Overseas residential property investment in London reaches the £3.7bn a year mark.

June 30, 2011 1 Comment

Overseas property investment in London reaches the £3.7bn a year mark.Overseas property investment in the Greater London area will at current rates ensure that by the middle of next century, all residential properties in Greater London will be owned by foreigners, stated Savills.

Foreigners are accountable for 34% of all London property dealings. The majority of London property investment is centered at the higher end of the market in areas such as Notting Hill,Chelsea, Mayfair and Kensington. In the preceding financial year, foreign buyers exchanged funds worth £5 million in value      accounting to 65% of all funds traded.

The concentration of capital injections has somewhat varied in the past years due to investment being focused in the prime property locations ‘It is as if the equity is getting stuck in prime south-west London; of the £3.3 billion into prime London, only £0.5 billion left via the large south-west markets in 2010,’ head of research, Yolande Barnes. Read more of this post

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First-time buyers falling off the property ladder

June 28, 2011 1 Comment

In the wake of the economic crisis, banks are becoming increasingly reluctant to lend due to lack of affordability in the young professional circle. This combined with a rise in private rents, has made it hard for first-time buyers to save up sufficient funds for a new home. In reaction to the problem, the government has introduced a new FirstBuy scheme.

The Yorkshire Post has recently reported the reasons behind the new FirstBuy scheme being the support of young professionals that cannot afford a deposit to buy a house. Constricted by rising rents, the young professional generation is beginning to live longer in shared houses. Government figures show the increasing difficulties facing young first-time buyers when getting on the property ladder:

Average: 2011 1997
Salary of the first-time buyer £34,886 £17,512
Required deposit £29,289 £3,606
Worth of property £118,903 £40,340

Young professionals seeking to become homeowners cannot afford the large deposit, qualifying them for a mortgage. Therefore, FirstBuy as a new scheme, backed by the Government, was initially designed to assist first-time buyers on to the property ladder. Read more of this post

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Prime property demand peaking despite downturn in market

June 24, 2011 Leave a comment

Prime property demand peaking despite downturn in marketPrime property asking prices have reached a record high. The latest report suggests that since 2007, alone in May asking prices have increased by 1, 3%.

The gradual increase of prime property prices from £457,040 in April to £463,153 in May, illustrates the high market value of prime properties, which make up the top 25% value of the property market.

Since May 2008, the average prime property asking price has dramatically increased, by 13% (£53,000) over the last three years. On the contrary the mass property market has experienced a negative price fall of 0, 2% during the  same time period.

To answer the speculation and uncertainty in the property market, UK prime property prices nationwide have in general increased. Wales up 4, 6%, Yorkshire and Humberside at 6.1% and Scotland with a growth of 2, 4% in the monthly quarter. The only exception being London with a slight decrease of 0, 1% in prime property prices. Read more of this post

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Housing deficit in the UK estimated by the Institute for Public Policy and Research (IPPR)

June 21, 2011 2 Comments

housing deficit estimation 2025The IPPR recently published a report regarding the housing deficit of England, in which it was estimated that in 2025 there will be a shortcoming of 750,000 homes in the country.

The report analyses and inteprets the various sectors of the economy and its particular effects on the housing market. According to IPPR, a faltering economy would lead to the necessity of more than 200,000 homes a year, whereas the number of needed homes a year would rise to more than 280,000, if the economy recieves a strong boost. In the report of the Instituted a statement was published, stating, that “If the rate of housebuilding does not radically increase, we face a growing housing crisis. Whether the economy performs well or poorly, a serious gap looms between housing supply and demand.”

The most adversly affected region by this shortfall, will be London with 325,000 too few homes, followed by Yorkshire and Humberside with a housing gap of 151,000. Read more of this post

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Rental demand and price reaches a record high

June 17, 2011 Leave a comment

Rental demand and prices reach a record highIncreasing rental demand and difficulties in the accessibility of mortgages, for purchase of properties, has dramatically driven up the rent in the London, the north-east and the east Midlands region by an average of 7.8%

Average rents during the period May in both England and Wales have reached an all time high of £695. This is an evident but gradual increase of 0, 5% on the previous monthly quarter. A key factor in the influence of the increased rental price, explains the latest LSL Property Services buy-to-let index as being the “rental gazumping”, whereby the seller accepts a verbal offer from a potential buyer, but then agrees to accept a higher offer from another potential buyer or demands a higher price at the last minute.

Drastic increases in monthly rental rates have been proficiently evident and steadily increasing in the regions of east of England (1.4%) and the north-east (1.1%). On the contrary only the West Midlands (-0.7%), the south-west (-0.6%) and Wales (-0.2%) have seen an ongoing decline in monthly rental rates, according to the Guardian.

Across the board annual rental prices have increased by 4.4%, managing to stay scarcely under the average UK rate of inflation of 4.5%. Needless to say, rents have risen at most in London by 7.8% in the last 12months, followed closely by an average of 6.3% in the north east and east Midlands. Only both the south-west and east of England region have experienced a decrease in rental prices of- 0, 4% and -1, 2% respectively. Read more of this post

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The homeless are increasing as housing benefits are cut down

June 10, 2011 Leave a comment

The homless are increasingHomeless people applying for local authority housing have increased with 23% compared to last year. For the first three months of this year as many as 26,400 persons claimed that they are in need of housing.

London was highly affected by the rise of homeless people where some of the highest increases in applications for housing help came in some of the London boroughs. In Haringey and Islington the recorded increase was over 80% and Hammersmith and Fulham experienced a 92 % increase for January to March 2011. The absolute highest increase of housing applications occurred in Bromley where the rise was 99% compared to one year ago.

The reasons to this dramatic increase of homeless people can be derived from the aftermath of the recession forcing the government to cut down on housing benefits. Furthermore, more than half of all applications were rejected and forced people to stay with friends or even live at bed and breakfast facilities. Read more of this post

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