Management Offer | 04/08/2010 |
Property Book UK are offering 3 Months Free Management & Free limited content insurance (subject to terms & conditions) throughout the months of August & September. |
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Budget 2010: Capital Gains Tax on second homes | 02/07/2010 |
The Chancellor of the Exchequer George Osborne has set out his Budget with a comprehensive five-year plan to rebuild the British economy.
With regard to residential property, owners of second homes may pay higher taxes, the Chancellor announced today.
Capital Gains Tax (CGT) will rise from 18% to 28% for those liable to income tax at the higher and additional rates. Basic rate taxpayers will continue to pay CGT at the current 18% rate.
The existing £10,100 threshold before there is any liability to pay CGT will remain in force and will be increased each year in line with inflation. This means you will not be liable to pay CGT on the first £10,100 rise in the value of your second home when you sell it.
There is no change to the CGT exemption on the sale of your sole or main residence. Source: UK Property Shop |
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Fewer residential landlords choose to remortgage | 17/03/2010 |
The number of residential landlords who remortgage their buy-to-let loans continues to decrease, according to figures released by Paragon Mortgages. The last fiscal quarter of 2009 saw yet another drop in remortgages and fewer still are obtaining loans through financial advisors. In fact, 30 percent of residential landlords were able to receive a loan by applying through a financial advisor in order to remortgage their existing properties. This represents a 9 percent drop over figures from just three months earlier when the proportion of remortgages arranged through a financial advisor stood at 39 percent. Paragon Mortgages has tracked continuous decline in remortgaging for the past four quarters and the firm concluded that the number of landlords choosing this financial arrangement has never been this low since 2006.
Landlords often choose not to remortgage because the Bank of England's base rates continue to hover around historic lows of 0.5 percent, meaning as near good a rate as they are likely to get. The relatively restrictive nature of buy-to-let lending coupled with a scarcity of loan products for the rental sector have also discouraged landlords who might consider remortgaging.
Britain's Council of Mortgage Lenders seems to underscore what Paragon found in its survey. Over the past two years, gross advances in the buy-to-let loan sector have decreased by a staggering 72%. While the value of regular mortgages has also fallen, the decline has been closer to 50%.
Source: UK Property Shop |
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Rental Grows In Dominance By 4.1 Percent | 10/03/2010 |
Forty years ago home ownership may have been the route of choice but according to research by the Communities and Local Government's English Housing Report, more and more homeowners are becoming dependant on the Private Rented Sector.
In their report they revealed that since 2001, the number of UK households renting has risen from 1 million to 3.1 million people. Similarly this sector has rapidly grown in dominance increasing from 10.1% in 2001 to 14.2% in 2008-09. These figures appear to be working in direct correlation with the decrease in home ownership which has dramatically dropped in popularity from 14.8 million people to 14.6 million in the last 2 years.
Speaking on these statistics, Nigel Terrington from Paragon Group feels that they are proof that the government needs to recognise the growing importance of the rental sector and remove all the red tape from property investment so property investors can effectively invest in property.
With the UK population expected to grow by 10.6 million people by 2033, and the government not mustering enough property developments to cope with increases in housing demand, the government need to get their act together and acknowledge that the property market is vastly different from 40 years ago. |
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House prices rise again but weather depresses activity | 01/03/2010 |
In January, 32 percent more chartered surveyors reported a rise than a fall in house prices up from 30 percent in December. However, the majority reported that buyer enquiries fell for the first time in 14 months while new instructions dropped for the first time in seven months. 20 percent more reported a fall than a rise in new buyer enquiries down from a positive reading of 18 percent, while a net balance of five percent of chartered surveyors saw a decline in new instructions which compares with a positive balance of 15 percent in December.
The bad weather clearly had a negative impact upon both supply and demand in the housing market with newly agreed sales also falling for the first time in ten months and activity coming to a halt amidst the seasonal chaos.
Surveyors are however optimistic that these negative signs are a reflection of the extreme weather conditions only. Transaction levels fell just slightly in January. The number of sales per surveying firm fell from 19 to 18 while the closely watched sales to stock ratio - a measure of market slack and a lead indicator of future prices - fell for the second successive month.
Activity and interest is likely to pick up in the coming months as the market experiences a spring bounce.
