires for a new home fit for a new era.

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“Some of that demand has now been met, and the phasing out of stamp duty reliefs has also taken away some of the urgency to move, though our high traffic and search data indicate that there is still strong buyer demand. This super-charged activity cannot go on forever, but we expect the market to remain vigorous for at least the remainder of the year.”

Demand is particularly high for “top of the ladder” detached homes with four bedrooms or more with the number of sales agreed for properties priced over £500,000 up by 49% in May compared with May 2019.

The housing market as a whole has seen an average price rise of 7.5% since March 2020, or £23,448. But average prices for top of the ladder homes have increased by £67,394, or 12.3%, during this period. Prices of newly marketed properties in Wales are up by 14.6% since March 2020 – the biggest rise in Britain, Rightmove said.

The second largest price rise is in the South West, where price tags are up by 11.4%.

Mr Bannister continued: “Average prices in Wales are well below the national average, offering good value as well as beautiful rural and coastal surroundings.

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“Buyer demand is up by 44% compared to a year ago, the highest increase of any part of Britain. The South West has been long-established as a second home hotspot, but has seen renewed impetus from main residence relocators being unshackled from the traditional locations for their daily commute.”

Matt Barry, director at Astleys estate agents in Swansea, said: “We’re now regularly receiving offers from multiple buyers per property. This often results in us requesting best and final offers and homes selling for far in excess of the original asking price.”

Nick Leeming, chairman of Jackson-Stops, said: “There were 18 buyers chasing every listing across our branches in the South West last month as towns and villages which were once out of reach to five-day-a-week commuters now present realistic options for hybrid or remote workers.”

By Brett Gibbons

Source: Kent Live

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Average UK House Price Falls for First Time in Months

The average UK house price fell 1.9 per cent between March and April but was still 8.9 per cent higher than it was in April 2020, according to HM Land Registry’s latest House Price Index.

The index, released yesterday, showed the average price of a property in April 2021 was £250,772, down from £255,707 the month before. Since at least May 2020, average house prices within the UK have increased incrementally.

The increase in mortgage lending throughout March, itself boosted by the Stamp Duty holiday, to £35.6bn was thought to have boosted April’s sales, even though the average price fell.

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Nick Barnes, head of research at Chesterton’s, said that this would have a snowball effect in the coming months.

He added: “As a result, we will continue to see strong demand from property buyers in an already competitive market.”

Others, including Paul Stockwell, chief commercial officer of Gatehouse Bank, said that the annual growth in prices was ‘still remarkable’.

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He added: “There remains a shortage of properties coming onto the market in many areas, resulting in intense competition in some cases, and this factor is likely to keep prices pushing upwards throughout the summer.”

Others took up the theme of the UK’s housing shortage.

Andy Sommerville, director of Search Acumen, said: ““Our national housing supply squeeze looks set to continue for the foreseeable future, pushing up prices further still. The beneficiaries on the building side are the developers of homes with access to gardens, given that working from home and more flexible working practices are likely to continue in the coming months, driving people to move into bigger homes with access to green space.”

BY PETE CARVILL

Source: Property Wire

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House prices continue to rise as supply and demand gap widens

House prices in the UK continued to rise in May as the gap between rising new buyer inquiries and falling new instructions by sellers became the widest seen since November 2013, Royal Institution of Chartered Surveyors (RICS) data has shown.

RICS said prices had increased for the fourth month running in May as the stamp duty holiday continued to fuel demand.

However, it added that there were signs that more properties would be coming onto the market in the summer and that 12-month sales expectations were flat.

But, it did warn that there was “no sign of house price inflation losing any steam”, adding that agents are predicting rises over the short and long-term.

Simon Rubinsohn, RICS chief economist, said: “With the economy performing better than could have been expected even a short while ago and the cost of money still at rock bottom levels, the principal drivers supporting demand will remain in place even after the expiry of the stamp duty holiday.

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“More challenging is the question of supply, a theme coming back strongly from respondents to the survey both with regard to the sales and lettings markets.”

Sundeep Patel, director of sales at specialist lender Together, added: “With both house price growth and prices up again in May, the demand for property continues to pick up the pace ahead of the summer months. House prices rose to +83% in May, up from +76% in April and 32% more respondents noted an increase from prospective buyers.

“Although, with today’s data showing -21% of respondents reported another fall in the number of new listings being brought to market and Andy Haldane’s, chief economist at the Bank of England, remark earlier this week about the UK property market being “on fire” – only reconfirms the widely reported market concerns over future supply and demand issues.

“That said, with the government’s First Homes scheme now launched and the new Planning Bill to prop up more regional housebuilding, it does seem as though there are a few boosts on the horizon for first-time buyers who have their sights set on getting on the ladder in the next few years.

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“Specialist lenders will be crucial in supporting buyers’ property plans as we expect there to be more demand for flexibility post-pandemic, to meet borrowers’ evolving circumstances.”

Whilst Nigel Purves, CEO of Wayhome warned of a perfect storm for first-time buyers.

He said: “The solid increase in buyer enquiries last month (+32%) and house price growth (+83%), is a something of a perfect storm for those hoping to take their first steps onto the ladder.

“With the stamp duty holiday finally coming to an end, we may start to see these levels of activity ease off, but aspiring homeowners will be left wondering what impact this will have on their ability to own a home of their own.

