Maddisons Residential, the award winning Tunbridge Wells Estate Agent is delighted to bring you June’s News and Market Trends. This month we are highlighting stories relating to house prices and also mortgage news as well as a slump in Buy-to-Let. As always, we have our regular quirky feature and have found a rather large terraced property that has come onto the market recently in London.
House Prices Are Stagnating And Have Fallen Over The Last Three Months
The Halifax has reported that over the last three months to April, prices fell by 0.2%, which is the first quarterly fall since November 2012. However, for the year to April, prices rose by 3.8%, the same figure as in March. This means the average cost of a house or flat is £219,649.
Martin Ellis, the Halifax Housing Economist said, “One reason why prices were slowing was that property had become too expensive for many people. Housing demand appears to have been curbed in recent months due to the deterioration in housing affordability caused by a sustained period of rapid house price growth during 2014-16.”
Mortgage Industry Calls For More Support From The Government For Smaller Builders
Property Wire carries a story saying the mortgage industry in the UK is asking the Government to promote and support lending to smaller house builders. It hopes that this would start to tackle the current shortage of homes to buy. 61% of mortgage lenders and 57% of mortgage brokers, according to figures from the Intermediary Mortgage Lenders Association (IMLA) support this.
With a forthcoming election on 08 June, the IMLA says that successive Governments have failed to address the supply side issues challenging the UK housing market, despite an array of different initiatives. The same organisation was critical of the government’s Housing White Paper, published in February 2017, because although it quite rightly highlighted the lack of housing supply, it failed to offer significant substantive solutions.
House completions were down 1% in the year to December 2016 compared to the previous 12 months according to data from the Department of Communities and Local Government. Small to medium sized house builders have said that obtaining finance is one of the principal challenges they face when it comes to delivering new homes.
Fewer UK Home Owners In Mortgage Arrears
Property Wire reports that the number of mortgages in arrears in the UK fell slightly in the first quarter of 2017. It is also down on both the previous quarter and a year ago. According to the figures published by the Council of Mortgage Lenders (CML), which represents the vast majority of lenders, there were 92,600 mortgages in arrears, representing 0.84% of all mortgages, the lowest quarterly rate on record.
The number of properties taken into possession was also 10% down on a year ago, but up on the fourth quarter, which the CML said reflects the usual seasonal pattern. In total, 1,900 properties were taken into possession, the eighth successive quarter of a repossession rate of 0.02%.
Borrowing Rates Set To Stay Low
There has been some potential good news for first time buyers and home movers as the Bank of England has indicated that the current historic low interest rates are likely to continue for some time. Seven out of the eight members of the Monetary Policy Committee voted to leave rates unchanged at 0.25%. However, the Bank indicated that if the economy continues to recover as it expects, then interest rates may need to rise more quickly than the market currently expects.
Stamp Duty Change Causes A Buy-to-Let Slump
The BBC carries a story showing mortgage activity in the Buy-to-Let sector has halved since the introduction of a stamp duty surcharge. Since April 2016, a 3% stamp duty surcharge has been applicable.
The Council of Mortgage Lenders (CML) figures show that 71,100 loans were advanced for landlords for house purchases in the year since the tax change, compared with 142,100 loans in the previous 12 months. The latest figures are the first indication of the first full year since the tax change was made. Landlord house purchases have stayed low but first-time buyer mortgages have started to pick up. The CML expects this trend to continue.
Paul Smee, Director General of the CML said, “As we head into the summer, both first-time buyer and remortgage lending are expected to maintain momentum in the light of the very attractive deals currently available.”
Could This Be The Largest End Of Terrace In London?
Zoopla reports that a 60 bedroom former hotel in west London with original art deco features and a fascinating history has come onto the market. Within just 5 days of being listed on Zoopla, the property had attracted more than 5,500 views.
The former Averard Hotel in Lancaster Gate, W2 has been derelict for many years and is on the market with London Property Zone with a cool price tag of £35m. The agents say, “Having been lying empty for 10 years, this is a blank canvas which represents a rare restoration opportunity, for example as a boutique hotel or luxury flats. Really, it’s a case of ‘what do you want to do with it’?'”
This end of terrace property is just 3-4 minutes from Lancaster Gate tube station and has partial views of Hyde Park. If you require it, there is scope to add more space at the back by adding 3 more floors to part of the building.