RICS spokesperson Ian Perry said, "House prices are likely to rise in the short term but if more supply continues to come onto the market, it is possible that the market will run out of steam in the latter part of the year." |
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November house prices up 0.9% since October | 08/01/2010 |
The November data from Land Registry's flagship House Price Index shows a positive monthly house price change of 0.9 per cent, which is the sixth month in a row in which the movement has been above nought per cent.
The annual house price change stands at -0.3 per cent. This is the seventh month in a row in which the annual rate of decline has decreased. The average house price in England and Wales is now £161,554.
Four regions in England and Wales experienced increases in their average property values over the last 12 months. The region with the most significant annual price fall was Yorkshire & The Humber with a movement of -4.7 per cent. Wales experienced the greatest monthly rise with a movement of 2.9 per cent. The West Midlands was the region with the most significant monthly price fall with a movement of -0.4 per cent.
The most up-to-date figures available show that during September 2009 the number of completed house sales in England and Wales rose by 30 per cent to 53,482 from 41,302 in September 2008. Transaction volumes, while no longer falling at 2007 rates, remain relatively low. |
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House Prices Edge Up | 11/12/2009 |
Nationwide Building Society reports that house prices rose in November, the same rate as in October. It increased by 0.5%. Year-on-year house price inflation increased from 2.0% to 2.7%, while the labour market has so far held up better than expected.
The average house price in November was £162,784, compared with £162,038 in October.
Commenting on the figures Martin Gahbauer, Nationwides Chief Economist, said:
The monthly rate of house price inflation was unchanged in November at a seasonally adjusted 0.5%, leaving the average price of a typical property 2.7% higher than a year earlier. At £162,764, the average house price is at a similar level to where it was in early 2006. The 3 month on 3 month rate of change - generally a smoother indicator of the near term trend - dropped to 2.8% from 3.5% in October and 3.8% in September. This suggests that house prices are now rising at a more moderate pace than in the spring and summer months, when they experienced a very strong bounce from the early 2009 lows
The outlook for the housing market remains crucially dependent on labour market conditions, and here recent developments have been somewhat more encouraging than might have been expected. With the UK experiencing its longest and deepest recession since WWII, most economists expected unemployment to increase very sharply in 2009, perhaps breaching the psychologically important three million mark by the end of the year. While unemployment has indeed increased noticeably, the rise has not been as rapid and pronounced as previously feared. Based on the latest labour market figures from September, it now looks unlikely that the jobless total will reach three million before the year is up
Part of the explanation for why unemployment has not risen to the levels implied by the recessions depth is that in many cases employers have opted to reduce working hours and pay rather than make employees redundant. This is reflected in rising part-time employment at the expense of full-time employment and record low growth in average earnings. The strategy of cutting hours and pay rather than headcount probably reflects a fear among many employers that they could find themselves short of labour when the economy recovers, thus leaving them less competitive in the longer term. Whether this strategy is sustainable will depend on how quickly the economy recovers. If output is too slow to recover, then firms may find it necessary to reduce their payrolls further in order to improve productivity and profitability. Another reason to remain cautious about the future outlook for employment is that the public sector has not yet experienced any significant job losses, but presumably will begin to do so when fiscal policy is tightened from next year onwards.
Despite continued uncertainties about the future, the better than expected performance of the labour market has probably contributed to the surprise rebound in house prices this year. Even though workers who have been forced from full-time employment into part-time work will have experienced a reduction in income, the impact has been less severe than it would have been if they had lost their jobs completely. Together with the fact that mortgage rates have fallen sharply as a result of base rate cuts, this has meant that far fewer borrowers have fallen into arrears than would normally be the case in such a deep recession. In fact, the percentage of borrowers in arrears across the mortgage industry has even edged down slightly in the most recent quarterly figures. As such, the downward pressure on house prices from distressed sales has so far been significantly lower than expected. |
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Tank Crashes into Garden Fence | 27/11/2009 |
An eight-tonne tank driven by a soldier on a driving lesson crashed into a garden fence in Letheringsett, Norfolk.
Sporting a set of L plates, the Spartan Armoured Personnel Carrier left the road as it made its way through the village.
The driver, who recently returned from Afghanistan, has apologised to house owners Phil and Jayne Jones for the mishap.