“Moving forward, we need to see better, deeper support for reluctant renters who are ready to take their first step onto the ladder. New pathways are needed to ensure people are not out-priced and are able to access desirable homes that are suited to their long-term needs.”

Source: Mortgage Introducer

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UK housing market is ‘on fire’ and will widen wealth gap, says BoE’s Haldane

The UK housing market is “on fire”, and as a result is likely to hit those without property especially hard, Andy Haldane, chief economist at the Bank of England, has said.

The housing market has been fuelled by a combination of government incentives for buyers, like the stamp duty holiday, more demand from households with more savings after the lockdowns, and a lack of homes for sale, Haldane said.

Speaking at a webinar organised by the University of Glasgow, the chief economist said the recent rise in house prices – which topped 10 per cent over the 12 months to March, according to official data – was very likely to worsen pre-existing wealth inequalities.

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The average house price went up £3,000 in May, according to the latest figures from Halifax, taking the average property price to a record high of £261,743.

In the 12 months to May, the average house price has increased by £22,000, according to Halifax data.

The government’s stamp duty holiday, which saw stamp duty scrapped on properties worth up to £500,000, is largely the reason behind the UK’s booming house prices in the last year.

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Just last week the BoE’s deputy governor Jon Cunliffe said the Bank was watching the housing market “very carefully” in the wake of the boom.

Prior to that, Sir Dave Ramsden, another one of the central bank’s deputy governors, said the BoE expects the price pressures to be temporary.

“There is a risk that demand gets ahead of supply and that will lead to a more generalised pick-up in inflationary pressure,” Ramsden told the Guardian. “That’s something we are absolutely going to guard against. We are looking carefully at the housing market and a raft of real-term indicators.”

By Hannah Godfrey

Source: City AM

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Bank of England carefully monitoring rise in house prices

The Bank of England is carefully monitoring the rise in house prices which has been largely fuelled by the extension of the stamp duty holiday.

A year ago activity in the housing market collapsed in the wake of the first lockdown with transactions dipping to a record low of 42,000 in April 2020.

Since then there has been a complete turnaround in the housing market in the past year, buoyed by the extension of the stamp duty cut introduced last summer.

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The tax holiday was originally due to end in March before the Government announced an extension to June. BoE figures published last month showed mortgage borrowing rose by a net £11.8bn in March, the strongest rise since the series began in April 1993.

“I think what we’re seeing in the housing market at the moment is being driven mainly by the tax holiday,” the BoE’s deputy governor Jon Cunliffe told the BBC today.

“There are some signs that people are making different housing choices and that may affect the future. It’s something we’re watching very carefully.”

House prices shot up 1.8 per cent month-on-month to 10.9 per cent last month, the highest level in nearly seven years. It followed a 2.3 per cent rise in April.

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The new record average house price is £243,000, up by almost £24,000 over the past twelve months, according to new Nationwide data released today.

Cunliffe’s comments come after Sir Dave Ramsden, another one of the central bank’s deputy governors, said the Bank of England expects the price pressures to be temporary.

“There is a risk that demand gets ahead of supply and that will lead to a more generalised pick-up in inflationary pressure,” Ramsden told the Guardian. “That’s something we are absolutely going to guard against. We are looking carefully at the housing market and a raft of real-term indicators.”

Inflation is at 1.5 per cent and is expected to rise above its two per cent target for a short period in the coming months.

By Angharad Carrick

Source: City AM

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The UK Locations Where House Prices are Rising Fastest

Research from national UK estate agent, Keller Williams UK, has revealed which areas of the property market in England are currently Best in Show, when it comes to price appreciation across each county since the start of the stamp duty holiday.

Keller Williams analysed house price growth since last July across all local authorities in England before highlighting which area was leading the property market boom across each of the 48 ceremonial counties.

Across England as a whole, house prices have climbed 8 per cent since the stamp duty holiday was introduced, but the highest rate of growth has been in Oadby and Wigston. At 22 per cent, house prices in the area have boomed and not only has Oadsby and Wigston seen the highest rate of growth of all areas of Leicestershire, but it currently leads the national property market.

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In Lincolnshire, stamp duty house price growth has been highest in South Kesteven at 21 per cent, placing it second in the list of county property market frontrunners.

Stratford-upon-Avon (19 per cent) in Warwickshire, South Derbyshire (19 per cent) in Derbyshire and Redcar and Cleveland (17 per cent) in North Yorkshire also sit amongst the highest levels of house price growth, having driven the market in their respective counties since last July.

However, breaking the market down based on the best performing area of each county reveals that not all areas of the UK market are seeing prices boom to the same extent.

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At the other end of the table, the unitary authority of Wiltshire has beaten Swindon to claim the highest rate of house price growth in the ceremonial county of Wiltshire. However, at just 7 per cent, it’s the worst performing county frontrunner in England.

Ben Taylor, CEO of Keller Williams UK, said: “The property market is booming since the introduction of the stamp duty holiday and we’ve highlighted the cream of the crop leading the house price charge in each county across England. While each area is home to the highest house price growth in its respective county, some are performing far better than others. This is down to the drastically different DNA of the market from one area to the next and it’s interesting to see how the rate of house price growth differs across the best performing areas in each county. That’s not to say that an increase of seven per cent should be sniffed at and, in fact, this would be considered a very healthy level of growth in ‘normal’ market conditions.”

BY PETE CARVILL

Source: Property Wire

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