A Ministry of Defence spokeswoman said the soldier was an experienced driver who was learning to drive tracked vehicles such as the Spartan. No-one was hurt the police were not involved.
Mr Jones, 64, a student accommodation administrator, said he and his 44-year-old wife, an opera singer, were both at home when the accident happened.
We heard what sounded like a collision and ran around to investigate. We then found a military vehicle sitting astride our fence. It's a 5ft wooden fence and I suppose it demolished a section of about 20 metres (65.6ft), he said.
Mr Jones said the fence had been mended and he was discussing payment with MoD insurers. It is safe to assume the couple's house nsurance policy does not specify tank damage. |
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Average house prices increased by 0.9% in September | 09/11/2009 |
The September House Price Index (HPI) data from the Land Registry shows a positive monthly change of 0.9%, with an annual movement of -5.6%, up from a low of -16.3% in February. This brings the average house price in England and Wales to £158,377. This is the fifth month in a row where the annual rate of decline has eased.
The number of sales averaged 48,109 per month from April 2009 to July 2009. In the same time period for 2008, transaction volumes averaged 59,677 per month.
In September, London displayed a positive monthly change of 1.3%, which was the highest growth of any region. This is the fifth month in a row that Londons monthly change has been positive. London and the South East are the two regions most responsible for the positive growth experienced by England and Wales as a whole. Londons annual house price change is -3.2%, which is the sixth month in a row in which Londons rate of fall has eased. The average value of a property in London is now £314,954.
London experienced the greatest monthly rise with a movement of 1.3%. Wales was the region with the most significant monthly price fall with a movement of -2.6%.
All regions in England and Wales experienced a decrease in their average property values over the last 12 months. The region with the most significant annual price fall was the North East with a movement of -8.2%. |
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The residential rental market is beginning to stabilise | 06/10/2009 |
The residential rental market is beginning to stabilise with property oversupply decreasing across the UK and the number of new tenancies increasing, according to the Association of Residential Letting Agents (ARLA).
Results from the latest ARLA survey of its members show that the historical decline in numbers of tenants, which led to a surplus of properties to rent, is coming to an end. 83% of ARLA members signed up 10 or more tenancies during the last quarter, compared to 79% last quarter. Each member signed up an average of 36 new tenancies, compared with 32.6 last quarter.
Almost a third of members (33%) surveyed felt that supply and demand of properties is in balance; this compares with just 19% last quarter. Ian Potter, Operations Manager of ARLA, said: "This shift in the balance of supply and demand is extremely significant for the private rented sector. It gives further evidence to suggest that the property market as a whole is getting back on its feet.
"This shift also indicates that confidence is rising among prospective tenants; it seems that people who delayed setting up home 12 months ago, now feel secure enough to proceed. Equally, those who historically have shared a rental property seem happy to set out independently."
In addition, the number of members who believe that there are more residential properties available for rent than there are tenants to fill them dropped significantly in the three month period, from 70% to 43%. The number who say that there are more tenants than properties has risen from 10% to 24%.
The situation is particularly significant in the rest of the South East, where three times as many members said that there are more tenants than properties (27% compared with 9% last quarter).
"This recovery of sorts is still in its infancy and needs as much support as the Government can muster. As we have stated repeatedly, a healthy private rental sector is the only way in which the Government can hope to house future generations. Accordingly, the Government must do all it can to nurture the recovery of the PRS including the implementation of meaningful consumer protection measures," Mr Potter added.
Historically, tenancy rose across all regions of the UK until the recession hit, when properties became harder to let and supply outweighed demand. This trend was felt hardest from late 2008 and into early 2009. This latest ARLA research also showed that the average void period of a rental home has dropped for the first time in more than a year, indicating that properties are being rented more quickly.
In the winter of 2008 the average length of time for a property to remain empty was 3.8 weeks across the UK, yet by May 2009 this had risen to 4.3 weeks as homes became harder to rent. Now, the figure has dropped to an average 4 weeks (and 3.8 in the South East), giving further indication that the rental property market is picking up.
The data from the third quarter of the ARLA Members' Survey of the Private Rented Sector is drawn from 639 offices. The survey is supported by mortgage lenders Mortgage Express and Paragon Mortgages. Together with the Survey of landlords, this forms part of the quarterly ARLA Review and Index. |
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